A Slam Dunk?
At the NBA Exhibit on Hainan Island, China, I create several augmented reality photos: myself at Boston’s TD Garden with a graphic at the bottom of the screen with my name, as if I were a player, alongside the National Basketball Association (NBA) and Utah Jazz logos; another one spinning a virtual basketball on my finger; and my favorite, three images of myself in one photo: shooting from the left, blocking my own shot from the right, and cheering from the sidelines.
This 2,275-square-meter facility, which opened last October and showcases NBA history, is a collaboration with China’s Mission Hills Group in the Mission Hills Centreville shopping complex. There’s memorabilia like Shaquille O’Neal’s sneakers and a basketball autographed by China’s most famous NBA player, Yao Ming. Another display highlights the bios of all six Chinese players who’ve made it to the big league.
Midway-style games invite children and adults alike to shoot hoops, with graphics exploding in joy on the backboard when a shot is made. A half-court with regulation baskets is used for clinics, while a graphic on the wall encourages visitors to compare their height to that of NBA stars. Downstairs, a retail store features Los Angeles Lakers caps, LeBron James and Stephen Curry jerseys, and other merchandise. Visitors will pay about US$55 for a cap and US$90 for an adult jersey.
This permanent exhibit is one of more than half a dozen attractions the NBA has launched in China over the past three years. There are NBA Playzone family entertainment centers (FECs) in Beijing, Chengdu, and Shanghai; a training center in Wuqing; an NBA Hoop Park in Hunan province; and a 3,000-plus-square-meter traveling exhibition. While the NBA owns the existing FECs, league officials say they are about to franchise another five Playzones, with the opportunity to do more. On top of the attractions, there are 275 NBA retail outlets in China, including a flagship store that opened in Beijing last March, plus an outreach program with China’s Ministry of Education to take the NBA’s basketball curriculum to some 8 million students in 8,000 schools.
The FECs, exhibits, and clinics—including a new basketball school to open next year at Mission Hills Haikou—build on the NBA’s strength in China. Last year, some 640 million people in China watched at least “some element of NBA programming,” according to NBA officials, who quickly point out that’s almost twice the size of the entire United States population. China is also the top international market for NBA merchandise sales, and NBA China is estimated to be worth US$4 billion. A partnership with Tencent, a provider of comprehensive internet services in China, ensures that every NBA game is accessible to Chinese viewers, while another deal with Alibaba showcases original NBA programming and online shopping.
The annual big event for NBA China happens in the preseason, when two NBA teams travel to Shanghai and Shenzhen to play exhibitions in sold-out stadiums. Some 17,000 fans fill the stands for each game, while an additional 20 million viewers watch on TV and online. Due to the time difference with the United States, these are the only games of the season broadcast live during prime time in China.
In Europe, the league has a cafe in Barcelona, Spain. In North America, the NBA is slated to open an experience at Disney Springs in Orlando, Florida, this summer. To date, no other region, indeed no other country, has as big of an NBA attractions presence as China. That said, the NBA has not released investment or visitor figures.
Just what is driving the NBA’s move into China’s attractions’ space?
Funworld speaks with NBA China CEO Derek Chang to find out more.
Why is the NBA opening attractions in China?
Derek Chang: The basic context is that the NBA is huge in China. For the most part, it’s been a digital experience. People watch our games on television, on their mobile phones, and, to some extent, they go and buy merchandise from the NBA. The biggest draw is the China Games, two preseason games showcasing two NBA teams. Unfortunately, due to logistics and the length of travel, it’s hard to do more than these two games every year. So, to give fans the ability to interact much more closely with the NBA, we developed branded attractions.
NBA China was really a licensing company—licensing our media rights and licensing merchandise. As we thought about taking that and developing a more fan-focused experience, that’s when we started thinking about branded attractions and how we can create physical assets, within the country, that fans can touch, feel, and engage with on a daily basis.
Is there a business case for NBA attractions in China, or are you willing to let them be a marketing/branding cost center?
DC: We’re still pretty early into this. As we move forward and see how the fans take to these attractions, I think we have the opportunity to do a lot more. But we’re not rushing into it. We’re taking it at a metered pace to make sure that, indeed, the market is there for these sorts of attractions.
The goal ultimately is to have profitability; in some cases, there already is. I think that right now, it’s an investment, in our minds, and a desire to create interaction with our fans, to really allow them to connect with the NBA. Certainly, our plan is that these are very successful attractions, and we will see that play out over time.
How would you describe NBA China’s attractions industry strategy, and how does this fit into the NBA’s broader vision for the country?
DC: A lot of what we’re doing in China is breaking new ground. Attractions are an area that historically the NBA, as a whole, hasn’t pursued. We are very popular in this market, but we really only have the two global games that we bring here every year, so we need to find other ways for our fans to touch the brand. With these attractions, we’re trying to tap, or actually respond, to the size and enthusiasm of the market. The hope is to expand beyond your normal first entry points in China, i.e., places like Beijing, Shanghai, and Guangzhou, and get further into the country, where it’s been even harder for us to bring games to the fans.
We have a broader vision for the NBA, and for the sport of basketball globally, which is to make this the No. 1 sport in the world. China, given its size and the popularity of the game here, is going to be a key component of that.
Why have you opted to develop FECs rather than a larger experience, perhaps like the one that’s planned for Disney Springs in Orlando?
DC: China is huge. The heartland cities have over 10 million people, so there are plenty of ways for us to access the market. Playzones become a place where parents can take their kids on a repeated basis, say weekly, and get a regular curriculum, as opposed to a broader theme park where that’s sometimes once a year or a once-in-a-lifetime experience. But they’re not mutually exclusive. I think we will be looking at the viability of many of these different models and deploying the ones that we think are the most useful for us.
So, there is a possibility that we might see something like an NBA theme park down the road in China as well?
DC: Yes, I think everything is open right now, from our standpoint.
What’s your favorite part of the NBA China attractions?
DC: In the traveling NBA Championship Exhibition, there’s a simulation of shooting a 3-pointer over a point guard, and he’s obviously tall. That really brings to life how challenging it is to be on a real basketball court!