Milk brands gear for battle in 2004

BEIJING: China dairy producers and domestic oil lubricant brands are gearing up for a serious shootout next year, as intensive bidding at the national broadcaster's most successful annual airtime auction to date showed.

by | 11/28/2003

On the back of strong advertising growth forecasts for the mainland, China Central Television (CCTV) smashed previous sales records at the just-concluded auction for 224 slots in 2004. The auction stretched to 11 hours and raised Rmb4.4 billion (US$532 million), up by about 32 per cent over last year.

More than 150 companies fought for slots, with Inner Mongolia-based dairy producer Mengniu emerging as the bidding champion. Mengniu bought more than Rmb 300 million worth of airtime against second-largest bidder and rival Yili Group, which invested Rmb200 million.

Title sponsorship appeared to be the most popular advertising format, with Yili and another beverage company, Wahaha, bidding heavily for it.

Yili paid Rmb100 million to outgun Wahaha for title sponsorship of drama programmes in the first half of the year.

Yili president Pan Gang said the group's revenue had grown by more than 50 per cent in the first three quarters over last year. "We have decided to spend more on TV advertising. Before attending the auction, I believed we have to use about Rmb120 million to bid for it," Pan said.

The auction's other heavyweight spenders came from the beverage, domestic petroleum, mobile phones and consumer goods categories.

The biggest spenders after Yili were Procter & Gamble, the only international company to enter the bidding with a commitment of Rmb176 million, and Panda Mobile.

MindShare Beijing executive buying director Lisa Wei noted that pharmaceuticals, last year's biggest spender, dropped considerably, while home appliance spending also declined.

Mengniu's outlay was matched by the collective spend of three local lubricating oil brands - Great Wall Lubricating Oil, Kunlun and Tongyil - which competed for the 15-second breaks around the weather and news reports, considered the most popular programmes nationwide.

TOP SPENDERS AT THE CCTV AUCTION (RMB MILLION)