Starting in February, Alibaba will begin its ad campaign for the upcoming Winter Olympics in Pyeongchang. This will be the Chinese e-commerce giant's first corporate advertising campaign outside of China , and the first that features the Alibaba brand itself.
Alibaba and the International Olympic Committee signed a 12-year sponsorship deal to provide cloud computing services, with plans to incorporate facial recognition technology, as well as e-commerce platform services.
The financial terms of the deal have not been made public, though Reuters has referenced a figure around several hundred of million dollars.
Opportunities outside of China
The move comes at a time when China's domestic online retail market – which Alibaba once dominated – is increasingly saturated. Competition from the likes of Tencent and JD.com make global expansion a logical next step.
Delivery men sort boxes on the eve of Singles Day, Alibaba's 24-hour shopping extravaganza, in Beijing on November 10, 2017. (Photo credit: FRED DUFOUR/AFP/Getty Images)
The competition has pushed Alibaba to look outside of China, and into Japan, South Korea, and the U.S. Not all have gone through without a hitch: This month, a deal for Alibaba-owned financial services and payment processing company Art Financial to purchase MoneyGram International for $1.2 billion was blocked by the U.S. Treasury Department over security concerns.
But the International Olympic Committee has welcomed a collaboration with Alibaba, with the deal framed as an effort to bring the Olympics into the digital age.
‘The greatness of small’
Alibaba, the world's single largest retailer, harped its humble beginnings to unveil the theme of its first Olympic advertisement: “The Greatness of Small.”
The three-commercial advertising campaign features inspirational sports stories: One is centered on the 1928 Amsterdam Olympics, in which Australian rower Bobby “The King” Price stopped rowing to let ducks cross the waterway during a semi-final.
Another features a Kenyan ice hockey hopeful, his story told as a child. “Forget it, we don't play ice hockey in Africa,” he is told. Today he finds himself on the country’s nascent national ice hockey team. Alibaba announced plans to bring five members of the team to the Pyeongchang Games as spectators.
The ad campaign officially rolls out February 1, and will include an on-the-ground showcase at the Pyeongchang Olympics to feature oncoming tech. Chief marketing officer Chris Tung said that the company is also in talks with Olympic sponsors P&G, Coca-Cola, Samsung and Intel for collaborations to further other Olympic product activation.
Looking forward to Beijing 2022
Tung says that at the Pyeongchang Games, Alibaba will take the backseat and learn from the Organizing Committee to understand what the modern Olympics are missing. The company is looking forward to the Beijing 2022 Winter Olympics, more so than the Tokyo 2020 Summer Olympics, to demonstrate its impact. A few weeks ago, a storefront for the Beijing Organizing Committee for the Olympic Games launched on Alibaba's online shopping platform Tmall.
Vice Premier of China Liu Yandong and Beijing Municipality Communist Party Secretary Cai Qi attend the emblems launch ceremony for the Beijing 2022 Olympic and Paralympic Winter Games on December 15, 2017 in Beijing, China. (Photo by VCG/VCG via Getty Images)
Tung said that cloud-based solutions -- including facial recognition, travel guidance and "enhanced content creation capabilities" -- will make the games more engaging and cost-effective. Ticketing and a new media and core data and IT services centers will figure heavily into push to cut the cost of hosting games. Currently, each Olympic city builds up new local data and IT centers from the ground up.
While infrastructure developments were once the backbones of Olympic bids, useless "white elephant" structures have plagued host cities in recent years. “Bid efficiency” now figures into the process. Alibaba has identified itself as the platform to find the solution.
