Sponsorship of major athletic events offers way to raise global profile
Chinese companies have secured a dominant presence in the 2018 World Cup that opens in Russia on Thursday, which experts said represents a bid to increase their international brand awareness and optimize their "going out" strategies.
Seven Chinese brands, including Dalian Wanda, phonemaker Vivo, appliance producer Hisense, and dairy company Mengniu are among the sponsors of Russia 2018, domestic news site awtmt.com reported Saturday.
The number is a big increase compared with 2014, when there was only one Chinese company, solar panel provider Yingli Solar got the sponsorship rights for the 2014 World Cup held in Brazil, the report said.
Wanda, which is the only and first Chinese company to become one of FIFA's Partners, the highest level of sponsorship rights, is estimated to have paid at least $120 million for those rights. The other Chinese companies, including Hisense, Vivo and Mengniu had to pay at least $68 million each to get second-level sponsorship rights, according to the awtmt.com report.
"We believe that the sponsorship will vastly improve global awareness and economic value for Hisense as a truly international brand, since the FIFA World Cup brings together the highest levels of competition and prestige in global football," Hisense said in a note sent to the Global Times on Sunday.
Hisense has also sponsored other major sports events including the UEFA European Championship 2016 and the Australian Open.
Domestic dairy company Mengniu also said in a statement released on the official website of 2018 FIFA World Cup Russia that the sponsorship "gives us an opportunity to reach an even bigger global market and, more importantly, to showcase the Chinese dairy industry to the whole world."
Mengniu's branding will appear on all key promotional platforms, such as FIFA's digital channels, LED boards and match tickets, read the statement.
"The main reason for domestic companies' unprecedented presence this year is the Chinese government's support of developing sports culture and the sports economy since 2014 - for example, opening the broadcasting rights of sports events to private capital," Zhang Jiayuan, a partner at Beijing-based Ransenhuizhi Investment Fund Management Co, told the Global Times on Sunday.
Zhang noted that the move is also in line with Chinese enterprises' "going out" strategies. They've seized a great opportunity to do business," Zhang said.
Damien Chen, product manager of a British football club, told the Global Times on Sunday that "sports marketing is a smart and effective way for companies to quickly tap into the global market and increase their brand awareness."
Figures provided by Hisense showed that during the UEFA European Championship 2016, Hisense's global popularity increased by six percentage points. The firm's sales in the European market increased by 65 percent year-on-year in the second quarter of 2016.
Such event-driven popularity has a long-term effect. In 2017, Hisense achieved international sales of $3.9 billion, a year-on-year increase of 22.3 percent, according to the note of Hisense.
"The fan base is huge, even without teams from some popular countries like Italy and Netherlands, and football fans are flocking to Russia to watch the games," Chen said, adding that his club has also organized online and offline activities, as well as corresponding articles during the game on its public WeChat account every day.
"Unlike several years ago, when we could only watch the games on TV, there are now many viewing choices, and this adds to the exposure of brands," Chen noted.
Nevertheless, with more domestic companies eyeing sports marketing as a "shortcut" to raise their global profiles, they're bound to face competition in similar products or market strategies, Zhang said.
"Sponsorship is just the first step. Companies should also make clear their global market position, what featured products they want to promote, and what follow-up activities they are going to launch," Zhang added.
