Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

Escola Universitària d’Enginyeria Técnica de Telecomunicació La Salle

Final Thesis

Graduate in Management of Business and Technology

Internationalising Football Leagues:

The Case of LaLiga

Student Promoter Nicolás Larrosa Gómez Chris Kennett

1

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa ACTA DE L'EXAMEN DEL TREBALL FI DE GRAU

Meeting of the evaluating panel on this day, the student:

NICOLÁS – LARROSA GÓMEZ

Presented their final thesis on the following subject:

Internationalizing Football Leagues: The Case of LaLiga

At the end of the presentation and upon answering the questions of the members of the panel, this thesis was awarded the following grade:

Barcelona,

MEMBER OF THE PANEL MEMBER OF THE PANEL

2

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

Acknowledgements

First of all, we want to thank collectively to our tutor, Christopher Kennett, for always having the time and showing interest in our work. Also, helping us to improve it and having the best possible version of it, it’s been a real pleasure for us, and we will not forget it. Secondly, we also want to thank our families for supporting us emotionally and economically during this management case, because without them it wouldn’t have been possible.

On the other hand, we want to thank the interviewed, because it has been more than a simple interview, it’s been several lessons for life. Ivan Codina, Emilio Butrageño and Joan Laporta, thank you very much and it’s been an incredible experience.

Finally, we want to express our gratitude to all the people that gave us some of their time. From our classmates to other professors to close friends. Thank you, because this has been a beautiful project that we will always remember.

3

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

Abstract

This management case will explore the strategic plans used in “La Liga” for international expansion, it will also analyse the impacts of this international expansion on the key stakeholders. Eventually, it will consider other models in the entertainment industry and provide a better internationalization strategy. Moreover, the aim of this project also focuses on getting a complete understanding of how this process it’s occurring, where it’s occurring and why. Furthermore, the goal is to be able to have a clear idea on La Liga internationalization plan and how it’s going to result in the future and finally, the end objective will be to determinate if La Liga can become the main option for the consumers of entertainment all around the world and then, provide different proposals on how they could expand internationally with an innovative and digital strategy that could potentially make them the first option.

4

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

Executive Summary

This management case investigates the current situation of LaLiga and their expansion strategies around the globe. Moreover, digs forward the understanding of what is LaLiga doing now, and how it can improve the different aspects to make it the best league and the best source of entertainment in the world. To achieve this, different topics have been analyzed, studied and opinions have been heard. In terms of why, it’s because there is an existing potential in sports, mainly in football, and La Liga is one of the top players. Therefore, some things need to change, things that are changing and of course, things that need to keep be working like they are. Moreover, this management case, mainly it’s based on how to improve this existing organization and how can they implement other ideas form different sources of entertainment. To do that, there has been comparison done with other big football leagues like the Premier League or even with sports like UFC or the NBA. In summary, after the whole recompilations of information, this management case gives out a proposal on how LaLiga could do things differently to become the first option regarding entertainment. The proposal is based mainly on social media strategies and how they can increase their monetize rate since it’s one of their main problems. Also, it tries to help in terms of the overall strategies and give an idea of what the future markets of this sport are.

Finally, it’s important to say that even though LaLiga can always improve become better as a brand and as an organization, they still are one of the main sources of entertainment that people follow and that it’s been improving and escalating positions in this infinite race that is the entrainment.

5

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

Table of Contents

1.Introduction ...... 8 2. Framing the problem: Globalization of the football industry, increasing competition and the role of LaLiga ...... 9 2.1. The growth of the football industry into a global entertainment phenomenon ...... 9 2.2. The growth of LaLiga ...... 10 2.3. The role of the big 5 leagues (EPL, LaLiga, Bundesliga, Serie A,Ligue 1) ...... 12 3. La Liga’s internationalization strategy to date ...... 13 3.1. La Liga’s main actions undertaken so far ...... 13 3.1.1. LaLiga Global Network...... 14 3.1.2. LaLiga Ambassadors ...... 15 3.1.2. La Liga Icons ...... 15 3.1.3. Changes in the schedule of matches ...... 15 3.1.4. Changes in the sale of media rights ...... 16 3.2. Theory for market entry strategies (JV’s, direct investment) ...... 18 3.2.1. LaLiga North America ...... 18 3.2.2. Investments on digital advertisement ...... 20 3.3. Social media strategies ...... 21 3.4. La Liga Iberdrola...... 23 4. Comparative analysis ...... 24 4.1. Compared leagues and other sports ...... 24 4.1.1. UFC ...... 24 4.1.2. NBA ...... 26 4.1.3. English Premier League ...... 28 4.2. Key lessons ...... 29 5. Methodology ...... 29 5.1. Primary Research ...... 30 5.1.2. Qualitative: Interview ...... 30 5.2. Secondary Research ...... 31 6. Proposed Solutions ...... 31 6.1. Expansion...... 31 6.1.1 New Markets to penetrate ...... 31 6.1.1 How to approach it ...... 32 6.2. Innovation...... 32 6.2.1 How to approach it ...... 33 6.3. Digitalization ...... 35 6.3.1 How to monetize international fans ...... 35 6.3.2 How to activate new international commercial deals in a digital environment ...... 35 6.3.3 How to create and distribute media content in an engaging way...... 36 6.3.4 How to grow international fans in key markets through social media ...... 36 7. Conclusion ...... 37 7.1. Key messages learned...... 37

6

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

7.2. Specific problems that LaLiga need to respond to ...... 38 8. References ...... 40

7

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

1.Introduction

This management case will explore the strategic plans used in “La Liga” for its international expansion, it will also analyse the impacts of this international expansion on the key stakeholders. Finally, it will consider other models and provide an improved solution to the actual internationalization plan. The question is: How can La Liga become global market leader among football leagues?

The objectives of this management case will be to analyse the internationalization and expansion of La Liga in different markets, while at the same time, understand and compare the different styles of management of other sports industries. Regarding the problem, La Liga has to be able to capture new fans and be able to monetize their brand. Moreover, if the local market is saturated, they should have a global understanding of what are the needs of the end consumers and implement a successful internalization strategy for the near future in order to compete with other leagues such as the English Premier League (EPL) as current market leader and the other members of what is known as the ‘Big 5’ in the football industry: Italy’s Serie A, Germany’s Bundesliga and France’s La Ligue.

8

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

2. Framing the problem: Globalization of the football industry, increasing competition and the role of LaLiga

2.1. The growth of the football industry into a global entertainment phenomenon

Football has become one of the most important sports in the world, with a fan-based of 4 billion people (bloomerg.com). In a Nielsen study in which they analysed 18 different markets, a percentage of 43% of the people said that they were interested or interested in the sport. In comparison with other sports like Basketball, they only had a total score of 36%. Other data to support this evidences, in terms of the digital impact that football has, it’s the record broken by the last FIFA world cup organized in Russia, which more than half of the globe in a range of 4 years old and over, tuned into the World Cup of 2018. The total number was of 3.572 billion viewers, taking into account, TV and digital platforms according to the Global Broadcast & Audience Summary realized by FIFA in 2018. Additionally, these numbers also reflect the importance of the digitalization transformation which is helping to reach even more possible future leads. Regarding the World Cup of 2018, and as the article of CNBC mentions, they have been streamed 23.3 million hours just in the quarter-finals. Looking at the big picture, the current value of the football industry is estimated to be around 30.000 million euros which is almost equivalent to what the industry of Hollywood generates (Expansion.com). But also, what makes a difference, is that football goes cross boundaries and regarding the socio-cultural aspects of society, it’s able to move masses, it forms part of people’s identities and has a disproportionate social impact compared to its economic importance. Being more specific, the main leagues in Europe (Big 5), grew 12% simultaneously during 2015- 16, which equals 1.4 billion euros; 59% of this huge increase was due to the broadcast revenues and 31% due to the new sponsors (Deloitte, 2018). With all this foreigner and local investments received, the main leagues in Europe are trying to re-invest in other parts of the world to create awareness and expand to new markets to keep growing as an industry.

9

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

2.2. The growth of LaLiga

“The impact that La Liga is creating in other sectors of the Spanish economy almost reached 4.000 million € during 2016/2017” (PwC, 2018)

Graph from El impacto económico, fiscal y social del fútbol Español.

