Marketing Football Clubs: Current Practices and Key Success Factors

Marketing Football Clubs 
Current Practices and Key Success Factors 
 
                                                     
my purpose, as well as sports and economic newspapers and magazines. 
In order to get more specific and up to date material I also subscribed to 
two important European sports finance newspapers (i.e. Il Sole 24 Ore 
Sport and Soccer Analyst) and periodical bulletins (i.e. Soccer Investor), 
and to the most important Italian sports management Web site (i.e. 
StageUp). 
This project was intended to be multidisciplinary, encompassing 
elements of Strategic Management, International Marketing, Sociology of 
Sport, Sports Contract Law, and Sports Sponsorship and Marketing. 
Among these, emphasis was placed on the Sports Marketing elements. I 
also attended some interesting seminars on economics and marketing of 
sports around Italy, from which I earned some useful information.
2
 Other 
material used is represented by working papers, theses, and reports 
about my area of study. 
Finally, I had the chance to interview some professionals who work 
actively in the football industry and whose help has been consistent and 
which shaped the direction of my research. 
Whilst this may leave some margin for error with regards to consistency 
of some of the analysis presented, the data is believed to be sufficiently 
accurate and consistent to allow the portrayal of current trends and 
developments in the football industry. 
2
 See Bibliography for further details. 
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Marketing Football Clubs 
Current Practices and Key Success Factors 
 
 
 
 
 
 
 
 
 
 
 
 
 
Part I 
 
It comes down to a very simple saying: there is a right way and a 
wrong way to do things. You can practice shooting eight hours a day, 
but if your technique is wrong, then all you become is very good at 
shooting the wrong way. 
Get the fundamentals down and the level of everything you do will 
rise. 
Michael Jordan 
 
 
 
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Marketing Football Clubs 
Current Practices and Key Success Factors 
 
                                                     
Sport: From Leisure Time to Entertainment Industry 
 
Sport can be defined as "a source of diversion or a physical activity 
engaged in for pleasure"
3
 because it takes people away from their daily 
routine and gives them pleasure. Comparably, the definition of sport is 
very close to that of entertainment, in the sense that they both are 
something diverting or engaging. Most consumers choose between going 
to the cinema or to the theatre, between watching a play or an opera, and 
between going to a concert or to a football match almost indifferently 
demonstrating they are closely related forms of entertainment. 
Sport is undoubtedly one of the most ancient forms of entertainment, 
even older than language. It offers unexpected possibilities to the human 
needs of self-expression and creation, and for these reasons it represents 
a humanistic ideal that goes beyond its mere nature: sport means not 
only physical exercise, it satisfies the human needs of communication 
and aggregation.
4
 
However, it is only during the last century that it has come to assume the 
proper characteristics of an industry. The 23
rd
 of June 1894 is a key date 
in the history of sport, because that is the date of birth of the CIO 
(Comitè International Olympique). It was founded in Losanna by Pierre de 
Coubertin, with the purpose of revamping in modern times the 
celebration of the Olympic games. Since then, the sports industry has 
been keeping up an outstanding growth rate. According to data from 
Istat, the Italian economy owes much to the sport industry: if more than 
34 million people are considered "active persons" in sports, each year 
800.000 volunteers dedicate to it 150 million of hours in work. This is 
nothing compared to the annual turnover that in 1998 had reached €25 
billions, which represents 2,4% of the Italian GDP.
5
 If this was not 
enough, one could argue that Italy is the only European country where 
the State does not finance sport but, on the contrary, sport finances the 
State (i.e. through the betting system). 
These are a few summary statistics about the importance of the sport 
industry in the Italian economy: 
3
 Webster's definition of sport, reported by Matthew D. Shank (2002), Sports Marketing. A 
Strategic Perspective; p. 3. 
4
 Franco Ascani (1998), Sport Management. Il manuale per il dirigente, l'organizzatore, il 
tecnico, il gestore della società sportive; pp. XVII-XXIII. 
5
 Official data, released by Deloitte & Touche during the conference Lavorare nello Sport 
in Milan during the "Task 2002" organized by Il Sole 24 Ore. 
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Marketing Football Clubs 
Current Practices and Key Success Factors 
 
 
PEOPLE INVOLVED IN SPORT IN ITALY 
Non-profit organizations 83.000 
Sports organizations 64.000 
Active volunteers 800.000 
Practicing sportspersons 15.000.000 
Affiliated practicing 8.000.000
Total # of persons involved 34.200.000 
Source: 
Deloitte & 
Touche, Il 
Calcio Italiano 
2000. 
 
