|John Cappo- CEO, AEG China|
|Profile of the week|
Friday, 16 November 2012 15:02
John Cappo is the President and CEO of AEG China, a position he has held since December 2008.
Between 1998 and 2008, he was Senior International Vice President and Managing Director for China of IMG.
He graduated from the National Taiwan University in 1992 with a BA Honours degree in Business, Finance and Marketing.
What does your current role at AEG involve?
Most of the current work is sales, strategy; government relations take a lot of time and effort and are very important.
We’re involved with facilities design, management, operations, acquiring sponsors, providing them with platforms to showcase their brands, delivering for sponsors and content.
Soon we’ll be doing ticketing with our AXS ticketing system.
It’s all about our venues, our sponsors and the content we put through.
What do you think are the major differences in the way sports industry works in Europe and the US to China?
In the US and Europe it’s pretty structured and there’s a lot of tradition and rules of engagement, it’s a more level playing field because a lot of people understand how things work and the smaller players can be involved in it.
In China it’s kind of opaque how the mechanisms work and how to be involved in things, if you can even get involved. The athletes are more or less working directly for their federations; a lot of them cannot do individual deals.
Male diver, Tian Liang, was kicked off the national team because he did a deal on his own.
With swimming or golf; as an example, if you are part of the national team, the federation would sell to a sponsor but the national team member would not see any of the sponsorship money but they would be required to represent that product or brand.
This changed a little bit around 2002 when tennis player Peng Shuai was signed to a foreign agent- I signed her with Max Eisenbud, who represents Li Na. She was the first player who was allowed to branch outside the system and go on her own and sign deals directly and make her own schedule decisions.
Do you expect this trend of athletes having more freedom to negotiate deals to continue?
I do. The key thing for an athlete to get this kind of privilege or status is they have to be really good. Then they have leverage.
An example is Liang Wen-Chong, the golfer, who can do his own deals but he’s also part of the national team- there’s a hybrid there. It would be embarrassing for the China Golf Association (CGA) to not have the best golfer in China and he supports China very strongly. I was previously his manager so I know intimately what we went through and what decisions we made.
More and more athletes in China will have an opportunity to branch out on their own and it will be a hybrid system from the start, partly controlled by the federation and some autonomy to do their own thing but they’ll all have to come back and represent China for maybe the national games in China, the Olympics and be part of national teams for different events.
Federations here are finding their own sponsors for teams, so it’s hard for a player if he endorses Adidas to come back and wear a Li-Ning shirt.
They’re trying to make it happen but I think it’s pretty difficult. That’s where there will still be a bit of a challenge and there’s a little bit of a balance with that, there’s carve outs for select events in the deals.
You’ve been in China for over 20 years so presumably you have a good understanding of how things work?
I went to Taiwan National University- I was educated in Chinese.
I understand the values; if you see how people are educated you have a better understanding, and I also have experience.
Some of the things my colleagues or Western counterparts would think are quite odd I don’t see to be strange at all.
Sometimes I find the Western methods of strolling in with an army of lawyers to beat down the doors is not really the way to get things done here.
You have to have patience, persistence and a long-term vision.
You cannot manage China from abroad- that doesn’t work. As soon as you come over, you’ll have great meetings, you think you have a deal in principle, you get on the plane and go back and then it starts over. To get what you need you have to fly over again and after a while, you make a lot concessions that you probably wouldn’t normally make.
That’s why it’s important to work with consultants or people that have local staff that you trust. A lot of it is relationship building. Usually the relationship you build during that negotiation period will carry your contract through.
Was it always an aim of yours to be involved in sports?
I was always doing some type of event and it just kind of evolved and then we started in Taiwan with Michael Chang Tennis and Greg Norman golf exhibitions.
There’s a lot that has gone on here [in China] and I’ve seen a lot of the evolution and the development, which has helped me quite a bit in what I do now- it makes it a lot easier just experience having been there and seen it and I have relationships now with all the officials or the key people in the federations, many years ago they were just starting out, but now they’re the top people. We created a lot of great programmes together, and many from a standing start, like golf for example.