BEIJING--Johnson & Johnson is promoting its sponsorship of the 2008 Olympic Games with a major branding effort in one of its fastest-growing markets. Although J&J has operated in China for more than 20 years through its various operating companies, few Chinese know the parent company.
“This is the initial phase of the Olympic program we’re putting together,” said Joe McCarthy, Johnson & Johnson's global VP of advertising and marketing at J&J’s global headquarters in New Brunswick, N.J. “It’s our first corporate brand campaign ever in China, and will run through and after the games.”
In July 2005, J&J became the ninth national sponsor of the 2008 Olympics. As the official health care partner for the games, it will provide funding and services for the Chinese Olympic Committee and for Chinese teams competing in the games. The agreement, which included the 2006 Winter Games in Turin a year ago, covers everything from basic products like Band-Aid bandages to high-tech diagnostics tools.
Since China represents enormous growth potential for J&J, the company hopes the campaign will cement its brand image and diverse line of products with local consumers. Advertising by Ogilvy & Mather connects these themes with the tagline, “Because we love, we live.”
A series of spots tell stories with multiple meanings about Chinese people who are unsung heroes as they care for others. The spots, edited into 90’, 60’ and 30’ versions, were shot in China by director Tony Kaye, best-known for the controversial feature film, “American History X.”
J&J “turned to the use of real people, not actors, in authentic situations,” said Mr. McCarthy, including nurses, doctors, teachers and students.
He appointed the WPP Group agency last year to handle the U.S. health care and cosmetics company’s corporate marketing surrounding the games. Ogilvy pitched against two J&J roster agencies, McCann Erickson and Lowe Worldwide, as well as JWT and TBWA Worldwide. Lowe still handles J&J’s baby care brands in China, while McCann works with Acuvue.
“We picked Ogilvy even though we hadn’t worked with them before in China,” said Mr. McCarthy. "Because the Olympic Games are in Beijing, we really wanted to look for the best and brightest talent available. Ogilvy did a nice job.”
The TV and outdoor campaign broke Jan. 15 and will run nationwide at least through the Olympic Games in Beijing in August 2008, in about two dozen key cities. The spot and animated banners will run on major internet portals like Sohu, Netease (163.com) and Tom Online.
J&J has also added the Olympic logo to packaging and promotions for many of its brands. For Band-Aid, J&J partnered with the event’s organizers in Beijing to sponsor an Olympic education campaign that will reach 400 million students in China. Posters have been distributed to schools throughout the country to foster the spirit and ideals of the Olympics and promote physical education in schools.
“It was somewhat of a surprise for J&J to sign up as an Olympic sponsor, they’ve never sought that kind of profile,” said Beijing-based Greg Paull, founder and principal of R3, an independent marketing consultancy that is tracking brand and star performance connected to the 2008 games.
“What this campaign does is prove the importance of families and commitment to Olympic success, and that’s likely to resonate very well with their Chinese target. They have narrowed the gap on bringing meaning to their Olympic investment.”
In R3’s second wave of research, J&J was one of the five most-improved companies, alongside Volkswagen, Bank of China, Adidas and UPS, although only 42% of 1,500 people surveyed believed J&J was a sponsor of the Olympics, and fewer than 5% mentioned the company without prompting.
“They still have some work to do to close the gap on Coca-Cola, Yili and other packaged goods companies,” said Mr. Paull, but this campaign “is driven by a very powerful insight, that the bonds of family have an impact on your life. They have managed to link this insight to their brand through the families of Olympic athletes.”
The TV spot may air in other markets outside China, but that “is still under discussion,” said Mr. McCarthy.
Johnson & Johnson has focused on its medical and baby-care products, both large categories in China. The company is also looking for opportunities to expand beauty product lines like Neutrogena and Clean & Clear, both rolled out in China in late 2004.
As part of its expansion into the beauty category in China, one of the world’s top ten cosmetics markets, J&J is seeking approval to acquire state-owned Beijing Dabao Cosmetics Co.
Although it already has one joint venture in China, Xian-Janssen Pharmaceutical, which produces drugs like Motilium, this deal would help the company grow consumer sales. J&J’s effort to buy Dabao recalls moves by other multinationals like L'Oreal, Procter & Gamble, Shiseido and Avon. They pursued a similar strategy of acquiring local companies to expand beyond the high-end of China’s cosmetics market with more mass-market brands. L'Oreal, for example, has acquired two of China’s most popular local cosmetics brands, Little Nurse and Yue-Sai.
Still, the “golden egg” in J&J’s portfolio is China remains baby care,” said Stephen Drummond, group managing director of the independent shop Nitro in Shanghai, and a former exec at Lowe’s China office. “That proposition has done extremely well in China. The bond between mother and baby is universal but it’s especially strong in China.”
Overall, he added, J&J has done “spectacularly well” in China, growing 15% or 20% annually for the past few years. “Their sales in China should overtake the U.S. by about 2010, despite the popularity of J&J in its largest market for use by adults themselves as well as for babies.”
The only category that hasn’t performed well for the company in China, and in Asia overall, added Mr. Drummond, is feminine hygiene. “Asian women don’t use tampons. It’s not the done thing, I think it’s too much of a cultural shift, so that remains a very small business for them here.”