The economic activity of La Liga is generating an annual economic impact equivalent to 1.37% of the Spanish GDP, about 15.688 million € in seasons 2016/2017. (Sport, 2019) Regarding Apps and Videogames, according to the figure above, from the almost 4000 million €, 217 million € come from Apps and Videogames. La Liga is providing seven different types of Apps for smartphones and tablets; LaLigaSportstv, LaQuiniela (gambling app), La Liga Fantasy MARCA, Head Soccer, Tiny Stricker and Adrenalyn XL™. From all these Apps, one is a channel, a gambling App and a fantasy team game. The other three are videogame applications. With these Apps, La Liga is expanding the brand into different sectors, emerging sectors such as e-Sports. According to the results obtained in the survey and having account the average expenditure made by each person in video games, video game sales and soccer apps reached € 217 million. This sales volume was translated into an added value of € 140 M and the creation of approximately 5.700 jobs. (PwC, 2019)

In terms of the positioning regarding revenues, La Liga is behind the EPL as the second league, since they passed the Bundesliga in 2018. The reason behind this advancement in the list is that

10

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa they were able to increase the value of TV rights by 46% since 2015, achieving a new record with revenues of 2.9 bn euros (El País, 2018)

As mentioned before, this increase in revenue and La Liga, in general, is due to TV rights sales that were divided between two main broadcasting companies. The valid contract at the time of writing was divided between MediaPro and Telefonica. The distribution of this investment stated that MediaPro had to pay 1.950 million euros for the rights of streaming the games in bars and to be able to sell the agency's contracts internationally. Besides, Telefonica paid another 700 million for 8 games and “El Clásico”. In the new contract signed this year, they continue to have the same companies working for them but now the price has increased by 15%. Therefore, Telefonica closed the deal for the next two seasons by paying 2.9bn euros, furthermore, MediaPro closed the other part of the deal by paying 480 million euros. The distribution regarding games and rights is still the same that was signed in 2015 (El Español, 2018).

Moreover, it is important to mention and highlight the tasks that the organization is doing to tackle the problem of piracy in streaming. According to elgrupoinformatico.com, this issue represents annually a 400 Million Euros loss for the organization and therefore, they decided to activate different types of initiatives to erase the problem or try to control it. As ABC.com mentions in one of his articles, La Liga has made usage of their official application to trace possible places, mainly, restaurants and bars, that are streaming their games illegally. They can do this, by using the microphone of each user and also through the geo-localization.

The implementation of this idea brought a lot of controversy through the community because they in a sense were crossing individual privacy. On the other hand, La Liga always lawfully implemented this concept and the users could turn off this feature.

Finally, as time goes by, this issue it’s going to become less relevant since the implementation of these proposals against the piracy of football, have already make a reduction of 16% against last season, according to elgrupoinformatico.com.

Screenshot of the login process for La Liga app

11

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

2.3. The role of the big 5 leagues (EPL, LaLiga, Bundesliga, Serie A,Ligue 1)

Related to La Liga and its competitors, the English Premier League is the biggest and strongest competitor in Europe. They are the most well-known football league that embodies the traditions and history of the sport. They are a major dominance in Europe because they have clubs like Manchester United, which are considered one of the biggest franchises in the world (Forbes, 2018). English Premier League has possibly the most competitive tournament and its revenues are close to 6.4 billion pounds. La Liga also competes with the other big 3 leagues in Europe, Serie A, League 1 and Bundesliga. In terms of revenue and international acknowledge, these leagues are less famous but still have importance in other levels.

Graph from Football Observatory; Transfers fee investments of the Big 5- leagues clubs

Other aspects to take into account are the growth of transfers over the years. According to the CIES Football Observatory, the “Big 5” has recorded the following numbers from 2010 until 2018. These numbers are crucial to explain the growth of the industry and the relevance of the “Big 5”. In the course of eight years, they have increased the total value of the transfers by more than 5.5.

12

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

Graph from Football Observatory; Spread of transfers fee investments between big 5- leagues

The following table from football observatory also shows a really important aspect for La Liga and its new international strategy. Regarding the years 2010 and 2018 the English Premier League it is been the organization that has spent the most with a 37.4% overall. Followed by Serie A with 21.5%. Nevertheless, what it’s important to highlight is that La Liga besides being the third position with an important gap of 4.8 points, the year 2018 it’s allocated the second in the ranking with 22.7% and after a decrease of the EPL of 0.9%. This interesting increased it’s due to the new media right distribution that La Liga it’s implementing and also affected by the excellent performance of La Liga teams in the different tournaments over the past several years. 3. La Liga’s internationalization strategy to date

When trying to expand internationally, La Liga faces many challenges to meet economic needs and more important stakeholder needs. It is very difficult to satisfy everyone's needs without any kind of conflict. "Going global” is defined as the worldwide movement toward economic, financial, trade, and communications integration. (Forbes,2015)

3.1. La Liga’s main actions undertaken so far La Liga is a football brand that started growing thanks to its new design strategy, rebranding is the term used for the explanation of La Liga’s growth during the past years. According to Reason Why, the strategic objectives for this rebranding were to increase awareness and brand recognition of Spanish football but also had the mission of showing La Liga as an entertainment company itself, independently from the clubs and even the players. La Liga is already present in 188 countries throughout 88 broadcasters which fans can subscribe to thanks to the technological improvements in audio-visual retransmission (La Liga, 2018). Moving on, other important aspects are happening regarding the expansion of La Liga. As Joris Evers, a global communications officer for La Liga said, "We are building our global brand...

13

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa moving forward and changing from being a football regulator into an entertainment provider". By this, he means that La Liga is changing their actions and also their mentality inside the organization. In terms of global goals to expand their awareness, La Liga has only shown the tip of the iceberg. Examples of this push actions are the game between FC Barcelona and Girona Football Club that was supposed to be held in Miami at the Hard Rock Cafe Stadium, which the Spanish Football Federation did not permit. The strategies implemented by La Liga are several, such as developing an international global network, rebranding the name, changing a re- structuring the sale of international media rights and open new commercial deals on a world region basis. One of the proposals stated in this paper is the last objective mentioned in this section.

3.1.1. LaLiga Global Network By having the worldwide network called “La Liga Global Network” the objective of transmitting La Liga matches every weekend around the world is being accomplished. “La Liga Global Network” offers knowledge and local support to the global plans of La Liga, such as institutional representation, opportunity generation and direct contact with local stakeholders. (La Liga, 2018). La Liga has 44 delegates who are working in countries around the world to increase the League’s reach using different initiatives. International growth is one of the strategic pillars for the organization, and thus the main goal. The 44 international delegates give La Liga a local presence and work to understand each market and fan base. The objective is to use a hyper-local approach and create a permanent dialogue with the fan base through different initiatives (events, publicity, grassroots initiatives, digital presence, sport projects, friendlies, relationships with key stakeholders ...) (Joe Favorito, 2018). By promoting all these different initiatives La Liga ensures promoting awareness of the teams, players and different events around the world. Using this hyperlocal approach La Liga can maintain close relationships with the different fan bases so the product or service can be delivered in optimal conditions.

14

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

3.1.2. LaLiga Ambassadors Furthermore, former La Liga players are an important role in terms of international expansion, they act as brand ambassadors; this position is normally given to famous players and celebrities; this involves recommending the service or explaining the content. They are the image of LaLiga in locations all over the world. In the modern-day, the active attitude of consumers regarding social media makes brand ambassadors a key stakeholder (Service Innovation Group, 2017). La Liga president Javier Tebas explained: "The role of ambassadors is fundamental to La Liga's internationalization process. They have all played here and know the values, perks, and joy entrenched in this competition. Furthermore, their international profiles bring us knowledge and experience linked to other markets and are of immeasurable value to La Liga’s brand" (La Liga 2018). Former players such as Carles Puyol, Xabi Prieto or Julio Baptista are part of the team La Liga Ambassadors and all of them are helping the organization to create awareness and expand internationally. La Liga not only has ambassadors but also 44 delegates who are working in countries around the world to increase the League’s reach using different initiatives. International growth is one of the strategic pillars for the organization, and thus the main goal.

