The state of KIA’s Golf Sponsorship
KIA’s involvement in the LPGA, as one of the tournament’s major auto partners, has become an important talking point within the golf industry. A desire to boost its brand image has been at the core of KIA’s engagement with the sports marketing industry, especially given that the industry boasts the presence of premium brands across the board. Even within its parent group, KIA is struggling to distinguish itself from Hyundai by projecting itself as a more dynamic and youthful brand. How does this objective play into the quest to get a foot in the bourgeoning golf marketing industry? To get a deeper insight into the market dynamics of the industry and KIA’s engagement trajectory, our very own Josh sat down with Mr. Giho Han, General Manager of the Overseas Promotion Team, and Mr. Jungwook Wi, Manager of the Overseas PR Team, at its corporate headquarters in Seoul.
Explaining to Josh’s how the company decides which sport to sponsor, Mr. Han said that such decisions are made within the context of their overall mid- to long-term marketing strategy. He added that “Our sponsorship has two forms of activation: one at the global HQ level. and second, the local or country level.” There is also a degree of autonomy for local dealers and distributors that allows them to pick and choose which local activities in ways that reflects the company’s overall long term marketing policy goals. According to Mr. Han, what KMA is doing with the KIA Classic is one of the model sponsorship activities that the headquarters encourages local-level sponsors to engage in.
Han further explained that the company’s decision to choose which athlete or event to sponsor is often hinged on the potential to increase the company’s brand awareness. Mr. Wi added that “We rarely go for athletes that are already at the pinnacle of their careers. We often lean towards players that have shown great potential in their early stages. Talking about Rafael Nadal for example, our relationship with him started at the very early stages of his career, despite him not having the name recognition back then.”
On whether the industry can expect to see a growth in KIA’s engagement in golf, Mr. Han reechoed the importance of enhancing the brand image of KIA, which is reflected in its commitment to reach out to a more integrated customer base. Therefore, they at KIA view the popularity of golf in this part of the world as an essentially ideal avenue to work towards that end. That certainly means deeper engagement in ways that consistently incorporate both the brand and the market dynamics.
We were also very interested in knowing the overall direction of KIA’s financial spending in sports marketing in terms of the global and local markets. Without offering concrete numbers, Mr. Han estimated that the company spends nearly 10 percent of its marketing budget on sports marketing. He sounded more sanguine when it came to the question of the importance of golf to the corporate goals of KIA, for two reasons: Domestically, golf still evokes an image of elitism - rightly so due to the dominant stake of premium auto brands like BMW and Mercedes Benz in golf sponsorship. These brand names therefore exude a high-end perception of golf as a luxury sport. Second, with KIA not being ranked within the industry’s top tier range there is an opportunity to leverage its core objective of being a dynamic and youthful brand to challenge the mainstream players. “Of course, this poses a significant challenge and opportunity for the image of KIA and golf, for which we aim to close,” Wi said. Currently, there is a bipolar US-Korean marketing focused strategy at KIA. Despite having a formidable presence in the Korean market, the company remains marginal across other important regional markets outside the US, pointing to a possible opportunity for making forays into new markets. Within the context of KIA’s engagement in the golf sponsorship market, the opportunities are indeed very promising within the context of the LPGA. From the media’s perspective, the LPGA has, after all, become as hot in terms of interest as the PGA Tour. It especially speaks to the links between the LPGA’s status as a global sensation and KIA’s strategic goal of boosting its brand image across the industry.
On KIA’s engagement with the international sports sponsorship industry, Mr. Wi reiterated the company’s determination to go for the long haul, citing the extension of their sponsorship deal with FIFA for both the Russia 2018 and Qatar 2022 World Cup tournaments as an indication of the firm’s long- term strategic direction. When asked if the corruption scandals at FIFA had given the company any second thoughts about their sponsorship partnership, Mr. Wi stated that, like all the other corporate sponsors, KIA’s position on the FIFA scandal has been to consistently urge the organization to take all the necessary steps to clean house, and to ensure utmost transparency. “Of course, the resignation of Blatter is an indication of the changes taking place inside FIFA,” he added. All indications currently point to KIA being poised for more active engagement with the sports sponsorship industry. Needless to say, this has serious implications for the golf industry as well.
