China Sports Business Weekly | 13th January
Hello Industry Friends, here is the very latest news and insights from China. 📰 Headlines: ATP partners with PacificPine Sports, Zhou Guanyu signs with Lululemon and Dior, Barcelona adds Daka, NBA kicks off 12th CNY celebrations, China’s tech crackdown is over, the Top 5 Chinese athleisure brands to watch out for in 2023, Migu secures three-year media rights deal for multiple esports leagues, and Nike is replaced by Li-Ning as exclusive LPL apparel sponsor. 🗣️ In this week’s From The Top, we spoke with Raymond Roessel, Co-founder and Co-CEO, PacificPine Sports Group, about partnering with the ATP, 2023 expectations, pivoting strategy during covid, and China’s growing tennis industry.
🗞️ Top Industry News ATP Tour and PacificPine Sports Partner to Create Tennis Development Centres This multi-year partnership will look to create a range of world-class ATP-licensed tennis centres in China and Hong Kong. Beginning this year, ATP will engage with junior tennis players and young fans locally, expand opportunities in the sport, and allow ATP Coach members to share their expert knowledge with players in a fast-growing region. Read more on ATP (English) and NetEase (Chinese) 💡 Mailman Take: China looks set to have a bright future in tennis, with the likes of Wang Xiyu, Qinwen Zheng, Wu Yibing, Zhizhen Zhang, and Jerry Shang all making notable jumps up the official rankings. Professional international tennis organisations such as the ATP partnering with locally-based companies such as PacificPine Sports in China can only be a good thing in terms of providing better opportunities for the younger crop of players. Prediction: a Chinese tennis player will make the quarter-finals of a Grand Slam this year.
F1’s Zhou Signs Lululemon and Dior Endorsement Deals, Extends with HSBC The 23-year-old, who is about to enter his second season in Formula 1, has become highly sought-after since being announced as an official F1 driver. Deals with coveted brands such as Lululemon and Dior highlight the scale of his impact. To add to these deals, the Chinese arm of financial services company HSBC has extended its deal with Zhou to cover the 2023 F1 season. Read more on SportBusiness (English) and Tencent (Chinese)
💡 Mailman Take: Ahead of his second season in F1, Zhou Guanyu continues to land endorsement deals with some of the biggest brands globally. Zhou is the perfect ambassador from China - bilingual, good-looking, talented, professional in front of the camera, and has a huge and growing fan base. If Zhou can build on his first season and gain more points, we expect Zhou’s portfolio of brands to grow as big as the likes of Eileen Gu.
Barcelona Adds Daka to Portfolio The Spanish La Liga club has announced a three-year sponsorship deal with the Chinese trading card manufacturer Daka. Running from this month until June 2025, Daka gains rights to produce Barcelona collectible cards signed by the club’s players, and also co-create digital content in China. Read more on SportBusiness (English) and Tencent (Chinese)
NBA Kicks Off its 12th Chinese New Year Celebrations The National Basketball Association (NBA) announced that the league will hold NBA New Year celebrations for the 12th consecutive year to celebrate the Spring Festival with fans. The celebrations, held between January 14 and February 5, will include game broadcasts, a new NBA Spring Festival promotional video, NBA Cares CSR initiatives, and a series of online fan activities. Read more on ArchySports (English) and EcoSports (Chinese) China’s Crackdown on Tech Giants is ‘Basically’ Over, Top Official Says China’s heavy-handed crackdown on tech giants is coming to an end and the country’s economic growth is expected to be back on track soon, according to a top central bank official. The crackdown on fintech operations of more than a dozen internet companies is “basically” over, said Guo Shuqing, the Communist Party boss at the People’s Bank of China. Read more on CNN (English) China’s Reopened Borders Raise Hopes for Football Resurgence After three years of isolation and financial struggles in Chinese football, the country is reopening its borders and economy to the outside world. With it, frustrated fans, financially challenged clubs and unpaid players in the Chinese Super League might receive some long-awaited good news. Read more on AP (English) Cloned Horse Raises Hopes For Equestrian Sports in China For an equestrian sports industry pegged back by its reliance on expensive imported horses, Zhuang Zhuang, China’s first competition-approved clone, has presented an opportunity to break free. The popularity of equestrian competition in China has taken off in recent years, but horses costing “from a few million to 10 or 20 million RMB” have put the halters on it. Read more on Barrons (English)
🤔 Opinion How do Wolves tackle China’s esports ecosystem? Wolves Esports competes in a range of popular Asian mobile titles including Honor of Kings, PUBG Mobile, and Call of Duty Mobile - most of which have gone on to win countless tournaments. Why did Wolves opt to invest in China’s ecosystem? “We have made great efforts to develop esports in China because it is in line with the development of the times,” said Clarie Teng, the General Manager of Wolves Esports China. Read more on Esports Insider (English) 5 Top Chinese Athleisure Brands To Watch Out For In 2023 With the continuation of Covid-19-induced work-from-home life in China, as well as a growing prioritisation of wellness and healthy lifestyle choices, athleisure styles are on the rise across the country. Jing Daily took a look at the top-performing native athleisure brands in China, and what to look out for in the year ahead. Read more on Jing Daily (English)
