The average retail price of Z-do products will range from $13 to $40, about half the price of Li Ning’s other products, which are sold under the Li-Ning brand name. The company’s founder and namesake is an Olympic medal-winning gymnast who was China’s first celebrity athlete. Li Ning also has a joint venture with the Swiss sportswear marketer, Aigle International, allowing it to manufacture, market, distribute and sell Aigle branded clothes and shoes in China.
Z-do products are already on sale in more than 70 outlets across China, and another 200 sites will be added this year. The local sportswear company expects sales of the new low-priced line to top $130 million within four years.
Li Ning’s main brand has far wider distribution. At present, it has more than 4,000 stores across China but the Beijing-based company plans to increase that figure to 5,600 by the start of the 2008 Olympic Games in Beijing next August. Although Adidas is the official sportswear sponsor of the next year’s games, Li Ning is eager to capitalize on local interest in the event. Last month, it signed a deal with the Spanish Olympic Committee that makes Li Ning the official sportswear provider for the Spanish Olympic delegation. The Chinese company already has a similar arrangement with the Swedish Olympic delegation.
Despite massive investment by Nike and Adidas into the Chinese market, Li Ning remains one of top three sports footwear brands in terms of overall brand equity, and has partnered with three players in the National Basketball Association, Shaquille O'Neal, center of Miami Heat, Damon Jones, guard of Cleveland Cavaliers and Chuck Hayes, forward of Houston Rockets.
In 2006, Li Ning’s turnover grew by 29.8% to $421 million, due to “strong economic growth and rising consumer spending in China, coupled with the upcoming 2008 Beijing Olympic Games,” said chairman, Li Ning, in a company statement last March.
Three Chinese internet giants take on Sohu's Olympic leadership
BEIJING--Three major Chinese internet companies, portals Sina.com and NetEase (163.com) and a popular instant message service provider, Tencent, have formed a partnership to jointly cover the 2008 Olympic Games in Beijing.
By combining their information-gathering resources and technology platforms, the sites hope to cash in on interest about the upcoming games. In particular, they hope that attracting a greater number of eyeballs to their sites will help them to generate more ad revenue, which will also be shared between the partners, although the three companies are reportedly still working out the details of their cooperation.
Their alliance is a major threat to Sohu. As the official internet content provider for the games, Sohu is slated to enjoy advantages over competing web sites, such as first-rights, exclusive participation in some official events and first access to Olympics information.
But Sohu may not be able to compete against the combined efforts of its competitors, especially if more web sites join the alliance. Tom Online, a major portal, popular blog site Bokee and search provider Qihoo and other sites are rumored to be pitching in with Sina, Tencent, and NetEase.
“We believe the formation of [an] alliance aims to attract advertisers to increase online spend” during the next games, as well as “dispel some of the claims that Sohu made to advertisers, and the alliance may negotiate with Olympics Committee for additional rights” such as the right to use the Olympics logo, said Dick Wei, a Hong Kong-based internet analyst at JPMorgan.
Despite Sohu's “commanding advantages over other sites,” he added, “we believe the alliance is still incrementally negative to Sohu. For example, if Sina, Tencent, NetEase cooperate for a large-scale ad campaign, users may turn to alliance sites for Olympics news, [so] Sohu may need to increase marketing spending to match the alliance.”
Another uncertainty regarding 2008 Olympics coverage is the rights to real-time online broadcasting, letting viewers to watch the Olympics from a computer.
“We believe the rights will likely be granted to CCTV, [which will] likely to look for partners to distribute the live video contents. With the formation of [the Sina, NetEase and Tencent] alliance, [that group has] a 50-50 chance” of getting the rights from CCTV, he added.
Ford adds excitement to its brands in China with road trip
CHONGQING--Ford Motor Co. is adding life to its car brands in China by taking a handful of Chinese on a road trip in an effort to give its brands a more dynamic image.
The initiative was inspired by a public opinion poll conducted by AC Nielsen for the American auto giant’s joint venture in the mainland, Changan Ford Mazda Automobile Co. in Chongqing, which indicated 75% of Chinese believe excitement is one of the most important keys to a happy life. The survey also suggested Chinese crave thrills, but have a hard time finding them in their daily life.
