China Sports Business Weekly | 27th March
Welcome to the latest edition of the China Sports Business Weekly.
Taking the headlines this week: Nike proves digital prowess amid China lockdown, Tokyo 2021 reschedule gives China event headache, Advance Publications progresses on IRONMAN purchase, Wu Lei and Lang Lang to join LaLiga charity music festival, China foreign entry ban casts doubt on CBA season start, and the Chinese Athletics Associations brings on data-driven Huami.
We spoke with Li Shuangfu, Co-Founder and President at Lanxiong Sports - a leading multi-service China sports industry platform - about China’s impending sports resumption, how media and broadcasters handled the lockdown, what’s next and desirable for Chinese media, and his three key takeaways from an unprecedented time for the sports industry.
Top Industry News
1) Nike Announces Strong Online Growth in Last Quarter The sportswear giant saw digital sales in China grow by over 30% following a period of shutdown for its brick-and-mortar stores during COVID-19. Nike stores in China are now 80% open, while the majority of offline stores remain closed elsewhere. Read more on BBC (English) and Beijing Business News (Chinese)
Mailman Take: Nike capitalised on people in lockdown and working from home better than any other brand in China by producing home workouts and pushing the ‘health & fitness’ narrative. This megatrend, which includes celebrities and influencers delivering or documenting classes, is skyrocketing around the world. Nike’s challenge will be to carry on engaging this audience in China as offline stores re-open and netizens return to the office.
2) Tokyo 2021 Set To Impact China’s Sporting Calendar
With the Summer Olympics now set to take place in Tokyo next year, China’s sporting calendar has been thrown into disarray. The 2021 Summer World University Games in Chengdu, China’s quadrennial National Games, and the FIFA Club World Cup will all likely have to change dates or take place in the shadow of the Olympics. Read more on Sports Business (English) and The Paper (Chinese)
Mailman Take: Competing for viewership, spectators and sponsors against the Olympic Games is a battle lost before it’s even started. The country’s sporting authorities will know this and need to act fast to ensure events next year take place in front of full stadiums and that sponsor obligations are fulfilled. Brands will be hungry to make up for lost time, therefore a cluster of sports events jam-packed throughout the year could claw back parts of lost revenue for many.
3) Advance to Acquire Wanda Sports Group’s IRONMAN Advance Publications owns Condé Nast and holds significant shares in Discovery. The all-cash transaction will value the triathlon business, which comprises mass participation sports events across triathlon, running, trail running, cycling and mountain biking, at $730m. Read more on PRnewswire (English) and Lanxiong Sports (Chinese)
4) Wu Lei and Lang Lang to Take Part in LaLiga Fundraiser Music Festival The famous footballer and world-renowned pianist will join LaLiga's online fundraising music festival this weekend. The concert will be broadcast simultaneously worldwide via all LaLiga channels and the LaLigaSportsTV platform. In China, it will be available to stream on iQiyi Sports. Read more on LaLiga English and Chinese
5) China’s Foreign Entry Ban Puts CBA Start In Doubt A reported 20+ foreign athletes playing for Chinese Basketball Association (CBA) clubs are still outside China. The country’s new temporary ban on foreigners entering China will likely see a further delay to the start of the league season. Read more on NYT (English) and Tencent Sports (Chinese)
6) Chinese Athletics Association Partners with Huami
The five-year deal gives biometric company Huami exclusive rights in the smart wearables category, covering devices including smart bracelets, smartwatches, smart headphones, and smart glasses. Read more on Yahoo (English) and China News (Chinese)
From The Top
Li Shuangfu - Co-Founder and President at Lanxiong Sports
1. Sport in China has been stopped for months. Are there finally signs we could see a resumption in the near future, if yes, what are these?
Yes and no. Yes because we almost had the Chinese Basketball Association ready to go in early April. However, with all these imported COVID-19 cases rushing in from abroad, there was concern popping up and the restart plan was delayed. Also with the postponement of the Tokyo Games, there are no basketball qualifying games in June anymore, which means the CBA doesn’t need to worry about the small window. They have much more time flexibility.
The season could be played until September. CBA probably won’t reopen until May. CSL will wait, too. Especially after the issue of the foreigner entry ban. Both of them have more than half of their foreign players still abroad and some coaches, too. My guess is they’ll see what happens to CBA and decide when to go with the new season.
2. How have China's sports media & broadcasters handled no live sports and what have they done to fill this void in their weekly routines to entertain fans?
Mainly classic games. Reruns. Some live fitness lessons from athletes. Really not much. 2020 was supposed to be a big year for sports. Broadcasters invested heavily, directly or indirectly, on these games. It’ll be interesting to see how they save themselves from the setback. Media content shortages have become a global problem. I haven’t seen many great solutions yet. They need to get more star players involved rather than just letting them post on social media.
3. What are the main differences in how Chinese sports organisations, teams & players have engaged and entertained their fans compared to their international counterparts? Can they learn anything from each other?
Chinese teams and players tend to be quieter. International players played a huge part in spreading the awareness of the pandemic this time, which helps the world and also their brands. With issues as big as COVID-19, Chinese players are afraid of saying wrong words and doing the wrong things. And the extreme feedback on social media won’t do any good. On that note, I understand why they’re not posting much.
4. As a prominent sports business media platform in China, what are you looking for in international sports organisations to generate news and headlines?
More original content for sure. Players have more time. They basically spend daily time online and are looking for cool things to do, which is a rare opportunity. Try to come up with more ideas and produce more creative and fun programs. Take the NBA and Premier League, for example, you can tell they're thinking progressively in terms of revitalising their seasons. Just a thought.
5. Are we likely to see anything 'new' in the way China consumes and engages with sport after COVID-19, or will it likely go back to as it was before?
I think so. Sports should be one of the industries that attracts bounce-back consumption. Think about it, when was the last time we played basketball, went to the gym and exercised in our own way. We all really want it and we really want to get into it. So once things get back to normal, people would get back to sports. After a pandemic like this, people will surely pay more attention to their health and their average exercise time. With that, that’ll be a huge opportunity for the sports industry.
6. What are your three main takeaways from the last few months in how sports can play a positive role in China's society during such difficult times?
First, exercises are really important and they help your immune system. The nation’s biggest hero Zhang Nanshan, still exercising at the age of 83, sets a great example. And more people would love sports after the pandemic. We’ll have more games and venues in the future to meet those needs.
Second, China's sports industry is relatively new. With the Olympics and Euro 2020 gone, some companies will close for sure, especially some small-and-medium-sized ones, because they don’t have a Plan B. We need to have long-term plans and operate like a real business.
Last but not least, players should really learn to use social media to build their brands even under tough times. Organisations and companies, too. The bigger rewards are always for those willing to take bigger risks.
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