football industry analysis
DESCRIPTION
Hints the revenue a football industry generates in a Football rich culture. Benefits include - Cutting hospital bills!TRANSCRIPT
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Football Industry Analysis- Shyam Prasad
- MIB – 1113 - 007
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Clubs
Staff and Professionals
Local Businesses
Fans
Merchandise Sale
Sponsors & Gate receipts
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Clubs
Staff and Professionals
Fans
Sponsors
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• "Football isn't a matter of life and death - its much more important than that!" Bill Shankly
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• “I have the chance to do for a living what I like the most in life, and that’s playing football. I can make people happy and enjoy myself at the same time.”
• ~Ronaldinho
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• Football Industry• Players of football Industry• Size of the Industry• Market share of players• Profitability Analysis• PEST Analysis• Porter’s Five Forces
Objective
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The Industry• Cup Competitions• League Competitions• Broadcasting rights• Player transfer fees• Sponsorships• Footballer’s Earnings• Product manufacturers earnings• Games
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Players of the Industry• Manchester United• Real Madrid• Arsenal• Bayern Munich• Barcelona• AC Milan• Chelsea• Juventus• Liverpool• Internazionale• Others
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Players of the industry• Top Sponsors
• Aon corporation• Nike• Adidas• Fly Emirates• Standard Chartered Bank• Telekom• Bwin• UNICEF
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Size of the Industry
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Size of Football industry• Trends of Turnover
• Trends vary based upon “On pitch performance”» Sponsorship bonuses
0
500
1000
1500
2000
2500
3000
Turnover 2010turnover 2011
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Market share
Manchester United10%
Real Madrid10%
Arsenal 4%Bayern Munich
7%
Barcelona9%
Milan4%Chelsea
5%Juventus
3%Lierpool
4%
Internazionale4%
Others40%
Market share
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Profitability AnalysisRevenue Sources
Gate Receipts Tickets
Reservations
Broadcasting revenue TV broadcasting
Radio broadcasting
Commercial Revenue
Sponsors Shirt Sponsors
Kit Sponsors
Merchandising Brand
Costs Staff Player’s Wages
Staff Salaries
Amortisation Player’s amortisation
Goodwill amortisaiton
Operating Cost
Home matches Conducting expenses
Conference and catering
Factors Affecting Profitability
On Pitch Performance Getting Points on board
Fan appreciation
Off Pitch Performance Negotiations
Player’s Team Moral
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Profitability Analysis – ManU
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Profitability Analysis - ManU
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Political Environment
• Governing bodies
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Economic environment
• Sponsors• Owners• Stock Markets
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Social Environment
• Fans / Supporters• Press• Culture
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Technological Environment
• Media• Broadcasting Partners
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PEST analysis
Political
Economic
Social
Technological
• Financial Fairplay• Squad size restriction
• Owner’s debts• Inflation
• Hooliganism• Gossips
• Media• Broadcasters
•BOP rule• Financial Caps
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Porter’s Five Forces
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Porter’s Five Forces
• Bargaining Power of Buyers» Fan attendance – affects ticket sales
» TV viewer ratings
Lack of success18% less
season ticket renewals
Reduced ticket rates
Wolves Case :“Wolves pay price off the pitch”
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• Bargaining Power of Suppliers» Sponsors bargain over provision of finances» Player transfers
Porter’s Five Forces
Sponsors / Owners Negotiations Deal
Other clubs Negotiations Deal
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• Threat of substitutes» Other predominant sports in respective
countries/continents
Porter’s Five Forces
Racing
Hockey
Rugby
Classic Sports
Golf
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• Threat of competitors» Rival clubs , Foreign league clubs» Overseas Fans
Porter’s Five Forces
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• Threat of new entrants» New club entering into competition (Long term threat)
Porter’s Five Forces
Relegated in 1974Went on to become Champions for 11
Times
Now, Most valuable club In the world
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Resources 1.Wikipedia2.Footballeconomy.com3.Footballfinance.com4.Sun magazine5.Google6.Deloitte Football Money
League
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Questions?
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Thank you!