Brand-owners are faced with unprecedented choice of how to reach out to consumers, no more so than in China itself, where media options are changing at breakneck speed and advertisers see a unique chance to connect with a Chinese audience.
Nowhere are these changes developing faster than in the digital space, with Chinese consumers logging on in huge numbers — 137 million internet users and over 420 million mobile phone users by the end of last year, with increasing numbers keeping up with sporting events online or using their mobile phone.
Previous Olympics have been successfully streamed worldwide on dedicated websites and Beijing 2008 will see a proliferation of online resources — from forums to unofficial Olympic sites to branded Olympic mini-sites. Advertising on the official Beijing 2008 website, www.beijing2008.com, being built by Sohu, will probably be prioritised for sponsors, though in common with other major portals Sohu has also developed its own Beijing 2008 website. Ad rates here range from US$2,500 to $12,500 a day, with prices rising as the Games get closer.
The 2008 Olympics has been specifically earmarked by the Chinese Government as a showcase of China’s shift to digital technology, specifically 3G and digital TV. However, while offering a potentially innovative platform for marketers to cut through Olympic clutter, it is still a matter of speculation whether these new technologies will be as widely available as the Government hopes. 3G licences would vastly increase digital marketing opportunities but have yet to appear after being first promised two years ago. Although it looks likely that 3G will be up and running in time for the Games, the scale and quality of opportunities these will present marketers is largely educated guesswork. With advertising reliant on the quality of content it sits next to, one key question is whether content development can keep pace with the new technology.
The digital TV infrastructure meanwhile is also taking shape slower than expected, with the number of people watching the Olympics on digital TV in China likely to be more in the hundreds of thousands rather than the millions the Government predicts. This audience will be affluent and could offer a clear path for brands chasing this hard-to-reach group.
With over one billion viewers and 300 million sets, television will retain its status as both one of the most effective and one of the priciest means for reaching the Chinese audience in the months building up to the Games. CCTV, the official broadcaster for the 2008 Olympics, saw its ad rates boosted by the inclusion of Olympics-related slots to reach 16 per cent in its 2007 auction, up from 10.8 per cent the year before. CCTV’s rates for next year should be released in the third quarter but agencies are waiting for news on whether these will include the coveted Olympics live coverage slots. CCTV may also sell its broadcasts to local TV companies, opening up a multitude of different spaces to choose from, though it has yet to be announced what these may be — possibly live events that CCTV does not want or post-event highlights.
Local sports such as Shanghai Sports already have rights to re-broadcast from CCTV-5, CCTV’s dedicated sports channel. Major city satellite broadcasters such as QTV in Qingdao and BTV in Beijing are offering their own Olympics advertising plans for 2007. Rates for these vary, from $600,000 to $2 million for the year. Most other stations have pushed up rates, some by between 30 and 50 per cent. All predictions are that, with the Olympics as a motor, next year will see even larger price inflation in TV.
The time is also ripe for marketers looking to bolster their Olympics campaigns by tying up with key media properties. CCTV is searching for sponsors for many of its Olympic programmes, recently sealing a $21million deal with Olympics partner Lenovo for an Olympic countdown show. Other companies with official ties to the Games such as Yili, Bank of China, Haier and PICC have also invested in CCTV programme sponsorship.
In print however, relatively few publishers have released precise details of their Olympics packages, although some magazines have started to prepare editorial topics around the Olympics for advertisers.
“The market is changing and now media vendors are wanting to talk to advertisers to build their Olympics strategy,” observes Starcom Beijing general manager, Angela Ng. Leading sports reads Titan Sports, Arena, All Sports, Sports Illustrated and Soccer Weekly have announced special Olympics content and packages for the middle of the year. Most newspapers on the other hand are still in the planning stage, but with circulations in the millions they will be crucial to any media plan.
China’s notoriously cluttered outdoor market meanwhile could be set for consolidation, and inflation, following a pledge by the Chinese Government to clean up the sector in time for the Olympics, serving ‘dismantlement notices’ to many small-time and illegal operators.
Partly in preparation for the Olympics, the Government is also demanding advertisers gain official approval for outdoor advertising to avoid illegal or ambush marketing. Advertisers without official approval risk a fine. One agency estimates that the decline in available space caused by the clampdown, combined with Olympics-generated demand, could see rate inflation jump from 15 to 30 per cent in the run-up to 2008.
Meanwhile, the Olympics organising committee, Bocog, plans to identify outdoor sites in and around the Olympic venues and village by the second quarter of 2008, for commercial and non-commercial promotion of the Olympics. “Non-sponsors may find it hard to secure better outdoor space so it is suggested they start their campaigns as soon as possible,” advises Winnie Lee, deputy managing director at OMD China.
With so much priority given to the high-paying sponsors, it seems non-sponsors could find it hard to find opportunities in what promises to be an extremely cluttered advertising environment. One way in which non-sponsors have previously got a look-in is ambush marketing — typified by Nike who built a massive store right next to the Olympic complex at the 1996 Games in Atlanta, overshadowing arch rival and official sponsor, adidas. One of the key issues for ambush marketing in Beijing is whether any advertiser would risk antagonising the central Government, which has vowed to tackle the practice. Such blatant ambush tactics as Nike used will be hard to pull off in Beijing but more subtle means, for example using the internet or focusing on smaller cities, may well sneak through.
With so many brands jumping on the Olympic bandwagon creating a winning media plan seems daunting. Ogilvy PR China president Scott Kronick recommends an integrated approach with a distinct message to make leveraging Olympic hype more achievable. “Everyone has a different strategy, but the key is to integrate all parts of the plan, from PR to advertising to hospitality,” he says. “It’s all about building a brand within an Olympic context — how do you leverage those rights to connect with consumers? Know your message, and who you want to get it to.”
