If Manchester United had won the Champions League final last night, the Glazers would have got none of the credit. As it is, they are getting their share of the blame for taking money out of the club.
If Manchester United had won the Champions League final last night, the Glazers would have got none of the credit. As it is, they are getting their share of the blame for taking money out of the club.
For a neutral it was a strange sight to see United being outclassed as they undoubtedly were by Barcelona. Some United fans think that not enouh has been done to renew an ageing midfield. It has also been argued that a not very competitive Premier League this season has not challenged the champions enough. They also had a series of relatively easy opponents en route to the final.
The Glazers have always been playing a capital appreciation game and they now think the club is worth £2 billion, a price tag likely to deter most buyers even if it was for sale. United have 14m subscribers to the club’s Facebook page, a database of 10 million and a fan base that may at its core number 140m.
In addition to Aon, its short sponsor and Nike, its technical partner, the club has 11 official sponsors, although it would like to add on ones from energy and handsets, sectors where it is not represented. Commercial deals other than Aon may hit £40m, compared with £24m last year.
The club is about to recover the rights to financial services it gave to AIG, its former sport sponsor. That means a revenue share for the club for every United credit and debit card sign-up fee and transaction. It will see the upcoming renewal of the Nike contract as an opportunity to extract better terms.
It wants to exploit its MUTV broadcasting operation which it brought back in house last year, and push content such as highlights through digital media. Other revenue streams are less flexible. United will make £60m from its cut of English and European TV rights deals but these are in the negotiating hands of others. Gate receipts are not immune to recession or perhaps fan discontent and the strategy is to hold steady.
United has something like £150m cash in hand of which £60m could be used for players. But as United blogger and Glazer critic Andy Green (who is a City analyst in his day job) points out, ‘it doesn’t change the fact that you have £40m-odd walking out of the door just to pay the interest.’
Andy Green does think that the green and gold campaign had an effect in deterring the Glazers from taking the dividend payments that the refinancing deal made possible. He reasonably makes the point, ‘The club has been appalling, noticeably at trying to communicate any positive image. If people like me are wrong, why not engage with us?’
There is a business strategy that thinks one can treat customers with contempt: it is called Ryanair. Their adversarial strategy works because their product is (apparently) cheaper than their rivals. But even the Rynair strategy is encountering some turbulence. And United is not a commodity, it is a high value product. But the Glazers and their advisers may think that the gulf with many of the supporters, particularly those who come to games, is too big to be bridged. If they continue to turn up and the global fan base grows, why bother? It may not be good for football, but it could be a good business strategy.