Strategy to tap Games fever includes new stores, sports star signings and sponsorship of teams, athletes Mainland sportswear company Li Ning plans to raise advertising and promotion spending to almost 20 per cent of its revenue in 2008, grasping the international promotional opportunity presented by the Beijing Olympic Games. Since the beginning of this year, the company has been aggressively courting international exposure by signing up famous athletes to represent it and teaming with a French sportswear company and an international tennis organisation. It plans to further promote the brand in the international arena by sponsoring teams from other countries during the Olympics. Advertising and promotional expenses accounted for 17.5 per cent of the company's total turnover in the first half, up from 15.7 per cent a year earlier. Li Ning's sales gained 24.5 per cent to 1.37 billion yuan in the first half. Chief financial officer Tan Wee Seng said Li Ning expected a large Olympics-related sales boost in 2008. Investors have been bullish about the company which reported a first-half profit increase of 66 per cent to 130 million yuan. Its share price has more than doubled in a year, closing at HK$8.77 on Friday. Mr Tan said the company had not yet decided where to start its push into foreign markets. To qualify as an international brand, said Mr Tan, Li Ning should generate at least 20 per cent of its sales abroad. Overseas sales now are about 1 per cent of its revenue. The company, which sells mainly basketball, soccer, running and tennis equipment, had 3,630 outlets nationwide at the end of June and expects to have 4,100 by the end of this year, 4,600 next year and 5,100 by 2008. Most of those outlets will be franchised. Mr Tan said that apart from Beijing, Li Ning would ensure a presence in another six of the Olympic host cities - Hong Kong, Qingdao, Shenyang, Tianjin, Qinhuangdao and Shanghai. 'The aim of the store openings in these cities is not to make profit. It is to help promote the Li Ning brand to people coming from all over China to visit the cities during the Games,' he said. As in previous Olympics, Li Ning will sponsor China's national diving, table tennis, archery and gymnastics teams which produced 40 per cent of China's gold medals. But this time, Li Ning will go a step further to sponsor Spain's men's and women's basketball teams and Sudan's track stars. Li Ning signed up United States National Basketball Association stars Damon Jones and Shaquille O'Neal this year to promote its products. The company also became an official partner of the Association of Tennis Professionals. Mr Tan said the company also planned to sign a top international tennis player to a promotional contract. This year Li Ning formed a 50-50 joint venture with French sports apparel firm Aigle. The venture, which caters to niche areas including skiing, sailing and riding, opened 21 Aigle franchised outlets in the mainland in the first half; it aims to have 60 stores by the end of this year, according to Mr Tan. Li Ning ranks third in sportswear sales in the mainland, following adidas and Nike. Domestically, competition remains keen with the likes of Anta, Doublestar and Kangwei. Li Ning derived 99.4 per cent revenue from its own brand and 0.6 per cent from the Aigle venture in the first half. Same-store sales rose 8 per cent during the period.