United Commercial Partnership Revenue

sglowrider said:
I think we just need to look at the New York Yankees as gauge of how much the upper ceiling of commercial deals. We are global. The Yankees barely stretch beyond the shores of the US yet they made US$450million in merchandise and with 40% growth in stadium sponsorship deals in 2010.

Long way to go to exploit the global United brand and to fund our team.
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Where are you getting those figures from? According to Forbes, their total revenue is just under $450m.
 
The Taurean said:
GCHQ, do you think we are right at the top of the curve in exploiting commercial aspects associated with the club? Are we reaching a certain saturation level or is there still a lot of potential without going into ideas like stadium naming rights? I think these regional based agreements are great revenue generation points and provide the best opportunity apart from the things already tapped.
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GCHQ said:
No, we're nowhere near the top of the curve. I think there's absolutely frightening potential for further dramatic growth in commercial revenue. In short, we're incredibly well positioned to benefit from the ongoing shift in global financial power from West to East due to the phenomenal amount of supporters that we have in Asia and the Middle East.

The value of our platinum deals will rise sharply as those regions become more and more important for global multi-national companies. And then probably even more significantly there's the regional and territory specific partnerships (such as the Honda deal in Thailand) and of course the telecommunication deals where there appears to be pretty much unlimited potential for growth! I mean, no disrespect to Vietnam, Laos and Cambodia, but a three million pound per year telecommunication agreement covering those territories?! That's fecking scary.
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We're definitely top of the curve when it comes to commercial partnerships with football clubs. But overall we still have a lot of potential.
 
ralphie88 said:
Mental DHL branding of the stadium tonight. Couldn't get away from it. For those thinking it's worthwhile trying to sell "naming rights" for OT - we'd not get the value we currently get from the likes of DHL/Hublot/Audi etc with them.
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I haven't followed these threads lately, but I thought the general consensus among branding experts was that this might be a moot point. Because naming rights to Old Trafford wouldn't make sense for the sponsor, since no one would actually use the corporate name. If you build a new stadium and name it after a sponsor (Emirates), there's nothing else to call it so the name sticks. But for at least a generation, people would still be calling our ground Old Trafford.

Hal9000 said:
May look awful but £10 mil for a tiny logo like that?. DHL have been mugged off. I was expecting to to be splashed over the front, back, sides etc etc.
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Yeah but I don't think that's our training gear. Those are just casual polos, or some such.
 
Manchester United to ramp up fan base gains

High quality global journalism requires investment. Please share this article with others using the link below, do not cut & paste the article. See our Ts&Cs and Copyright Policy for more detail. Email ftsales.support@ft.com to buy additional rights. Man United to ramp up fan base gains - FT.com

The money Manchester United can make from exploiting its fan base will “dwarf” the income it has been acquiring from sponsorship deals, Richard Arnold, the Premier League champions’ commercial director predicted.

While the Glazer family, which bought the club in 2005, ponders when to advance their $1bn Singapore flotation plans, the club’s executives are working on the next phase of the owners’ long-term goal of maximising income from its fame.

The economic climate is forcing the Glazers to delay a planned initial public offering of about a third of the club’s equity on the Singapore stock exchange. But, as and when it does go to market, United’s commercial potential is bound to be a key part of its sales pitch.

Officials have in recent weeks closed the latest of several deals with credit card companies that will enable United to earn income directly from their fans around the world. The club makes money when the Manchester United branded cards are first activated, during their general use and whenever the user incurrs charges.

Up until now, United has expanded its commercial income from high-profile deals such as the £80m shirt sponsorship with US insurance group Aon, and the £40m training kit deal with logistics company DHL . United last season earned £103.4m in commercial revenues, up 27 per cent on the previous season.

But Mr Arnold said the club had not yet taken its fanbase “and put that into a money-making machine”.

The club’s customer database stands at 11m, he revealed, giving it a quantity of data and knowledge “about the same as a Boots or Tesco’s loyalty card”.

But United has “a very high level of confidence” that the database will continue to grow at an “exponential” rate, and the potential income from direct monetisation of the fan base, such as United-branded credit cards in the Far East, was huge.

