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Chinese people are showing an unprecedented enthusiasm for sport in this post-Olympic era. Since September 2009, many of the world’s top sporting contests were fought on Chinese soil, including the World Snooker Shanghai Masters, the China Open, NBA exhibition games in Beijing, the Shanghai ATP Masters 1000, the Formula One Powerboat World Championship in Shenzhen and the Race of Champions held in the Bird’s Nest. These events have succeeded in attracting large audiences while delivering healthy profits for the sport magnates who made them possible.
Real Madrid Leads the Way
As early as August 2003, Real Madrid FC made its way into China.
The team earned €700,000 for their training match in Kunming, capital of Yunnan Province, and €2 million for a friendly game in Beijing. On top of the salaries, the Chinese organizer provided them free training fields as well as cozy accommodations at luxury hotels. The Chairman of Real Madrid FC was instantly captivated by China’s new zeal for the sport and its untapped money making potential.
Obviously, this success strongly influenced sporting professionals and marketers worldwide.
The next year Formula One held its first race in China. A total sellout (150,000 tickets) transpired over a week before the engines started. F1 teams from around the world enjoyed huge returns during the three-day event. Team Ferrari sold over 1,200 caps and 800 T-shirts despite the relatively high price tag for the goods in China: US $48 and US $96 respectively. But Ferrari had something bigger on its mind for the Chinese market – its car sales, which had climbed to 212 in 2008 over 50 in 2004. The biggest winner in the event is obviously FIA, who, according to its contract with Shanghai for the period from 2004 to 2010, is paid US $ 50 million annually for the races’ hosting and broadcasting rights.
NBA’s Traveling Carnival
David Stern does not want to be left out. As commissioner of the National Basketball Association, he knows firsthand that basketball fever is racing in China. When the NBA played its first exhibition game in China on October 14, 2004, the tickets were so hot that the sponsor had to limit purchases to a maximum of twoper ID card.
The game was not only an athletic showcase. “Maybe it’s a competition, or maybe not. Or in other words, the competition itself seems to be an interlude, while the breaks and timeouts are the highlights,” recalled a journalist who was covering the match. During the three-hour game, David Stern brought all the sponsors onto the court, singing, dancing, with a myriad of performances to fill the intermissions. “During the amazing displays of entertainment provided by the advertisers, the arena took on a festive atmosphere. Then the match resumed and tens of thousands of fans caught a second wind, just to resume the party later,” narrates a fan’s blog, “and what impressed me most was not the athletes’ excellent skills, but America’s proficiency at superb commercialization.”
China, with its population of 1.3 billion, has about 300 million people who play basketball regularly, that’s equal to the entire population of the United States. How could the NBA overlook such a huge market? In past years the NBA staged many games across China. The summer of 2009 was dubbed the carnival season for NBA fans in China – not only were superstars like Shaquille O’Neal, Ron Artest and Kobe Bryant invited to China, legends like Scottie Pippen, Dikembe Mutombo and Robert Horry also made appearances in the Middle Kingdom.
According to data from the NBA’s China website, the organization held over 100 basketball activities in China during the summer of 2009, including the Mengniu-NBA Ultimate Blueprint for Basketball Players, NBA Caravan, NBA preseason games and more. During the months that 51 TV stations in China broadcast NBA games and related programs, they drew 1.6 billion viewers, a 34 percent leap over the previous season. Such market saturation effectively ensured the organization’s fame in China. A study shows that in 11 big cities 89 percent of people aged between 15 and 24 have knowledge of the basketball league.
Following the Tide to China
The 2008 Beijing Olympic Games significantly expanded Chinese enthusiasm for sports. They are spending lavishly to broaden the scope of top sporting events they can enjoy. Only a decade ago there was little interest in watching things like golf, tennis or snooker, and the English Premier League, Bundesliga and NBA games were the only three events that had big fan bases in China.
The Olympic experience has also titillated the Chinese appetite for live sports; this translates into considerable commercial opportunities. Though the sport world has suffered gravely at the hands of the global economic crisis, China is a market that keeps on growing.
“China’s sports industry is currently expanding at an annual rate of 15 to 20 percent,” said Lin Xianpeng, a professor at the Beijing Sport University and a researcher for the China Institute for Sports Value. Compared to the countries with highly developed sports industries, China’s potential is just starting to be tapped.
According to the China Sports Industry Development Report (2008/2009), earnings of domestic sporting industries stood below US $50 billion in 2007, accounting for only 0.7 percent of Chinese GDP, while the figure in the U.S. exceeded US $1 trillion, making up seven percent of its GDP. Sport ranks sixth among America’s top ten mainstay industries, surpassing automobile and IT sectors.
However, seeing the prospect of huge profits in China, sporting clubs around the world are now shifting their focus to the Chinese market.
The NBA is one such successful example. In 2008, it set up the first NBA store outside the U.S. in Beijing. So far, it has opened eight stores and more than 30,000 franchised outlets, selling NBA-related products from team uniforms to basketballs, accessories and even electronic appliances. A Coca Cola tin emblazoned with the logo of the NBA Shanghai Game can fetch up to US $14 on the Internet. The sporting giant is rolling intoChina at full steam. It now has 21 business partners in the nation, nine of them Chinese. So take a seat, the games are about to begin.
