Sports Industry in Korea, Part II

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Monday, July 4th, 2016
Kim Chang-min

In Part I, I talked about what sports industry is and why we should support the sports industry and marketing. In this article, I’ll talk about the companies that could have economical profits with sports marketing. These days, there are many companies such as Red Bull and Coca-Cola that are so big that their customers come from all over the world. How could they become such huge, global companies? One of the factors to their success came from sports. Because enthusiasm for sports is one common thing for people all over the world, global companies use sports to get noticed. And this can indirectly influence a country’s economy.

Coca-Cola has been using sports marketing to advertise its name since the 1928 Amsterdam Olympics. In 1930, when the first World Cup was hosted in Uruguay, most companies focused on advertising through the radio, but Coca-Cola’s focus was on a different place. They decided to take advantage of people’s enthusiasm for sports. Coca-Cola provided its beverage to spectators at the first World Cup, and Coca-Cola has had stadium advertising at every FIFA World Cup since 1950. It became a corporate partner with FIFA, with a formal association since 1974. Since Coca-Cola has one of the longest corporate partnerships with FIFA, it has powerful rights for sponsorship: the exclusive right for non-alcoholic beverage, and they can use the logo of the FIFA World Cup.

In Korea, Samsung is best at using Sports Industry to its advantage. Chelsea and Samsung had a partnership from 2005-2014. This partnership was called the “Blue alliance” because the representative color of both teams is blue. The terms of the contract were for Samsung to sponsor Chelsea financially, and in return Samsung’s logo was put on Chelsea’s uniforms. Samsung paid 18 million pounds annually. This was one of the most important things Samsung did because it brought astronomical profits to Samsung. The English Premier League that Chelsea belongs to has 4 billion viewers all over the world, and about 120 million of them also bought and wore the Chelsea uniforms that had Samsung’s logo. This was one of the most efficient ways to get people to recognize its name, and it had a hugeeffect on Samsung’s revenue in Europe. Samsung’s revenue in Europe in 2007, 3 years after its contract with Chelsea FC, was recorded to be $10 billion more than their revenue in 2004, before its contract with Chelsea FC.

Hanhwa Solar is another very large company in Korea. Now they have set their eyes on the world. So, they have used sports marketing to get people to recognize their name. First, they targeted the European soccer league. The company sponsored Hamburg SV. The Korean representative soccer player Son Heung-min is on the team. Also they sponsored the Bolton Wanderers FC, where Chung-Yong Lee plays. Then, they sponsored Juventus FC, which is an elite club of the Italian Seria A league. By sponsoring these teams, Hanhwa Solar was given the exclusive right to display their company logo and name on the A-boards and electronic display in their home stadiums.

This company sponsored not only soccer teams, but also the San Francisco Giants, which is one of the most famous baseball teams in Major League baseball. They carried out a campaign called “I Sun SF.” This campaign includes the installation of solar PV panels at AT&T Park, the home stadium of the SF Giants – a Hanhwa Solar designed, sun-sharped LED sign above left field. They also sponsored the Giants in-game recycling “Green Team.” Hanhwa usedthe name-recognition of the SF Giants to make itself known and made a good image for itself to the San Francisco people.

Many people think most sports are the “men”sports, but it also includes“women” sports. These days, the status of woman is increasing more than ever. As a result, changes are occurring in the sports industry. Because of the growth in the number of female fans, In Huffpost Business,Jean Afternam noted that the Yankees sell more women’s apparel than any other merchandise in this shop.

Globalization and technology have changed the sports industry for decades. Also, it has changed the sport demographics, too. Women have not only become part of the fan base, but also the decision makers, change agents, and major players in the industry as a whole. However, there is still a long way to go for women. The popularity of women’s sports is limited to tennis and golf.

As of 2005, women still only make up about 20% of the participants at sports events, and even if there has been a lot of effort by Europe to promote the advancement of women into positions of leadership, the sports industry mostly consists of men. “If they start to give women more influential positions where they are overseeing tournaments, it will show that women are just as, or even more, capable, because they are not as entrenched in tradition, of running these sports successfully,” says sports commentator Liseli Sitali, according to The New Economy. The popularity of women’s sports is increasing. But it will take more time.

These days, the popularity of sports that were not previously popular in Korea – sports such as bobsled, golf, and women’s sports, are becoming more popular since they got amazing results at international competitions. If companies support these kinds of sports that have enough potential to become popular, everyone could get amazing economic profits. Through sports marketing, the companies can get a positive brand image and be associated with a passionate, enthusiastic, and energetic image. In addition, the people who are exposed to the name of the companies during a sports game will feel like they are buying something familiar at the store and feel good about buying it. So I think more companies should use sports marketing to elevate their brand. It would be a successful strategy for everyone!

Kim Chang-min, Daejeon Daeshin High School

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