China’s Internet Marketing is a Hot Topic for Sports Brands

Online marketing is becoming more popular due to major sporting events taking place in recent years.

Co-operations of high profile

On April 4, 2007, China’s most well-known brand of sports, Lining, was named the online sports section of Netease. Netease is one of China’s largest internet portals. Lining’s logos, product promotions and web page design colors dominate the pages. This 3-year strategic cooperation agreement was reached between Lining and Netease. Other national portals have sports sections powered by other brands, such as Nike Sina, Adidas Sohu and 361deg Tencent Sports 링크모음.

The online marketing boom for sports brands began long before 2007. The rise of internet marketing has enormous implications for two industries that are considered to be the most important, namely internet commerce and sports goods. This is a result of the strategic marketing shifts made by leading brands in sports, and also marks a breakthrough in the marketing industry for China’s sporting goods sector. Sports brands can partner with online portals to create a comprehensive online brand display platform that allows them to expand their sports content.

Win-win benefits

Let’s take Lining and Netease as an example. Netease estimates that the co-branding pages will provide hundreds of millions of brand exposures per year. This will increase brand penetration among targeted audiences. The content section includes NBA columns, various Lining branded events columns, and other Netease online products that will be used to promote Lining brand. Lining-related sections include online communities, profiles of sports stars, new product exhibitions, and interactive forums for sports fans.

Netease believes that such cooperation will not only enrich the content of their sports sections but also create an interactive and humane online environment, which will attract more people and increase sports brand recognition.

Justifications for research

Recent research has shown that sports companies are more willing to invest in online marketing because of the rapid rise in internet users in China.

China Internet Network Information Center (CNNIC) reports that the number of Internet users in China was 162 million as of June 2007. This is second only to the United States’ 211 million. New internet users have reached 25 million, compared to the 26 million at the end of 2006. The current demographic mix of Chinese internet users is skewed toward young people with 51.2% being under 25 and 70.6% below 30. This large, young, and adventurous group of internet users makes a great target for sports goods. It’s no surprise that sports sections on online portal sites are a hot spot for brands.

IT&T industry consultancy firm iResearch also published China’s Sports Goods Online Advertising Report 1st Quarter 2007. These reports revealed that online marketing of sports goods saw strong growth in 2006 and 2007. They also showed significant increases in online advertising placements income, frequency, and media channels. Online advertising is a key tool for consolidating marketing resources within sports companies. It is anticipated that online market investments will continue to rise in 2007. The growth in online advertising fees for sports goods has been steady since 2002. It saw an average annual growth rate 101%. In 2006, the advertising fees had reached nearly US $10 million. This is 14 times the amount in 2002.

According to iResearch, the rapid rise in online sports merchandise advertising fees suggests that more companies are paying more attention to this alternative channel. Online advertising investment from sports companies will continue to rise, with a particular focus on corporate image promotion. In 2006, online advertising fees for corporate images, shoes and clothing, as well as corporate image promotion, continued to rise. Although spending on sports shoes and clothing fell in the first quarter 2007, corporate image promotion is still on the rise.