Smartphone companies place bet on sports marketing

Will people buy smartphones that are endorsed by their favorite sports stars? The answer, in many Chinese smartphone manufacturers' eyes, is a resounding "yes".

Few people deny the fact that Chinese smartphone companies are able to make good-quality mobile phones at low prices. Companies such as Huawei Technologies Co Ltd and Lenovo Group usually sell devices below 2,000 yuan ($326.34) - about half of the price of Apple Inc's popular iPhone handset.

But the major obstacle for potential buyers of Chinese smartphones, especially those in overseas markets, is branding.

"We believe that brands like Samsung and Apple can deliver products that will satisfy you, but for Chinese brands, the answer is not that sure," said John Barry, a US student who is living in Beijing.

As Huawei, Lenovo and ZTE Corp managed to become top-5 mobile phone vendors globally and now aspire to climb the pricing ladder and attract high-end users, they're starting to build up their branding by using the power of sports stars.

Shenzhen-based Huawei, which has been paying more attention to the smartphone business in recent years, recently signed a sponsorship agreement with Italian football club AC Milan. The three-year deal allows Huawei to use AC Milan's logo and images of its players for phone promotion activities.

"This cooperation is a great opportunity to bring our brand and our products to a wider consumer audience, not only in European markets but also on a global level," said Daniele De Grandis, executive director with Huawei Device Italy.

Earlier, ZTE, another Chinese mobile phone company, said it has teamed up with the Houston Rockets to become the team's official smartphone partner. Chandler Parsons, 24, a Rockets rising star, will endorse ZTE's smartphones. ZTE also signed agreements with NBA China to promote products in the domestic market.

"It's not that strange that Chinese mobile phone players are cooperating with sports teams and stars," said Adam Zhang, CEO of Key-solution Sports Consulting Co.

"Sports transcend culture and language differences. It brings in the broadest audiences. For companies like Huawei and ZTE, which conduct more than half of their business overseas, sports marketing is a necessary move," he pointed out.

Consumer electronics companies also are benefiting from the association with sports stars, who usually introduce a sharp style that is welcomed by customers.

"The major target of smartphone companies are young clients, and this group of people likes to do sports," Zhang added.

Lenovo is already something of a front-runner in terms of sports marketing, thanks to the international operations of its personal computer business in the past decade. In August, Lenovo invited National Basketball Association star Kobe Bryant on stage to promote its flagship smartphone products.

Liu Jun, senior vice-president of Lenovo, said that Bryant never gives up and is always shooting for the top spot. "That's also the branding message that Lenovo smartphones want to deliver," Liu said.

Though there has been no significant progress achieved so far by sports marketing moves, Chinese mobile phone companies are rather optimistic.

"The Houston Rockets have 350 million fans worldwide, and the team's popularity can also lift ZTE's branding in the United States," Cheng Lixin, chairman and CEO of ZTE USA Inc, said in an earlier interview.

He Shiyou, executive vice-president of ZTE, recalled that Samsung became an overnight sensation after its corporate sponsorship of the 1988 Seoul Olympics. After the event, the South Korean company successfully expanded to other parts of the world.

In He's opinion, similar things may happen to ZTE after the Houston Rockets deal.

For customers, the responses to smartphone vendors' sports marketing actions are diverse. Piao Jia, a big fan of football club Intel Milan - an AC Milan rival - joked that some of her friends who use Huawei handsets vowed to smash their phones. "That expresses their determination to support Intel Milan," she said with a smile.