Business
15:12, 16-Jul-2018
French World Cup win means 79 million yuan payout for Chinese customers
Updated
15:02, 19-Jul-2018
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As France lifted the World Cup trophy on Sunday evening in Moscow, the team’s Chinese sponsor could be forgiven for not cheering too emphatically, with an unusual marketing campaign meaning the victory will cost them 79 million yuan (11.8 million US dollars).
Vatti Corp Ltd, a kitchen appliance manufacturer based in south China's Guangdong Province, promised customers in May a full refund on a 4,999 yuan (747 US dollars) package of “championship products” if France won the World Cup. The offer ran throughout June until July 3, several days after Les Bleus knocked out Argentina in the Round of 16 with an emphatic 4-3 victory.
On Monday, Vatti posted a banner on its website, congratulating the French team and promising that the process of fully refunding customers had officially started.
"To celebrate France becoming World Cup champions, Vatti's full refund process has begun!" Screenshot from Vatti's official website.
"To celebrate France becoming World Cup champions, Vatti's full refund process has begun!" Screenshot from Vatti's official website.
While Vatti stands to lose almost 80 million yuan, the special offer has successfully raised the profile of the company and boosted sales.
According to The Paper, preliminary statistics suggest Vatti saw total offline sales of more than 700 million yuan (104.7 million US dollars) over the period of the special offer, up 20 percent compared to the previous year.
Online sales increased by an even larger margin, jumping by around 30 percent to 300 million yuan (44.9 million US dollars). The company told The Paper that despite having to pay out 79 million yuan because of France’s victory, Vatti has still profited from the marketing campaign.
Under the terms of the special offer, regional franchisees are responsible for refunding offline in-store sales, while Vatti will bear the cost of refunds for online customers.
The boost to Vatti’s profile comes at a good time for the company, after cash-flow and legal problems arose at the end of June. According to Caixin, regional distributors in Beijing and Tianjin had their assets seized by a Guangdong court, “after the legal representative behind both franchises disappeared for more than 10 days.”