Advertisers race to win loyalty of fans

Despite an uncertain global economic climate in recent years, advertisers have been taking a generally positive attitude toward sports in Asia. Data suggest that, from jewelry retailers to automakers, major brands are doling out millions of dollars on sports advertising in the region.

GroupM, the consolidated media investment management arm of communications giant WPP, says that advertisers in India spent 92 percent more in sporting event in 2013 on sporting events than in 2008. GroupM has based its conclusions on the parameters of sponsorship, athlete endorsement and media spending.

"Total spending on sports advertising has increased from 21.49 billion rupees ($356 million) to 41.1 billion rupees between 2008 and 2013 in India. It depicts the whole story of the region," Dilip Cherian, founding partner of communication firm Perfect Relations, tells China Daily.

The same applies to Asia as a whole. In China, sponsorship accounts for some 48 percent of total sports revenue, according to a PricewaterhouseCoopers study, Outlook for the Global Sports Market to 2015.

Specialists in sports marketing believe that the rise in sponsorship spending reflects the growing wealth and spread of the new middle class in many Asian countries.

They say that the huge following for the English Premier League and European Champions League football in the region is a good indication of the size of the prize.

According to a recent report by the Organization for Economic Cooperation and Development, the economic outlook in emerging Asia (Southeast Asia, China and India) remains robust over the medium term, anchored by the steady rise in domestic demand.

Real GDP in emerging Asian economies as a whole is expected to grow by 6.9 percent a year from 2014 to 2018.

"With the expanding economic opportunity, sports events have caught the attention of marketing professionals and advertisers. Global brands are likely to leverage the potential of the situation," says Cherian.

Besides growth in the region, it is the sheer size of sporting audiences that woos advertisers. According to various estimates by Nielsen Holdings NV, a global information company, soccer is watched by 4.1 billion fans in over 100 countries worldwide. Every four years, the FIFA World Cup alone garners over 1.5 billion viewers.

Cricket, followed in over 25 countries, is watched by 650 million people, with the Cricket World Cup garnering roughly 200 million viewers.

Nielsen estimates that tennis has 330 million worldwide viewers, ice hockey 250 million, baseball 220 million, basketball 200 million, volleyball 150 million, table tennis 130 million, rugby 125 million and golf 100 million.

A report by the Economist Intelligence Unit, The big league? The business of sport in China, says the opening ceremony for the 2008 Beijing Olympics drew a domestic television audience of 842 million, and more than 100 million Chinese watched the event online. In particular, more than 300 million people in China tuned in to watch Olympic table tennis matches.

Experts, nevertheless, believe it is difficult to determine which sport holds the greatest marketing potential, as it requires a definition of what your market is and the requirements for your brand.

However, when it comes to sports marketing and advertising, companies are going beyond mere visibility and reach.

The PricewaterhouseCoopers study points out that the key motivation for companies is no longer just about maximizing brand visibility and awareness, but also about gaining deeper and more emotional engagement with fans, and even managing the perceptions of the sponsoring company.

"It means more than just buying space on shirt fronts," says Dave McCaughan, managing director of marketing agency McCann Hong Kong and director of McCann Truth Central, Asia Pacific.

"Decades ago, we saw the movement of brands from China, Turkey and other developing countries buying sponsorships of teams and individual sports outfits. That was a crude way to gain some recognition," he explains.

"But sports marketing is more sophisticated now. Brands want to associate with the events that appeal to people in Asia as a way to highlight their brand attributes and product offerings."

Sports sponsorship and advertising have become elevated to the corporate strategic planning conversation. They are being discussed in the context of integrated marketing programs that can take advantage of the reach of traditional advertising as well as the emotional and experiential benefits earned through partnerships with sports.

McCaughan says that Asian markets are still very heavy users of celebrity in all forms of marketing. In fact, the use of celebrity is a way of establishing and maintaining brand meaning. He cites US basketball star Michael Jordan, who began endorsing Nike in the 1980s, as an example. Now many brands are using celebrities, including Asian athletes, to give meaning to their brand equity.

For instance, it was reported that during the Beijing Olympics, basketball player Dwyane Wade and tennis star Serena Williams, both from the US, had interacted quite frequently with the Chinese media and chatted online with Chinese sports fans, to help their brands penetrate the rising Chinese market.