Alibaba Group Founder and Executive Chairman, China's Jack Ma (left) shakes hands with International Olympic Committee (IOC) President Thomas Bach in Davos, Switzerland yesterday.
Davos: Alibaba Group Holding Ltd. has struck a deal to become a lead sponsor of the Olympic Games through 2028, betting that greater exposure to a global audience will help it reach consumers and promote its cloud computing business.
China’s largest online marketplace will become one of a dozen or so “TOP” Olympic partners, joining the likes of Coca Cola Co. and Samsung Electronics Co. in the highest rung of sponsorship at a cost estimated in the hundreds of millions of dollars. The Chinese Internet firm will provide online computing services and data analytics for the sporting contest, while creating a marketplace for official merchandise. And it will help develop an online video channel for viewers in China, the world’s largest consumer market.
Alibaba’s partnership with the Olympics adds pressure on the company to fight sales of counterfeit merchandise. In December, the US Office of the Trade Representative added Alibaba to its "notorious marketplaces" list of companies that violate intellectual property rights.
As host to more than 12 million businesses that sell more than a billion items, policing such a vast digital world is difficult, Alibaba’s billionaire founder Jack Ma said in a press conference at the World Economic Forum in Davos, Switzerland, when asked about seemingly counterfeit Olympic memorabilia on the site.
The company has roughly 2,000 people working on the problem and is adding new technology to better scrub its sites, Ma said. "It’s difficult to clean all the dirty things in one night," he said.
Alibaba becomes one of the few Chinese sponsors, such as Lenovo Group Ltd., to pay for the right to sport the iconic five-ring logo. The agreement also makes Alibaba the first Chinese company to sign on as a partner for the 2022 Winter Games in Beijing. The company typically eschews costly marketing, but is keen to showcase its nascent cloud computing business on an international stage while reaching out to consumers around the world. For the International Olympic Committee, its involvement spells greater Chinese engagement and, potentially, revenue.
Major Chinese businesses have started investing heavily in sports amid a call from the country’s government to grow the sector. A national plan announced in 2015 contains the audacious goal of spurring an industry worth ¥5tn ($747 bn) by 2025. Alibaba will kick off its Olympic tour in Tokyo in 2020. Companies including Canon Inc., Nippon Life Insurance and Fujitsu Ltd. are already paying upwards of ¥15bn ($125m) for their own partnerships, according to Japan’s Kyodo News.