“Adding these pieces together, it makes what we do now look like small fry... Even on some of the sponsorship activities and merchandising activities and the licensing activity, our opportunity in the future dwarfs the work that we’re doing currently.”

However, the Manchester United Supporters Trust, the Glazers’ most strident critics, questioned whether the owners really understood the club’s fans. “The problem with their ownership model is the fans don’t feel a sense of ownership,” says Duncan Drasdo of MUST. “They feel a sense of exploitation.”

Trying to persuade the fan base to spend money has proved “an impossible nut to crack”, he added.

Mr Arnold acknowledged that cracking the Chinese market – “a hugely important piece of the puzzle in our commercial success” – was complicated and time-consuming.

The club’s commercial strategy was shifting away from doing global deals with single brands to the more exhaustive task of multiple deals in individual countries. “Have we got the strategies sorted? No, but we’re erecting some phenomenal building-blocks for each and every one of these markets,” he said.

In contrast to United’s manager, Sir Alex Ferguson, who earlier this week complained about the dominance of TV over football clubs, Mr Arnold had nothing but admiration for the way the Premier League and television had turned clubs such as United into “global property”.

United’s matches were ubiquitious pieces of TV content, he said, speaking before Sir Alex’s comments were made public. “There’s nothing else in the world that is shown at least two hours a week on 80 per cent of the world’s televisions. There isn’t.”
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Man United to ramp up fan base gains - FT.com

Timing of those quotes with the IPO just around the corner makes me very skeptical with regards to Richard Arnold's comments about future commercial growth dwarfing current deals.

With regards to the comments about the credit card deals, we supposedly already have 11 million members but they don't really bring much in do they? Why is Arnold so bullish about future prospects with regards to it?
 
Actually yeah I was thinking wrongly. I'd be surprised if they couldn't expand the customer base by x% or more each year.
 
United sign deal with Telco Du

Telco du on Tuesday announced a partnership deal with Manchester United to offer its fans in the UAE exclusive access to club-related content.

The announcement was made at GITEX, and was attended by Manchester United legend Andy Cole, the second-highest goal scorer in Premier League history.

The two-year contract with the 19-time title winning team allows du customers to access exclusively-assigned content, allowing them to follow the team throughout the year on their phones.

du CEO Osman Sultan declined to comment when questioned about the value of the deal.
The club is reported to have over 300m followers, of which 56m are in the Middle East, du said in a statement.

Announcing the deal, the club's commercial director Richard Arnold said: “The partnership with du further extends our coverage to our 56 million fans in the Middle East even further and we’re delighted to have found a partner that can give our supporters in the country a premier service of updates, exclusives and action.”

Manchester United's manager, Sir Alex Ferguson, added: “In recent years, the club has grown very close links with the Middle East and we know from our visits there that the fans are as loyal and as passionate about the team as anyone.

"To be able to address them directly is incredible and the network of deals that we are building up means that more and more fans can feel involved with what happens at United.”

Farid Faraidooni, chief commercial officer, du, said: “Manchester United is an icon and our sponsorship of the club will open up a world of exclusive privileges to our customers, allowing them to experience more than has ever been possible.”

Through the sponsorship agreement, du customers will be able to keep up with the latest images, news, games and more related to the club.

Manchester United is the most successful team in England’s football history with 19 league titles, 11 FA Cups, four League Cups, three European Cups and two World Championship trophies to its name.
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Telco du signs partnership deal with Manchester United - Technology - ArabianBusiness.com

Apparently its only a two year deal, which does seem slightly on the short side but come to think of it most of our platinum deals are only around 3 years. Surely the club would much prefer having the security of a longer deal?
 
Zong, the Pakistani Dong!

‘Zong’ Join hands with ‘Manchester United’

PAKISTAN: Zong has partnered with Manchester United, one of the top football clubs in the world to become the official telecommunication partner of the football club in Pakistan.

This is the first ever deal from any Pakistani corporation with Manchester United. Zong might bring packages/services based on this deal with Manchester United to target millions of Man Utd fans in Pakistan. By the end of this month, Zong will be introducing something that has never been done before in Pakistan.
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‘Zong’ Join hands with ‘Manchester United’ « iMobile News

That's our 13th telecommunications partner. Plenty of territories still left to conquer believe it or not!
 
