When Big Bets Go Bust

From page 21, Money & Insurance, and Corporation, page 31, issue no. 382, Aug 25, 2008
Abridged translation by Zuo Maohong
Original article: [Chinese 1 2 3]

Cadillac and Volkswagen finally need not argue over whose car Liu Xiang should ride in to CCTV for an interview if he won a second Olympic gold medal. Cadillac was a brand Liu Xiang endorsed, and Volkswagen was the Beijing Olympics' official sponsor.

As the sight of the favorite sportsman in China faded out on television screen on the noon of August 18, all his sponsors faced an embarrassing situation.

Many of them had prepared two advertising plans—one to be used if Liu won the gold, and the other for losing. But pulling out of the Games during his first heat in the Bird's Nest was certainly something they had not expected.

Ping An: A Blank Check for Liu's Legs
The moment Liu Xiang limped off the field with his injured right foot, a 100-million-yuan insurance policy he had signed with China's leading insurance company Pingan became the subject of heated public debate.

Two days later, Pingan stated on its website that both the General Administration of Sports (GAS) and Liu himself had declined to make a claim.

The statement said the policy was signed by Pingan, the GAS and Liu last October, with a one-year term from November 1, 2007 to October 31, 2008. It emphasized that this insurance policy covered risks of normal life accidents.

The statement met with skepticism from the net community, as it was previously rumored that Pingan had offered Liu an insurance on sports injury of his legs for free. One netizen directly criticized the insurance as an advertising gimmick, saying the company reacted passively and irresponsibly.

According to a source from Pingan, the insurance policy was a gift to Liu as he was the company's branding spokesman —"charity ambassador", as they called it.

Nike: the Quickest Comfort
"Love this game. Love puting all your pride at stake. Love to win it back. Love to give all out. Love the glory. Love the pain. Love sport, even when it breaks your heart."

The day after Liu quit the Olympics, Nike offered comfort with the above advertisement.

Red, bold type-face, the words appeared in many mainstream newspapers in China on August 19. Liu's face was half in shadow, but his eyes looked bright. At the bottom of the picture were Nike's logo and slogan "JUST DO IT".

"It takes only 20 minutes to produce such an advertisement, but the whole process from proposing this idea to actually putting it in newspapers could take several months or even half a year for some companies," said one industry professional was startled by the efficiency of Nike, which finished the job within 12 hours.

Liu had played a leading role in Nike's marketing strategy since he became an Olympic gold medalist in 2004. The day after he broke the world record for the men's 110m hurdle in 2006, Nike staff China changed their uniform into a commemorative t-shirt. The day he finally won a world title at the Osaka world championships last year, Nike designed a T-shirt with the Chinese character "xiang".

However, as these episodes have shown, no one could avoid the risk of betting on sports stars.

This June, when Cuba's Dayron Robles broke the world record Liu had written two years ago, Nike's advertisement "I'm Liu Xiang. Who are you?" seemed a little embarrassing. It was soon changed into "I'm Liu Xiang... I am focused".

If Liu had won a second Olympic gold, Nike might have launched a new pair of shoes with red soles and yellow insteps specially-designed for Liu in the Olympics.

However, as he withdrew from the games, these shoes, which made their debut in a press conference a few days before, also left the 110m hurdle tracks.

Lenovo's Illusory Sports Stars
When the curtain of the Beijing Olympics went up on August 8, a commercial with the image of Liu Xiang hurdling and the logo of Lenovo, China's fast-growing electronics giant, began to be broadcasted regularly on CCTV.

On the night of August 18, there was a rumor that a commercial Liu had shot for a Lenovo laptop had been cancelled.

Lenovo's spokesperson Zhu Guang responded later that the commercial would continue to be broadcast until the conclusion of the Games.

On August 21st, its vice president Li Lan told the EO, "we will support him as always. Lenovo will not change its advertising plan because of his pull-out."

Despite the clarification, Lenovo was slow in reaction compared with Nike. In fact, this was not the first time it stumbled in marketing.

In April 2006, the company made a high-profile announcement that Brazilian football superstar Ronaldinho Gaucho would endorse its products. Like all his fans over the world, Lenovo expected the master's brilliant goals in the Germany World Cup that year.

To their disappointment, Ronaldinho didn't score any goals in Germany, and the Brazilian team ended their World Cup journey at an unexpectedly early time. Only half a year later, Lenovo terminated its contract with the holder of two FIFA World Player of the Year awards.

According public statistics, the brands Liu endorsed currently totaled 23. After all the efforts to sign a contract with him, how to differentiate themselves became a focal point for advertisers. They weren't prepared for Liu's withdrawal.