China Sports Business Weekly | 16th August
Here are the top China sports business news stories you need to know from this week, and my From the Top interview is with Rouven Kasper, Managing Director of FC Bayern Munich China, where we chat through how FC Bayern’s China strategy differs to international markets, the importance of a China office, and the biggest changes China’s sports market has witnessed in recent years.
Joe Tsai to Complete $2.35b Brooklyn Nets Takeover The co-founder of Chinese ecommerce giant Alibaba is close to buying the remaining 51 percent of the Brooklyn Nets. Tsai already owns 49 percent of the NBA team after acquiring the minority stake from billionaire Mikhail Prokhorov in April last year for $1b, with an option to buy the Russian’s remaining stake before the start of the 2021/22 season for an additional $1.35b. Read more on SportsPro (English) and Sohu (Chinese)
Mailman Take: This had been expected to happen eventually. With the off-season delivering superstar additions and ahead of the 2019 NBA China Games, which the Nets will take part in, it's the perfect opportunity for Joe Tsai to pick up the option on full ownership. This deal would value the Nets at a whopping $2.35b, making it the highest price ever paid for a sports franchise. The only negative for Joe Tsai is the fact Alibaba missed out on the NBA digital broadcast rights in China to current holders Tencent.
US Open Launches Douyin Account & Mini-Game The United States Open Tennis Championships (US Open) has launched an official account on Douyin to reach new audiences with short-form video content. The tournament's launch on the platform is coupled with the debut of an interactive mini-game, a fun and entertaining H5 game available to play for free on the official US Open Weibo and Douyin accounts. Read more on The US Open (English)
Mailman Take: I like the idea of a Mini-Game as an extra component to entertain fans and engage younger generations. They simply aren’t satisfied with generic posts and campaigns anymore, they have abundant options, and sports IPs are all in competition for eyeballs. A Mini-Game is a smart way to attract hardcore, casual, and even non-tennis fans to the US Open’s social platforms and keep them there.
Juventus Sell Out 500 Limited Edition Chinese Jerseys in One Hour The Italian club and kit sponsor Adidas launched a limited “Shanghai edition” away jersey with Chinese elements. The traditional black logo and details on the Juventus jersey were also replaced by a bright red, which is perceived as a lucky colour in Chinese culture. Read more on SportBusiness (English) and Sohu (Chinese)
Mailman Take: Despite the high price point of the limited edition shirt, this has been a successful initiative for the club. Flash-sales have proven to work particularly well in China. While football clubs have previously launched jerseys with players' names in Chinese during China tours and Chinese New Year campaigns, this Juventus edition represents a more unique & innovative idea. And it clearly worked.
Nova Esports Team & BBIN Sign Global Partnership The world-renowned and current Clash Royale champions Nova Esports Team has announced a strategic alliance with the leading iGaming software supplier, BBIN. The partnership is expected to give BBIN further competitive edge in becoming a global giant in the e-world. Read more on Ecosports (Chinese)
Manchester United Brings on Yabo Sports as Asian Betting Partner The Premier League club signed a major new partnership with Asian betting brand Yabo Sports. It’s the club’s first betting partner deal with an Asian-facing brand. Yabo Sports replaces the mobile betting and gaming brand MoPlay in United’s global betting category. Read more on SportBusiness (English)
In Other News
Suning & Tencent Announce Joint Membership Service As part of this new partnership, content to be distributed across both Tencent and Suning will include PP Sports’ football members pass, as well as Tencent Video's dramas, movies, and much more. Read more on Lanxiong Sports (Chinese)
Mailman Take: This announcement will have serious implications for China’s digital landscape. Suning & Alibaba had previously been touted to partner up and share content on a joint platform. This relationship has since turned stale and it appears Tencent has seized the opportunity to get one up on their rivals, Alibaba. Where this leaves Alibaba’s digital platform Youku Sports is yet to be seen.
Espanyol to Bring on LD Sports as Main Shirt Sponsor The Spanish top-flight football club is set to replace their current shirt sponsor in a new deal with Chinese digital content brand LD Sports, according to a report in Spain. The deal with LD Sports, which is also paying £7.5m a year to be the shirt sponsor of Southampton FC, marks Espanyol’s latest move in the Chinese market. Read more on SportsPro (English)
Mailman Take: Some fears have been allayed by the legitimacy of LD Sports now that they have an operational website and are active on social. However, the roots of this company and where the funding comes from is still unclear. Questions remain, and I’m not convinced we’re going to be given clear answers soon...
From the Top
This week I spoke to Rouven Kasper, Managing Director of FC Bayern Munich China, where we chat through how FC Bayern’s China strategy differs to international markets, the importance of a China office, and the biggest changes China’s sports market has witnessed in recent years.
1. How does your China strategy compare to other international markets? "China is the most important international market for FC Bayern besides the US. And as you know, the two markets are different in many ways. In China, FC Bayern has over 136 million followers - more than we have in the whole of Europe. We have developed our strategy for China from the beginning based on our Bayern philosophy and core pillars. But at the same time, we localised our approach in the most authentic way, which you can see in our various activities.
Our fans can experience us 365 days a year in a very unique way. We operate differently than other clubs: half of our China team work on producing localised and interesting content for our very big and fantastic fanbase. Having our own and highly qualified specialists for football development, eCommerce, events, marketing and institutional partnerships in our team, for producing the biggest possible value together with our partners. We are not targeting quick-wins, we have a long-term strategy in China and are aiming for sustainable, strong and reliable relationships."
2. How important is it to have a China office and what advantages does it bring? "In the summer of 2016, exactly three years ago, we were the first non-Chinese football club to open a registered company in Mainland China, which already shows our commitment to this market on the one hand, but as well the sincere approach that we want to work on in China.
There are over 8.000 kilometers between Munich and Shanghai, two great cities with different mentalities, cultures, and ways of living and thinking. You can have a look at this from the outside as many do. But we think that, only if you live in China, you can really learn about and feel the country and its wonderful people, knowing what is happening, what the needs are and where you can support in the best way. Based on this know-how and localized thinking, we have developed very strong partnerships and relationships in different fields, which are bearing fruits for all parties."
3. What are the biggest industry changes you've seen in China since you started working here and what expectations do you have for the future? "There is an incredible motivation and plan for developing sports culture and especially football. The concrete plans, the amount of activities, investments, and stakeholders who influence the development of football are outstanding.
From my perspective, the thinking of how to develop football and its business changed a lot within the last years. In the beginning, we saw a ton of ideas, concepts, and stakeholders not always having the know-how, capacities, and experience in football. Within the last few years, a process of filtering has started, people focus more on the quality of projects and reliable relationships, which affirms our way of living and working in partnerships. The dynamic development of football and its market will continue. Stakeholders, projects, and concepts will be filtered based on more qualitative and sustainable approaches."
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