 With the Olympics hype reaching fever pitch, perhaps it is understandable that a few players are starting to feel the heat. Take Tom.com chief Zeng Fuhu, who responded in a rather animated manner to the contention by bitter rival Sohu that all online Olympics advertising bearing the Olympics logo must run on its site. The spat demonstrates the Olympics’ undeniable appeal to media owners, who are queuing up for a slice of the lucrative action...
The mainland’s surging online players are no exception - but what exactly are the options for clients and agencies when it comes to non-traditional media?
1 In Sohu’s mind at least, matters are blissfully clear. VP Chen Luming is adamant that his company’s exclusive supplier deal with the Beijing Olympics gives it exclusivity over online Olympics advertising that bears the logo. And given Sohu has just announced a record Q3 revenue result of US$51.5 million, up from $35.4 million in Q3 2006, it’s clear there’s plenty at stake. “If the Olympics partners and sponsors want to work with other online companies to do any co-marketing activities, then they can’t use the Olympic logo,” says Luming.
2 Unsurprisingly, Chen’s rivals disagree. Sina head of PR Wei Guo says that Sohu’s deal gives it online broadcasting rights and rights to the logo, period. “However all of the Olympics’ sponsors and partners can place ads on other websites, using the (Olympics) logo. There is no online regulation that they can’t advertise anywhere else,” says Guo.
3 Looking at the rights held by other media, Sina’s argument certainly holds weight. After all, CCTV’s rights to Olympics content do not preclude sponsors from running their Olympics ads on other mainland TV stations. For what it’s worth, the legal eagles at BOCOG are believed to be working on a solution to the dispute, although media agencies do not expect a resolution until early next year, a timeframe when most brands will begin their Olympics push in earnest.
4 The dispute may run deeper than current events indicate. Earlier this year, Sina announced an alliance with QQ and Tom to pool resources for Olympics coverage, in a move which many believe has sparked the current stoush. That partnership is now thought to include 40-plus online players who are, presumably, operating under the belief that a joint effort may be the best way to compete with Sohu. A number of newspapers and TV stations have also jumped onto the bandwagon, opting for strength in numbers.
5 For clients the current standoff is a concern, although agency sources suggest most advertisers are pushing ahead with online campaigns. It’s widely rumoured that if BOCOG ultimately sides with Sohu, financial penalties may be implemented for those found to be breaching the exclusivity — how much is anyone’s guess. “It will probably come to a head once the first clients are penalised if that is the way BOCOG goes. But it’s still early days, and it is worth remembering this is not just about Sohu’s rights, but it’s also about the rights of advertisers,” says Esther Yang, GroupM Interaction China general manager.
6 With many advertisers balking at CCTV’s prices, they are eyeing digital — says WWWins director of digital media Ruby Chiu — in the hope of getting more bang for their buck, another key reason as to why a timely resolution to the issue is critical. And with online rates soaring, it appears there’s little to be gained from taking a cautious approach. “The media inflation for online is huge ranging from 20 to 70 per cent, and that will increase in every quarter,” warns Chiu. “For example QQ.com and Baidu have increased their rate cards by 70 per cent.”
7 Mobile is expected to be another key beneficiary of the coming gold rush. While the mobile broadcast rights are still at a tender stage, China Mobile’s status as market leader makes it the clear favourite as a platform for advertisers looking to capitalise on the hype. And unless the current online drama is sorted out promptly, mobile and other digital avenues are well placed to benefit. In Hong Kong, i-Cable has snared the online and mobile rights. And, if you’re so inclined, Sega won the video gaming rights back in 2005.
What it means for…
Advertisers
-The size of the medium may be less important than what you do with it.
-Many, meanwhile, are forging ahead with their online Olympic campaigns across a wide range of platforms until they hear otherwise.
-If BOCOG begins issuing fines over the issue, most will be left with little choice but to focus their energies on Sohu.com.
Online media owners
-For Sohu, a favourable ruling from BOCOG’s legal department could pave the way for unprecedented revenue, on top of it’s recent record announcement of more than US$50 million for Q3 2007.
-Sina, Tom, QQ, Netease and the rest of the alliance will be forced to take a lesson from the books of ambush marketers, and “get creative” in how they approach attracting online revenue.
(Source: Media)
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