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Olympic sponsors' ads up 49%

By Hu Yuanyuan (China Daily)
Updated: 2008-08-29 09:42

New players vs old

While some companies such as China Mobile have invested close to 5 billion yuan in measured media over the last two years, their "cost per OP point" is 31,000 yuan.

By comparison, Coca-Cola is a cost per point of 4,000 yuan - while some giant enterprises such as China Netcom have a cost per point of 50,000 yuan.

"So purely from a consumer impact point of view, some companies are outperforming others by ten times" he added.

In terms of sales, for some such as Coke with $30 billion, a $100 million investment in Olympic sponsorship, along with supporting activities might still be less than 0.1 percent of their sales, less than 10 percent of their annual marketing budget - "so the returns are there," Brosenne added.

In the case of dairy maker, the Inner Mongolia Yili Industrial Group Co, their China business has seen a 21 percent growth in the first quarter of 2008 and is on track now to be over 20 billion by year-end, something that without an Olympics association would have been difficult for it to achieve, he explained.

According to the report, drink giants Coca-Cola and Yili both showed the greatest improvement during this period in their awareness, purchase intent, values and promotional recall.

"Coke's secret is just the right combination of experience, athlete management and focus that a lot of other sponsors have lacked," said Paull.

Coke has an 86-year head-start over most companies in this area, with the longest sponsorship history and great shared learning across the Olympics and FIFA World Cup.

For the first time, close to 50 percent of all respondents spontaneously mentioned Coke as a sponsor-and more than 86 percent recognized the brand on a prompted basis. Meanwhile, local milk company Yili continued to improve its position.

"Yili has made some smart choices on stars such as Liu Xiang, Guo JingJing and Yi Jianlian - but used them in a relevant and creative way. Using Liu Xiang with his parents is a strong method to build differentiation and drive impact" said Paull.

Amongst this stiff competition from more than 60 active sponsors, there are some that have failed to leverage their Olympic investment.

"A lot of the State-owned enterprises (SOEs) are relatively new to consumer marketing, and don't have the experience of Coke or talent pool of companies like Yili and Mengniu" said Paull.

"Sinopec, Air China, China Netcom and others have all done tactical work to support their investments, but the payback has been poor. This has been a great learning curve for them though, to see how other world class Chinese companies such as Lenovo and Yili have generated a positive return" he added.

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