Why Do Sports Organisations Create Foundations and How Do They Impact on Brand Identity?
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La Salle International School of Commerce and Digital Economy Final Thesis Graduate in Management of Business and Technology WHY DO SPORTS ORGANISATIONS CREATE FOUNDATIONS AND HOW DO THEY IMPACT ON BRAND IDENTITY? Student Promoter JOSE LLABRÉS KAPÓN CHRISTOPHER KENNETT 0 FINAL PROJECT DEFENCE Meeting of the evaluating panel on this day, the student: D. JOSE LLABRÉS KAPÓN Presented their final thesis on the following subject: WHY DO SPORTS ORGANISATIONS CREATE FOUNDATIONS AND HOW DO THEY IMPACT ON BRAND IDENTITY? 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 PRESIDENT OF THE PANEL 1 ABSTRACT This thesis aims to understand why sports organisations create foundations and how do they impact on brand identity. The literature review contains the definition of foundation, how foundations develop over the time, the differences between a foundation and an association, the advantages and disadvantages of a foundation and the different types of sport foundations. Primary research was conducted by interviewing different employees or managers of three different types of sports foundations and analyse the annual reports. With the objective to compare and contrast the three cases, to understand the benefits of a foundation, the factors behind successful communication strategies and how they measure the effectiveness. 2 TABLE OF CONTENT Acknowledgement 5 Executive Summary 6 1. Introduction 7 1.1. Motivation To Study This Topic 7 1.2. Research Question 7 1.3. Research Objectives 7 2. Literature Review 8 2.1. What Is A Sports Foundation? 8 2.2. How Have Foundations Developed Over Time? 9 2.3. Differences Between A Foundation And An Association 10 2.4. Advantages And Disadvantages Of A Foundation 11 2.5. Types Of Sports Foundation 12 3. Methodology 14 3.1. Research Methodology 14 3.2. Interview Objectives 14 3.3. Annual Report Analysis 15 3.4. Interview List Of Questions 16 3.5. Interviewed People 16 3.6. Comparative Case Studies 17 4. Data and findings 18 4.1. Ownership Model 18 4.2. Objectives 20 4.3. Financial Structure 21 4.4. Marketing & Partnership Strategy 25 4.5. Main Operations Activities 32 4.6. Foundation Impact On The Brand 36 4.7. Effectiveness 40 4.8. Covid-19 41 5. Conclusión 42 6. Bibliography 45 3 7. Appendix 49 7.1. Appendix A - Interview with Carles Domènech 49 7.2. Appendix B - Interview with Albert Sala 53 7.3. Appendix C - Interview with Yolanda Antin 57 7.4. Appendix D - Interview with Alex Galí 60 7.5. Appendix E - Interview with Pati Roura 64 7.6. Appendix F - Interview with Xavier Vilà 65 Table of Figures Figure 1 - Annual Report of Damm Foundation 15 Figure 2 - Annual Report of Barça Foundation 15 Figure 3 - Annual Report of Johan Cruyff Foundation 15 Figure 4 - Comparative Case Studies 17 Figure 5 - Barça Foundation Governing Board 19 Figure 6 - Damm Foundation Governing Board 19 Figure 7 - Johan Cruyff Foundation Governing Board 20 Figure 8 - Economic Report of Damm Foundation 21 Figure 9 - Distribution of Sources of Income of Barça Foundation 22 Figure 10 - Income of Barça Foundation since 2013/2014 23 Figure 11 - Comparative Table of Foundations Expenditure 24 Figure 12 - Main International Communication Strategies of Barça Foundation 26 Figure 13 - Main Local Communication Strategies of Barça Foundation 26 Figure 14 - Main Communication Strategies of Damm Foundation 27 Figure 15 - Main Communication Strategies of Johan Cruyff Foundation 28 Figure 16 - Areas of Action of the Foundations 29 Figure 17 - Areas of Action of Barça Foundation 29 Figure 18 - Comparative Table of the Main Channels of Communication 31 Figure 19 - Estrella Damm Advertisement in FC Barcelona Stadium 33 Figure 20 - Cruyff Court Les Roquetes 34 WORD COUNT: 10.340 words 4 ACKNOWLEDGMENTS I would like to express my gratitude to my promoter Professor Chris Kennett, for guiding me through the process of writing this thesis, but also for being an excellent professor and mentor throughout my four years at the university. Without his detailed guidance and persistent help, this final thesis would not have been possible. I would also like to thank Professor Dawn Hiscock and Professor Miguel Sanchez for their support and guidance in the initial phases of the research and for inspiring me at the first stage when gathering the ideas for the topic of the project. I also want to express my gratitude to Professor Ricardo Torres for being my tutor during the four years at the university. Thank you as well to all the classmates I have during this years and to all the friends I made. I wish to express my deepest gratitude to the Sport Foundations analysed during this thesis and especially the people that participates on it. Thanks to Mr. Carles Domènech and Mr. Àlex Galí from the Damm Foundation, Mr. Albert Sala and Ms. Pati Roura from the Johan