3.1.2. La Liga Icons During the last 3 years, there has been a massive change in terms of scheduling the matches, since paying platforms obtained the TV rights of the matches. “La Liga Global Network” has been trying to make all the matches at different times so they do not clash and can maximize the audience numbers. The Asian market was also key in deciding the time when matches should be played as they represent a huge percentage of the audience nowadays. This is the reason why well-known clubs like FC Barcelona or Real Madrid CF ask La Liga to play their games at 4 p.m. (El Confidencial, 2017). Nowadays, the games that are planned to be watched all over the world are played at a time that fits as many fans as possible to ensure they will watch it live and interact with additional promotions (social media, buy TV rights, merchandising…). For La Liga, season 2018-19 is a very important one because they are the pioneers in promoting an event that never happened before in European football leagues.

3.1.3. Changes in the schedule of matches During the last 3 years, there has been a massive change in terms of scheduling the matches, since paying platforms obtained the TV rights of the matches. “La Liga Global Network” has been trying to make all the matches at different times so they do not clash and can maximize the audience numbers. The Asian market was also key in deciding the time when matches should

15

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa be played as they represent a huge percentage of the audience nowadays. This is the reason why well-known clubs like FC Barcelona or Real Madrid CF ask La Liga to play their games at 4 p.m. (El Confidencial, 2017). Nowadays, the games that are planned to be watched all over the world are played at a time that fits as many fans as possible to ensure they will watch it live and interact with additional promotions (social media, buy TV rights, merchandising…). For LaLiga, season 2018-19 is a very important one because they are the pioneers in promoting an event that never happened before in European football leagues.

3.1.4. Changes in the sale of media rights The impact that created the change from the individual sell of the media rights to a collective one in 2016 it’s unquestionable. They were sold collectively for the first time. As before clubs sold their rights, a transaction that benefited the big clubs FC Barcelona and Real Madrid, the majority of the teams did not get any positive impact from that transaction. Joris Evers, a global communications officer of La Liga stated that “There was a huge increase for the clubs in terms of TV rights money, particularly for the smaller clubs - but the bigger clubs got more money too" (BBC News, 2018).

Graph from; Lavozdegalicia.com, Los ingresos en Tv de los clubes de primera.

Taking into account that the new centralized model started in season 16/17 there is a big difference in the revenue from the previous. As an example, Deportivo was fighting to stay in first division during those years and just because of the centralized model, the team went from 18M € in 2014 to 31.68M € in 2015 and 2016 kept growing with 40.9M €. To sum up, in 2013 the team that got the least amount of revenue from TV rights was Valladolid with 18M € (La Voz de Galicia, 2018). Last season the team that got the least amount of revenue was Girona with 40.3M € (La Liga, 2018)

16

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

The difference between the audio-visual income of Valladolid in 2013/2014 and Girona in 2017/2018 is 22.3M €. In only 5 years the smallest teams in the Spanish league incremented their TV rights revenue more than 100%. In general, this change in the way of selling the audio-visual rights had a very positive impact in La Liga and all the teams. In the figure below, the gap between 2014/2015 and 2015/2016 in terms of broadcasting is notable, all the others are growing exponentially and are very stable.

La Liga will enter this season 3.326,4M €, 59% more than 5 years ago (Expansión, 2017)

Graph from; Expansión.com, Evolución de los ingresos de La Liga por cápitulos.

Although the centralized model was the main factor that made La Liga grow so much in the last five years, other factors such as the improvement of the financial regulations affected this improvement. Tim Bridge, Spanish football expert at Deloitte agrees that “A few years ago Spanish football was in a financial mess, now Spanish clubs have to submit budgets in advance, if they can't meet their liabilities then they are placed under a transfer embargo and other restrictions. “Before, clubs could only get short-term financial credit," he says. "Now investors are willing to lend for longer, and at better rates. He says there is now more interest from financial investors to get involved in the Spanish game. "TV centralization has ensured more eyeballs around the world," says Mr Bridge.

17

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

3.2. Theory for market entry strategies (JV’s, direct investment)

3.2.1. LaLiga North America La Liga North America, a media joint venture formed last year between La Liga and the sports marketing firm Relevant, is building out a media business that includes daily video programming for social platforms, long-form productions to license to streaming platforms TV and networks, life fan events, support for local soccer communities across the U.S and, eventually, even a regular-season La Liga game held in the U.S. The joint venture’s long-term goal is to increase the media rights value of La Liga in North America. Domestic broadcast rights are currently held by BeIN Sports and are up in two years. With soccer becoming more popular in the U.S, as well as the fact that La Liga is home to two of the most famous clubs in the world, the league is expected to draw a ton of suitors. (Digiday, 2019)

Photograph from; Bring us the game twitter account

“We want to help grow La Liga in the U.S.,” said Boris Gartner, CEO of La Liga North America. “It’s the biggest market for La Liga outside of Spain already, and there is room for growth, especially leading into the World Cup in 2026.” Exporting a match between FC Barcelona and Girona FC and changing match times so they do not clash is no longer sufficient to continue expanding. FC Barcelona, Girona FC, and La Liga requested permission from the Royal Spanish Football Federation (RFEF) to stage the matchday 21 fixture between Girona and Barcelona, scheduled to be played on 26 January, at Miami's Hard Rock Stadium in a 20:45 CET kick-off (La Liga, 2018). Unfortunately for the North- American fans, the Spanish Royal Football Federation and other institutions such as the Spanish government declined the request claiming that the game will be played because of business interest and nothing related to the competition or the sport. Even though it is just one match, the impact it would have on different stakeholders would be huge, starting by the fans. According

18

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa to Girona FC, to encounter the best solutions for everyone, different options will be presented for the members to choose from. The club received a good predisposition from a lot of members just for the fact of participating in a historical march as well as for the projection, mid and long- term benefit that this will bring to the entity (Marca, 2018). It is still very early to know what will happen with this type of match and whether all the organizations and institutions involved will get to an agreement. What is known is that playing a La Liga match outside the Spanish territory will attract more people and La Liga will continue expanding internationally. Spanish Football Federation (RFEF) was against a La Liga game outside of Spanish territory “due to the consequences to the local fans, the players and the teams”. The RFEF had the last word in this case and it was decided that this game was never going to be played, at least in the 2018/2019 season. Mr. Tebas has mentioned already that sooner or later there is a La Liga game that is going to be held outside Spanish territory, he also mentioned that there will be further attempts in making this game happen as it would be very beneficial for all the parties, and the fans will be compensated.

The president of La Liga, Javier Tebas has called this a “ground-breaking agreement” and has chosen the U.S market for a reason. According to BBC.com, the United States is one of the top countries regarding fans, and it’s a market that has a huge potential in a long-term perspective. The popularity of soccer—both in participation and interest—is increasing in the United States. (Forbes, 2019). According to a 2018 Gallup poll, 7% of Americans cited soccer as their favorite sport to watch Major League Soccer, the top domestic league, has experienced a 27% rise in interest since 2012, according to Nielsen Sports Sponsor link.

“I’m very happy for America because soccer is growing quickly,” former Arsenal and France midfielder Robert Pires said recently. “I think some players help the MLS grow like my friend Thierry Henry, and Zlatan Ibrahimovic and Wayne Rooney who currently play in the league. There is a space in America for football. I know it’s difficult with basketball, baseball, and American football, but football is for everybody.” On the other hand, the player’s union and fan groups, were against this proposal, since this game was played during the middle of the season and factors like the travel time and distance could have represented a disadvantage for the teams, fans and the player's performance itself. In terms of the impact of a game like this, for a small club like Girona, it’s huge. They “took away” the probably, most important game of the season, and even though La Liga compensated Girona fans, the domestic market, in this case, is the one losing. Other changes that La Liga did and orientated them within a internationalize perspective are the change in time of the game schedules. As Javier

19

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

Tebas said, “We have changed kick-off schedules so that they can be seen at reasonable times here in Asia and we will continue to take steps to ensure that this part of the world can enjoy La Liga as much as possible,” he also put emphasis on that Singapore will be the getaway to East Asia and reach a far greater number of fans

3.2.2. Investments on digital advertisement

According to BBC News, these are perimeter advertising boards in the stadium - but which have a digital overlay facility, allowing for different advertisements to be seen in different TV territories simultaneously.