Real Madrid Leads the Way
As early as August 2003, Real Madrid FC made its way into China.
The team earned €700,000 for their training match in Kunming, capital of Yunnan Province, and €2 million for a friendly game in Beijing. On top of the salaries, the Chinese organizer provided them free training fields as well as cozy accommodations at luxury hotels. The Chairman of Real Madrid FC was instantly captivated by China’s new zeal for the sport and its untapped money making potential.
Obviously, this success strongly influenced sporting professionals and marketers worldwide.
The next year Formula One held its first race in China. A total sellout (150,000 tickets) transpired over a week before the engines started. F1 teams from around the world enjoyed huge returns during the three-day event. Team Ferrari sold over 1,200 caps and 800 T-shirts despite the relatively high price tag for the goods in China: US $48 and US $96 respectively. But Ferrari had something bigger on its mind for the Chinese market – its car sales, which had climbed to 212 in 2008 over 50 in 2004. The biggest winner in the event is obviously FIA, who, according to its contract with Shanghai for the period from 2004 to 2010, is paid US $ 50 million annually for the races’ hosting and broadcasting rights.
NBA’s Traveling Carnival
David Stern does not want to be left out. As commissioner of the National Basketball Association, he knows firsthand that basketball fever is racing in China. When the NBA played its first exhibition game in China on October 14, 2004, the tickets were so hot that the sponsor had to limit purchases to a maximum of twoper ID card.
The game was not only an athletic showcase. “Maybe it’s a competition, or maybe not. Or in other words, the competition itself seems to be an interlude, while the breaks and timeouts are the highlights,” recalled a journalist who was covering the match. During the three-hour game, David Stern brought all the sponsors onto the court, singing, dancing, with a myriad of performances to fill the intermissions. “During the amazing displays of entertainment provided by the advertisers, the arena took on a festive atmosphere. Then the match resumed and tens of thousands of fans caught a second wind, just to resume the party later,” narrates a fan’s blog, “and what impressed me most was not the athletes’ excellent skills, but America’s proficiency at superb commercialization.”
China, with its population of 1.3 billion, has about 300 million people who play basketball regularly, that’s equal to the entire population of the United States. How could the NBA overlook such a huge market? In past years the NBA staged many games across China. The summer of 2009 was dubbed the carnival season for NBA fans in China – not only were superstars like Shaquille O’Neal, Ron Artest and Kobe Bryant invited to China, legends like Scottie Pippen, Dikembe Mutombo and Robert Horry also made appearances in the Middle Kingdom.
According to data from the NBA’s China website, the organization held over 100 basketball activities in China during the summer of 2009, including the Mengniu-NBA Ultimate Blueprint for Basketball Players, NBA Caravan, NBA preseason games and more. During the months that 51 TV stations in China broadcast NBA games and related programs, they drew 1.6 billion viewers, a 34 percent leap over the previous season. Such market saturation effectively ensured the organization’s fame in China. A study shows that in 11 big cities 89 percent of people aged between 15 and 24 have knowledge of the basketball league.
Following the Tide to China
The 2008 Beijing Olympic Games significantly expanded Chinese enthusiasm for sports. They are spending lavishly to broaden the scope of top sporting events they can enjoy. Only a decade ago there was little interest in watching things like golf, tennis or snooker, and the English Premier League, Bundesliga and NBA games were the only three events that had big fan bases in China.
The Olympic experience has also titillated the Chinese appetite for live sports; this translates into considerable commercial opportunities. Though the sport world has suffered gravely at the hands of the global economic crisis, China is a market that keeps on growing.
“China’s sports industry is currently expanding at an annual rate of 15 to 20 percent,” said Lin Xianpeng, a professor at the Beijing Sport University and a researcher for the China Institute for Sports Value. Compared to the countries with highly developed sports industries, China’s potential is just starting to be tapped.
According to the China Sports Industry Development Report (2008/2009), earnings of domestic sporting industries stood below US $50 billion in 2007, accounting for only 0.7 percent of Chinese GDP, while the figure in the U.S. exceeded US $1 trillion, making up seven percent of its GDP. Sport ranks sixth among America’s top ten mainstay industries, surpassing automobile and IT sectors.
However, seeing the prospect of huge profits in China, sporting clubs around the world are now shifting their focus to the Chinese market.
The NBA is one such successful example. In 2008, it set up the first NBA store outside the U.S. in Beijing. So far, it has opened eight stores and more than 30,000 franchised outlets, selling NBA-related products from team uniforms to basketballs, accessories and even electronic appliances. A Coca Cola tin emblazoned with the logo of the NBA Shanghai Game can fetch up to US $14 on the Internet. The sporting giant is rolling intoChina at full steam. It now has 21 business partners in the nation, nine of them Chinese. So take a seat, the games are about to begin.