Manchester United Brand Audit

Transcription

1 Manchester United Brand Audit By: Michael Matthews

2 Table Of Contents Company Information 2-5 Category and Competition 6-7 Brand Analysis 8 Consumer Profile 9 Advertising 10 Media 11 Internet 12 Social Media 13 Other Brand Information 14 Brand Value 15 Research and Recommendation 16 1

3 Company Location: Manchester, UK. Organization: English Premier League (EPL) Football (soccer) Club. Subsidiaries: Red Football Finance Limited Red Football Holdings Limited Red Football Shareholder Limited Red Football Joint Venture Limited Red Football Limited Red Football Junior Limited Manchester United Limited Manchester United Football Club Limited MU Finance plc Manchester United Interactive Limited Manchester United Commercial Enterprises (Ireland) Limited Alderley Urban Investments Limited MUTV Limited 1 History: Founded in 1878, Manchester United was originally named Heath L&YR. In 1902, the name changed to Manchester United Football Club. In 1908, the club won it s first English League Title, and in 1910, Manchester United moved to Old Trafford, the current stadium. 2 1http:// 2 information/history.aspx 2

4 Company Financial Data: Interestingly, a large amount of Manchester United s Non- Current Assets is Goodwill, the value of a company s brand name, solid customer base, good customer relations, [and] good employee relations. 3 This basically states that Manchester United s name accounts for approximately $662 million Definition of Goodwill according to Investopedia. 4 IR/Annual%20Reports/manchester- united- plc- 20f pdf 5 shown in Great Britain Pounds. 3

5 Company Key Personnel: Avram Glazer: Executive Co- Chairmen Joel Glazer: Executive Co- Chairmen Louis van Gaal: Club Manager Recent News: On May , Louis van Gaal was named manager with a three year contract. Van Gaal has brought in many great talents with a combined spending of 145,500,000. Manchester United is currently in 3 rd place in the English Premier League and on a 6 game winning streak. 4

6 Category and Competition Category Definition: Manchester United is listed as a holding company. With its subsidiaries, it engages as a professional football (soccer) club. The category is most easily defined as professional sports however. Any team in any country that pays individuals to compete under their name can be considered a professional sports organization. Size of Category: The English Premier League contains 20 teams, however from a brand standpoint, no team compares to Manchester United. Therefore I ve expanded the category to include all professional sports team, which amounts to thousands of teams. Category History: The first recorded moment of professional sports was in the mid 19 th century, when baseball players charged people gate prices and then divided it amongst themselves. 6 Since then, professional leagues for each sport were formed and the clubs employing the players has handled payment. Methods of Distribution: Retail, ecommerce, ticket sales, television revenue. Major Players: Manchester United competes on a global stage in soccer, and also competes in a business sense against global competitors from different countries. Forbes 50 most valuable sports team lists Manchester United 3 rd with a valuation at $2.81 billion. It sits behind Spanish superpowers Real Madrid and Barcelona valued at $3.44 billion and $3.2 billion respectively. In 4 th sit the New York Yankees with a $2.5 billion valuation and the Dallas Cowboys round out the top 5 at a $2.3 billion valuation. 7 Seasonal Factors: The English Premier League Season runs from August through May. Therefore no ticket revenue is generated outside of those months. However, Manchester United normally takes a tour of the United States and the rest of the world during the summer months, generating retail sales in other countries, as well as television revenue real- madrid- 2/ 5

7 Category and Competition Regional Factors: Manchester United plays a majority of its games in Europe. Since they have a large worldwide following, it seems they would lose opportunities at ticket sales, however they have sold out their stadium since With today s technology, there are no real regional restrictions. Legal Restrictions: Trademark and Copyright Violations. Products: Manchester United has no real products in and of itself. It licenses its logo to merchandizers. Its logo is used on many companies retail products, such as Nike and Addidas. Manchester United branded products are sold through 200 licensees in about 120 countries information/about- manchester- united.aspx 6

8 Brand Analysis Top Brands: The top brands in this category are the same competitors mentioned early, specifically Real Madrid and Barcelona. Because American sports teams are privately owned, most of their financial information is not public knowledge. Real Madrid reported earnings of $219 million from their marketing, which includes licensing. 9 Barcelona s information is only in Spanish, and has not been updated since 2010/2011. Manchester United reports $297 million from their commercial expenditures. Recent News: Among European soccer, the biggest news tends to be a championship or the signings of each teams. Real Madrid won the European Championship about 7 months ago, while Barcelona has been relatively quiet on a trophy hunt. Manchester United has made the biggest splash in the transfer market with most of their recent acquisitions. However, Real Madrid and Barcelona have made a few big deals, including Real Madrid signing Columbian forward James, and Barcelona signing Luis Suarez. The implication of championships and new signings on a brand tend to be a revenue increase from merchandise. New players mean jersey sales, while championships equal brand new championship merchandise, as well as new fans. 9http:// where= &ssbinary=true 7

9 Consumer Profile Demographic: The beautiful thing about the game of soccer is that it has no age requirement, no gender discrimination, and it is for everyone. It is easiest to focus on the consumers in Manchester, UK, as supporters of clubs are born into it based on where they live. However, for an international audience, different factors play in to what can be considered a consumer. Frequency of Use: Depending on what this refers to, consumers frequency of use can be described as weekly. Manchester United plays at least once a week and dedicated consumers will tune in to watch them on a regular basis, leading to advertising dollars for the networks broadcasting them, which leads to money directly to the club. From a merchandising standpoint, consumers will purchase new items around holidays as gifts, as well as every time a new jersey is released, generally around June or July of each year. Brand Loyalty: Brand Loyalty will mainly be affected by the organizational decisions. For instance if the team is doing well because of the manager, the club will likely attract more supporters. If the team is doing poorly, trades away a loved player, or makes a poor image decision, it is likely to lose supporters. Professional sports consumers always have a section called bandwagon fans, consumers who support or leave a team on a whim. Manchester United also struggles with people who refuse to conform. Because they are one of the most popular sports team in the world, people will dislike them simply because other people do like them. 8