Supponor’s Virtual 3D Carpet Replacement Solution in use at the recent Atletico Madrid vs. FC Barcelona match in La Liga, 14th October 2017 (in venue vs. international broadcast feed)

In each different TV market around the world, the live-action will show local advertising on the billboards, rather than those being seen in the stadium at the actual match in Spain. (BBC News, 2018) “It enables local sponsor partners to maximize their investment in La Liga in their territories", says Mr Bridge. As mentioned before, with global interest in La Liga growing rapidly, the demand for more innovative and localized sponsorship is increasing, and Supponor is one of the companies entering this new market. Supponor’s market-leading virtual replacement technology has been commercially deployed for the past 4 years in La Liga. Supponor’s long-time Spanish partner, MediaPro, has provided the commercial deployment and commercialization which enables audience-specific perimeter advertising to be delivered from every FC Barcelona and Real Madrid away match. (Supponor, 2017)

20

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

The innovation sponsorship company is now able to deliver 9 distinct regionalized feeds for every game; Middle East North Africa, South Africa, Latin America, Mexico, and Europe. So, depending on what virtual feed is the spectator watching the game on different advertisements will appear taking into account the geo-localization. This is happening now in a big amount of games around the world, it is efficient to segment the market and penetrate more into the local markets.

3.3. Social media strategies Social media platforms are a big aspect to take into account when we are trying to increase brand power. That’s why La Liga has adopted several strategies to increase in this sector that nowadays it’s so relevant for a business and even more, businesses that are in the entertainment industry. As an overall community, La Liga has over 80 million people that follow them on all social media platforms. The key factor behind this has been opting for a global content creation strategy, which involves content with the same message but in different languages, specific to the local market. This has seen La Liga cater to the preferences and concerns of fans across the world and has also made them advance main competitors like NBA or Premier League. In terms of numbers, they have had a boost, but also in terms of engagement which is the hardest thing in social media. The following statistics are evidence of La Liga's recent development in social networks. Despite growing more than 50% on Facebook, 38.82% on Twitter, the biggest increase that the league experienced was on Instagram, with 4,049,113 people, meaning a 112.88% more than in the previous season. With a fun and engaging content and a wise usage of the Instagram Stories feature, La Liga now can boost twice as many interactions on Instagram as the Premier League, which has 17.196 followers, almost twice as many than La Liga, but on the other hand, the relationship it’s less engaging and less powerful at the end of the day. If La Liga is compared to some prestige competitions, such as the NBA or Champions League, they remain above them in terms of an increase of followers and Facebook engagement. This is the only competition that has grown over the previous season, with 88% more interaction. As mentioned, the key to this success was to create the content in more than 10 languages and create a different approach for each of the languages. According to Bermejo, the director of the digital strategy of La Liga, La Liga’s growing presence on social media has been bolstered by “a global workforce through which we’re able to gain an in-depth understanding of our fans’ tastes.” Bermejo also acknowledges that “Asian fans are more interested in the big-name players rather than the clubs themselves, although this trend is changing.”

21

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

The adoption of this global outlook has seen La Liga reach out to its fans in various languages regularly. “We’ve gone from communicating with our followers in Spanish and English to doing so in over 10 languages, which has brought us closer to new communities and fans,” states Bermejo. What’s more, La Liga has created Twitter accounts for Japanese, French, and Portuguese-speaking fans as well as penetrating the Russian market through popular social network VKontakte to great success. In addition to the before-mentioned, La Liga has Arabic and English language Twitter feeds and profiles on Chinese social media platforms WeChat and Sina Weibo, where it has been increasing its presence over the last two years. According to Bermejo, “La Liga aims to be a global brand. While in Spain the premium product is highly sought after, the appetite internationally is far greater still. Through this multilingual content strategy, La Liga has also offered Thai, Korean, Turkish, Hindi, and Swahili speakers’ content in their native tongues. They have additionally reached out to the people of Cameroon, Ghana, and Nigeria through the use of Pidgin English, a variant that first emerged as a means of communication among specific groups that didn’t otherwise have a language in common. “Even though internet penetration levels are still very low in Africa, the continent offers the greatest potential for growth across the world, with our activity having grown more than 20% in the last year,” notes Bermejo.

“La Liga is a global entertainment brand, we boast the best product on the planet and have to take full advantage of that,” concludes Bermejo. Awareness of the tastes of its fans, communicating with them in their languages and offering tailor-made content at the click of a button has been a strategy that has seen La Liga rise to the top of the digital sporting content and entertainment table.

Photograph from; Infoplay.com

22

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

3.4. La Liga Iberdrola La Liga is also the main pioneer in women’s football, La Liga Iberdrola broke a world record by hosting a game between Atletico de Madrid Femenino and FC Barcelona femení, 60.739 spectators attended to Wanda Metropolitano to watch that historic game. There is a whole new world in this market as women’s football now is attracting more people and by this, more money. La Liga is trying to bust this market by being the pioneers in promoting La Liga Iberdrola and Spanish women’s football. Real Madrid is now going to be a new member of La Liga Iberdrola as they acquired CD Tacón, the acquisition is going to take place in 2020. It can be seen the great exponential impact that women’s football is having in society. Just one day ago the European Super Cup was played, the fact that the referees in the game were women should not surprise anyone, the fact is that it is the first time this happens and therefore football keeps building its way to equality.

Photograph from; scoopnest.com; Stephanie Frappart, Manuela Nicolosi and Michelle O’Neill

La Liga Iberdrola is one of the most competitive leagues in the world and new incredible footballers are coming to Spain to succeed in this league, every year the revenues in women’s football are increasing as well as its awareness. The clubs agree with it because it is another source of income and a different way of attracting new fans and creating a whole new environment involving women’s football, totally different and with the same income and audience than men.

23

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

4. Comparative analysis

To understand the market, the best way possible, the best three examples of international expansion in the world of sports were chosen to create a comparative analysis to get the best strategies and objectives out of them. UFC, NBA and the English Premier League were the entities chosen because each of them had a different approach but always with the same outcome: success. The objective of the comparative analysis is to gather valuable data to increase the information and ideas to come up with the best-proposed solution possible. Different insights were taken from the three of the sports, explained below.

4.1. Compared leagues and other sports

4.1.1. UFC Over the past 25 years, MMA (Mixed Martial Arts) has evolved from barbaric, organized brawls to the fastest growing sport in the world, mainly due to the growth of the Ultimate Fighting Championship (UFC). Now valued in the region of $4 billion, the UFC has seen a meteoric rise in popularity, transcending the sport of MMA (The Stats Zone, 2016) One of the reasons for UFC’s increase in popularity could be the purchase of the organization by Zuffla LLC in 2001. Since that purchase, the increase has been major and according to The Stats Zone, today, the popularity of the UFC has exceeded all other fighting sports and now consistently achieves more pay-per-view (PPV) buys than boxing and even rivalling the WWE.

Graph from; Thestatszone.com

According to Jessica Roosli, former VP-global brand marketing fan experience at UFC, the company’s transformation can be attributed to two developments—global growth and the expansion of the brand’s identity outside the “octagon.” As the UFC grew its global audience, it went from producing 15-20 events per year to a roster of more than 40. The brand forged stronger broadcast partnerships, implemented an aggressive

24

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa social media strategy in the regional voice and deployed talent relations groups in cities around the globe that promoted its fighters in-market (Event Marketer, 2017). Back in 2014, Iain Kidd commented on the long-term UFC international strategy, stating that “UFC relying on the Americas as the sole source of revenue will hinder their growth and leave them more financially vulnerable than is desirable. Expanding into Europe and Asia is an important strategy, and one that requires building up local talent and hosting local events.” Iain was not wrong at all; he came to short. UFC has had events in five continents now, they expanded their product all over the world thanks mainly to the pay-per-view strong partnerships and the aggressiveness in their strategy regarding social media.

Quote from; Sportsbusinessdaily.com Moreover, stated view Event Marketer, the “UFC’s event marketing strategy was no longer about one fight, but about the six to eight-week build-up for the event, and how consumers engage with the brand throughout the process across social media, Fight Pass (UFC’s paid digital service) and the live event.” Meaning that inside the big event, the company was able to put small events such as press conferences with the fighters, weighting day and other activities to create awareness not only of the specific event but also of the brand.

