Manchester United
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CASE 7 Manchester United Creating the Global Sports Brand 1 INTRODUCTION successfully demoted Manchester United to sec - ond place in the Deloitte World Football Money May 2005 will go down as a watershed moment League in 2005. The downward trend was con - in the storied history of Manchester United, as firmed in 2006 as the club slipped to fourth in U.S. businessman Malcolm Glazer bought finan - global club rankings, one place ahead of seven- cial control over the fabled English football (soc - time UEFA winner AC Milan. The pressure was cer) club. It was noteworthy that Glazer’s move on Manchester United to ratchet up its perfor - was premised on Manchester United’s position mance levels both on and off the field in order as one of the most prominent global brands in to maintain its position as the world’s best- a sport with proven worldwide appeal. known football club. The question facing Manchester United’s new owner and club management was how to leverage the club’s global brand name further in the worldwide marketplace. Manchester HISTORY OF MANCHESTER UNITED United’s historic pedigree was not to be doubted, nor was its position in the top eche - The club now known as Manchester United was lons of English football. The club was already originally formed in 1878 as the Newton Heath reputed to have 75 million fans worldwide, Lancashire and Yorkshire Football Club. including 40 million in Asia. Financial problems followed and the club was But the competitive environment of the reformed under its present name in 1902. The “beautiful game” was tightening. In the English club moved to the Old Trafford stadium in 1910. Premier League (EPL), Chelsea, with the bot - Throughout the 1920s and 1930s, it was the tomless purse strings of Russian owner Roman lesser of the two Manchester clubs, with Abramovich, had set the pace with over €330 Manchester City being more successful in the million worth of new player signings in recent interwar years. The foundation for the club’s years. In Europe, it was Spain’s Real Madrid— current success was laid in the post-1945 era by nine-time European Cup (Union of European two exceptional managers, both Scottish—Matt Football Associations—UEFA) winner—that had Busby and Alex Ferguson. 609 610 MANAGING GLOBALIZATION The Matt Busby Era Cup win) to enhance its reputation, garnering the European Cup in 1968 with charismatic Manchester United’s move toward national and Irishman George Best voted the European international prominence began with the Player of the Year. Busby retired in 1969, and appointment of Matt Busby as manager in the club languished during the 1970s and 1980s 1945. It was Busby who established the dis - while Liverpool superseded them as England’s tinctive corporate culture that characterizes the leading club, though Manchester United club today. Corporate (or organizational) cul - remained the best-supported English club. ture consists of the shared values, beliefs, and norms that help an organization achieve The Alex Ferguson Era results. Effective corporate cultures have high performance standards, caring attitudes toward The hiring of Alex Ferguson in 1986 heralded a people, and feelings of uniqueness and pride. return to traditional club values and a revival of Busby’s soccer philosophy established club the club’s fortunes, with Manchester United precedents in many key areas. He established dominating English soccer through the 1990s, the youth orientation by playing seven winning the league title eight times between teenagers (the “Busby Babes”) against 1992 and 2003 and being crowned European Huddersfield in 1953. Busby’s quest for soccer champions in 1999. Commentators noted at excellence extended nationally as he scoured the time that it was a good decade to dominate the country in search of talent. He promoted English football. The Premier League was individuality and flare on the field but encour - formed in 1992. Television revenues skyrock - aged a club-oriented “one for all” camaraderie eted and made clubs and players wealthier. off the field. He enhanced team unity by With the proliferation of satellite, cable, and arranging off-the-field perks for all players, digital TV, the beautiful game became the truly including golf memberships, local cinema global game. Ferguson’s revival of Manchester passes, and concessions at resort hotels. In United’s traditional club values involved a heavy 1956, he took the club to Europe in defiance of orientation back to youth and talent. The over - the English Football League. The Busby corpo - riding quest to develop the best available soccer rate culture legacy imbued Manchester United talent was continued as the bulk of the 1990s with a reputation for youth, talent develop - team, including Ryan Giggs, Paul Scholes, Nicky ment, and striving for soccer and individual Butt, the Neville brothers, and David Beckham, excellence, all within the framework of a club came up through the club’s youth system. Over steeped in traditional values and atmosphere. the club’s championship 1992–2003 