Market Research on Tennis in China

Tennis Market in China

A General Landscape of Tennis Development

According to a market research on audience rating, following football and basketball, Tennis has steadily become the third most popular sport for Chinese spectators to watch on television. Let’s look at the numbers, 30, 000 established tennis courts and a roughly estimated 14 million tennis professionals and enthusiasts are in the process of making this sport a rapidly growing sport in China. More surprisingly, based on a research done by Tom Cannon, a professor and sports finance expert at the University of Liverpool, this new emerging market is gradually generating approximately $4 billion per year.

Two Biggest Tennis Events in China

The Shanghai Masters, as part of the ATP World Tour Masters 1000, was established in 2010 in order to fulfill the desire of ATP and Chinese Tennis Association to develop the tennis market in China, and is held annually at the Qizhong Forest Sports City Arena in Shanghai. Yang Yibin, the Marketing Director of the Shanghai Masters, expressed that the situation of Shanghai tennis population has improved amazingly from 540,000 6 years ago to almost 1 million spectators in 2011. As one of the members of the organizing committee, what he really appreciated about ticket sales in 2011 is that it increased nearly by 40%, which means more and more people were attracted by this event but also that it depends less and less on sponsors.

However, China Open seems to receive a lot of controversial comments about its model of development, which lead to an awkward situation of sales turning negative. Although the sales of last year achieved a record of 110 million RMB, the main revenue is sponsoring with up to 90 million RMB from sponsoring deals and so less than 20 million RMB from ticket sales, and zero from authorizing broadcasting rights. According to the analysis of China Business Journal, this developing trend is damaging what a normal commercial tennis event should become. Take French Open’s operations as an example. The gain from selling broadcasting rights usually account for 45% to 50% of the whole revenue, ticket sales are able to make up to 30%, but sponsorship deals only grab the third place of the whole sales system due to its instability. Accordingly, the total value of this whole package could be estimated at 200 million Euros, with a profit margin at 20% to 25%.

“Li Na Gust” in China

After a prevailing “Li Na Gust” blown through the entire country, it seems that Chinese people experienced their second upsurge of tennis because Li Na has become the first Chinese player, even within Asia, to be entitled with the highest trophy of Grand Slam, at the French Open 2011. Consequently, with this award, hundreds of endorsement contracts for commercial brands proposed to Li Na made Tennis popular at the same time. However, only seven of them successfully signed with her with an estimated value at $42 million.

From Nike, Rolex to Haagen Dazs and SpiderTech, Li Na not only performed well in the female tennis rankings, but also made a big progress in the world’s female athlete ranking by annual revenues, just behind Maria Sharapova. On 19th June of 2011, this 29-year-old Chinese tennis player signed an endorsement deal with Daimler AG to endorse its Mercedes Benz, which is worth about $1.5 million annually for three years.

Written by Limo for Daxue Chinese consultants from Daxue Consulting


To Graduate In China: Dead-end or Highway?

Generally speaking, national employment rate of 2010 graduates was 89.6%, increased by 3%, 4% respectively from 2009 and 2008, with income 2479 RMB on average. Which demonstrates that national condition of employment has recovered from financial crisis. In terms of monthly income, it increased by 349 RMB averagely from 2009 graduates to 2010 graduates, specifically, university graduates with bachelor earned higher income (2629 RMB) than college graduates (2027 RMB), while during various majors in university graduates, economics ranked first with 3023 RMB a month on average, followed by engineering with 2953 RMB a month, leaving education at the bottom with 2491 RMB a month. In comparison, college graduates who majored in resource development earn most with 2568 RMB, while graduates majored in medical science earned least with 1713 RMB, according to China market research.

As the figure shows, universities and college graduates from East coast of China, mainly including Shanghai, Tianjin, Hebei Province, Zhejiang Province, Jiangsu Province and Fujian Province, enjoyed highest employment rate with 62.43%, and that can be attributed to regional economical environment, import and export trade motivates local industries and brings opportunity for graduates. Meanwhile they earned most income with about 3600RMB on average compared with other 3 parts, and equally bear high cost of living. Among all, Shanghai graduates’ income is 4800 on average and ranked first. While West China, including Sichuan Province, Yunnan Province, Guizhou Province and Chongqing, suffered the lowest employment rate because of less developed local economical situation. Their income is around 2500 RMB or below. Besides, Middle part of China and Northeast China takes the second and third place respectively with 47.88% and 43.39%.

 

 

Difficulty in employment is due to several reasons. First is lack of social experience, since students spend much time on classes and absorb theories instead of practice, they don’t have much flexibility and adaptability when get into work. Second is too much competitors, a sever employment situation requires job seekers to be outstanding and gain competitive advantage, that quality should be accumulated during daily life step by step. Third is too much expectation, graduates seem not realistic when choosing an industry and asking for payment.