Devil_forever said:
Telco du signs partnership deal with Manchester United - Technology - ArabianBusiness.com

Apparently its only a two year deal, which does seem slightly on the short side but come to think of it most of our platinum deals are only around 3 years. Surely the club would much prefer having the security of a longer deal?
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Well obviously the length of contract has to suit both parties but I don't really see a three year agreement as an issue from our point of view. From our perspective if the contract was much longer than that then we could potentially miss out on an uplift in revenue by not being able to renegotiate sooner either with the existing partner or with a different company.
 
Manchester United Soccer Team Takes Old Trafford Game to Hedge Fund Alley

In December of 2009 an unexpected package arrived at the headquarters of Concha y Toro, the 127-year-old winemaker in Santiago, Chile.

Inside was an ornate box lined with black silk and holding a leather soccer ball with the Concha y Toro insignia stenciled next to that of the sender’s: Manchester United. An accompanying book laid out the financial benefits of a partnership with the soccer club. Within 36 hours, United executives were on the phone, outlining an agreement signed in May 2010.

The 19-time English champion introduced the Chilean company as its first global wine partner four months later at United’s Old Trafford stadium. Luxury boxes and lounges in the stadium serve only Concha y Toro’s Casillero del Diablo wines and the company’s ads appear on the digital billboards seen on broadcasts of United home games.

The courting of Concha y Toro epitomizes how United officials have made the club among the most valuable brands in sports, Bloomberg Businessweek reports in its Oct. 24 issue.

A 2007 survey conducted by London-based TNS Sport found that the team has 333 million supporters around the world. Last season, when United won its fourth English Premier League title in five years and made it to the finals of the European Cup, a cumulative audience of 4.2 billion watched its matches on television -- the equivalent of a Super Bowl every week, according to Futures Sport & Entertainment.

The club’s visibility has allowed it to assemble a roster of more than 30 global corporate partners ranging from Aon, the Chicago-based insurer that pays 20 million pounds ($31.5 million) a year to put its logo on the team’s jerseys; to Nike Inc. (NKE), which is in the final two years of a 13-year, 303 million pound agreement to produce all team apparel; to Mister Potato, the Malaysian brand that inked a deal in September to become United’s official “savory snack partner.”

“What’s the pitch?” asks Pierre Pang, deputy general manager for sales and marketing at Mamee-Double Decker, which owns Mister Potato. “Three hundred and thirty-three million fans globally, with close to two-thirds coming from Asia. That’s basically along the lines of where our strategy is: The vision of being Asian No. 1 for the potato snack segment.”

Last June, United said it had revenue of 331.4 million pounds for the 2010-11 season, a club record and by far the most among English clubs -- though about 95 million pounds less than Spain’s Real Madrid, which is soccer’s biggest moneymaker.

Unlike U.S. sports, where salary caps and revenue-sharing agreements constrain the ability of rich teams to dominate, in soccer cash is still king. Chelsea, Manchester City, and others have catapulted themselves into the European elite thanks to billionaire owners willing to spend any amount to win.

European soccer’s governing body says beginning in 2014 it will consider banning teams that spend significantly more than they make. That would strengthen the position of clubs with the most revenue -- such as Manchester United, Real Madrid, and Barcelona -- which could use it to buy the best talent. The governing body’s proposed fix could end up locking in the status quo for years.

The people charged with selling the United brand work out of an office 200 miles south of Manchester in the London district of Mayfair, also known as Hedge Fund Alley. The office has oak-paneled conference rooms and an open-plan work space, where staffers dressed like bankers are bent over computers and working the phones. Rent for the London space costs the club 1 million pounds a year, and similar offices are set to open later this year in Hong Kong.

“Our approach has evolved beyond a traditional sports club’s, to being far more like that of a conventional blue-chip company,” Commercial Director Richard Arnold, 40, said in a conference room named for Alex Ferguson, United’s manager. “To arrive at this position we have spoken to companies with reputations as the world’s leading marketing organizations to see how they approach promotion and sales.”

