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Letter from SpoBis: Thinking about China in Düsseldorf

Letter from SpoBis: Thinking about China in Düsseldorf

By: Matthew Glendinning

31 Jan 2017
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On day one of SpoBis, the sports industry conference held each year in Düsseldorf, Germany, the main session on the internationalisation of sports revealed some unanimity on the opportunities presented by the Asian market and, in particular, China.

Senior marketing executives from the Lagardère Sports agency, the National Football League (NFL) and the National Basketball Association (NBA) agreed that investment in China needed to be long-term, requiring careful and concerted brand building and consumer engagement. 

As Peer Naubert, VP product management Lagardère Sports, summed up: “Even if you can generate turnover in the short term, which is especially attractive in China, in the long term you must understand it as an investment and only strong brands can survive in the market.”

But could the window of opportunity for major western sports properties be somewhat more limited than this methodical approach implies?

Benjamin Morel, managing director EMEA NBA, cited statistics which projected that China’s current middle-class demographic of some 150m people will increase to 550m in the coming years - more than the population of the US.

The sport industry, he said, should double or treble in size by 2025. With the added impetus provided by Chinese government investment in sport, Morel predicted that the Chinese Super League could be the biggest football league in the world by 2035-40 in which case Chinese brands, like Alibaba and Wanda, which have invested in western sports, will begin looking inwards.

Where does that leave the major western rights-holders currently building foundation in China? Morel sees the China opportunity as one where the NBA is competing for share of mind. The NBA’s measure of success is focused on three areas: “participation, followers an ultimately consumers”.

While participation in basketball is growing in China, the NBA understands that 99.9 per cent of Chinese fans will never attend an NBA game live. The NBA’s intention is therefore on delivering the best content possible through broadcast and free-to-view digital channels. And because of the time difference, the NBA focuses on content for mobile devices during the morning commute.

Akash Jain, vice president, international commercial development for the NFL, said that the league was positioned in China as a premium brand and taking a niche position for the “extremely long-term”. China, along with Canada, Mexico, Brazil, the UK and Germany are priority markets for the NFL.

“Niche in China is quite a good size,” he said. “We have experimented with content distribution through digital platforms and the demographic of the fan base is a very tech-savvy and mobile first. It’s a challenge because there are a limited number of games and the kick off times are not going to change for us, so we need to develop new and unique stories”

Paradoxically, given the relatively limited on the ground support for the sports brand in China, English Premier League club Chelsea appears to have the most direct route to market. Chelsea’s managing director Christian Purslow said that the club chose the destinations of its summer tours based on where its leading sponsors want to go. After two years touring the US, Chelsea will this year go to Beijing for a showcase game against Arsenal. The move is informed by its main shirt sponsor Yokohoma Tyres, which has China among its top-three markets after Japan and the US. China is its fastest-growing market.

English Premier League clubs need to work less hard than rival leagues in China because of the league’s popularity as a broadcast spectacle. But Chelsea also has two key things that further appeal to global brands: the club’s association with London and with success. Said Purslow: “Chelsea is a relatively new global phenomenon. It’s all been since 2004 and the ownership of Roman Abramovich. In the last 12 years we’ve won more trophies than any other EPL club. There’s no brand in the world that doesn’t want work with a winning sports team.”

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