February 25, 2018 / 11:17 PM / 24 days ago

Alibaba turns heads as it joins Games sponsorship waltz

PYEONGCHANG, South Korea (Reuters) - The Olympic movement’s new Chinese global sponsor, e-commerce group Alibaba, came to the Pyeongchang Winter Games promising to revolutionize the experience for spectators, from buying tickets to souvenirs.

FILE PHOTO: A sign of Alibaba Group is seen during the fourth World Internet Conference in Wuzhen, Zhejiang province, China, December 3, 2017. REUTERS/Aly Song/File Photo

But other sponsors quickly reminded Alibaba that its revolution can’t happen if it steps on their turf.

Many of the services Alibaba wants to change, such as buying tickets online or shopping at the Games for Olympic-branded clothes and souvenirs, could involve trespassing on the territory of other IOC partners, experts and sponsors said.

Alibaba is the Olympic “E-Commerce Platform Services” provider under a deal worth hundreds of millions of dollars unveiled in 2016. But Visa Inc is the Olympic payment technology partner and also has an e-commerce role at the Games.

“In our mind it’s very clear, consumer e-commerce is our category. Business to business is theirs,” said Visa’s Korea manager, Iain Jamieson, who attended the Pyeongchang Games.

“They’ll find their feet. It’s their first Games. They have the next Winter Olympics (in Beijing). I can understand that they want to make a strong statement up front,” he added.

When Beijing hosts the Winter Games in 2022, Alibaba will still have to pick its way around the dozen other top global sponsors of the International Olympic Committee (IOC), a dance whose rules are set out by the IOC’s sponsorship regulations.

Since the IOC created its top sponsor program in the 1980s, it has sliced and diced its sponsorship categories and granted strict marketing rights to different companies, ensuring sponsors do not compete with each other.

For example, Samsung Electronics Co Ltd, as the wireless communication equipment sponsor, can have nothing to do with cameras at the Games because rival Panasonic Corp is the global Olympic camera sponsor.

In a sign of its intentions, Alibaba set up a marketing showroom at the Games to demonstrate potential future uses of its technology, such as using facial recognition to help personalize the shopping experience.

Alibaba Chief Executive Daniel Zhang said in an interview in Pyeongchang that the company was also looking to improve how merchandise is sold during the Games.

“Why do people have to stand in line for such a long time?” said. He described a scenario where people can see items on their phone, order them and collect them at the Olympic park.

Zhang said Alibaba was looking at which specific areas to focus on with its IOC deal and was also working closely with the Beijing Games organizers.

“We are talking with the IOC and Beijing and other partners to brainstorm. Pretty soon we’ll try to narrow down to very concrete ideas,” he added.

FILE PHOTO: Daniel Zhang, Chief Executive Officer of Alibaba Group Holding Ltd., attends the Alibaba Group's 11.11 Singles' Day global shopping festival in Shanghai, China, November 11, 2017. REUTERS/Aly Song/File Photo


Alibaba said it had no problem working with other sponsors, saying the Games enabled it to deepen its relationships with other large companies.

Alibaba has said it is in talks with other top sponsors Procter & Gamble Co, Coca-Cola Co, Samsung and Intel Corp to find opportunities to work together in the short and long term.

An executive familiar with Coca-Cola’s thinking said it saw no conflict with Alibaba’s current e-commerce deal and that it would still leave room for Coke to do a marketing deal around the Olympics with another e-commerce firm.

Alibaba also needs to be mindful of French technology consulting company Atos SE.

Alibaba is also the cloud services provider of the Olympics while Atos is the IT partner. The French firm’s Olympic website also makes reference to the cloud.

Alibaba said in a statement before the Games that Atos was “obliged to remove this communication on their website”.

Atos said in a statement that it “is allowed to refer to cloud as it relates to the provision of services that Atos provides for the Olympic Games.”

Shaun Whatling, chief executive of sponsorship consultancy Redmandarin, which has worked with IOC sponsors, said Atos as an existing sponsor should have managed its sponsorship category more actively to avoid Alibaba taking over all cloud services.

Atos added that top sponsors are supposed to work with one another and that it had started talks with Alibaba “to evaluate future collaborations.”

IOC executive Christian Voigt, who oversees the top sponsorship program, told Reuters that Atos was not a cloud services partner and it instead looked after integration of IT systems around the Olympic sites.

“Of course, the use of the cloud is possible for others, it’s just that the marketing around it and focus for the Olympic movement is just Alibaba,” Voigt said.

“Our categories are pretty clearly crafted. We have no overlap and we are quite careful in the selection process.”

Alibaba can work well with the other sponsors and still look to steal the spotlight away from them.

“Alibaba’s made a strong start as an IOC partner. It’s understood the need to use (the Olympics) as a platform for a big vision, which many other partners fail to do,” said Whatling of Redmandarin.

Editing by Mark Bendeich, Larry King

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