Transcripts

Politics, Protest, & Promotion May Be The Name of the Game At The 2008 Olympics

SUSIE GHARIB: The 2008 Beijing Olympics are just 36 days away. China watchers say some sponsors are concerned the games could be marred by protests, much like the Olympic torch relay was earlier this year. As Shannon van Sant explains, that could pose a challenge for corporate sponsors hoping to expand market share both inside and outside China.

SHANNON VAN SANT, NIGHTLY BUSINESS REPORT CORRESPONDENT: Lenovo engineers spent months designing the Olympic torch. They call it the "cloud of promise" and say the curly-cue strokes represent clouds often depicted in Chinese paintings. For Lenovo and other sponsors, the Olympic games promise a huge opportunity to build brand recognition. But so far, the 2008 games have also brought political protests and calls for boycotts of western and Chinese corporations. Alice Li, vice president of Olympic marketing, says Lenovo's Olympic sponsorship will pay off despite the controversy.

ALICE LI, VP OF OLYMPIC MARKETING, LENOVO: When we evaluate the return and the value of this sponsorship, we want to take -- we need to take a very long-term view and bigger picture.

VAN SANT: For Lenovo, that picture includes building brand recognition overseas. In 2005, Lenovo bought the PC division of IBM and last year transitioned its entire product line to the Lenovo brand name. Lenovo's marketing strategy includes providing 30,000 computers, servers and printers for the games and auctioning an Olympic torch PC on eBay. Like Lenovo, Olympic sponsors are using the games to build market share in China and the west. William Hess, a senior analyst with Global Insight, says these sponsors are walking a political tightrope.

WILLIAM HESS, SENIOR ANALYST, GLOBAL INSIGHT: There's much more of an attachment to this being China's time to come and be the host of this big party. So, in that sense, I think it's been trickier to try to balance the concern, to identify with the local audience, also to make sure that they're not sacrificing too much of their global image and their global marketing campaign just to try to play into this very complicated political environment surrounding the Olympics here in Beijing.

VAN SANT: While the Olympics may be a coming out party for China as a modern state, it's also a coming out for Chinese companies looking to boost brand awareness in western markets. Lenovo is the top computer maker in China but still lags behind Dell and Hewlett-Packard in the U.S. Lenovo's Alice Li says the Olympics sponsorship will help change that.

LI: In the past two years, our brand awareness and recognition in most important countries increased dramatically and this is part of the reason we activate the sponsorship.

VAN SANT: For sponsors like Lenovo, the summer games offer a unique opportunity to seize global market share so long as consumers associate their brand with the Olympics and not political controversy. Shannon van Sant, NIGHTLY BUSINESS REPORT, Beijing.