United hasn’t always been successful. George Best and Bobby Charlton helped lead the club to a European championship in 1968, but the team went another two decades without a league title and even suffered relegation to the second division in 1974.

The improved on-field fortunes coincided with the creation of the Premier League in 1992, which made English soccer more global. Matches are broadcast live in 211 territories and income from global television rights now exceeds 1.4 billion pounds. That’s in addition to the 1.78 billion pounds the league earns from its domestic television contract.

United has been the biggest beneficiary of the Premier League’s growth, winning the inaugural season title and 11 more over the next 20 years.

“Manchester United’s timing was great,” said Dan Jones, a partner with the accounting firm Deloitte, which has produced an annual review of soccer finance for the past 20 years. “They started to have huge success on the pitch at the time that all the other developments around media and so on gave them a place to take that.”

In 2005, Malcolm Glazer, the American owner of the National Football League’s Tampa Bay Buccaneers, completed a 790 million- pound leveraged buyout of the soccer team. Glazer and his family have spent 40 million pounds on the team’s marketing strategy, including creating a sales force. Before the takeover, two people worked on selling the Manchester United brand.

“The early months of what we did was spent in very high- depth strategy discussions [with] multiple, multiple iterations,” Arnold said. “Even now, two days a month is spent iterating all those strategies.”

By investing in research like the TNS Sport study, United has been able to get a better understanding of the brand’s value and reach, Arnold said. The result is a strategy that sells access to its stadium infrastructure to major sponsors, while offering limited territorial association rights to telecom and credit card companies, allowing them to sell United-branded products and content. Many of the agreements also include revenue sharing between United and its partners.

In the past year commercial sales have increased 27 percent, to more than 100 million pounds, while the value of the team’s corporate partnerships has risen tenfold since 2008.

The club has done it by creating new forms of advertising inventory, beyond the industry standard. The team’s global sponsors, including Turkish Airlines and Thai beer brand Singha, get physical advertising space at Old Trafford and digital ads during broadcasts of United’s home games.

Since 2008 the club has also signed agreements with regional partners, which are given exclusive rights to promote their companies alongside United within specific geographic areas, though they have little or no visibility in Manchester or on the team’s website.

Arnold said one reason United is able to secure such deals is the time it spends learning about potential partners. “We found there was a CEO of one of the companies we dealt with who didn’t like tea or coffee, he liked Diet Coke,” Arnold said. “When the meeting starts he gets a Diet Coke, not tea or coffee. Everything we do has to express the premium offering that Manchester United is, and you have to be able to do that transcending industry, culture, country.”

The club’s recent agreement with shipping company DHL reflects its commercial power. Arnold’s team sent branded iPads loaded with company-specific presentations to DHL, in an effort to persuade the company to sponsor the jerseys United players wear--during practice.

In August, DHL signed a four-year contract for 40 million pounds, more than what all but four other Premier League teams get from their biggest sponsors.

It’s also an example of how the team is able to slice its rights. In 2009, Standard Chartered, the financial services company, competed with Aon in the race to sponsor United’s game- day jerseys. When Standard Chartered lost out, it signed on with Liverpool, but insisted on being the exclusive corporate name on all Liverpool apparel.

“The training kit thing is a very interesting angle because it’s essentially saying the media coverage that Manchester United get when they’re training equates to smaller teams’ coverage when they’re actually playing,” said Andy Korman, a partner at the U.K. law firm Couchmans, which specializes in sports sponsorship. “So more people are interested in seeing Manchester United down on the training ground than they are in seeing most other teams live.”

United’s sales operation dwarfs that of any of its rivals. Chelsea, United’s chief Premier League competitor in recent seasons, has “a handful” of sponsorship sales staffers, one club executive told Bloomberg Businessweek. Liverpool, the team that comes closest to United in worldwide appeal, hired its first London-based employee earlier this year and didn’t have a commercial director until 2007.

“Any team should look at them and learn,” said Ivan Gazidis, chief executive officer of Arsenal, whose commercial revenue is about one-third the size of United’s. “But not every club is in the position Manchester United is in. So the solutions for any individual club could be different.”

