Marketing with World Cup

Now we need to see how much money we can earn from the World Cup of this time. We of course want to sponsor more World Cup games in the future， Liang Tian， PR director of Yingli Solar Holdings Limited（Yingli） ten days before the opening of the 2014 Brazil World Cup.

This was the second time for Yingli to sponsor the World Cup. However， no enterprise can afford carelessness in such an important event.

“We only reached the agreement three or four months before the South Africa World Cup， leaving us no time to ponder over other things. This time， we spent three years preparing for this years event. We are a bit nervous for the result，” Liang Tian said.

According to Forbes list of most valuable sports events， the World Cup ranked No. 3. In 2013 its brand value reached US$160 million. The games have been watched 26 billion times through 198 channels. All these turned it into a heaven for the marketing.

However， in such a grand international sports event， it is hard to see the Chinese sponsors.

Presently， most of the Chinese companies that have been marketing with the World Cup， apart from Yingli， are just using its concept. The platform they are using is just the copyright owner， say， the TV station that transmits the event live. However， it is not uncertain whether this pattern is profitable or not.

Is Official Sponsor a Worthy Title？

Simply from the investment， the cost of sponsoring the World Cup is as high as delivering an advertisement in CCTV during the World Cup. In addition， the investment in the pre-game period is only one tenth of that in the post-game period. That means the sponsorship or ad delivery is just the beginning. The investment in the marketing after the game is the real money consumer.

“That depends on the aspirations of the enterprises. Do they want to improve their brand awareness or their sales？”said a former director of a well-established sports marketing company.

“In our Chinese peoples opinions， do you want a better ‘face or a fuller wallet？” said Liang Tian.

There are many enterprises can have a better “face”and a fuller wallet through the World Cup. The WorldCup-based campaign in which Adidas used to surpass it slifelong rival Nike has been recorded into many business schools textbooks.

Asians are more willing to listen to the stories of Hyundai Auto. In the Korea-Japan World Cup in 2002， Hyundai spent 1.5 billion euros becoming the official sponsor. In the same year， its sale in the U.S. soared 40% and the brand awareness increased from 32% to 67%.endprint

But there are not many Adidas or Hyundai sharing their successful stories about marketing with the World Cup.

Take Yingli for example. According to its financial report， this Chinese energy companys net revenue totaled 13.4181 billion yuan in 2013. In the 2012 financial year， the net revenue hit 11.3919 billion yuan and the net loss was 1.94 billion yuan. This was the third straight year for Yingli to suffer the loss.

The cost of sponsoring the World Cup started with US$80 million. This raised a question： why does a company that suffered years loss want to sponsor the World Cup？ Liang Tian， however， held a different opinion.

When Yingli sponsored the South Africa World Cup in 2010， Chinas PV industry was booming. After becoming a World Cup sponsor， “Yingli， China” soon became a hot word of various search engines.

Along with the increasing search， Yingli was more often exposed to the media and public. From February to July 2010， there were 2202 media reports about this company. The “media attention” increased by 800%. The daily visits to the official website of Yingli reach 20 thousand， five times as high as before.

From June 7 to July 23 of that year， Yinglis stock price in New York Stock Exchanges went up US$3.8， with which the total market value had a net increase of US$560 million. After the World Cup， the orders of Yingli reached 4 gigawatt-hours and the company realized the product premium as the price increased by 3%-5%.

Its financial report in 2010 showed that the companys sale of set products reached 1061.6 megawatt， almost twice the one in 2009.

“With the brand effect of the World Cup， Yingli at least increased the profits of US$50 million，” Liang Tian said at that time.

Also at that time， Yingli had enough capital to extend its sponsorship to 2014.

Unfortunately， here came the winter for PV industry in 2011. Chinas PV enterprises more or less fell into the trap of losses. Small enterprises directly collapsed. Big ones like Yingli could avoid the fate of loss.

“In 2010 we stressed the ‘face. The World Cup started in June， yet we only announced the sponsorship in February. There was almost no time for us to have a full study into the marketing plans. What we can do is make use of the World Cup to have the name of Yingli known to more people，” said Liang Tian.

To realize the goal， Yingli gave priority to the contents of“China-based Yingli” which was written in Chinese in South Africa. Yingli hoped to make people know two things about itself through the 2010 World Cup. One： it is a company from China； two： its name is “Yingli. As for what the company does， the answer has been left to the Brazil World Cup.endprint

“In our new ads for the World Cup of this year， we not only add English contents， but also tell people that we are engaged in the PV industry，” Liang Tian said.

“Edge Ball” to Avoid the Risk

Then， how much can the improvement in business from the World Cup benefit the deeply troubled Yingli？

“This answer is not only expected by Yingli， but also by many Chinese enterprises that are still wavering in sponsoring the worlds top sports events or not. The sponsorship of these events has its own advantages， but the risk is also quite high. Chinese enterprises are still pupils when it comes to the marketing with sports events. This is why many Chinese enterprises choose to market with the sports events via media，”said the aforementioned sports marketing director.

It is known that the 1% improvement of brand awareness needs the advertising cost of US$20 million. In comparison， the cost is 10% higher if the company turns to sponsoring sports events.

Take CCTV， the exclusive copyright owner of World Cup in mainland China， for example. This year， Tmall spent 141 million yuan becoming the partner of CCTV for the section of “World Cups Top Scorer List”. Nike spent 46 million yuan gaining the exclusive title sponsorship for the TV program Moving in Brazil.

The list of ad deliverers with CCTVs World Cup project also includes Adidas， Budweiser， Castrol， Hyundai， Midea， King-Boxing， Kia， Flyco， Jianlibao and so on.

Apart from this， there are some Chinese manufactur- ing enterprises developing in the small goods market of the World Cup. For example， the four outdoor colorful LED displays of the National Stadium in Brasilia came from a Shenzhen-based enterprise. A Hangzhou-based company， through its overseas subsidiary companys efforts， has become the officially authorized manufacturer and distributor of the mascot of Brazil World Cup. 90% of Caxirola， a tool fans used to cheer for their teams in the Brazil World Cup came from Zhejiang and Guangdong. A Shandong-based enterprise received a lot of orders of hairpiece for football fans.

With the connectedness to the World Cup， who can become the real beneficiary of this evnt？

How to Ride the World Cup？

Actually， the selling of copyright is also an important source of income for the World Cup. As a third-party organization has forecast that the Brazil World Cup can get the income of US$4 billion， 60%-65% of which come from the right of transmitting the games.endprint

CCTV is going to enjoy that feast too. The central TV station of China made 12 programs for the World Cup， which totally collected the sponsorship fees of 500 million yuan. In addition， CCTV charged the company 1.5-4 million yuan per 15 seconds for the ads during the World Cup.

In addition， CCTV opened the rights and interests of the World Cup to the social media. Sina Weibo became its exclusive partner. In the World Cup， this microblog is going to transmit the game data from CCTV through social media platforms. It is said that the interests and rights valued 1 billion yuan.

However， CCTV stopped the selling of the transmitting rights to other agencies. Sina， Sohu， Tecent and other portal websites in China got the rights of “recording and playing the games” of the World Cup. Without the live games， how to position themselves has become a question for these websites.

“We pay more attention to the interaction with football fans more than to the games themselves，” said Lu Yang， Second Editor-in-Chief of Sina. In addition， Sina launched the guess of game results， football video game and World Cup Shopping Mall.endprint