In response, Ford created a China Excitement Challenge campaign, in which 18 people will travel through the mainland for 21 days--the length of time psychologists say it takes to form new habits--to inspire Chinese to visualize and demonstrate the value of excitement.
The participants will engage in Ford-created activities each day, and then be measured both subjectively and with scientific instruments created by former NASA space-program experts on changes in their excitement levels. Their experiences and the results will be filmed in a reality TV-style and published online at excitechina.com.cn.
The campaign includes a TV spot created by JWT that went on-air early this month, supported by digital media and a CRM promotion that began in mid-July. On the web site, viewers can vote for the “most exciting” participant. The winner will receive a Ford Mondeo car.
GroupM backs soccer reality show
SHANGHAI--WPP Group’s GroupM division is backing a sports reality show in China, “Soccer Prince,” through its specialist unit Entertainment, Sports and Partnerships (ESP).
The program, which will debut in August, is a search for China’s most promising young football stars, starting at local soccer schools and auditions in six Chinese provinces--Beijing, Guangdong, Hunan, Shanghai, Hubei and Sichuan. From there, contenders will undergo further coaching and assessment in Changsha, the capital of Hunan Province. Gradually, the young squad will be reduced to one winner, who will be awarded a one-year apprenticeship at a top English Premier Club, Everton FC. The runner-up will go to Bolton Wanderers FC.
The program was created through an alliance with FremantleMedia, an independent production company, the sports and entertainment media firm Kickworldwide, and Hunan Satellite TV. One of China’s most innovative provincial broadcasters, Hunan has nearly national reach in the mainland through satellite syndication.
ESP is involved with project management and content development as well as the search for sponsors. Nike, which works with MindShare in China, has agreed to sponsor apparel and equipment for the series and online registration takes place only on Nike's Chinese web site nikefootball.com.cn. It will also participate in auditions and encourage young Chinese to participate through its retail outlets. GroupM is in sponsorship negotiation with several other key marketers, according to its director of corporate communications for China, Sweelynn Chong in Shanghai.
MTV and EMI team up for Chinese film and music competition
HONG KONG--EMI Music and Viacom’s MTV Networks Asia have partnered with a web site P2bChi.com
The competition allows the local musicians to write and perform their own songs, in either English or Mandarin, based around the theme of Chinese pride. Visitors to the site can vote on entries and the winning songs will be marketed and released by EMI South East Asia.
The second part to the competition is aimed at aspiring film directors in the region, who will be asked to create and produce a video for the debut single by Scott Hui, the youngest son of Canto-Pop pioneer Sam Hui. Entries will go to MTV Asia. The video the father-son team like best will air on the music channel.
The competition “puts [our audience] in charge and empowers them to influence content being offered to them. Our recent survey shows that young Asians are very passionate about music and it's our mission to help it grow. Proud To Be Chinese is a project that we believe in as it is a realization of the rise in popularity of Asian culture and Asian music,” said Silvia Goh, MTV’s VP, multiplatform content and digital media in Singapore.
Both competitions began July 15, and entries can be submitted until Sept. 15. The catalyst for the initiative is the track sung by Scott Hui, which was written and produced by Hans Ebert, EMI’s Hong Kong-based executive director, Southeast Asia. “After speaking to MTV Asia and P2bChi, it just seemed logical that we join forces and turn this concept into something much bigger,” said Mr. Ebert.
Coke starts construction on $80m complex in Shanghai
SHANGHAI--Coca-Cola Co. has broken ground on an $80 million complex in Shanghai. Spanning 120,000 square meters, it will house the U.S. beverage company’s Chinese headquarters as well as a global innovation & technology center that will be one of its largest R&D facilities in the world.
The new site emphasizes the importance Coke has placed on China, both as a growing consumer market and a test market for new products, particularly fruit juice, tea, water, coffee and energy drinks. By 2005, China had become Coke’s fourth largest market globally, and its sales volume in the mainland has grown by double digit figures for the past 10 quarters.
