Domestic Sports Brands Rush To NBA Stars?

In the summer of 2010, NBA The gathering of stars to rush to China's Gold Rush has become a unique and beautiful landscape. Behind this scenic line is the huge amount of money paid by many sports brands in China.

Someone has roughly estimated that the NBA star has at least 60 million dollars (about 407 million yuan) in China this summer. Behind the gold rush and "being cleaned up", what drives domestic sports brands to spoil the NBA stars?

Coming and rushing stars

The first floor of Shanghai Hui Hui Plaza is famous at home and abroad. Sports brand 。 In May this year, Anta stores settled here, and Xiao Fan began to work at Anta store.

In August 5th, unlike in the past, Xiao Fan found a group of young people wandering around the shop after the 8 point opened. "Since last night, many people came to ask (Garnett visit) the time for activities."

Dozens of security guards have emerged from the afternoon to maintain order. Xiao Zhu has been standing outside the interception line, looking forward to the appearance of his basketball superstar. As a college student, Xiao Zhu has great enthusiasm for Garnett. He said, "I will definitely collect his peripheral products." Young people like Xiao Zhu were blocking the three floors of the three storey outside Anta store. In the audience's loud cries, Garnett finally showed up and took part in a few simple games with fans, and then hurried away. Whole process

It's about 15 minutes. "In the next 3 years, Garnett will have the opportunity to come to China every year." Zheng Jie, executive vice president of Anta, told reporters.

"In the next 3 years, Anta The Chinese market is still a key market, and international stars will have a great impact on consumers in China's sports market. Zheng Jie pointed out in an interview with the daily economic news reporter.

In August 1st, after the NBA star Luis Scola, Anta signed the NBA superstar Kevin Garnett. The outside world is full of speculation about how Garnett broke up with Adidas and then turned to signing Anta.

"This opportunity is not available." Zheng Jie said, "Anta has always wanted to cooperate with NBA superstar. And then there was such an opportunity for NBA to talk to us.

The "big gamble" of enterprises

In August 6th, Garnett was assigned to shoot a TV advertisement for Anta in Luwan gymnasium. In the cries of lighting, scenery, and a bunch of improvised actors, Garnett was in a very good mood and joked with the staff on the sidelines.

Correspondingly, Zheng Jie's hastily appeared. After confirming several matters with the staff and receiving a phone call, Zheng Jie hurried away. In the whole process, the frown is always accompanied by his hurried figure.

Huge investment is often accompanied by greater risks. Garnett's contract with Anta lasted for 3 years. For such a contract, how much money did Anta invest as a domestic brand? It may be evident from the intensive arrangement of Garnett China bank.

"For basketball, choose China - Kevin Garnett China trip", this is Garnett's second visit to China, although only 8 days, but he will go to Beijing, Xiamen, Shanghai three places, during the activities include meetings with fans, visit factories, museums and shooting advertisements. An accompanying insider told reporters that this time he did not arrange any play time for Garnett. "The cost of Garnett's China trip is charged by the hour."

In fact, Anta has already made plans for signing Garnett.

At the beginning of 2010, Anta announced the annual report of the 2009 fiscal year, and also revealed the trend of advertising and publicity investment. The announcement pointed out that in fiscal year 2009, the ratio of advertising and publicity expenses to business volume decreased by 1.1 percentage points.

When the domestic sports brands got together to invite international sports stars in 2009, the advertising and marketing expenses of Anta declined year by year. The company said it was reserved for more 2010 sponsorship fees.

Anta's advertising and publicity expenses in 2009 still reached a sizeable 746 million, according to its 5 billion 800 million yuan turnover in the 2009 earnings report. According to Anta's advertising promotion plan in 2010, the promotion fee in 2010 will be even more expensive.

Not only is Anta's huge investment in advertising and marketing costs, but also the investment of Lining, PEAK and other companies, which are domestic sports brands, can also be huge investments.

In fact, PEAK, who has also taken the NBA route, has increased its investment in advertising and marketing since its listing in Hongkong in late September. Its advertising and promotion expenses accounted for the percentage of revenue in recent years. It also increased year by year, from 6% in 2006 to 11.3% in 2009. In the last quarter of 2009, PEAK's investment in media advertising, brand promotion and marketing activities reached 116 million 200 thousand yuan.

Behind the huge investment is the 9 active NBA stars including Artest, Kidd and Battier endorsing the brand, and these stars also rushed to China this summer to "gold rush".

As the leading brand of domestic sports brands, Lining's advertising and marketing expenses accounted for 15.4% of his income in 2009. In 2009, Lining's total income reached 8 billion 300 million yuan. According to this ratio, Lining's advertising cost was as high as 1 billion 291 million yuan.

According to the development of these companies, there will be only a lot of advertising and marketing expenses in 2010.

In fact, such inputs of enterprises seem to be effective at the present time. In addition to being able to see these basketball stars, these young people will be her customers, such as Xiaofan's store staff, with the surge in sales.

"Last month, the sales of our stores were around fifteen sixty thousand, and in August only 5 days of sales have reached thirty thousand or forty thousand." Xiao Fan calculated an account. After Kevin Garnett signed Anta, the sales volume of ordinary working days was about two thousand or three thousand, and doubled yesterday, to five thousand or six thousand.

From the perspective of executive vice president, sales expectations are much more than that. "We also hope that Garnett's products will perform well in the market." Starting in December this year, "Anta will have the online launch of Garnett products as a whole, and there will be Anta Garnett series products to meet the market demand."

"When the enterprise develops to a certain stage, just like Lining of previous years, he will start signing big stars." Marketing expert (see marketing expert blog) Li Zhiqi pointed out: "the essence of sports brand is sportsmanship. In today's domestic sports world, there are not many representative figures." NBA star is a more "insurance" thing.

Brand upgrade {page_break}

"Now sports brand is not a big problem in the construction of network outlets. At present, the main input is brand building, which should be their focus now." Li Zhiqi admitted in an interview with the daily economic news.

From the experience of successful precedents, the important source of profits of international brands Nike and Adidas is not only the low labor costs acquired in developing countries, but also the added value of brands. Therefore, we see that many sports brands in China choose NBA stars to enhance their brand image.

"What determines basketball stars is brand influence. The development of sports brands in China basically lasted for about 10 years. Why does the vice president of del Hui pointed out that sports brand is a fast developing industry. "Compared with internationally renowned sports brands, there is still a certain gap between domestic brands and Nike and ADI in terms of brand accumulation."

"First of all, in terms of the size of the enterprise, the NBA players are not too big, and the cost can still be borne. The added value of the brand in the future is supported by the gold content of the brand, which is also an important investment behavior on the brand. Li Zhiqi endorsed the practice of domestic sports brands signing up NBA stars with huge sums of money.

"But this is a very direct pressure, and this is one of the reasons why they are constantly upgrading in image. Because the opponent's brand image is constantly upgrading and their brand image can not keep up, consumers may soon divide it into two or lower grades." Li Zhiqi stressed: "when we grabbed the brand resources, we cast our eyes on the NBA stars. This is also a manifestation of the current industrial upgrading."

Xu Zhihua, general manager of PEAK shoe industry, who signed many stars, told the daily economic news that after signing a contract with each NBA player, the NBA star will gain about 5% of the profits from the sales of its endorsement products, which is a common phenomenon in the industry.

"This is probably a good thing for the stars, and for enterprises, the cost is relatively high. To cooperate in this way, to some extent, is to give yourself a pair of handcuffs. Li Zhiqi said frankly, "there is no way to solve this rigid cost of enterprises."