Post-Game Sponsors Take Big Risk
During my visit to China I was struck by the capitalist nature of the country that identifies itself as “communist”. In keeping with that hidden nature, last Friday’s Wall Street Journal announced that the owners of China’s “Birds Nest” stadium and “Water Cube” aquatics center are selling corporate naming rights to the highest bidder.
Ben Sturner, chief executive of New York-based Leverage Agency, which is helping broker both deals, says six multinational companies are competing for title rights to the stadium, which cost $500 million to build and whose steel superstructure resembles a bird’s nest. He won’t name them but says he has been taking top executives through a whirlwind sales pitch in recent days, including visits to high-profile Olympic events.
“I would call it the most valuable piece of real estate in the world right now,” Mr. Sturner says.
Among the presumed bidders are Coca-Cola, Adidas and Lenovo. Mr. Sturner is correct in his declaration of the marketing importance of these buildings. China’s emerging middle class is the most important strategic market for many (if not most) western businesses that sell consumer items. Whoever hangs their brand on either of these buildings will be signaling an enormous commitment to that market. However, it does not come without risk.
In past blogs I’ve written about the importance of understanding culture when marketing in China (here, here, here and here). Branding these Olympic buildings is an even more sensitive issue than Starbucks opening a store in the Forbidden City.
Where the Forbidden City is a symbol to the Chinese people of their proud heritage, the buildings that house the Olympic games represent China’s present and future ambitions as a global political and economic power. The Olympics are for all intents a “coming out” party for the Middle Kingdom after decades of isolation.
That party was soured when westerners protested what Chinese consider purely “internal issues” (i.e. Tibet and human rights issues). Those protests contributed to growing nationalism and east/west polarization there.
IF the CCP (Chinese Communist Part) allows this sale to go through, it is likely the only marketing winners would be a Chinese company like Lenovo or Haier. A western company would be taking on an enormous risk of incensing the Chinese people. And it is certain that a Japanese company (or any company with ties to Japan) would be blocked from such a sale.
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