period, Ironically, however, it was a tragedy that first Manchester United topped the EPL in starting raised the Manchester United profile above appearances for homegrown talent. other English clubs. In 1958, returning from But the club’s youth development system European competition play, eight players were proved insufficient to sustain the lofty stan - killed in Munich, West Germany, when the team dards of play now characterizing the EPL. As airplane crashed. A surviving player, Bobby the soccer industry globalized, increasing com - Charlton, noted, “Before Munich, it was petition in the EPL necessarily expanded the Manchester’s club; afterwards, everyone felt search for talent, and foreign players were they owned a little bit of it.” The club rebuilt, more routinely recruited. The success of and in the 1960s and 1970s it took advantage of Frenchman Eric Cantona (bought from Leeds the era’s Beatles, James Bond, and Anglophile United) in the 1990s encouraged the club to tendencies (including England’s 1966 World buy new talent, and over the 1992–2002 CASE 7 Manchester United 611 period, Manchester United topped the English time periods is a challenge. In this area, Premier League in purchase fees for new play - Manchester United has few equals. In the mod - ers, averaging close to £20 million per year. The ern era, from 1945 to the forming of the English current team roster includes many imports: Premier League in 1992, the club had top two Christiano Ronaldo, Wayne Rooney, Rio finishes 15 times, winning top honors five times Ferdinand, Louis Saha, and Carlos Tevez. (see www.ManU.com). But the forming of the The club’s potent combination of home - Premiership heralded the club’s most successful grown and imported talent resulted in an attack - era. From 1993–2003, Manchester United won ing style of soccer that got results and attracted the Premiership 8 of 11 times and lifted the fans worldwide. From 1992–2003, Manchester Football Association (FA) Challenge Cup four United averaged over two goals per game, with times over the same period. In 1999, the club most of the remaining EPL clubs languishing at achieved a unique treble: the FA Premiership, one to one-and-a-half goals per game. the FA Challenge Cup, and the European Cup. Manchester United had become well-known Throughout the 14-year Premiership history, not only for its attacking soccer but also for the the Manchester club has never finished out of galaxy of stars it attracted under the club banner. the top three. This consistency in excellence has In the corporate world, companies assemble earned Manchester United a coveted place in portfolios of brands to reinforce their corporate English and European soccer annals, matched brand image. Within the portfolio branding perhaps only by Spanish club Real Madrid. It framework, it is the “silver bullet” concept that also paid off as the club topped EPL attendance identifies key individual brands to form the mar - figures from 1992 to 2003 at over 53,000 per keting vanguard for corporate branding strate - game, significantly above the average of 37,000. gies. In soccer, it has been player brands that Club supporters, known as the Red Army, con - have contributed to the excitement quotient at sistently follow them to away games, and its the club level. In Manchester United’s case, a national fan membership is over 190,000. succession of charismatic players has generated Astute leadership is the hallmark of excel - that excitement. In the 1950s, it was teenager lent organizations. Following the Busby era, Duncan Edwards; in the 1960s, it was George the club experienced a leadership vacuum for Best, ably supported by Bobbie Charlton and about 15 years until Alex Ferguson took charge Denis Law, who generated on- and off-the-field in 1986. Under his stewardship, Manchester media coverage to maintain Manchester United’s United has experienced two decades of high news profile. In the early 1990s, it was the unprecedented success. Sir Alex, currently the mercurial Frenchman Eric Cantona who pro - longest-serving manager in the Premiership, vided headline sports news until a talented crop recently turned 65. Effective succession plan - of young stars from their youth academy, includ - ning is clearly paramount if the club is to main - ing media and celebrity icon David Beckham, tain its success on the field and as a business. came on the scene. In 2007, the squad included young world-class talents with attacking flair such as Portuguese winger Cristiano Ronaldo THE NATIONAL INDUSTRY and England’s Wayne Rooney (both 21 years old). Such talents exemplified and magnified ENVIRONMENT: THE CHANGING the aura of the club. FACE OF ENGLISH SOCCER On-field success is important for any sports brand seeking national and global fame, but for In the 1990s, increased competition to procure sports teams, maintaining success over long and retain unique soccer talent put enormous 612 MANAGING GLOBALIZATION financial pressures on clubs to augment club matches peaked in 2002–2003 at 35,445 but revenues, especially from off-the-field revenue fell to 33,887 in 2005–2006.