Milking it

In demand

Can Lionel Messi inspire Argentina to World Cup glory in Qatar later this year? With his 35th birthday coming this month, Messi likely won’t get another chance to emulate his idol Diego Maradona, who led the national team to lift the trophy in Mexico in 1986. At least the omens look promising: Argentina haven’t lost for 32 games, the longest streak in their history.

Messi’s prodigious soccer skills may be on the wane. But his commercial star power is still strong. Yili – the biggest of China’s dairy companies – has just announced a sponsorship deal with the Argentina football team and their captain is at the heart of its new advertising campaign.

Yet Messi also has a longstanding deal with rival dairy firm Mengniu for his image rights on a personal basis, meaning it can run its own ads centred around the soccer star.

The two dairy giants have a history of marketing mayhem, with Yili trumping Mengniu to become the official supplier of dairy products for the 2022 Winter Olympics in Beijing. Mengniu then partnered with Coke to become a joint beverage sponsor at the Games, a move that Yili immediately opposed. It fumed on social media, accusing Mengniu of deliberately trying to confuse consumers on its dairy sponsorship of the Games and threatening to walk away from its Olympic deal.

This month’s situation with the rival claims on Messi echoes another controversy in 2015, when the Chinese swimmer Ning Zetao did a personal deal with Yili, despite an existing contract between the national swimming team and Mengniu. He was later fired from the national squad.

In this latest case it seems that there won’t be a legal clash between the sponsors as the current arrangements allow both firms to use Messi to promote their products and brands.

Justin Tan, managing director of the sports digital agency Mailman, told Forbes the sports sector is alluring for companies because the Chinese media is so responsive to news about its stars – meaning iconic sporting figures like Messi make great ambassadors. The trend has been amplified by the pandemic, which has driven more people online, creating more opportunities for the top performers to have a branding impact.

Yili and Mengniu shared about 40% of China’s $62 billion dairy market last year, although Yili is the larger company in sales and market value. Analysts say that competition between the two is intense, given their sales networks are so well matched across the country. That supercharges the battle for brand awareness with consumers, where the struggle is fierce.

Average dairy consumption in China is still relatively small compared to overseas at 25kg of milk a year versus a global average of 113kg, according to the National Bureau of Statistics. As the dairy industry grows, so will the rivalry between the two largest players.

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