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Tuesday, 28 May, 2002, 20:29 GMT 21:29 UK
Man Utd to paint China red
David Beckham
David Beckham, the world's best known footballer

Football fans in China will get the chance to see a Manchester United squad jogging through the streets of Beijing this autumn.

But it won't be the star players, whose feet are worth millions of pounds, who'll be negotiating the potholes.

Chief executive Peter Kenyon will don his shorts to run the Beijing Marathon in October along with staff from Manchester United PLC, the firm that manages the football club.

It's just one of the ways Man Utd hopes to tap into the Chinese love of football and turn its high profile into revenue.

"We're still relatively new in (the Chinese market) but we've got a huge name awareness," Mr Kenyon told BBC News Online.

Satellite TV

Research by polling firm Mori suggests Man Utd has 8 million fans in China out of 50 million worldwide. That means Chinese supporters make up more than 10% of the total.

The club gets "vast exposure" from weekly coverage of the UK Premier League on satellite channel Star TV, owned by Rupert Murdoch's New Corp, and has also signed a deal for state broadcaster CCTV to carry footage from its own Man Utd TV channel.

"We're still at the stage of understanding exactly what is the right way for us to enter the China market," he says.

Despite being novices in the game, Man Utd has an ambitious line-up of marketing launches planned.

Checking the pitch

Perhaps that is why I found Mr Kenyon co-sponsoring a lunch for one of China's most powerful leaders in the art deco splendour of the Dorchester Hotel on London's Park Lane on behalf of the China-Britain Business Council.

The guest, Li Ruihuan, is ranked among China's top five leaders and strongly tipped by foreign diplomats to become chair of China's parliament, the National People's Congress, in the autumn.

That would put him in the number three shirt, after the president and prime minister.

Man Utd's strategy to pump revenue from the world's biggest market combines a website, clothing sales and even a string of restaurants.

It has just signed a deal with software giant Lycos to build a Chinese language website, due to go live in September.

Elite wear

The site will enable any Chinese fan with an internet connection to hear live match commentary, watch past games on streaming video and buy goods, says Mr Kenyon, who is "very excited" at the prospect.

The Lycos deal is part of an Asia-wide initiative, but the club picked Beijing for the signing ceremony, happily for President Jiang Zemin, who now owns a Man Utd shirt.

However, President Jiang could soon be behind the times.

In August, the club will launch three new strips, part of a 13-year worldwide distribution deal with sportswear firm Nike worth a minimum of 333m ($428m) to Man Utd.

The distribution deal with Nike will lead to the club's clothing being sold in China for the first time.

"China will get the products at exactly the same time as Manchester, it's a truly global launch," says Mr Kenyon.

Bye-bye black pudding?

Man Utd is also planning to open a chain of "about 90 family-style restaurants" in Asia from the autumn.

It has set up a joint venture with Singapore-based firm F J Benjamin and two well-known restauranteurs to promote the Reds Cafe brand.

Old Trafford staples like warm black pudding may not feature on the menu of the Asian Reds Cafes as the food will be developed "to suit the local taste".

Mr Kenyon says it has "still to be decided" how many Reds Cafes will open in China, but "10 to 15" is a likely number.


For Man Utd, the best thing about all of these deals is that its brand is so powerful its joint-venture partners are willing to pay to develop new revenue streams for it, making the brand stronger still.

"They're responsible for the investment and we're obviously inputting our brand and our content on a promotional basis," says Mr Kenyon of the website.

But the same goes for the Reds Cafes and other marketing ventures.

Last year, Man Utd earned about 22m from merchandising, or about 30% of its overall revenue. The chief executive sees plenty of scope for improvement.

"If you look at our revenues, less than 1% comes from our international business, yet we're a brand with 50 million fans, 40 million of which are outside the UK," says Mr Kenyon.

The strategy is "about building exposure... building football and then looking for business opportunities, brand extension coming from our core activity of football."

And he's impressed by the ability of Chinese officials to get behind big projects, like the Beijing 2008 bid.

"I never cease to be amazed by the growth, the passion for football and their ability once they get behind a project to actually make it work."

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