In the second quarter of this year, sales grew 18% across all 50 products it distributes in China, making the mainland one of Coke’s “most dynamic and fastest-growing markets,” said Douglas Jackson, Coke’s Shanghai-based president, China.
FedEx launches domestic express service with BBH campaign
SHANGHAI--FedEx launched its first major ad campaign for its domestic express service in China. Created by Bartle Bogle Hegarty, Shanghai, the campaign promotes the idea that FedEx delivers what is most important to Chinese businesses--their reputation--using the tagline, “We deliver more than just packages, we deliver your promises.” The strategy is a departure from the usual premise of courier campaigns-- promises to deliver packages on time. “Reputation is what drives success for businesses in China. If a delivery is late or damaged, it hits Chinese businesses where it hurts most, their reputation,” said Pete Heskett, BBH’s head of planning for China in Shanghai.
The Beijing-based talent company, established last year by Zhang Ya Dong, one of China’s top musicians and producers, is affiliated with artists such as Faye Wong, Pu Shu, Xu Wei, Zhang Shi Di and Tian Yuan and the bands Catcher in the Rye and Fruity Vitamin C.
Next month, the partnership will release a compilation album, titled Dong Le Yuan (Dong Music Land). The music CD has 12 tracks by four singers and two bands, and will be sold with a DVD with documentary footage and live artist performances. The release will be promoted with a 20-city campus tour around China beginning in September.
Universal has also expanded its relationship with Linfair Records, a major independent label in Taiwan. Universal will promote and distribute all the label’s Taiwanese pop artists in China. Established in 1961 by Linfair Chang, the Taiwanese label represents artists such as Angela Chang, Fan Fan, Claire Kuo and Freya Lin.
Taiwanese artists are gaining popularity in mainland China, in part because Taiwanese and mainland Chinese both speak the same Chinese dialect, Mandarin. So “Mando-pop” music, as Mandarin-language pop music is called, easily transcends both cultures. Universal already distributes Linfair Records’ catalog in Taiwan and markets, distributes and sells the catalog in Hong Kong, India, Indonesia, Malaysia, Singapore, Philippines and Thailand.
JWT wins southern Chinese real estate account
SHANGHAI--Agile Property Holdings, one of the largest property developers in southern China’s prosperous Pearl River Delta region, has appointed JWT to handle advertising for its roster of properties, such as villas, apartments and condominiums, and commercial properties including retail shops and commercial complexes. The appointment comes during an expansion phase, as Agile is planning to expand nationwide, and JWT is in charge of developing a long-term branding strategy. Previously, Agile worked with local agencies on an individual property basis. There was no pitch for the business.
Haier appoints Y&R for Olympic branding
QINGDAO--Chinese white-goods producer Haier Group has appointed Y&R, Beijing, to handle its Olympic-related branding activities. Haier, a major mainland manufacturer of electronics and appliances such as freezers, washing machines, televisions, water heaters, air conditioners, and microwave ovens, is one of the official sponsors of the upcoming Olympic Games in the Chinese capital, which kick off in just over one year. The WPP agency pitched against Japanese agency ADK, Interpublic Group of Cos.’ DraftFCB and Havas-owned Euro RSCG in the final, second round of the pitch. JWT, Leo Burnett Worldwide and Bates Asia were eliminated in the first round. Saatchi & Saatchi, Shanghai previously handled the account.
Emphasis wins SilkAir inflight contract
HONG KONG--SilkAir, the regional wing of Singapore Airlines, has awarded Hong Kong-based inflight publisher Emphasis Media Limited the publishing contract for its inflight magazine Silkwinds. Emphasis already publishes Singapore Airlines’ inflight entertainment guide KrisWorld and recently assumed publishing responsibility of Priority and Lifestyle Privileges. The announcement was made just weeks after Emphasis lost the inflight publishing business of Singapore Airline’s chief Asian rival, Cathay Pacific Airways. The Hong Kong-based airline moved its inflight business to Australian Consolidated Press (ACP) earlier this month.