For all their success at bringing in additional revenue, the Glazers have faced resentment from United fans who say the family is using the team’s income to cover the costs of buying it, rather than investing in talent. United, which had been listed on the London Stock Exchange since 1991, was debt-free before Glazer took it private, and now has net debt of more than 300 million pounds.

The Glazers have hired Credit Suisse to help float as much as 30 percent of the club for $1 billion. Analysts say the valuation is unrealistic because it would mean the club is worth more than $3 billion, far higher than a Forbes rating of $1.8 billion. Some of the proceeds from the listing would likely be used to pay off a 500 million-pound bond the team issued in Jan. 2010.

Financial details released in that bond prospectus revealed how much the Glazers’ ownership had cost, fueling a protest campaign. Andrew Green, a financial adviser to the Manchester United Supporters Trust, a group opposed to the Glazers, said the team’s commercial revenue is “a drop in the bucket compared to the 495 million pounds of interest, banking, and other costs” during the family’s ownership.

At the height of the backlash last year, fans brandished gold and green scarves, representing the club’s founding colors, and held up signs at home games with messages such as “Love United, Hate Glazer.” The protest colors have been less visible this season after United spent 50 million pounds beefing up its already potent roster.

Arnold said the club has explored ways to monetize a customer database with detailed information about 11 million fans. It’s expanding its relationships with credit-card companies. Indonesia-based Bank Danamon, Korea’s Shinhan Bank, and Malaysia’s Public Bank already have credit cards bearing the United logo.

The team is also renegotiating its contract with Nike, which currently gives the apparel maker control over the production of all United merchandise, whether its logo appears on it or not.

“Manchester United have grown ... and that will reflect the price,” said sponsorship expert Korman, whose firm’s clients include Nike. “The greater the prestige of the brand, the greater their marketing team is able to go to the manufacturers and say, ‘Look, this is what we believe the deal to be worth.''
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Manchester United Soccer Team Takes Old Trafford Game to Hedge Fund Alley - Bloomberg
 
My friend who has a local newsagents, has just had a package of a logo'd up football sent to him by Manchester City , he's waiting for their sponsorship team to give him a call
 
In 2005, Malcolm Glazer, the American owner of the National Football League’s Tampa Bay Buccaneers, completed a 790 million- pound leveraged buyout of the soccer team. Glazer and his family have spent 40 million pounds on the team’s marketing strategy, including creating a sales force. Before the takeover, two people worked on selling the Manchester United brand.
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This was the part that interested me. 40 million pounds could have bought one or two top class players, but the Glazers have used it instead to prime the pump for commercial revenue.

They saw a way to buy on credit and then improve the value of the asset and took it. Long term 40 million invested may turn into a good deal more, enough to pay back loans and build the club.
 
Arnold talks a bit in the article below about other clubs adopting the same commercial strategy:


Manchester United make moves in Pakistan market

Manchester United commercial director Richard Arnold is not concerned about the prospect of rival clubs adopting the Red Devils' 'territorial' approach to marketing.

United became the first club to crash through the £100million barrier for commercial income last year and, judging by their continuing ability to attract sponsors, it seems that number will grow still further.

Pakistan mobile company Zong is the latest to join United's portfolio.

Although the Glazer family have been repeatedly attacked for pushing the club into huge debt, they are also responsible for the new approach of doing deals with various companies - particularly mobile operators - in different countries.

By offering exclusive content, they are able to maximise revenue from a fanbase estimated at £333million.

"Any team should look at them and learn," said Arsenal chief executive Ivan Gazidis recently.

Given the vast global popularity of the Premier League, it would be no surprise if some of United's rivals tried to adopt the same methods, and possibly forge links with the same companies.

But Arnold remains unconcerned at that prospect.

"There is only one Manchester United," he said.

"Whilst a lot of the strategy is public knowledge, I am very fortunate to be with the club I am with and able to do these deals.

"I don't spend a lot of time worrying about other clubs.

"I just concentrate on what happens here.

"We are in a very good position. It is my job to make sure that continues."

Arnold is the man credited with the £40million four-year contract with DHL for United's training kit.

Aside from Liverpool, Arsenal, Chelsea and Manchester City, it was more than any English club receives for its actual kit deal.

"A lot of hard work has gone into getting to the position we are in now and we are already looking to the future," said Arnold.