UFC’s Chief Operating Officer Lawrence Epstein broke down the company's media plans in an interview posted in Sports Pro, “we’re going to continue to sell pay-per-view through our platform, UFC.tv, in addition to a host of digital distributors including Xbox, PlayStation, Roku, Amazon, the list goes on. We will continue to distribute through traditional cable and satellite.” ESPN, unlike previous TV partner Fox, also has the technology to sell UFC pay-per-views as a non-exclusive distributor. (Sports Pro, 2019) Their strategy that UFC has been using in terms of media has been successful thanks to the distribution of the rights, the difference with La Liga is that the distributors are non-exclusive, so more than one distributor can be selling their media rights.

25

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

According to Sports Pro, UFC in China is now considered at the same level in terms of sports content alongside the Premier League and Bundesliga. PPTV and “OTT play” creates another route to the audience.

The main difference between media rights regarding UFC and La Liga is that the first one uses “build up” events and there are approximately 40 events per year, whereas La Liga is a constant development of events every weekend during a big part of the year. Back in 2014, UFC among with EA Sports release the first video game for consoles, nowadays they already released two more versions of it. Another expansion strategy to continue increasing brand awareness as well as expanding into other sectors. Today, UFC is one of the most important sports companies with much more impact than boxing or other martial arts because of its international expansion strategy. The top fighters also made UFC be what it is now, people such as Conor McGregor or John Jones have also been a key aspect to take into account the awareness that they create.

4.1.2. NBA According to Linkedin.com, the National Basketball Association or also called the NBA is the fastest growing sports league in the United States of America with an increase since 1997 of 30% in terms of views. Moreover, the NBA is being able to achieve this and also expand to other markets because they have a superior and more persistent marketing strategy than any other sport in North America. Another aspect in which the NBA is well known, it’s because of their ability to generate brand awareness and by their usage of Social Media platforms like Instagram, YouTube, Twitter, and Facebook. In terms of how they manage this platform, they have different approaches for each of them. Regarding YouTube, they post on the daily basis, being one of the few entertainment pages that do so, and as well, they post different formats of video like highlights, montages, interviews and even talk shows. When it comes to the actual views, and how to make it accessible and easy for the international viewers, the NBA counts on services like the NBA League Pass, which incentivize global audiences to tune in, and also, contracts with foreign TV channels such as Canal+ allow audiences who wouldn’t usually watch the NBA show involuntary interest. Furthermore, the only issue with this, until now, was the time zone difference and that the audience abroad wasn’t able to experience the game live. As it’s mentioned earlier, the development of the NBA League Pass

26

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa brings the ability to the fans of having a completely different experience, mainly, because it brings freedom of choice to the end consumer. In other words, they can watch any game live, or on delay, which allows the fans to experience the NBA whenever they want to and wherever they live. This service is available in more than 200 countries and the top five markets outside the U.S. as of the end of the 2017-18 season (in subscriptions) were China, Australia, Brazil, Canada, and Mexico according to Forbes.com. Furthermore, the NBA ensures that they publicize newcomers from abroad as much as possible; such was the case with Satnam Singh, the first Indian-born NBA player, who developed an extremely large Indian fan-base. The Association ensures that it’s players travel around the world through contracts with international basketball camps (such as the Swiss All-Star Basketball Camp in Zug, Switzerland that features a different NBA player every year), NBA Global games (games that are played in landmark international cities such as London), and the NBA preseason (which is hosted in different nations against international club teams). This is all one large push to market the NBA globally, and the results speak for themselves.

Photograph from; Businessindider.com

Moreover, as it’s been explained, the NBA is doing an important step forward, regarding the Social Media platforms, but as well, they have several markets that are targeting more than others. As Linkedin.com says, the NBA generates around 5.5 Billion of Dollars a year, which 150 Million comes just from the Chinese market. However, their “new” objective is India, which as a country has the potential to become as influential as China. Furthermore, the first NBA academy in India was recently built, and former MVP and Golden State Warriors superstar Kevin Durant recently announced that he would be spending his summer at the academy in India.

Moving on, other aspects make this organization one of the most well-known brands around the world, and this factor is the overall complementary inputs that the NBA it’s built on. By this, the

27

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa thought behind is that the Hip Hop culture, or the sneakers culture, the fashion industry, and other aspects, make the NBA a complimentary event. It’s not just about basketball, it’s about the whole umbrella of things that involve the NBA nowadays. An example of this, it’s the involvement of the biggest Rap figure at the moment, Drake, with the Toronto Raptors. He has become the official ambassador of the team and he also has involved his own clothing brand OVO which will provide during 6 different games an alternate jersey for the team. He also is developing different types of programs with the idea of targeting the art, the community, and basketball according to medizine.com.

4.1.3. English Premier League It is known that the Premier League holds the first position in the world in terms of revenue, which makes it the main competitor of LaLiga. different actions taken by the English League made them be on the top of the ranking. One of the most relevant actions was to be the first European league expanding into the Asian market, diving inside a blue ocean that no one had ever penetrated before. According to Romain Rossi, Vice President of Business Development, Account Management & Sales for Delattre’s Global Football, form a cultural perspective, the Chinese government has officially deemed sports as a key component for the current and future Chinese society. “Chinese audiences are very much fanatics, yet probably more interested in individual players than teams or clubs. They love having “heroes”.” Europe has had two ways of approaching the distribution of the Chinese market. UEFA, Premier League, and La Liga chose to enter domestic pay-TV platforms which means the revenue is bigger, but the audience is small compared to the size of the country. The French League 1 approached the market closing deals with CCTV – the national broadcaster in China, which meant less revenue but a bigger amount of audience. The difference between the Premier League and the other entities is that the English started several years before the others and now has the biggest part of the country attracted to them more than the other Leagues. According to scmp.com, the English Premier League had 2.7 billion global viewers last season, 38% percent of whom were from Asia and Oceania. Rupert Pratt, director of marketing firm Mongoose Sports and Entertainment, said Asian firms sponsoring Premier League teams stood to gain “instant credibility and overnight brand awareness” at home and abroad. “This comes not from the football on the pitch, but rather the incredible amount of hard work put in by clubs over the last decade to develop and grow their fan bases in Asia,” Pratt said.

28

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

4.2. Key lessons La Liga can take as an idea different actions that entities such as UFC, NBA, and the Premier League. Starting with the UFC, as mentioned above the Mixed Martial Arts organization built a global image and started expanding into other continents, such as Europe and Asia. What La Liga can take as an example is the aggressive implementation of their social media strategy by moving around the globe and going to countries where famous players were born to attract new fans into La Liga’s environment. Spain relying on Europe’s sole source of revenue will hinder their growth and how consumers engage with the brand throughout the process of social media, Another brand awareness strategy that La Liga could use is creating small events to build up the weekend games, the big games (Barça – Madrid) or even building up games with small relevance so the smaller teams have the opportunity to be seen. These small events can be brought through social media, hiding games around the team’s city, giveaways and more can be done.

One of the things that generate a lot of revenue to the National Basketball Association is the OTT platform called NBA League pass, it is very accessible and easy for the international viewers, La Liga does not have a platform like this, the implementation of La Liga pass in the same La Liga webpage could be a good way to continue increasing awareness and give another option to the viewers, even if they just want to buy a single match, they should be able to do it from the same webpage, making sure that all the revenue goes to La Liga. Also, continue having foreign TV channels for audiences who would not usually watch La Liga show involuntary interest. The development of La Liga pass could bring the ability to the fans of having a completely different experience, basically, it brings freedom of choice to the end consumer.

What La Liga can learn from the Premier League is the quickness on how the English League penetrated the Chinese market, clearly it’s too late to be faster than them in China but they could do it with India which is the new main objective of European football teams and it has the potential to be as influential as China. Also, by bringing players individually to Asian countries it is another way to earn a reputation for them and the team, Chinese audiences love having “heroes” more than being fans of a team. Last but not least, having Asian sponsors also reinforces the way Chinese audiences look at the league when they see a brand of their own country in the football team a feeling of reassurance could appear.

5. Methodology

29

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

In terms of methodology, the approach adopted will be mixed as it is planned to do different strategies such as interviews and of course, the usage of the secondary research itself. Even though the methodology will be mixed, the amount of qualitative data will be only as the word itself: based on three high-standard interviews done to three relevant people in this sector. Going on to the specific approaches, the best suited approach is a case study, as it will allow analysis to the most valuable information. According to BMJ Journals, a case study is described as “an intensive, systematic investigation of a single individual, group, community or some other unit in which the researcher examines in-depth data relating to several variables.” The first step to take while doing the case study is to deeply analyse the topic chosen and elaborate a report of the data collected. An example of this analysis could be a literature review already elaborated on the topic. Regarding the methods, as said before it is planned to use a mixed approach with the final objective of having the best overall perspective possible.

