Superstardom in the Professional Football Industry ‘an exploratory, qualitative study’ Universty of Groningen, Master of Business Administration Faculty of Management and Organization “Strategy & Innovation” Dierenriemstraat 100 July 2006 Postbus 800 9700 AV Groningen Supervisors: Student: Dr. T.J.B.M. Postma R. Woestenenk, Dr. G. Gemser s 1231006 S Superstardom in the Football Industry & I -Preface- Preface This thesis is also the subject of many discussions between football experts ranging from a select number of professional football analysts to millions of people who follow the most popular sport in the world. I would like to seize this opportunity to thank the many people who helped me to write this thesis. First of all I would like to thank my supervisors at the University of Groningen, Dr. Postma and Dr. Gemser, for the inspiring discussions and feedback. Secondly, I would like to thank the people who found the time to discuss my research: Professor Ruud Koning (University of Groningen), Bert Schaap and Valentijn Driessen (Telegraaf), Kees Ploegsma jr. (Kees Ploegsma Management B.V.), Alex Kroes (MT&V Sports International), Hans Nijland (FC Groningen) Joris van Benthem (Feyenoord Rotterdam) and Jan de Visser (SP International). Thanks to their efforts and input I was able to obtain and present an empirical insight on the phenomenon of superstardom. Finally, I would like to thank my family and friends who joined in discussions and supported me during the writing process. I hope you will enjoy reading this thesis on the professional football industry and its key inhabitants: the superstar football players! René Woestenenk Groningen, July 2006 R. Woestenenk, s. 1231006 p. i S Superstardom in the Football Industry & I -Abstract- Abstract The purpose of this thesis is to construct and empirically underpin an exploratory conceptual model that comprises the plausible factors that lead individual players to superstardom within the selection system of professional football. The theories on selection system, value creation and value capture as well as the concepts of superstar effects and winner-take-all markets form the fundaments of this thesis. The empirical, qualitative research consisted of a number of explorative semi-structured interviews with representatives of football clubs, football players’ agencies and with independent sports experts. The main conclusion of this thesis is that it is very difficult to pinpoint one or two factors or aspects that lead football players to superstardom. The most important factor appears to be a player’s tacit knowledge, represented by the talent to play football coupled with the right personal traits. Players that can perform decisively in a consistent manner are valued highly. Furthermore, the importance of commercial activities of individual players is emphasized in this thesis; when a player improved his reputation he can become an invaluable promotional / commercial medium for expert selectors like sponsors and advertisers. The most important addition this thesis makes to the current theory on superstardom is the role of bargaining. The amount of value captured by an individual football player depends on a bargaining process, not on the amount of value created. Moreover, the valuing criteria of the two types of employers, i.e. the football club and the expert selectors, appear to differ. The first mostly values a player’s on-pitch-performance, whereas the latter appears to value his reputation more. The final conceptual model that concludes the empirical research can be used as a starting point for future, explanatory research. Key words: Selection system - sports economics - experience products - value creation - value capture - superstars - football R. Woestenenk, s. 1231006 p. ii S Superstardom in the Football Industry & I -Table of Contents- Table of Contents INTRODUCTION.............................................................................................................1 RESEARCH OBJECTIVE AND RESEARCH QUESTIONS ........................................................1 OVERVIEW ....................................................................................................................2 1. THEORETICAL BACKGROUND.............................................................................4 1.1. INTRODUCTION ...................................................................................................5 1.2. SELECTION SYSTEMS ..........................................................................................5 1.3. VALUE CREATION , CAPTURE AND PROTECTION ....................................................6 1.3.1. Value Creation ...........................................................................................6 1.3.2. Value Capture............................................................................................7 1.3.3. Value Protection.........................................................................................9 1.4. SPORTS ECONOMICS ........................................................................................10 1.4.1. Peculiar Economics..................................................................................11 1.4.2. Products of Professional Sports Clubs .....................................................13 1.5. SUPERSTAR EFFECT .........................................................................................18 1.6. SUMMARY AND CONCLUSION .............................................................................19 2. RESEARCH DESIGN ............................................................................................23 2.1. INTRODUCTION .................................................................................................24 2.2. RESEARCH METHODOLOGY ...............................................................................24 2.3. DATA GATHERING & ANALYSIS ..........................................................................24 3. DOMAIN: PROFESSIONAL FOOTBALL INDUSTRY ...........................................27 3.1. INTRODUCTION .................................................................................................28 3.2. SELECTION SYSTEM OF PROFESSIONAL FOOTBALL .............................................28 3.2.1. Selected: Football Clubs ..........................................................................28 3.2.2. Selectors: Market and Expert Selectors ...................................................30 3.2.3. Competitive Advantage in Football Industry .............................................32 3.3. ROLE OF INDIVIDUAL FOOTBALL PLAYER ............................................................34 3.4. SUMMARY AND CONCLUSION .............................................................................37 4. EMPIRICAL FINDINGS: EXPLORING SUPERSTARDOM ...................................41 4.1. INTRODUCTION .................................................................................................42 4.2. FOOTBALL SUPERSTARS ...................................................................................42 4.3. EXPLORING SUPERSTARDOM .............................................................................45 4.3.1. Talent.......................................................................................................46 4.3.2. Reputation ...............................................................................................48 4.3.3. Access to Large Markets..........................................................................51 4.3.4. Bargaining................................................................................................52 4.4. CONCLUSION ....................................................................................................59 R. Woestenenk, s. 1231006 p. iii S Superstardom in the Football Industry & I -Table of Contents- 5. CONCLUSION & IMPLICATIONS .........................................................................62 5.1. INTRODUCTION .................................................................................................63 5.2. CONCLUSION ....................................................................................................63 5.3. IMPLICATIONS ...................................................................................................64 5.4. SUGGESTIONS FOR FURTHER RESEARCH ...........................................................65 REFERENCES..............................................................................................................67 BOOKS AND ARTICLES .................................................................................................67 WEBSITES ...................................................................................................................72 NEWSPAPERS .............................................................................................................73 APPENDICES...............................................................................................................75 A. THE PRODUCTS OF SPORTS ORGANIZATIONS .....................................................76 B. EMPIRICAL RESEARCH ......................................................................................77 B.1.1. People Approached For Pilot Research ...................................................77 B.1.2. Sent Information for Pilot Research..........................................................78 B.1.3. Results of Pilot Research.........................................................................82