Chinese Sponsorship
EMW Global set up its Shanghai office following China’s accelerated economic growth over the last decade and the successful global expansion of many Chinese-owned brands. According to Brand Finance, 11 of the 25 most valuable brands in the world are from China, including the new entrant for 2022, Tik Tok.
With its universal appeal and ability to attract global audiences, sport (especially football), presents an unparalleled opportunity for brands to access huge numbers of potential new clients.
UEFA’s most recent flagship men’s tournament, the postponed Euro 2020, boasted up to 2 billion viewers through 137 broadcasters in 229 countries and regions, with 760,000 match day attendees and 420,000 fans participating in the host cities’ fan squares, viewership numbers that are only surpassed by the FIFA World Cup.
As the globalisation of sports continues, it was only a matter of time before Chinese brands took advantage of this opportunity to grow internationally. Chinese companies accounted for a quarter of official sponsors at Euro 2020, making China the biggest single source of sponsorship at the tournament.
Beyond giving Chinese brands more credibility domestically as seeing them at major sports events is a source of national pride, sports sponsorship provides a platform to pursue a myriad of international growth strategies.
?? This year’s EURO competition marks a historic record, as Chinese firms now occupy over a third of sponsorship slots.
⬆ A significant growth from 2016 when Hisense was the sole Chinese sponsor and 2020 when Vivo and Alipay started to be involved. pic.twitter.com/99IZXu6K8D
— EMW Global (@EMWGlobalSports) July 13, 2024
Increasing Brand Awareness
With so many eyes from all around the world focused on major sporting events, the opportunities for brand growth are endless. Hisense led the way in seizing this opportunity by becoming the first Chinese sponsor of a UEFA tournament at Euro 2016. This campaign reached 335 million people across all platforms, 67% above target, and increased brand awareness from 7% to 19% among UK consumers. Hisense went on to sponsor the 2018 FIFA World Cup as well, reporting an overall sales surge of 275% year-on-year during the tournament. Following this successful partnership, Hisense extended their sponsorship contract with FIFA for the 2022 World Cup. The company’s vice president, Huang Xiaojin, said, “It is more than a sponsorship. We had reached a wider audience base and had achieved substantial awareness of our brand among football fans through sponsor partnership with FIFA and UEFA.” On the back of sponsorship success, Hisense has increased its sponsorship footprint in football by developing relationships with individual clubs – and in 2020, announced a global partnership with Paris Saint-Germain.
Hisense aren’t the only major Chinese brand to see the value of sports sponsorship for pursuing their expansion strategy. Alipay signed an 8-year deal worth €200 million to become the official global payments partner for UEFA’s men’s tournaments from 2018 to 2026, which includes Euro 2020 and 2024 as well as the Nations League. To gain further high-profile exposure for the brand, Alipay sponsored the trophy for the tournament’s top goal scorer, which was won by none other than Cristiano Ronaldo.
More recently, in July 2022 OPPO was announced as an official UEFA Champions League sponsor, becoming the first Chinese brand to partner with UEFA’s premier club competition. Games kick off when China is asleep, which is further evidence that Chinese brands are investing because of the audiences in foreign markets.
Addressing New Markets
Sports sponsorships can be an excellent vehicle for penetrating new markets, as they provide a large and visible platform allowing brands to target a sizeable audience in their chosen region. In 2016, leading Chinese smartphone brand Vivo became the exclusive smartphone sponsor of the NBA and secured Stephen Curry as product ambassador. Not only did this provide Vivo with major brand exposure, but also an opportunity to access millions of potential new customers as they capitalise on the NBA’s popularity through TV ads, billboards, and social media.
