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September 15, 2009

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Getting bang for Expo bucks

WORLD Expo 2010 has 42 sponsors and they have invested millions of dollars to promote their brand image. A new survey looks at six sponsors and asks whether they're getting bang for their buck. Yang Jian reports.

World Expo 2010 in Shanghai has drawn huge amounts of investment from the world's business community that wants bang for its buck.

As about 70 million visitors are expected at the Expo, companies in China and overseas consider the event an ideal stage to showcase their brand images. The Expo theme is "Better City, Better Life." Some call it the "Olympics of Science and Economy."

To become one of the 42 Expo sponsors, companies pay a very large sum, which neither the organizer nor the sponsors will disclose. Some will also have corporate pavilions, pouring millions of dollars more into the event.

The overall Expo budget is 28.6 billion yuan (US$4.19 billion). Income from expected sales of 62 million tickets is likely to reach 6 billion yuan, while 8 billion yuan worth of bonds have been authorized for sale in China.

Much of the balance of 14 billion yuan will come from sponsorship.

So, with Expo coming in eight months, a big question is whether sponsors are getting value for money with a boost in their recognition ratings and perception of their brand image.

Ipsos, a global market research company in Paris, early this month released a survey report on whether sponsors' brand images have been enhanced by sponsoring the big event.

The Expo has 42 sponsors - 13 global partners, 13 senior sponsors and 16 project sponsors. The 2008 Beijing Olympics has 63 partners and sponsors.

The Expo sponsor list includes the Olympics sponsors such as Coca-Cola, Lenovo, China Mobile and Yili. They significantly improved their brand images through the Games.

Some new faces have joined Expo, such as China Eastern Airlines and China Telecom, which have less experience sponsoring world-level events and did not show at the Olympics.

Ipsos surveyed six global partners (China Mobile, China Telecom, China Eastern Airlines, Bank of Communications, Coca-Cola, Siemens) and four senior sponsors (Tencent, Yili, Lenovo, IBM). They interviewed people in Shanghai, Beijing, Guangzhou (Guangdong Province), Chengdu (Sichuan Province), Wuhan (Hubei Province) and Shenyang (Liaoning Province) about the six brands and received 1,200 valid responses.

Among the 10 sponsors, the Bank of Communications most effectively improved its image. The number of positive comments on one of China's four big banks increased by 39 percent since the announcement of its sponsorship.

Then came Siemens, the German engineering conglomerate, which got a 36 percent increase in positive comments.

China Mobile seems to have benefited the least from sponsorship. The country's main telecommunication provider only got 2 percent more positive comments than it had before its sponsorship.

According to the survey, Siemens has benefited greatly from its Expo sponsorship over the years. It has sponsored 16 World Expos since the first World's Fair in 1851 in London, so it already has a good image among World Expo followers, according to the report.

For Expo Shanghai, Siemens set up an "Expo Project Center" in 2006. It launched an Expo-City-Version Campaign in May that provides energy-efficient plans and facilities to the main Expo venues, including the China Pavilion. The campaigns boost the company's image.

However, the recognition rate of Siemens among Chinese consumers is the lowest of those companies in the survey. Only 52 percent of those interviewed knew the German brand.

The survey shows that China Mobile has established a good brand image in China through its wide range of promotions. It has the highest recognition rate among all the sponsors - 90 percent of respondents recognized the brand.

China Mobile will build a 6,200-square-meter telecom pavilion along with China Telecom, one of the biggest Expo pavilions. It is also an official seller of tickets.

The report suggests China Mobile establish a new high-tech and green brand image with the 2010 event, in addition to its current principle of providing good signal coverage and good services.

Lenovo, Yili and Coca-Cola benefited greatly from their Olympic Games sponsorship. The survey showed they have a "moderately high" recognition rate and slight improvement in image perception.

Lenovo, China's biggest personal computer maker, will provide about 10,000 pieces of computing hardware, including servers, notebooks, desktops, printers and peripherals, for the Expo. Coca-Cola and Yili, a Chinese milk producer, will be the sole beverage providers on the Expo site.

The Ipsos report suggests the three companies adopt new promotion strategies for the Expo because Olympics and Expo audiences are different.

The new-to-world-event sponsors, including Tencent, China Telecom and China Eastern Airlines, got good results in the survey. Tencent, a Chinese instant messaging and portal Website operator, improved its image by 31 percent. China Telecom ratings improved by 26 percent while China Eastern Airlines gained 25 percent.

Wang Junhao, vice president of the Shanghai-based JuneYao Group, main manufacturers of official Expo souvenirs and a senior sponsor, says the Expo was a perfect platform to advertise the brand even if it made no money.

He says the company has invested about 200 million yuan in the Expo, including the sponsorship.

Lenovo is upbeat.

"With a concrete track record and innovative technologies, Lenovo is well placed to handle such large-scale international events," says Yang Yuanqing, Lenovo's chief executive.

The survey will be repeatedin November.


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