10 Advertising Uses: Like most top- level professional sporting teams, Manchester United does not need to advertise themselves in order to generate excitement. They will produce advertisements to generate excitement, but as stated earlier, their stadium has been sold out for years. Their logo, players, and likeness will be used in advertising efforts of their sponsors in order to generate a positive association for the sponsors. The parent holding company will use the soccer logo to help promote some of it s other holdings such as the Manchester United Soccer School Turkish Airlines Advertisement 9

11 Media Spending: As stated before, Manchester United does not spend in conventional matters to generate revenue. The professional sports market gets paid to be put on television and internet, where as normal markets pay in order to get screen time. NBC owns the rights to broadcast the English Premier League games, and they are paid by advertisers to place their advertisements on television during the games. NBC in turn pays the league, which then pays the teams who are shown on television. Seasonality: The English Premier League is shown August through May so can only be shown on television during that time. During friendly exhibitions during the summer, other television networks vie for the rights to show the games because of the amount of money able to be generated. Regional Viewing: The EPL is broadcasted around the world by different networks. In the United States, NBC broadcasts it to all 50 states, as it is a national network, so long as the users have basic cable. Promotions: Manchester United has promotions for ticket and apparel giveaways. They also have opportunities to meet players and other contests. This generates consumer interaction with the brand and allows them to feel a part of something. Success Rate of Promotions: The club has such a large following, that all of their contests and promotions are entered, and generate a large amount of buzz that keeps them popular with their fans. 10

12 Internet Website: is published in 7 languages and gained approximately 47 million views over the past year. It contains all pertinent information about the club and team, as well as all business information made available to the public. It has a high functionality, and makes it easy to not only navigate, but get in contact with the organization as well. Ecommerce: Manchester United has licensed other vendors to sell their merchandise, but also have a link on their website to their direct seller of merchandise. Their merchandise on their direct selling site includes clothing for men and women, as well as souvenirs, and furniture. 11

13 Social Media Facebook: According to their website, Manchester United has over 58 million connections on Facebook. The New York Yankees have 8.3 million connections and the Dallas Cowboys have 7.5 million connections. In addition, Interbrand rated Apple and Google the best global brands of 2013, and they have only 12.5 million and 17.6 million respectively. 11 This huge separation in connections can be easily attributed to the global audience that Manchester United appeals to. Twitter: Manchester United s Twitter presence is not as large as their Facebook, but they still have 3.9 million followers. Their twitter account is generally used for match updates, and press conference alerts for those who are not able to view them or read the full story. Instagram: Their Instagram account is used for match photos, as well as fan interaction. Fans send in their photos in Manchester United gear, in hope of being posted on a site with 2.3 million followers. Overview: Manchester United uses their social media mainly to connect to their fans, and based on the proven interactions and connections, it is easy to see they accomplish this goal information/about- manchester- united.aspx 12

14 Other Brand Information Logo: Manchester United s logo comes from the club s nickname the Red Devils. It was incorporated into the crest in Top Players: Manchester United s greatest assets are its players, as they draw in the attention that allows them to generate revenue. Their top players are: Captain Wayne Rooney, Robin Van Persie, Jaun Mata, Angel Di Maria, and Falcao. Current Standing: Manchester United currently sits 3 rd in the league after a slow start. Normally they play in the European Championship, however thanks to a poor showing in their EPL last season, they did not make the cut, thus costing them millions in potential revenue from television broadcasting gb/matchday/league- table.html 13

15 Brand Value In the past year, Manchester United has gone through 3 different managers controlling the club. David Moyes took over for the Sir Alex Ferguson who retired after an incredible career. However, Manchester United had an exceptionally poor season within their standards finishing in 6 th place. David Moyes was fired before the season was over and Ryan Giggs was named interim manager, while finishing the last year of his playing career. Due to their poor performance, their brand value and followers decreased around May of this year. But this summer, the club hired Louis van Gaal to manage the club, and the sheer buzz of his arrival and the signings that were to come raised the brand value back to the level it should be. This current season started out slowly, however they have been back on track over the past month, and look to be English Premier League Champions again. I believe their brand value will continue to rise as they continue their season and fight their way back on to the European stage. 14

16 Research Quantitative: I conducted a survey of 20 people and asked them what they thought the value of Manchester United was. I gave them 4 options: over 1 million dollars, over 10 million dollars, over 100 million dollars, and over 1 billion dollars. 50% of my respondents said over 100 million dollars, 20% of my respondents said over 10 million dollars, and the remaining 30% said over 1 billion dollars. All of them were surprised to know the amount is $2.81 billion, and that it was greater than any American team. This research shows that people know of Manchester United, but not its true reach around the world. Qualitative: I conducted a survey of 10 people and simply asked whether they had a favorable, unfavorable, or indifferent view of Manchester United. I then asked why. 40% felt indifferent about Manchester United, because they did not know much about soccer. 10% said they had an unfavorable view, because they supported another team in the EPL. The final 30% said they had a favorable view because they either liked the way they played soccer, or had family members who showed the team to them. Recommendation My recommendation is to increase presence in the United States. Soccer is on the rise here, and a European club as big as Manchester United would be a great way to make it take off even more. I also believe they should have sweepstakes in the states to get people over to watch their matches. Their social media presence is nearly unbeatable, so there is nothing they can do there. The only other way to create their dominance is to show it on the field and gather the attention of those who only follow championship teams. 15