5.1. Primary Research Realizing the need of having primary research, we planned different strategies that could englobe all the aspects. During the process, we understood that regarding this topic, the most meaningful method, was to gather only qualitative data from the people that could have access to it and that their opinion could be relevant and essential for the progress of the final solution. Therefore, is it for this reason the primary research is focused on qualitative data only, and in a form of interviews to three high executives that work for the industry.

5.1.2. Qualitative: Interview As mentioned before, the primary research was done by interviewing three people whom work in the industry and have a well-rounded opinion regarding the past, present and future of the sport. The focus was to have the best quality as possible and that’s why our interviewers were, Joan Laporta, ex-president of FCB, Emilio Butrageño, actual VP of Real Madrid, ex-player of the Real Madrid, the National Team of Spain, Ivan Casado and Managing Director/SEA of Australia, Japan and South Korea. The interviews were conducted individually, boarding similar topics but always looking for different ways of thinking and opinions. In terms of the language used, the majority of them were done in Spanish because the interviewer’s preference, but in the case of Ivan Casado, it was executed partly in English.

30

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

5.2. Secondary Research After going through the whole management case regarding the conceptual idea, it was important to understand the actual impact and what is needed to be learn in order to reach the most amount of people possible and also generate the most engagement as possible in terms of the developing of La Liga internationally. In order to achieve this and have some good innovative ideas, there was a need for comparing La Liga to other organizations in the world of the sports. As always, the aim was to look at the best practice from other examples and learn what they have been doing successfully in order to grow as a sport or organization. Some examples were, the UFC, NBA, or other competitors like the EPL. On the other hand, the secondary research was based on searching the web and using sources like the newspapers. It was key to comprehend the industry and realize how La Liga should develop their new strategies to keep growing as an organization world-wide.

6. Proposed Solutions Moving forward in the management case, after having done extensive research on La Liga’s strategies, it was clear that there were particular aspects which could be improved to eventually gain relevance in their market. Therefore, in this section, proposals are going to be explained and mainly, they are going to be focused on how to improve the internationalization of LaLiga and the attraction of new generations through the digital platforms. The chosen ones are three that include all the topics mentioned during the project: Expansion, Digitalization and Innovation.

6.1. Expansion La Liga as an entity, should continually strive for brand expansion. Especially in an age where it has never been so connected and globalized. La Liga should always find ways of penetrating new markets. Therefore, in this section, the main idea is to try give some proposals of how La Liga could penetrate the Indian, Chinese and North American markets.

6.1.1 New Markets to penetrate

As mentioned earlier, the markets chosen are the Indian, the Chinese and the EEUU for several reasons. They are countries of influence, where La Liga is not the leader and all show aspects of future growth regarding the sport. In each specific country, La Liga has already had a presence. But to become the leader, they need innovative ideas in which younger generations feel attracted to.

31

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

6.1.1 How to approach it The first proposal aims to penetrate and gain the markets by innovating in their approach and differentiate themselves in order to generate more engagement in this “theoretical” blue ocean. There are a few strategies that they could implement but also, it’s important to mention that their mentality as organization should keep changing as well. One of this solution would be to focus more on smaller clubs rather than in such influential clubs like F.C Barcelona or Real Madrid. In order to do this while La Liga expands, the most feasible approach would be to organize a tournament between Spanish teams and each country teams. The entities that would be participating would be from the 8th place to the 11h place of La Liga classification table. As an example, last season would’ve been Athletic Club, Real Sociedad, Real Betis and Deportivo Alavés. The reasoning behind this is, because the big clubs are already well known all around the world, and the goal here is to promote the league, not just the “famous” and well-established teams. Moreover, the team’s level is lower and the national teams of each country have a better opportunity of winning and this of becoming more of an event for the city or country in which is being organized. The second and probably the most important thing about this proposal is based on the interaction and different activities done in the country. That is why, it would be interesting to organize a series of activities regarding La Liga teams and the fan base of the country throughout the duration of the tournament. Activities like Meets and Greets could be planned for personal interaction between the fans and players. Finally, the tournament would also have social responsibility, in the sense that La Liga will help the community by doing social actions during the stay of the tournament. This will help to boost the awareness at all social status and also help the community, which also shows the involvement that an organization like LaLiga needs to continuing pursuing.

Lastly, this whole process will be recorded in detail for digitalization purposes which will help boost the acknowledgment of what la Liga is doing and how is it being made. Platforms like Instagram, Facebook and YouTube will be essential for the engagement process as it ultimately, plays an important role for fans in deciding which team to support.

6.2. Innovation In this proposal, La Liga needs to find something that can disrupt the market and be prepared to be the first and gain, the first mover advantage. That is why the idea is to implement an innovative approach always focused on the expansion and internationalization of the league. Moreover, this section and its proposals will be based on the way the broadcasting rights are managed and the

32

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa introduction of new technologies into the industry which have the possibility of being a game changer.

6.2.1 How to approach it Having interviewed experts in clubs such as Joan Laporta and Emilio Butragueño and an expert in La Liga like, Ivan Codina. The concluded proposal is based on two different phases. On one hand, according to the club experts interviewed, the clubs need more resources from La Liga in terms of broadcast as they believe it would improve the quality of the teams and the entire league could be seen in a more competitive way. These resources consist of both audience and money; clubs claim that they want broadcasting deals with no audience, supporting their evidence is the deals that La Liga made with Bein Sports USA because the bid was bigger. Big broadcasters such as ESPN or FOX could have broadcasted the games at a lower price but with an audience number much bigger than Bein. According to Emilio Butragueño, the clubs are most interested on having a wider audience because the revenue would be coming from the fan perspective (merchandising, social media interactions, loyalty to the club). In China, the same thing happened, UEFA, The Premier League, and La Liga got deals with private TV channels that were paying more money than CCTV; the Chinese public television, only the French League got a deal with CCTV in order to have more awareness in the Chinese audience. The proposal here would consist on being the first of the three main football entities in Europe that closes a deal with a broadcasting agency that can attract more audience than anyone else, it would mean lowering the revenues from broadcasting rights as La Liga would have to sell them cheaper in return for more audience numbers. The revenue lost in lowering the price would come back from the new number of audiences that other channels cannot compete with. This proposal was taken after discussing the three opinions from the expert’s interviews: Mr. Emilio Butragueño mentioned that La Liga was more interested in money than audience and that is why they did not use broadcasters such as ESPN or FOX in the US. The same answer was discussed in Joan Laporta’s office and both directives agreed on the fact that money always comes first for La Liga and that it is something they should take into account and probably change if they want the entity to be known over the globe.

Mr Iván Codina on the other side commented, “the way the world consumes live sports is being changed by a new generation of online broadcasters, and LaLiga is committed to using such channels to extend the appeal of our competitions to a global audience in a relevant and appealing manner. This trend has allowed more brands to look at LaLiga as a highly attractive commercial partner that is able to reach a wide audience by leveraging on the collective of LaLiga stars and

33

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa heroes to many.” Stating, La Liga efforts to attract more audience in digital platforms and social media.

The audience coming from the broadcasters is bigger nowadays than social media, due to the fact that a big part of the society is still not “digitalized” enough in order to follow a football match, a team or a player through digital platforms or social media. Probably In approximately 5 years, the maturity on digital platforms will be old enough in order to gain the fight against broadcasters, but nowadays it is not happening, and La Liga needs to take that into account. To sum up, La Liga should be able to seek for both money and audience and signing deals with CCTV in China and ESPN in the USA would mean less revenue in short term basis but would increase La Liga’s awareness in a mid-term and long-term basis, making a significant impact in each of La Liga’s teams in terms of international expansion. On the other hand, another way to gain a huge amount of audience is La Liga implementing an OTT platform to broadcast all the games from La Liga’s webpage directly. Companies like NBA or Moto GP are already using these systems, NBA League Pass and DAZN respectively. Implementing this platform would bring another way for the fans to consume La Liga’s product; it does not mean that other broadcasters have to disappear, it means the revenue would be reduced from them in order to include another source of direct revenue to La Liga. As Joan Laporta commented, “a different and better way of broadcasting the games is needed”. Continuing with the deals with external broadcasters (Mediapro, Movistar…) in order to have as much awareness as possible and as much income sources as possible.

