May 18, 1998 in Social Responsibility News

Se Ri Pak's LPGA Championship Victory Boosts Brand Recognition for SAMSUNG

SEOUL, Korea - Se Ri Pak's LPGA Championship win on Monday morning, May 18, brought happiness to all of Korea, and not least to the Samsung Group.
Samsung has sponsored Pak in professional golf tournaments since December 1996, when a contract was signed for 800 million won (US $571,428) over 10 years. With an actual yearly average of 100 million won (US $71,429) in support, including Leadbetter training fees, victory bonuses, lodging, etc., the ten-year investment for Samsung comes to around 1 billion won (US $714,286).

So what sort of return on investment will Pak's victory mean for Samsung's international marketing

With CBS providing around 4 hours of coverage per round for the four rounds of the tournament and commercial time selling for about $400,000 for a 30-second spot, if Pak's Samsung logos were visible for just one hour (about 6% of the total 16 hours of coverage), then Pak's performance gave Samsung $48 million worth of brand exposure. Figuring in highlight footage on news shows, the CBS coverage was worth over $50 million.

But Pak's victory was also reported on CNN, ABC, and NBC news shows, on the Internet, and in newspapers, and with the value that this exposure will provide in terms of favorable brand imaging and added sales of Samsung home electronics, Samsung estimates the value of its benefit from Pak's victory at closer to $150 million.

As an official corporate sponsor, Samsung's corporate recognition rate is expected to soar. The company's recognition rate last year was 77% (according to Research International), but is likely to rise at least 6% points due to Pak's victory. Since it typically requires an advertising and marketing investment of $25 million to raise a company's recognition rate 1 percentage point, Pak's victory is also worth $150 million to Samsung from this point of view.

According to Samsung, just as Tiger Woods resurrected Nike from a market position, Pak's victory will have a revolutionary effect on Samsung's brand recognition rate. Considering Pak's unlimited future potential -- at 20 years old, she is the third youngest player to win an LPGA major - Samsung's potential return on its investment in Pak also seems unlimited.

Samsung has made savvy use of sports marketing for years, as Olympic Worldwide Partner and Official Partner for the Bangkok Asian Games, and as the sponsor of sporting groups including the Korean Wrestling Federation.


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