"If people want to recreate what we did five years ago that is up to them.

"It isn't other clubs that I worry about; it is what we are going to be doing in the future."
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Manchester United make moves in Pakistan market - Premier League, Football - The Independent
 
Manchester United children's apparel line launch in the middle east

The official kid’s merchandise of Manchester United, known for legends such as Wayne Rooney, Edwin Van Der Sar, Ryan Giggs and Rio Ferdinand, is now available in the Middle East giving the opportunity to young football fans to own its official merchandise and relive the club’s greatest moments.

Magicwell UK and its Dubai-based partner Big Ben Trading have joined hands with Manchester United Merchandising Ltd (MUML). MUML have officially licensed Magicwell Ltd to design, manufacture and distribute fashion apparel and accessories with Manchester United Official Logo, for children. Magicwell are launching a whole line of apparel across the Middle East.

The range, now available in select stores across the Middle East, features the latest collection for children aged two to 14 years and includes pyjamas, caps, socks and beach towels etc – adorned with the club’s distinctive red crest. The collection of Polos, T-shirts, denim wear, tracksuits, etc is also expected to be launched soon.

Magicwell Ltd has been in business of licensed kids apparel since a decade and is existing licensee for brands such as Barbie. In Middle East, Magicwell is operating through their marketing arm, Big Ben Trading FZT which is based in Dubai Textile City.

Big Ben Trading has been established in the Middle East for the past 21 years and over the years have earned reputation of supplying good quality children and infant apparel to most of major players in the region. Their collections are retailed at all major retail chains of children’s clothing.

Big Ben Trading will market the Manchester United Kids apparel line to 11 countries in the Middle East. Each garment will have an official hologram to foil imitators and help control copyright infringement and piracy.

“We realize that there is a huge community of dedicated Manchester United fans out here in the Middle East and our partnership with Magicwell and Big Ben will only serve to bring our younger fans closer to their favourite team,” said Romain Gardair of Manchester United Merchandising Ltd.

“Manchester United has evolved as one of the biggest global brands and continues to inspire entire generations of sports lovers in the region,” explained Robert Mirpuri, of Magicwell Ltd. “In the Middle East especially, being associated with this prestigious brand is a milestone development in our history.”
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http://www.middleeastevents.com/site/pres_dtls.asp?pid=14478[/URL

I was under the impression that nike were in charge of the merchandising.
 
They are. Where does it say any different in that article? Manchester United Merchandising Ltd is a subsidiary of Nike's.

BTW, Turk Telekom become our 14th telecommunications partner. Those partnerships now cover a total of 35 countries world wide.
 
GCHQ said:
They are. Where does it say any different in that article? Manchester United Merchandising Ltd is a subsidiary of Nike's.

BTW, Turk Telekom become our 14th telecommunications partner. Those partnerships now cover a total of 35 countries worldwide.
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Yeah saw their name appear on the official site's list of sponsors last night but couldn't find anything on google apart from a year old article about them becoming our sponsor. Would it be unrealistic to think that we could have deals in place to cover over a 100 countries world wide in the next couple of years?
 
Devil_forever said:
Yeah saw their name appear on the official site's list of sponsors last night but couldn't find anything on google apart from a year old article about them becoming our sponsor. Would it be unrealistic to think that we could have deals in place to cover over a 100 countries world wide in the next couple of years?
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100 sounds a bit unrealistic but who knows. That would be over half of the countries on the planet!
 
GCHQ said:
100 sounds a bit unrealistic but who knows. That would be over half of the countries on the planet!
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We do have over 330 million fans world wide;) We seem to be favouring these telecoms deals over product deals. Is that due to the fact that the telecoms deals don't need any exposure from us on the LED boards around OT etc and that there's only so many different partners we can give sufficient exposure to?

Also, any ideas as to when the turk telekom deal was even signed?
 
Devil_forever said:
We do have over 330 million fans world wide;) We seem to be favouring these telecoms deals over product deals. Is that due to the fact that the telecoms deals don't need any exposure from us on the LED boards around OT etc and that there's only so many different partners we can give sufficient exposure to?