There are different features that this new OTT platform could have:

- Premium packages in this platform for really devoted La Liga fans the premium aspect can be a way of including limited content to VIP users such as giveaways, VR experiences at home and bots assisting in the platform (La Liga Assistant) this proposal is believed to be a very successful source of income. - Ability to buy single games could be an option to attract fans that only watch the “important games” - Buying just one team games, for the fans that only want to watch their team, basically personalizing every aspect of the platform so the user can buy the exact product wanted

In conclusion, being able to monetize all the ways of watching a game, from just watching a game the traditional game to even be able to watch it with VR glasses.

34

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

6.3. Digitalization The approach was divided into 4 different branches due to the number of strategies that can be taken regarding expansion through digitalization. The content inside social media keeps growing at very fast speed rates and there are several ways La Liga could take advantage and penetrate new potential audiences.

6.3.1 How to monetize international fans Accounts like 433 and FootballJoe have millions of followers, 20.4 and 2.1 respectively and their content it’s mainly based on football. On the other hand, and in their favor, it has to be said that they don’t have the barrier of having only one competition, they are a highlight account for the actual sport itself. But the whole point is that if La Liga is capable of innovating and create an engaged community through different social media content (activities, giveaways) and platforms it would get to the point where some of this activity could be monetized in different ways such as partnerships and collaborations.

6.3.2 How to activate new international commercial deals in a digital environment In terms of the digitalization proposal for La Liga, the idea behind is to improve their digitalization content, by getting the most out of their material in order to generate fidelity in the league and also in the teams. The idea mentioned above of holding a tournament between the teams in the middle of the table would be a big step in order to grow the awareness of La Liga inside the fans that just know the big teams such as Barça, Madrid or Atletico. There are a lot of players in those teams that have a big number of fans in different countries and would be a way of giving the team an opportunity to interact with audiences of other nationalities. By doing this, different commercial deals can be done through different countries and involving different teams. Something that would give a big push towards the international expansion of La Liga.

35

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

6.3.3 How to create and distribute media content in an engaging way La Liga is leaving out content like replays or highlights, that other people use in their benefit and monetize it. People might think that it’s arguably not an issue, but the problem is that when you take into account the numbers and the impact, you can see that is a problem. Being a little bit more specific, the other part of the proposal is going to be about generating innovative content and using social media platforms as a showcase of what La Liga actual is. Also, the tournament is a tool that can be used when generating a lot of content from all the games involving the pregame, game and post-game and all the activities surrounding it. Generating attractive, funny, entertaining and engaging content is the way the distribution of it through social media should be done to attract as much audience as possible.

6.3.4 How to grow international fans in key markets through social media Other than have a more creative approach to their content, is that they need to adapt faster to the trends that are happening. For example, create challenges, or get involved in them. Other ideas would be to have a designated person to manage the platforms and be the face of them. Examples of this are accounts like 433, which have a person in charge of interacting with the fans and the players giving a closer point of view of what’s happening in a game or simply more personal aspects about players. By just doing this, they are innovating, creating a community that has a face, and also generating curiosity. La Liga could apply this for its social media platforms like Facebook, Instagram, YouTube, and Twitter.

Photographs from, 433 Instagram account; David the Host with Dani Alves David the Host with several Ajax players playing PS4 David the Host with Neymar da Silva

36

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

7. Conclusion The market for La Liga is still expanding and there is a huge business opportunity behind it since there is this enormous amount of money invested. Either locally or internationally, La Liga can continue growing and expanding. Although this is evident, the other side of the story is that this market is leaning towards a current/future bubble, which means that, whiting a good implementation of the internalization strategy, La Liga has the opportunity to possibly surpass other big entertainment options. Following this idea, La Liga can learn to learn from other big competitors and try to use their approach or innovate in the same direction as them to never fall behind. Entities of the same segment help each other to keep growing using competitiveness and the fact that no one wants to stay behind is what keeps the growth increasing.

After gathering all the information and analyzing the data, it’s relativity complex to conclude with some specific key messages explaining what are the main points that regarding the past, present and future of La Liga’s international expansion and if the entity will be able to keep up the path or even surpass the English Premier League at some point. On the other hand, it’s more about giving the most premium content to the end consumer and in the most personal way possible. One of the key points is to keep growing in social media platforms since there is a lot of work to be done. Other aspects that are relevant for the improvement are the usage of their applications and the way they distribute media rights. Conclusions were divided into two phases. The key messages learnt from all different inputs, references and interviews. The problems La Liga need to respond to in order to keep growing internationally and also to increase that growth.

7.1. Key messages learned In this section, the key lessons learned as students will be commented on. Dividing it into different phases to provide what are the messages that impacted more to the development of the management case and understanding of this message as students. Starting from the messages learned from the three people we interviewed, Iván Codina, Joan Laporta, and Emilio Butragueño. Ivan explained very well La Liga’s objectives in terms of international expansion, digitalization giving insights on the Asian market mostly and explaining the huge potential some countries in Asia have in terms of attracting fans and penetrating new markets.

37

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

While Joan Laporta and Emilio Butragueño were giving football lessons during the interview, explaining how they saw the international expansion evolve, and in some cases put the first brick for the “expansion building” (Barça New York offices). The messages were slightly different as their backgrounds are completely different and they support Barça and Madrid respectively, but when it came about La Liga, their messages were similar, La Liga should take more care for the teams and give them more resources. The quality of the interviews was very good and that made the learning and understanding of different terms, strategies, and insights of La Liga and the teams regarding international expansion and growth easier thanks to the personality, knowledge, and experience from the three subjects interviewed. A second message learned is the speed of the updates that are made in the world of football, focusing on La Liga, changes in the broadcasting rights every two or three years, constant changes in technology, marketing and of course international expansion. The message learned here is that La Liga should and must be always prepared for any kind of change, update or anything related to an improvement of technology because it is very likely to happen anytime.

To conclude with this section, one of the main key messages is that La Liga is not collaborating enough with all the teams, and La Liga depends on the teams to continue growing internationally. The teams are demanding more audience and more resources and by focusing more on the team’s interests La Liga could create a wealthy ecosystem where the teams could be happy to collaborate with them and share audiences for both entities to grow and gain more audience.

7.2. Specific problems that LaLiga need to respond to After being almost done with the whole project, it’s essential to keep in mind that even though La Liga it’s well-positioned, there are still future problems that they need to be able to tackle as soon as possible. One of the main issues that are, and will be around for quite a bit, is the piracy of TV rights. The fact that millions of people get access to prohibit websites to stream games, is affecting the league and the sport itself. There is a need for regulation and La Liga needs to develop systems in which they can tackle this issue. Moreover, they have been using several tactics to address this issue like “listening” to people through the app. This is concrete, has had a lot of criticism as we mentioned earlier in the project. But, in the month of June of 2019, La Liga got 250,000 euros fine since the Spanish data protection agency stated that they were violating several European Union laws (Engadget.com). In terms of numbers, the app has around 4 million users and it’s used for

38

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa displaying game results. Moreover, they have expressed their disappointment and have stated that the regulators do not understand the type of technology that they are using (El País). To put it into perspective, the type of loss that this represents for the organization is considered to be 400 million, as we mentioned earlier in the management case. On the other hand, the have activated other types of actions to end with this problem like creating several teams that are strictly dedicated to going around bars and restaurants of Spain, to supervise that they are making the correct usage regarding the media coverage of La Liga games. Regarding the results so far, during the season of 2017/18 La Liga turned down a sum of 2.000 locals around Spain that were streaming the games illegally and has suited 4.000 more. Finally, regarding the main problem that La Liga needs to solve, they must be always looked like they are helping the sport and the fans. Criticism like the “listening” app, it’s bad for reputation and does the opposite effect.

