|Monday, September 30
Updated: October 1, 8:02 AM ET
Rockets strike six-year deal with Yanjing Beer
By Darren Rovell
On Monday, the Rockets became the first NBA team to sign an official international beer partner when it announced a six-year deal with Yanjing Beer, China's largest beer manufacturer.
"As soon as we drafted Yao, we began to put together a target list of companies that were looking to appeal to the Asian sector in order to gain market share in the United States," said Tad Brown, Rockets vice president of corporate development. "Yanjing was one of more than a dozen that we are working on."
Throughout negotiations with companies, the team had to make it clear that the potentially new sponsors could not use Yao Ming's image or name to explicitly sell its product, unless the company signed a separate endorsement deal with him. Most active pro athletes are prohibited in their basic contract from doing beer or liquor endorsements.
The sponsorship was still deemed worth it for Harbrew Imports, which owns the worldwide export rights to the beer and will pay at least $1 million a year for marketing. Yanjing will have courtside and concourse signage, will be tied to promotional events -- such as the Rockets' special Chinese Lunar New Year Celebration scheduled for Feb. 2 -- and receive commercial time on Rockets radio broadcasts.
"Our partnership will give us an excellent opportunity to strengthen marketing efforts in the United States and take advantage of the international interest that is focused on the Houston Rockets," said Harbrew president Rich DeCicco.
Yao's agent, Erik Zhang, was pleasantly surprised by the news.
"For a beer that doesn't have a huge presence in the United States to do something like this is surprising," Zhang said. "It certainly bolsters our prospects for marketing Yao."
Zhang has not decided on marketing opportunities for Yao as of yet. He is currently enlisting the help of University of Chicago graduate business students, under the tutelage of marketing professor Jonathan Frenzen, to decide what brands would fit Yao the best.
Brown said it has not yet been determined if some of the signage will be in Chinese, but he does anticipate a host of companies will ask for Chinese signage this season. The Rockets are currently waiting on word from the league as to how many Rockets games will be broadcast live in China.
"They say that there are 300 million people that are interested in basketball and if we could reach just 40 million of those people, imagine the value that could come to these companies," Brown said. "It truly shows how having one player can really open up a lot of business in the international marketplace."
Nintendo, which owns the Seattle Mariners, has a rotating Nintendo sign behind home plate at Safeco Field in Kanji (Japanese script), which can be read by Japanese patrons at the ballpark or by those watching their home-grown talent -- star outfielder Ichiro Suzuki and relief pitcher Kaz Sasaki -- in Japan.
"This is not only about Yao Ming," said Marc Ganis, president of consulting firm Sportscorp Ltd., who just returned from a trip to China. "This is about the first opening of the door between the United States and China since Ping Pong Diplomacy in the 60s. Many companies will follow Yanjing's lead because there is so much more disposable income there than most Americans understand. You don't have to hit a large percentage of people when you are presenting something to 1.4 billion. Even if a company marketed to the eastern port cities alone, there's 800 million people there, which is almost triple the size of the entire United States."
It has been speculated that Yao Ming's greatest immediate help to the Rockets' bottom line will be in the form of an arena naming rights deal for the new 18,500-seat arena that opens for the 2003-04 season. Brown said several companies that have interest in tapping into the Asian market have contacted the club about arena naming rights.
Darren Rovell, who covers sports business for ESPN.com, can be reached at firstname.lastname@example.org.