Also, any ideas as to when the turk telekom deal was even signed?
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Well as Arnold said, we'll keep doing these telecom deals but the focus is shifting towards territory specific product deals such as the one with Honda in Thailand and with Sirius in the US. Then there are the deals with credit card companies that have been set up recently which Arnold sounds particularly optimistic about. There is a limit to the amount of global partners we can have (14-16 maximum probably) because as you say there are only so many we can give sufficient LED pitch-side and website adverstising space to amongst other things.

So there appear to be five or six different elements to the overall strategy.

1) Your bread and butter shirt and kit sponsors (AON and Nike - who in our case also own the merchandising rights)

2) Global partners (first and second tier)

3) The territory specific telecom deals

4) New areas of sponsorship such as the training kit deal with DHL and possible naming rights to Carrington for another company

5) Territory specfic product deals

6) The credit card company deals


I don't have any other information about the Turk Telecom deal. You can expect an official announcement shortly I'd imagine.
 
EXCLUSIVE: How Man United overtook Coca-Cola to become the world's SIXTH biggest brand

The glitzy address shows just how far Manchester United has come in the past seven years... as a money-making champion.

For while Sir Alex Ferguson has guaranteed glory on the football pitch, the suits behind the scenes have helped turn silverware into pure gold.

Little highlights this transformation better than the club’s London offices, housed in an anonymous Mayfair building, a stone’s throw from the Ritz hotel and with international hedge fund wheeler dealers as neighbours.

Old Trafford remains the centre of football operations, but this suite of offices is where the Red Devils cash in on the likes of Wayne Rooney and Nani’s superstar status.

An investigation into how the club has transformed itself into a £1.2billion franchise shows why the much-maligned Glazer family, who bought the club in 2005 and saddled it with huge debts, have hung on.

Only Google, Apple, the BBC, Dyson and Facebook are better known brands, marketing experts revealed recently, making it a bigger draw to advertisers than Coca Cola and Microsoft.

The numbers involved are staggering. The club’s estimated worldwide following is 333 million with 92 million in Asia, which is why the team often heads to the Far East for money spinning close-season tours.

The club’s turnover has crashed through the £100million barrier and experts estimate the value of the United brand alone as £412million, up from £197million in 2005.

It now has more than 20 “official partners” from US sportswear giant Nike and German car manufacturer Audi to Turkish Airlines and Chilean wine brand Casillero del Diablo.

But United’s business success is summed up by the shirt sponsorship. US financial giant AON has paid an estimated £20million a year for four seasons, 9,900% up on the £200,000 Sharp electronics paid back in 1992.

Just last month, a two-year £2million tie-up was announced with Du, a mobile phone firm in the United Arab Emirates, where an estimated 500,000 fans live.

It all began in earnest when the secretive Glazers moved in, convinced that United could be bigger than huge US sports brands such as the New York Yankees baseball team.

Since then, revenue has more than doubled, helping annual profits rise to £110million in the 12 months to the end of June this year.

Manchester United Ltd has a whole floor off Piccadilly, London, with a 70-strong sales and marketing team who are adept at striking lucrative sponsorship deals.

Commercial director Richard Arnold said recently: “We’ve only just started. There is a lot more to come. United has huge future potential.”

Firms are willing to pay big money to get in bed with United. Parcel giant DHL is spending a reported £40million in a four-year deal to sponsor the team’s training kit – for good reason.

When Wilkinson Sword launched a Manchester United-branded razor in Japan it sold 1.6 million units in just six weeks.

Tim Crow, of Synergy Sponsorship, which helped broker the deal, said: “United appeal to a huge number of people around the world. They have a bigger following then anybody else.

“Where we have used Manchester United, it has been extremely successful.”

Mr Crow said another key difference about the club is the quality of its power brokers, highlighted by a deal it clinched with another sponsor, Betfair.

He said: “We negotiated with another top-six club and their behaviour was absolutely terrible. They were completely disorganised.

“With United, you are dealing with a religion. You’ve got all that history in the club, that is what makes it worth what it is and that is what United understand.”

Dave Chattaway of Brand Finance, which calculates the value of brands, said: “Like them or hate them, it’s hard to dispute the business success story of the Glazer reign at Old Trafford.