🎮 Esports Migu Secures Three-Year Media Rights Deal for Multiple Esports Leagues in China The Chinese live-streaming platform has signed a three-year media rights deal with TJ Sports and Tencent for the League of Legends Pro League (LPL), League of Legends World Championship, Mid-Season Invitational (MSI), Honor of Kings competition the King Pro League (KPL), and Peacekeeper Elite’s Peace Elite League (PEL). Read more on The Esports Advocate (English) Nike Replaced by Li-Ning as Exclusive LPL Apparel Sponsor Tencent-owned Chinese League of Legends Pro League (LPL) announced a new partnership with local clothing brand Li-Ning after its 4-year contract deal with Nike ended in 2022. The collaboration means that from now on all team wear worn by players during competition seasons will be provided by the local clothing brand. Read more on The Esports Advocate (English) China Esports Blast: December 2022 For China’s esports industry, 2022 was bittersweet. During the year, the region’s most important esports city of Shanghai experienced a tough lockdown due to the government’s pandemic control policies, and multiple esports companies and competitions suspended their operations. Fortunately, the Chinese esports industry and Shanghai were resilient and overcame several challenging situations in 2022. Both will see many potential business developments improve in 2023. Here are the three biggest trends for China Esports in 2023. Read more on Esports Insider (English)
🎙️ From The Top 🗣 Raymond Roessel, Co-founder and Co-CEO, PacificPine Sports Group 1. How did the partnership with ATP happen and what are your initial goals for 2023? We could not be more excited to work with the ATP to launch our tennis partnership in China together. As a company, we had been exploring tennis since our launch in 2018. Tennis is a natural extension of our business; it attracts both a similar customer base and facility partners as our golf business. Additionally, the partnership with the ATP brings unique attributes, namely a significant number of ATP events held in China, providing the potential for students to see and interact with the world’s best players multiple times a year. In terms of our partnership with the ATP, this was a journey that started in late 2020, through an introduction from a close friend Micky Lawler, the president of the WTA. When launching a new sport vertical, it’s always our goal to partner with a global brand or governing body that aligns with our long-term goal and vision of developing the sport in China. With the ATP, it was a natural fit as we both saw the potential to develop the program and sport in China. Our goals in 2023 are to launch our initial facilities in Beijing, Hong Kong, and Shenzhen. While there is potential that we would entertain opportunities in other cities, our focus is to launch in these three key regions as they are significant markets for our other sports and we have the resources to support the launches from an operational, sales, and marketing perspective. 2. Now that China and Hong Kong have removed all quarantine, do you expect even more growth than initially predicted? Our growth plans have always been independent of covid. While covid continues to provide many challenges, especially recently, we are confident that China and the sports industry will experience a rapid return to pre-covid levels, if not greater. In the short term, we expect an uptick in enrolments across all of our sports once schools fully reopen. We are also experiencing strong demand for summer programming both in China and for our overseas camps, as this is the first summer that clients will not experience quarantine on return for three years and there is significant pent-up demand. 3. China has many exciting young tennis players coming through the ranks. How do you analyze the current crop and how can this partnership help produce even more talent? It is fantastic to see Zhizhen Zhang crack the ATP 100 rankings along with Yibing Wu close on his heels at 116, and of course, the women’s game has six players in the top 100 now. However, while our program will provide the entire athlete journey, from grassroots to elite development, our main focus is on bringing as many people into the game as possible, creating lifelong athletes, tennis players, and fans of the game and ATP. We know that the more people that are brought into the game, the greater the chance to find the next world #1. 4. How did you adapt and change strategy during the Covid-19 and lockdown periods to keep business ticking over? Covid was and still is an extremely challenging environment for us to operate in, especially as a large part of our business is conducted in schools, which have faced an even more challenging operating environment during this period. Overall, it has forced us to become more efficient in all aspects of our business and at the same time magnified mistakes that were made. While painful and difficult, the benefits and lessons learned are assets that will continue to benefit the business even in a post covid environment. 5. What more can we expect from PPS this year outside of the tennis space? While we are confident that business will return to normal in the near future, we are still experiencing significant challenges due to the current covid situation. Our expectation is that this stabilises towards the end of Q1 and that we will see a significant jump in business as we enter Q2. With international travel reopening, we will launch a number of overseas travel camps across all of our sports. Prior to covid, we had a very successful international travel business and expect that to be even stronger given the lack of travel over the past three years. We are especially excited to launch our overseas summer golf camp which will take place at the new PGA of America headquarters in Frisco, Texas. This new $500 million facility will officially open in May of 2023 and we will be one of the first international groups to visit.
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