Guangzhou Evergrande players celebrate after winning the 2013 Asian Champions League final in Guangzhou on Saturday. Photo: CFP

Guangzhou Evergrande Football Club won the Asian Champions League on Sa­turday, but as well as lifting the trophy, the club has also boosted the reputation and brand of its sponsor, Evergrande Real Estate Group.

The Hong Kong-listed company, founded in 1996 in Guangzhou, capital of South China's Guangdong Province, has reportedly invested around 2 billion yuan ($328 million) in the soccer team, allowing it to hire top-notch players and a world-renowned soccer coach.

Before the company invested in the soccer team in 2010, it was a less prominent developer, with its business focused mainly on China's second- and third-tier cities. But since then, the company has become one of the country's leading real estate enterprises.

Wang Danqing, a partner at Beijing-based ACME Consultancy, told the Global Times Monday that Evergrande Real Estate's investment in the soccer team has "created significant benefits for the company."

"The sponsorship gave Evergrande Real Estate a more powerful brand and helped the company network with local governments all around China," Wang said.

Many soccer analysts have said it was the new management methods introduced by the coach Marcello Lippi that have upgraded the performance of the soccer team.

But others say the generous financial backing from Evergrande Real Estate Group is a more significant factor.

Hiring the best

Evergrande Real Estate, headed by entrepreneur Xu Jiayin, paid 100 million yuan to purchase the Guangzhou team in early 2010, double the amount offered by three other bidders including the Guangzhou Automobile Industry Group.

Xu said after the purchase that he hoped the team could "win the Chinese Super League in three years, and win the Asian Champions League in five years."

Soon after the club signed the deal to buy the team, it hired some of China's top players, including Zheng Zhi, captain of China's national soccer team, from Scottish club Celtic in June 2010.

Zheng, a veteran central defender, was given a two-year contract with an annual salary of 5 million yuan.

The club also bought striker Gao Lin for 6 million yuan in March 2010, Guangzhou-based New Express newspaper reported. A month later, it bought defender Sun Xiang for 3 million yuan, news portal ifeng.com said. Both Sun and Gao are members of the Chinese national team.

"Evergrande Real Estate is unique and successful because it is willing to take high risks and invest billions into the soccer business," an unnamed general manager of a real estate consulting company in Guangzhou was quoted as saying by Guangzhou-based Time Weekly newspaper on Thursday.

"While other firms invest in soccer just to increase their brand value, Evergrande entered the game to create the best soccer club in China. That results in high investment but also strong returns," the manager said.

Guangzhou Evergrande did not limit its recruitment to China. It also hired global stars such as Argentine midfielder Dario Conca in the summer of 2011, with a reported annual salary of $12.5 million. The generous package put Conca among the highest paid players in the world.

On May 17, 2012, the club announced that it had signed renowned Italian manager Marcello Lippi on a two-and-a-half-year deal with a salary reported to be around 92 million yuan a year. Lippi led the Italian national team to the 2006 FIFA World Cup and was named the world's best soccer manager by the International Federation of Football History and Statistics both in 1996 and 1998.

 

Incentive scheme

Evergrande succeeded because it did not just spend the money on hiring star players or a world-renowned coach, but also on motivating the players and managing the soccer team in the most efficient way, Yu Mingyang, dean of the Institute of Chinese Enterprises' Development at Shanghai Jiao Tong University, told the Global Times Monday.

Guangzhou Evergrande players have earned some 157 million yuan in bonuses from playing in the Asian Champions League games, Shanghai-based Jiefang Daily reported Sunday.

However, less than 10 percent of the generous reward came from the Asian Football Confederation as a prize for winning the championship. The rest was all paid by Evergrande Real Estate.

The property developer initiated a reward system plan for its footballers in February this year. Under the system, known as "the 6306 plan," the team gets a 6 million yuan bonus for winning a game, 3 million yuan for tying a game, and 2 million yuan for each positive goal difference, or the number of goals the team scores minus the number it concedes. Also, the team gets 6 million yuan whenever it gets into the next round of the Asian Champions League.

Yu Mingyang told the Global Times that Guangzhou Evergrande has significantly boosted its players' motivation by offering the rewards.

"Xu Jiayin managed the soccer club as if it was a company and motivated the players as if they were employees. He achieved great success because the management methods are innovative and effective," Yu said.

Rich returns

The team's success has made the brand name of Evergrande Real Estate much more prominent and valuable, Yu said. The company has also tried to benefit from the patriotic feelings of Chinese soccer fans, he noted.

For example, the club established a reward plan for its players who are chosen to join the national team.

According to the reward plan, the club gives 100,000 yuan to each player who is selected for the national team. And the club fines players if they are seen as not working hard enough with the national team.

Evergrande Real Estate also launched a soccer school in 2012, aiming at training young footballers from an early age. The company reportedly has invested more than 1 billion yuan in scholarships and living expenses for students enrolled at the Evergrande Football School, located in Qingyuan, Guangzhou Province.

"Evergrande's support for the national team and its dedication in nurturing the next-generation of football stars have made the company's brand name much more positive," Yu said.

Global Times