China will host and win a Football World Cup by 2050. That’s if President Xi Jinping has his way. Although 80 countries currently rank higher than China, he’s putting Beijing’s almighty weight behind achieving this lofty goal. Driving the country’s participation and success in ‘the beautiful game’ is a master plan to make all sport a more important part of China’s lifestyles and economy.
Beijing appreciates the social, health, cultural, patriotic, soft power and economic benefits from a sporting China. It is investing in sports facilities, with the aim of half a billion regular participants by 2025. Economically, it’s hoped sport will contribute ¥5 trillion ($750 billion) to the economy a year, or 1% of GDP that year. We think China is going to blow this target out of the water, given it took just a year to grow from 0.6% to the current 0.7%, and the increasing level of commercial investment now that the Government is endorsing it.
It’s become fashionable for China’s billionaires to buy foreign sports teams and talent for China, particularly in football, which made up the majority of the almost $3 billion China has spent on acquiring foreign sports assets since the beginning of 2015. China also outspent every other country on football transfers last winter – $366 million – on buying European stars to add dazzle to Chinese teams.
With China’s wealthiest such as Jack Ma and Wanda’s Wang Jianlin being among the largest investors, we’re likely to see the sports promoted through their influential online, cultural and retail channels too. As another sign that China is getting serious about soccer, the TV rights for the Chinese Super League increased from $9 million for 2015 to $1.25 billion for 2016-2020.
Foreign brands are also spending big bucks and partnering locally to grow sports participation and success in China. The two biggest ‘fashion brands’ in China, Nike and Adidas are but two examples. Take Adidas – working with the Government to double the number of soccer players in its training programs to 20 million, on top of the Government’s investment to create 17,000 football pitches and facilities in schools by 2017, and 50,000 by 2050. Adidas has also teamed up with Wanda to help develop football and basketball in the country. That’s complementing the work of associations such as FIFA, NBA and other sporting codes, whose large China-based teams are investing in development, marketing and exhibition matches to drive participation and ultimately foster a few more Yao Mings – who has helped attract the estimated 300 million basketball players in China.
Fortunately the consumers are playing along too. Households now have the discretionary income to follow and participate in sport. Parents are looking at ways to give their child the best chance in life, but are realising that thousands of hours in books, and possibly piano and violin lessons, often don’t produce well-rounded kids – particularly when teamwork and camaraderie aren’t a natural bi-product of single-child families. Many of the 525,000 who sent their children overseas to study last year, also see sport as a way for their kids to fit in better to the foreign culture.
For the Youth themselves, sport has become a way to express their personality and individuality. Following Western sports also brings street cred to many. For the lonely-child generation, sports teams can be like family; with access never easier through smartphones and more facilities and choices in every city.
From a marketing perspective, it is good to be aware that Chinese consumers are increasingly watching and participating in sport. This could be a factor in positioning, marketing and product development going forward. This may impact everything from who endorses your products, to tourism, to sister city relationships. Good to keep it in mind! Go to Page 2 to see this week’s China news and highlights.