WSC 243 May 07

As Liverpool’s new marketing strategy starts to look east, China seems an attractive option, particularly as the world’s biggest clubs have made a head start. AC Milan, Manchester United and Real Madrid have all played here in the last four years, with Barcelona, who beat then Chinese Champions Shenzhen Jianlibao 9-0 in Macau in 2003, set to play in Beijing this summer. The public-relations results were mixed, however, especially for Milan, whose second-string team were soundly beaten 2-0 by Shanghai Shenhua in front of a pitifully small crowd at the 80,000-seat Shanghai Stadium. The Chinese fans’ message was clear: don’t take us for granted.

Premiership clubs with aspirations in China must learn from Milan’s mistakes. As the world’s fourth-largest economy, with a population of 1.3 billion, modernises at warp speed, new commercial opportunities are opening up. But, as many multinational retailers have discovered, China is a tough nut to crack and a short-term merchandising windfall is unlikely. Chinese consumers in the affluent east-coast cities are selective purchasers and, luxury fashion brands aside, are famously resistant to unfamiliar foreign marques.

Yet the sheer pace of China’s economic growth (averaging ten per cent annually in recent years) means the risks are worth the potential returns. Clubs such as Liverpool will need to undertake detailed market research, because winning the Premiership or even the Champions League is no guarantee of financial success in China, where fan loyalty is to superstar players rather than to the clubs they play for. Despite his career decline, David Beckham remains hugely popular with both male and female fans, as are Raúl, Ronaldinho and, increasingly, Cristiano Ronaldo. Players such as Dirk Kuyt, Mark González and Peter Crouch barely register in Chinese fans’ consciousness.

Leading the Premiership’s China charge is Chelsea’s Peter Kenyon, who believes that conquering Asia is vital to his strategy of making Chelsea the world’s largest club by 2014. As well as signing a four-year contract with the Asian Football Confederation to support their Vision Asian football development programme, Kenyon has been spotted frequently in Beijing – on one occasion in the company of Ken Livingstone and Girls Aloud.

Initially, it appeared that Kenyon was making all the right moves. By committing Chelsea to “developing football in China”, he clearly understood the painstaking yet pivotal importance of relationship building for business success in the country. To further enhance player-fan relations, Chelsea will tour China in 2008.

Kenyon’s strategy also recognises two key characteristics about Chinese fans. First, they love the internet. Chelsea have a Chinese-language website and more clubs will follow suit, not just to engage fans in their own language but to smooth the way for online broadcasting revenues. It seems certain that these rights will, one day, be negotiated individually by clubs and this could prove a lucrative revenue stream in China, where urban incomes are rising fast, football is a national passion and the internet population of 140 million will continue to grow.

Significantly, the era of subscription football in China begins next season, following Guangdong-based Tiansheng Digital TV’s three-season $50 million (£25m) deal to show Premiership matches, previously broadcast free by state-owned CCTV. Chinese fans will have to pay 188 yuan (£12) per month, but this is not expected to dampen enthusiasm among young Chinese urbanites, who are becoming accustomed to ­market ­economics in this, the world’s most capitalist communist nation.

Second, while extremely knowledgeable about the Premiership’s leading teams, fans in this avowedly nationalistic country want to see their own stars on the global stage. Hence Chelsea’s agreement with the AFC to support grassroots development in Asia. While sceptics argue that the rising tide of young Chinese footballers trialling with European clubs are just commercial pawns, a handful are now playing at a high level.

PSV Eindhoven’s left-back Sun Xiang was lauded nationwide when he became the first Chinese player to appear in the Champions League during the defeat of Arsenal. Three Chinese internationals are on the books of Premiership clubs: the national captain Zheng Zhi, currently on loan at Charlton, Manchester United reserve Dong Fangzhuo and Manchester City’s Sun Jihai. Despite City’s current plight, they retain a strong following in China because of Sun’s long-term record with the club and were invited to play in a pre-season tournament in Shanghai last summer.

But back to Chelsea, whose China engagement mission unravelled in January, when they hosted an ill-fated visit by China’s Olympic football team. Relations were immediately strained when the Chinese players complained about the training facilities and a practice match that featured none of Chelsea’s high-profile stars. It would only get worse. A mass brawl during a game with QPR saw one Chinese player knocked unconscious with a fractured jaw, seven players sent home in disgrace and Chinese league team Changsha Jinde seeking compensation from their FA because the injuries sustained by their top player, Chen Tao, will take four months to heal. The media fallout from the trip still rumbles on in China.

Yet perhaps the most unexpected image of English clubs’ courting of Chinese fans was John Prescott’s cancan kick during a photo call announcing Sheffield United’s 90 per cent purchase of Chengdu Blades, the first foreign club to take over a Chinese team. United’s chairman Terry Robinson says merchandising is not the catalyst for the deal, as “Chinese fans have a different relationship to their shirts than English fans”. Instead, United will use this second-division club in one of China’s fastest-developing cities, with a population of ten million, to boost their brand image in China and as a base to develop young African players. To retain the support of local fans, though, they might also consider cultivating some future Chinese stars as well.

From WSC 243 May 2007. What was happening this month

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