 
TURNOVER (MILLIONS OF €) 
Amateur sport 16.500 
Professional sport 8.500 
Total turnover 25.000 
 
This evolution of sport into a social phenomenon of worldwide economic 
interest has encouraged the application of business management models 
to sports companies. It is only since 1966 that sport associations 
acquired the legal form of limited companies, although we had to wait 
until 1996 for the possibility for them to pursue economic profit.
6
 It was 
clear that the old management model, based entirely on volunteers' 
activity, was no longer able to satisfy the new and growing requirements 
of organized sport. The old model of a few managers, who attempt to 
carry out the whole activity within the organization, pretending to do 
everything and do it well, is outmoded. The new administrator has a key 
role in the success of an enterprise: he must be a leader, in the sense 
that he would have to make strategic decisions and have the others in 
the organization implementing them. He should be able to manage a 
balance sheet, create a marketing plan, do planning and development, 
hire and motivate colleagues, apply communication techniques while 
approaching media and sponsors. In addition, he should also know laws 
and regulations, promote new activities, organize events, establish and 
maintain good relationships with the external environment and with 
institutions in particular (remember, for example, that almost all Italian 
venues and sport facilities are municipally owned). In order to be able to 
do all this, a good manager will need to develop communication, 
guidance and motivation skills that are not very common among 
volunteers, however passionate they can be. 
                                                     
6
 Legge 586/96. 
 6 
Marketing Football Clubs 
Current Practices and Key Success Factors 
 
The Emergence of Sports Marketing 
 
Although, as I have just stated above, sport can be considered as a form 
of entertainment, it is not possible to apply to it the techniques and skills 
appropriate to the other forms such as movies, concerts, play, opera, etc. 
As Shank (2002) states, "one important way in which sport differs from 
other common entertainment forms is that sport is spontaneous. A play 
has a script and a concert has a program, but the action that entertains 
us in sport is spontaneous and uncontrolled by those who participate in 
the event". When we go to a humorous movie, we expect to laugh, and 
when we go to a horror movie, we expect to be scared even before we pay 
our money. But the emotions we feel during a sports event cannot be 
planned before; they depend on the "quality" of the event and obviously 
on the result, which, by definition, is unpredictable. 
Because of its spontaneous nature, sports managers face a series of 
challenges that are different than those faced by most entertainment 
providers. Grant (2000), in his strategic management book 
"Contemporary Strategy Analysis", underlines the importance of defining 
broadly a firm's industry rather than narrowly. Accordingly, successful 
sport organizations realize the threat of competition from other forms of 
entertainment. They have broadened the scope of their businesses, 
seeing themselves as providing entertainment. This has increased the 
number of challenges sport managers have to face, with the result that 
marketing has assumed a central role within a successful sports 
organization. 
Thus, a company that aspires to succeed in the sport industry should 
concentrate on understanding the consumer and providing a sports 
product that meets consumers' needs while achieving the organization's 
objectives.
7
 This way of doing business is called a marketing orientation.  
Unfortunately, reality does not necessarily reflect theory, and indeed 
what actually happens among sports organizations, with the exception of 
those in the US, is that marketing is perceived as something against 
people's welfare or even corrupting sports ideals. If that was the case, I 
would not be here discussing the importance of marketing in sport. The 
€80 millions poured by Real Madrid into Juventus, the $12 million 
contract signed by Yankees' baseball player Derek Jeter, and the Nike 
super-sponsorship of the Brazilian national soccer team are some clear 
symptoms of the centrality of marketing in today's sports industry. 
 7