Cruyff Foundation and Ms. Yolanda Antin and Mr. Xavier Vilà from the Barça Foundation. Without their support and help, this project could not have reached its goal. Thanks for sharing your knowledge and participating in the realization of this thesis. I really appreciate your contribution. Lastly, I would like to thank all my family for all their love and encouragement. Especially to my parents, my godparents and my grandparents who raised me with love and supported me in all my pursuits. Finally to my little brother for being the person I love the most. All of them kept me going on and this work would not have been possible without them. Thank you from the bottom of my heart. I love you. 5 EXECUTIVE SUMMARY The objective of this thesis is to compare and contrast three different types of sports foundations in order to see the differences and the similarities. At the same time analyse the different strategies and the impact that they have on the brand they are attached to. Understand the benefits that foundations bring to the businesses, analyze the communication strategies and how they measure the effectiveness of their activities. The literature review contains the explanation of what is a sports foundation, how foundations developed over time, the differences between a foundation and an association, the advantages and disadvantages of a foundation and the different types of sport foundations. The research is done through four personal interviews with managers and employees from each foundation analysed. The questions asked during the interviews were related with: the ownership model of the foundation, which are the key objectives, how is the financial structure, how is the marketing strategy which are the main operation activities, how is the impact on the brand and how they measure the effectiveness. The second part of the research was to analyse, compare and contrast the annual reports of the three foundations analysed. The results and findings show that sport is one of the best tools to educate people for the values that transmit, also shows that the foundations have a huge impact on the brands and help a lot of people. How fundations create opportunities to the brand that they are attached to, the importance that the communication strategy has in their strategies and how in the next years sports foundations will grow significantly and will play a fundamental role in the society. 6 CHAPTER 1 - INTRODUCTION 1.1 MOTIVATION TO STUDY THIS TOPIC During the season 2016/2017 I played football on the first team of CF Damm. During this experience I enjoyed a lot and I learned many things. My interest for this types of organizations came from that experience and the final thesis was the perfect opportunity to study and explain how sport foundations works. During this thesis three sports foundations that are going to be analysed: the Damm Foundation, the Johan Cruyff Foundation and the Barça Foundation. The foundations are going to be compare and contrast in order to response the research question and to response the research objectives. 1.2 RESEARCH QUESTION The research question of this thesis is: ‘Why do sports organisations create foundations and how do they impact on brand identity?’ 1.3 RESEARCH OBJECTIVES 1. Understand the benefits that a foundation can bring to a business, focusing in the sports sector. 2. Determine the factors behind successful sport foundations strategies and analyze the impact on their communication strategies. 3. Analyze the effectiveness of different types of sport foundations in the wider organisational context. 7 CHAPTER 2 - LITERATURE REVIEW 2.1 WHAT IS A SPORTS FOUNDATION? Sport foundations are often associated with charity actions and promotion of values through sports. As the politician and social activist Nelson Mandela (Hughes, R. 2013: 2) said, “Sport has the power to change the world. It has the power to inspire, it has the power to unite people in a way that little else does. It speaks to youth in a language they understand. Sport can create hope where once there was only despair. It is more powerful than governments in breaking down racial barriers. It laughs in the face of all types of discrimination.” According to article 2 of the Law of foundations 50/2002 the general definition of a foundation is: “Foundations are non-profit organisations which, by the will of their creators, have their patrimony permanently affected to the realisation of general interest purposes.”. However the definition for the Spanish Association of Foundations (AEF) (na fundaciones.org, 2019) is ‘’A foundation is a non-profit organization that pursues purposes of general interest and benefits generic collectivities of people. Its initial and future assets are allocated to these general interest purposes, even in the event of dissolution.’’ A sports foundation (Cullinane, J, 2019) is an organization that supports charitable activities for the common good.