On August 20, 2017, Yili Group signed a sponsorship agreement with the Beijing Organizing Committee for the 2022 Olympic and Paralympic Winter Games, becoming the official dairy partner for Beijing 2022. This marked the second time Yili surpassed Mengniu to become the sole official dairy partner for the Winter Olympics, following its victory over Mengniu in the public bidding for the 2008 Beijing Olympics dairy sponsorship in 2005.

On June 20, 2019, Yili officially issued a statement claiming that Mengniu Dairy, a subsidiary of COFCO, had joined forces with an American company to undermine the Winter Olympics. The statement quickly ignited public opinion.

According to Yili's announcement, Mengniu Dairy, under COFCO, "paid a huge sum for Coca-Cola's Olympic sponsorship, taking the opportunity to become a global 'joint' partner in the 'beverage' category for the International Olympic Committee (IOC)."

Behind the 'Double-Dealing' Winter Olympics Partner's Interests Damaged

In the announcement, Yili stated, "Mengniu's beverage business accounts for only a small portion; in fact, as a dairy enterprise, Mengniu will be granted the 'beverage' category partnership on June 23, which violates the principles of fairness, justice, and equality in the Olympics and infringes on the legitimate rights of Beijing Winter Olympics partners."

According to Mengniu Group's 2018 financial report, revenue from its beverage category accounted for 1.2% of Mengniu's total revenue. In the public perception, Mengniu is undoubtedly considered a dairy company; indeed, in its various marketing advertisements, Mengniu strives to establish an image as a "leader" in "domestic dairy products."

According to Yili's statement, the reason for Yili's anger was that Mengniu bypassed the Beijing Organizing Committee and "jointly" became a global partner under the beverage category for the Beijing Winter Olympics with Coca-Cola. The statement claimed that "its real purpose is to mislead Chinese consumers into thinking it is an Olympic 'dairy' partner."

Public information shows that the Beijing Winter Olympics sponsorship plan is set at four levels: Official Partners, Official Sponsors, Official Exclusive Suppliers, and Official Suppliers, each with a benchmark sponsorship price. The relevant rules clearly state: "Exclusivity is one of the core benefits of Olympic sponsorship; categories occupied by higher levels cannot be developed at lower levels."

According to Yili's official statement, the fact that COFCO's Mengniu Dairy, in collaboration with Coca-Cola, "bypassed the Beijing Organizing Committee" to become a "global 'joint' partner in the 'beverage' category for the IOC" essentially constitutes a substantial infringement on Yili's "exclusivity" under the guise of the "beverage category." In terms of rules, Mengniu's "slick move" did not violate the rules under the disguise of the "beverage" category. However, from the outcome, Mengniu, by exploiting the "loophole" in the rules, indeed caused damage to Yili's interests as a Winter Olympics partner.

From this perspective, the IOC's move indeed appears to be a case of "double-dealing."

If 'Exclusive' Sponsorship Is Not Properly Resolved, Sponsorship May Lose Its Meaning

As the situation stands, for Yili, a Beijing Winter Olympics partner, the damage to its rights is an indisputable fact. Mengniu, which "took advantage" of the loophole, may be "legal" but is indeed not aboveboard, and its brand image may suffer as a result.

The reputational damage to the IOC in this incident is immeasurable.

The incident is still developing, and public opinion is still fermenting. Let's predict the impact of the final outcome from the perspectives of all parties.

For Mengniu, the best outcome would be an official statement from the IOC that its "joint partnership" with Coca-Cola does not violate sponsorship rules, and it will continue to be granted the "global joint partner" title. After the storm passes in 2022, Mengniu can openly use the title "Olympic Partner."

For Yili, given the substantial infringement of its interests, if the IOC terminates Mengniu's "joint partner" status, it would help Yili "stop losses" in time. However, if the IOC insists on granting Mengniu the "joint partner" status, then Yili's sponsorship of the Winter Olympics would be "meaningless."

For the IOC, any solution would discount its influence. On one hand, insisting on granting Mengniu the partnership under the rule loophole is itself an "encouragement" of "loophole-seeking" behavior, rendering the "exclusive rights" of partners ineffective. On the other hand, terminating the authorization would raise questions about the IOC's sponsorship rules. Therefore, in any case, the IOC's reputational loss is inevitable.

The "farce" has already caused damage to Yili, and if the IOC does not resolve it properly, it may affect future companies' enthusiasm for bidding on Olympic events.

If the Olympic spirit of "fair competition" cannot shine in all corners of the Olympic Games, the significance of the Olympics will be greatly diminished!

Tips for providing information will be paid 400-2000 yuan upon adoption.

China FMCG + Internet Professional New Media Committed to FMCG manufacturers' transformation and upgrading and channel digital solutions