“One of the key factors is the fact they have Sir Alex Ferguson. The Glazers have given him the resources for him to deliver consistent on-pitch success, which feeds the off-pitch expertise.”

The next stage in the Glazers’ plan is a rumoured stock market flotation that could value the club at £1.8billion. Reports have suggested they are willing to sell 25% of the club via a listing on the Singapore stock exchange, rather than in London.

Critics claim the Glazers will use income from the sale to cut their personal debts, rather then plough it back into the club.

Figures for Red Football Joint Venture, the Glazer company that controls United, show a loss of £108.9million in the year to the end of June.

At the same count, the club itself still had net debts of £358million and paid out £43.5million in interest alone last year, much to the disgust of fans.

Andy Green, a fund manager who writes a United blog called Andersred, keeps a close watch on the club’s finances.

He said: “The brand is being tarted around continuously. It’s ridiculous when you see an official wine partner, an official office supply partner. There has to be a limit to the number of brands you can hitch on to the United bandwagon.

“How far do you take it? Will there be an official washing powder? It just gets silly.”

Hostility to the Glazers’ ownership has waned, but Mr Green said fans are still angry at the debts dumped on the club and are anxious about what the future holds.

He said: “Yes, there is less hostility, but it doesn’t change the fact that, so far, it has cost more than £400million in interest, debt repayments and bank fees.

“That is enough for every fan to go free to every game, all season, for four years. It is a staggering amount of money.

“You need to ask why the club has had enormous success off the pitch in the past five years. Because it has won stuff on the pitch. Has it won stuff on the pitch because of the Glazers? Of course it hasn’t.”

Such criticism and concerns from fans are unlikely to deter the Americans. When you own one of the world’s biggest brands, it’s almost a licence to print money.
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Read more: EXCLUSIVE: How Manchester United overtook Coca-Cola and Microsoft to become the world's SIXTH biggest brand - News - MirrorFootball.co.uk

That's an impressive operation we're running at the moment
 
Number 15

Reds' Bulgarian mobile deal

Manchester United have signed a three-year sponsorship agreement with Bulgarian telecommunications company GLOBUL.

Under the agreement, GLOBUL will offer the club’s fans in Bulgaria access to exclusive United news, interviews, special features and other content over its mobile network.

GLOBUL and United will also develop a promotional microsite in Bulgarian and English, specifically tailored for local supporters. Through various promotion and subscription reward initiatives, fans will have the chance to win signed merchandise and gain access to tickets at Old Trafford.

As of February 8, GLOBUL will offer its new 'GLOBUL United' tariffs to all fans in Bulgaria, which will provide bundle minutes, SMS, MMS and mobile internet traffic, as well as access to dedicated United mobile content at monthly fees starting at BGN 12.90. Users who subscribe by February 22 will have a chance to win a ticket for a game at Old Trafford.

Sir Alex Ferguson attended a press conference at Carrington on Tuesday to announce the launch, along with first-team stars Dimitar Berbatov, Tom Cleverley and Phil Jones.

The Reds boss said: "I am very pleased to welcome Globul to Manchester. Anything that brings our international fans closer to the club is a good thing and we are looking forward to developing the partnership in the future."

United’s commercial director Richard Arnold added: "We are pleased to have established a partnership with Globul, a company that not only has strong links to football in Bulgaria, but also shares the club’s ambition to be the best in its field.

"This is a ground-breaking partnership for the club as it is the first mobile company we have teamed up with in Europe and Globul’s growing customer base is an ideal way for Manchester United to reach out to its 53 million fans in Europe."

GLOBUL CEO Haris Kotsibos said: "GLOBUL has a long-established commitment to football and, after years of supporting Bulgarian football clubs and the national team, we are now happy to expand our activities and join forces with one the most successful clubs in the world, Manchester United.

"We believe that this agreement will allow GLOBUL to give the United fans in Bulgaria a unique opportunity to have the latest and the best from their favourite club everywhere and at any time."
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United sign deal with GLOBUL - Official Manchester United Website
 
First order of business re partnership with Bulgarian national telecomm giant: piss off entirety of Bulgaria by continuing to not play Bulgaria's favorite son.
 
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