Public squabble erupts between Yili and Mengniu over Olympic sponsorships

Chinese dairy products company Yili Group issued a public statement on Tuesday criticizing its domestic competitor Mengniu Dairy of harming Yili’s interests by finding an underhanded way of sponsoring the 2022 Beijing Winter Olympics.

According to a statement that has since been removed from the Yili website and WeChat account, the company defeated Mengniu in open bidding to become the exclusive partner for dairy products for the upcoming games. However, the statement complained, Mengniu had maneuvered to become a global joint partner of the International Olympic Committee (IOC) for the drinks category by paying to join forces with Coca-Cola, which is an IOC partner.  

“The purpose of Mengniu’s move is misleading Chinese consumers and let them mistake the brand as a dairy partner,” Yili's statement asserted, adding that drinks account for a small portion of Mengniu's sales.

Screenshot of post on Yili's WeChat account.

Yili added that Mengniu was scheduled to officially announce its IOC partnership on June 23 and accused Mengniu of circumventing the Beijing Organising Committee or related government departments. The committee was appalled when it was informed, according to Yili.

The statement said that under pressure from the Beijing Organising Committee, Mengniu’s largest shareholder, COFCO Group, sent an apology letter to the Beijing municipal government, saying it would stop paying Coca-Cola and would not sign an agreement with the IOC. Yili, however, accused Mengniu of doing so insincerely.

The Beijing Organising Committee sent letters to the IOC twice to express strong objections to Mengniu's IOC deal without response, Yili said. The BOC then asked Yili to “make sacrifice for the sake of the event,” the statement said. 

“For its own profit, Mengniu pays for a U.S. company and conducts inappropriate competition, regardless of the big picture of the 2022 event,” the Yili statement continued, adding that “While Mengniu doesn’t support the event, it causes damage!”

The statement concluded that for "to maintain equality, national dignity and Olympic sponsors’ interests", Yili would have to consider whether to stop future cooperation with the Beijing Organising Committee and the Olympic Games. Yili has been a long-time sponsor of China’s international sports events, including 2008 Beijing Olympic Games, 2018 Shanghai Expo and the upcoming Olympic Games, as well as Military World Games.

In response to Yili’s criticism, reports said Mengniu would soon publish its own statement.

This is not the sole case of a public fight between rival companies in China recently. On June 10, Chinese air conditioner brand Gree published a complaint, saying its long-term rival Aux Air Conditioner produced unqualified air conditioners, which failed to meet energy-efficiency standards.

Aux immediately rebutted the accusations, saying in its own public statement that Gree had defamed Aux during the peak season, and that it had referred the case to the police.

Meanwhile, Aux played the patriotism card. “National brands should cooperate hand-in-hand against foreign brands," the Beijing News quoted Aux as saying. "Gree directly fires at local brands. It doesn’t care about overall national interest!”

Update, 24 June: IOC, Coca-Cola and China Mengniu Dairy announce joint worldwide Olympic partnership to 2032.