Cost of baby in China

 

Because of  the inflation and the increase of living cost, Chinese young couples seem to be more anxious about raising a baby than years ago, especially for those who living in first-tier cities, like Beijing, Shanghai, and Guangzhou. Taking Shanghai for example, it will spend over 30,000 a year on average for raising a child from his birth to graduation from  primary school, so it seems impossible for a young couple if they can live up with such high pressure without stable income. Specifically, as it recorded in 2010, a Shanghai family spent directly 32719.5 RMB a year to raise a baby from 0-3 years old, 31943 RMB for 4-6 years old, 31226 RMB for 7-12 years old. Around 35% of parents individually suffered high stress caused by raising a baby.

People who are becoming parents are the generation born in 1980′s, and as the single child, they are labeled as “the entitled generation”. However, time flies, and ever spoiled generation are becoming mothers and fathers and learn to take care of a baby when they have to suffer fierce competition in workplace. Taking all of economical and psychological factors into consideration, 45.3% of young couples stated that they give up plans of giving birth to a second child even if it is allowed by policy in the future. What on earth cost parents so much? The answer seems complicated, the expenditure  comes from hospital charges, baby necessities, like powder and diaper, nursery school tuition, kindergarten tuition, and extra payment for training classes to cultivate their interests  for art or anything else in order to make them outstanding in the future.

In Shenzhen(深圳), a family will spend 40,000-60,000 RMB to raise a baby from 0 to 6 months. Except high price caused by inflation, parents also worried about the quality of baby products, powder is a typical example because of its serious inspection issues in mainland China. Moreover, the 80′s shared globalization and they come to be more open to show their personality than their parents, so it is absolutely a sacrifice for young mothers to give up a promising job with high income and equal large workload, they have no choice but to pay more attention to  their beloved babies. What they lost maybe not only high income, but also a good opportunity for their professional development.


Luxury Watches in China

luxury watches in China

 

Luxury Watches Compete in China

Pateck Philippe, Vacheron Constantin, Audemars Piguet, Breguet, IWC, Piaget, Cartier, Jaeger LeCoultre, Relex and Girard-Perregaux are the top ten luxury watch manufacturers ranked in the China market. Nowadays, it is inevitable to talk about the topic of luxury and as the soon-to-be top one luxury market in the world, China is doomed to be a brand new focus of luxury marketers. This year, Blancpain launched the world’s first watch depicting the Chinese lunar calendar, which means with this watch, a family with a new-born baby does not need to find a psychic to tell the baby’s horoscope. The watch can do it for them. This gesture of specifically catering to the Chinese people’s need is a big sign of targeting.

luxury watches in China3

Celebrity Endorsement and Soft Marketing

Another commonly used strategy to get close to the China market is celebrity endorsement, using Chinese stars of course. According to the research result given by the market research company Synovate, rich Asian people like to purchase luxury with obvious visual logos and high brand awareness. So the brand popularity becomes a key factor in Chinese people’s purchasing decisions. Thus Chinese faces are well needed to be associated with these brands developing in China. Certainly in addition, the character of those chosen celebrity needs to go with the product itself, but sometimes this requirement is hard to be met, which is a reason why some brands choose not to go this way. “Not any single star can represent the noble quality of the brand.” One watch collector commented. Soft marketing is what some very big brands favor to use. Although they do not sign any celebrity to specifically represent their brands, they ask celebrities to be guests at their brand events, sponsor film festivals, or plant ads in films in order to enhance the brand publicity. In this years’ Cannes Film Festival, two Chinese film stars Chen Kun and Qing Hao were wearing Dior wrist watches. What’s more, many other Chinese film stars were wearing  luxury watches too: Zhou Xun with Channel, Gong Li with Louis Vuitton, and Liangchao Wei with Cartier. These are all parts of the soft marketing effort made by luxury watch brands. It is obvious to see soft marketing has become the sustainable marketing strategy widely used by luxury watch manufacturers to better compete in the China market.

Documentation:

http://news.guuoo.com/show/1730.html

http://finance.qq.com/a/20120810/002043.htm

奢侈品中国-腕表资讯


Market Research in China

Daxue Consulting regularly processes research on the Chinese market and marketing strategy in China, including image analysis, focus groups, store-checks, analysis of consumption habits based on our data and on-demand data-collection.

These market research projects aim at empowering our customers with an as exhaustive as possible vision to know how to sell, and to provide access to distribution networks in China. Project managers provide recommendations as operational as possible.

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To conduct a market research, Daxue Consulting may use various methodologies:

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The recommendations resulting from a market research go along with a certain number of documents, in particular:

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  • Summary sheets that detail the strategy of competitors, studies of marketing campaigns carried out previously,
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Some references for marketing research

Daxue Consulting recently realized the following market research projects:

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  • For a company of music equipment, an analysis of marketing strategies among upscale competitors and players in the West,
  • For an industrial company, a research on the deals in the last 3 years in their industry.

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Daxue consulting is the most cost-effective market research in China. Sourcing students’ brains from top Chinese universities to complete market research through well-kown methodologies such as documentary research in China, store-checks in China, focus groups in China, interviews, benchmarks, all of them at a very competitive price thanks to our business model and our localization in China. Each of our project is tailor-made and goes with adapted technological smart tools.