Vivo’s sponsorship efforts in India are a slightly more cautionary tale. They secured sponsorship rights to the Indian Premier League for 2018-2022 for just under $300 million in an effort to enter a new market and beat off their competition in this field. The deal ultimately fell apart due to a myriad of issues surrounding the breakdown of Sino-Indian relations. Another large Chinese smartphone brand experienced the same when they exited their shirt sponsorship for the Indian men’s cricket national team for similar reasons. Though the expansion plan wasn’t flawed, this demonstrates the importance of understanding cultural nuances and keeping an eye on international relations between a brand’s domestic and target market. Being cognisant of the geopolitical landscape is key to any expansion attempt, but in the case of sports sponsorship, it is often as important as the potential opportunity itself, as a major misstep is not only costly but also results in negative media attention.
Despite their experience in India, Vivo continues to see the value of high profile international sponsorship to help fuel its expansion efforts. After gaining access to new markets and cementing themselves domestically through sports sponsorship, Vivo became an official sponsor of the 2018 FIFA World Cup to gain even more attention on the international stage, addressing the largest possible market through the world’s most watched sporting event.
Bridging The Gap
Sports sponsorship can act as a mechanism for brands to lay the groundwork for future growth in new markets. One such example comes from Alipay’s aforementioned sponsorship of Euro 2020. Throughout the duration of the event, which was held in multiple cities across Europe, Alipay helped local merchants such as restaurants, hotels and service providers reach the Chinese customer base. The idea behind this was to provide tourists from China with payment and lifestyle experiences that made them feel at home. Alipay’s sponsorship not only increased their global profile and improved their domestic reputation, but was also forward-looking, ensuring the integration of their system abroad to facilitate future transactions.
Such partnerships with global brands are beneficial to the sports entity as they too gain access to a new market. During Euro 2020, UEFA launched a ticketing mini program on Alipay which allowed Chinese football fans to access content about football in Europe and apply for tickets to the tournament. It also allowed UEFA to deliver their content in local languages, providing a platform to do so effectively.
Opportunities For Athletes
Increased sponsorship from China also gives athletes the opportunity to strike major deals abroad. According to an article in The Guardian, following her heroic Grand Slam win, Emma Raducanu could become the UK’s first billionaire athlete due to access to the Chinese market. Her Chinese heritage and ability to speak Mandarin has made her very popular in China, opening the door to Chinese brands, which promise higher-paid sponsorships than their western counterparts.
Another example is American-born skier Eileen Gu who opted to compete for China. Though this decision wasn’t fuelled by commercial reasons, it has already paid off financially. She is in a luxurious position of having access to both American and Chinese brands, allowing her to act as a conduit for Chinese brands looking to expand internationally, and vice versa. As brands try to position themselves in as global a fashion as possible, athletes that can serve as a link between two cultures are becoming increasingly valuable.
Sponsorship money in China has become more interesting than in the US, as Chinese brands are at the start of their sports sponsorship journeys, meaning they are prepared to spend big to catch up with their global counterparts, and have vastly higher growth potential. Ultimately, access to the Chinese market, however it is achieved, can be a great source of sponsorship income.
EMW’s Role & Future
We have been part of Chinese brands’ push into sports sponsorship, working across our offices in London, Shanghai and São Paulo to facilitate partnerships such as those between Kwai (competitor to Tik Tok) and Copa America and the Brazil National Team, as well as licensing agreements between the Argentinian National Team and Liverpool FC with PUBG Mobile (owned by Tencent).
Currently Chinese brands are predominantly exploring “tier-one” events but are likely to explore more nuanced opportunities going forward. This process has already begun, as EMW Global was involved with such partnerships between Dani Alves and Moonton, and Michael Owen and the gaming brand Tanwan.
In tandem, sports properties will see the value of having access to these high growth markets. More high-profile Chinese athletes are beginning to emerge, such as Formula 1’s Zhou Ganyu, Wu Lei at LaLiga’s Espanyol, and Shen Mengyu of Celtic FC, the first ever Chinese women’s footballer in the UK.
Although Chinese brands are at the forefront of this shift, other international brands, especially in Asia, are beginning to see the value of sports sponsorship to engage with an international audience.
Ultimately, as the globalisation of sport continues, such partnerships will continue to emerge more frequently as they allow both the brand and the sports entity to pursue growth strategies in new markets.