Moving forward, it’s important to consider other possible future problems. La Liga has been able to scale positions in terms of popularity, revenues, fans and almost in every aspect because of their incredible performance. A fragment of what Emilio butrageño said in the interview, expresses well the possible issue, - “Para ganar y poder seguir creciendo como marca a nivel global, se requiere tener a los mejores. Si no tienes a los mejores, nunca podrás competir para ser el mejor”. What he was trying to explain was that La Liga needs to take advantage of what they have and what they need to work on keep having the best teams and win titles at the international level. In other words, the possible future problem is that once you lose one of the best players to ever play the game, Lionel Messi and the teams start to not perform as well internationally, you can lose pretty much in every aspect. Fans worldwide, sponsorships, football stars, and the league becomes non-attractive. A similar case is happening with Serie A. Even though last year they signed Cristiano Ronaldo, it has become a league which people worldwide, don’t have the interest and it’s not comparable to what it was years earlier.

Finally, it’s needed to highlight that if La Liga wants to become the leader in this industry, they need to focus tremendously on the digitalization of football. They are in a position in which they can innovate in their apps, the way they televised the game, the way they offer it using other digital platforms ... but if they don’t, then La Liga will see how other sources of entertainment surpass them without having better content and it will become a huge problem.

39

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

8. References

Article title: What is global expansion? definition and meaning Website title: BusinessDictionary.com URL: http://www.businessdictionary.com/definition/global-expansion.html

Article title: La Liga Grows Its U.S. Footprint | Sports Marketing & PR Roundup Website title: Joefavorito.com URL: http://joefavorito.com/2018/02/16/la-liga-grows-its-u-s-footprint/

Article title: ¿Por qué no seguir creciendo? Website title: Liga de Fútbol Profesional URL: https://www.laliga.es/noticias/por-que-no-seguir-creciendo

Article title: 5 funciones del brand ambassador para el éxito de una empresa Website title: Sigespana.es URL:http://www.sigespana.es/blog/129-5-funciones-del-brand-ambassador-para-el-exito- de-una-empresa

Article title: FC Barcelona, Girona FC & LaLiga seek permission from Spanish Football Federation to stage match in the US Website title: Liga de Fútbol Profesional URL:https://www.laliga.es/en/news/fc-barcelona-girona-fc-laliga-seek-permission-from- spanish-football-federation-to-stage-match-in-the-us

Article title: Girona: El Girona acepta la propuesta de jugar ante el Barça en Miami - Marca.com Website title: Marca.com URL:https://www.marca.com/futbol/girona/2018/09/06/5b917472268e3e4a558b45a3.ht ml

Article title: Forbes Releases 2018 List Of The World's Most Valuable SportsTeams Website title: Forbes URL:https://www.forbes.com/sites/forbespr/2018/07/18/forbes-releases-2018-list-of-the- worlds-most-valuable-sports-teams/#53ef010875ff

Article title: Tlefónica se hace con los derechos de La Liga hasta 2022 Website title: LaVanguardia.com URL: https://www.lavanguardia.com/television/20180626/45414759450/derechos-futbol- television-liga-telefonica-mediapro-subasta.html

40

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

Article title: Telefónica se queda con los derechos televisivos de La Liga en un contrato de 3.421 millones Website title: El Español URL: https://www.elespanol.com/economia/medios/20180625/telefonica-queda-derechos- televisivos-liga-contrato-millones/317718903_0.html

Article title: La Liga supera a la Bundesliga en ingresos y se coloca segunda tras la Premier Website title: EL PAÍS URL:https://elpais.com/deportes/2018/06/06/actualidad/1528310062_176912.html

Article title: Las Ligas de fútbol con más ingresos Website title: 2.deloitte.com URL: https://www2.deloitte.com/es/es/pages/technology-media-and- telecommunications/articles/ligas-futbol-ingresos.html

Article title: La Liga española, tercera competición que más ingresos genera en el fútbol europeo Website title: 2.deloitte.com URL: https://www2.deloitte.com/es/es/pages/about- deloitte/articles/liga-espanola-ingresos1.html

Article title: Soccer is the world’s most popular sport and still growing Website title: Bloomber.com URL: https://www.bloomberg.com/news/articles/2018-06-12/soccer-is-the-world-s-most- popular-sport-and-still-growing

Article title: Income from television rights in the Spanish football league (La Liga) in the 2017/2018 season, by team (in million euros) Website title: statista.com URL: https://www.statista.com/statistics/782317/la-liga-tv-rights-revenue-received-by-football- teams-in-spain/

Article title: Reparto de los ingresos audiovisuales en cumplimiento de las obligaciones previstas en el Real Decreto-ley 5/2015 Website title: Laliga.es URL: https://www.laliga.es/lfp/reparto-ingresos-audiovisuales

Article title: When sports meets business Website title: Books.google.es URL:https://books.google.es/books?id=3DkuDQAAQBAJ&pg=PT140&lpg=PT140&dq=do mestic+t o+external+market+la+liga&source=bl&ots=zPa5EaQs6Z&sig=ACfU3U3t4fENNySqGxJEV

41

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa aQc Vgy2e56cNw&hl=ca&sa=X&ved=2ahUKEwi54Z3c6JrhAhVDWxoKHdEsC40Q6AEwBXo ECAgQ AQ#v=onepage&q=domestic%20to%20external%20market%20la%20liga&f=false

Article title: Spain's La Liga sets global goals Website title: bbc.com URL: https://www.bbc.com/news/business-45020843

Article title: LaLiga Drives Virtual Innovation With New Advertising Replacement Solution from Supponor Website title: supponor.com URL: http://www.supponor.com/2017/10/laliga-drives-virtual-innovation-with-new- advertising-replacement-solution-from-supponor/

Article title: Un Wanda Metropolitano de récord: 60.739 espectadores en el Atlético-Barcelona de fútbol femenino Website title: eleconomista.es URL: https://www.eleconomista.es/deporte-negocio/noticias/9765958/03/19/Un-Wanda- Metropolitano-de-record-60739-espectadores-en-el-AtletiBara.html

Article title: International Development of La Liga Website title: spanishbusinesscouncil.ea URL: http://spanishbusinesscouncil.ae/international-development-la-liga/

Article title: LaLiga crece y abre nuevas oficinas a lo largo del mundo Website title: as.com URL: https://as.com/futbol/2016/07/18/primera/1468802548_494193.html

Article title: LaLiga Unveils Social Media, Digital Platform Strategy Website title: sportsvideo.org URL: https://www.sportsvideo.org/2018/07/16/laliga-unveils-social-media-digital-platform- strategy/

Article title: Soccer League Turns App Users Into Piracy Spies Website title: torrentfreak.com URL: https://torrentfreak.com/soccer-league-turns-app-users-into-piracy-spies-180611/

Article title: LaLiga, multada con 250.000 euros por falta de transparencia en su app Website title: Lavanguardia.com URL: https://www.lavanguardia.com/deportes/futbol/20190611/462801653528/laliga-multada- app-espia-250000-euros.html

Article title: Spanish Football League La Liga’s Plan For Asia Website title: allsportspages.com URL: https://allsportspages.com/spanish-football-league-la-ligas-plan-for-asia-inside-story/

42

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

Article title: How the UFC evolved into a knockout sports property Website title: eventmarketer.com URL://www.eventmarketer.com/article/how-the-ufc-evolved-into-one-of-the-worlds- fastest- growing-sports-properties/

Article title: The growth of the UFC ahead of the historic UFC200 Website title: thestatszone.com URL: https://www.thestatszone.com/the-growth-of-the-ufc-ahead-of-the-historic-ufc200

Article title: The UFC in 2019: Media strategy Website title: sportsmedia.com URL: http://www.sportspromedia.com/from-the-magazine/ufc-2019-media-strategy

Article title: LaLiga agrees early China extension amid cooling market Website title: media.sportsbusiness.com URL: https://media.sportbusiness.com/2019/06/laliga-agrees-early-china-extension-amid- cooling-market/

Article title: How Premier League Soccer Has Come To Dominate Southeast Asian Sports Apparel Markets Website title: forbes.com URL: https://www.forbes.com/sites/marcedelman/2015/01/26/how-british-premier-league- soccer-has-come-to-dominate-southeast-asian-sports-apparel-markets/#14ed8098311d

Article title: Guess how many Asian brands have deals with the English Premier League Website title: scmp.com URL: https://www.scmp.com/week-asia/business/article/1999543/guess-how-many-asian- brands-have-deals-english-premier-league

43

Internationalisation of La Liga Guillermo Ordoñez & Nicolás Larrosa

44