“To be a well-favoured man is the gift of fortune.” William Shakespeare, Much Ado About Nothing.
What sets the superstars of today apart from their forebears of football’s past? Is it their talent? Their drive and determination, perhaps? Or is it something more modern? I for one cannot believe that Lionel Messi and Cristiano Ronaldo are any more driven than were Pelé or Diego Maradona. Nor indeed that the latter pair’s talent would not transcend the generations and light up the sky as brightly as those stellar rivals from Barcelona and Real Madrid.
No. There are many improvements in the modern game – from medics, nutritionists and groundsmen to name only a few – that would benefit the flair of past heroes just as much as they have today’s. It goes without saying that when making comparisons with history, we all should be aware of that. It is my belief that what sets apart Messi and Ronaldo from the past pantheon of football greats is that most modern of concepts: brand.
Brand is, after all, the corporate and celebrity equivalent of any person’s reputation. What we have today and did not when Pelé or even Maradona were playing – at least not to the same extent – is the global grandmasters of sports marketing pitting themselves against each other over an advertising chessboard whose pieces are the top players in the world. Nike and Adidas are involved in an eternal game that enhances the standing of all players whom they are supporting.
Nowadays the FIFA Ballon D’Or awards give us a glittering ceremony every bit as glamorous as the Oscars – our eyes are drawn to the excellence of players who in years gone by would not have registered so profoundly on football followers overseas. (I know this, because I have recently watched a wonderful 90-minute video on YouTube of a man I should have known more about — “Michael Laudrup… The Ultimate Passing Compilation”. It introduced me for the first time to the sumptuous skills of the great Dane: truly an unsung hero of football’s past.)
Yet despite the efforts and the millions of the marketing men at Nike and Adidas to extend the brand reach of the world’s most recognisable players, it does not always work out as planned. Last week the football marketing-and-management agency Prime Time Sport issued a release that provided some very telling statistics. Lagardère, a sports agency, had interviewed 600 consumers in Spain, where both Messi and Ronaldo play their football. What it discovered was that Adidas, which according to Prime Time pays in the region of €6 million every year to Messi to receive his endorsement, lags dreadfully behind Nike in terms of brand association.
Esteve Calzada, chief executive of Prime Time, made the following assessment of what these data mean: “Considering very similar circumstances between Messi and Ronaldo (top 2 teams, top 2 players, top 2 technical sponsors, personal sponsor same as national team, personal product line developed by personal sponsor), the only reason I can find for Nike association with Ronaldo being better than the one of Adidas with Messi is a better usage of activation.
“It is fair to say that Messi was once sponsored by Nike, but controversially moved to Adidas at an early stage, hence not giving it enough time to develop a proper association. So it seems clear that the reason must be that Nike is better activating its association with Ronaldo.
“Despite not having evidence of more investment by Nike, I believe that Ronaldo gets more attention in advertising campaigns among Nike sponsored players than Messi gets from Adidas. This could probably be one of the reasons, which in my opinion would be 3: 1) Higher activation investment; 2) More Cristiano centric advertising and 3) Advertising creativity.”
This instinct would seem to be borne out by the two major sports brands’ respective financial performances over the five years between January 2009 and December 2013. It is clear that Nike’s market share has grown over the years relative to Adidas’s, with Nike achieving almost 45% better sales in 2013 versus 31% better in 2009. But it seems that Adidas has focused more heavily on efficiency of spending – the German firm’s earnings before interest, tax, depreciation and amortisation has risen by substantially more than the American’s on slower revenue growth.
So, as Calzada says, it is not enough merely to invest in the top line sponsorship; substantial effort and investment must also be put into shouting about it. What Nike has achieved with Ronaldo is to take substantial ownership of a player who wears an Adidas shirt every week. By contrast, Adidas has failed to do this with a player who wears a Nike one every time he plays for Barcelona. The problem for Adidas’s Messi sponsorship is that every time he scores a goal, the shots of him and his team-mates celebrating it contain the Nike swoosh. Overcoming that can cost an awful lot of cash in activation spending, as the reduced EBITDA at Nike – in almost every other way a like-for-like business to Adidas – seems to indicate.
To my mind, this fact helps explain why Adidas has poured so much money into the Manchester United sponsorship. At £75 million per year, many involved in the sports-retail sector question whether Adidas will ever make the money back on the Manchester United shirts they sell. But it strikes me that there is more of a strategic play at hand here.
The investment Adidas has made in owning the United shirt is a bet on the strength of United over the coming years. As this column has previously explored (see related article below), United have growing financial firepower that is set to explode with the new round of sponsorships and tv deals they will benefit from over the 2015-16 and 2016-17 seasons and beyond.
Aligned to that is United’s stated strategic positioning in trying to accumulate a squad of players with the biggest names in the world, as United’s chief executive, Ed Woodward, has previously made clear. “The reality is that we’re not afraid of spending significant amounts of money in the transfer market,” he said. “Whether it’s a record or not doesn’t really resonate with us. What resonates is that a top, top, elite player, that the manager wants, is going to be a star for Manchester United. There is no budget.”
Woodward was the man who as chief commercial officer grew United’s sponsorship revenues many times over. He knows the value of stars when it comes to negotiating deals with sponsors and is quite clearly prepared to invest heavily in accumulating the elite-player brands to Louis van Gaal’s squad in a virtuous cycle that would further enhance United’s sponsorship potential.
It works for Adidas too. Because when Ronaldo finally retires or is usurped by the Next Big Thing, which at 30 years old sooner or later he must, then the German firm will be very well placed to own the imagery around the most recognised football players in the world. Because with Manchester United, Real Madrid, Bayern Munich and Chelsea among their portfolio of clubs, every time a goal is scored by four of the biggest and most successful clubs in football, the photographs will contain the Adidas logo.
But it is worth going a step further, to the extent that I am prepared to make a little prediction. With the Premier League’s wealth growing as the euro weakens and, as reported on INSIDE World Football last week, with his own tax difficulties growing, I expect Messi to move away from Barcelona this summer. His destination? Old Trafford. And the transfer of such a well-favoured man will be a gift of fortune to him, Barcelona, Manchester United and their sponsors.
Related article: Manchester United and their Messi set of accounts http://www.insideworldfootball.com/matt-scott/16285-matt-scott-manchester-united-and-their-messi-set-of-accounts#.VMir0FYg4p4.twitter
Journalist and broadcaster Matt Scott wrote the Digger column for The Guardian newspaper for five years and is now a columnist for Insideworldfootball. Contact him at email@example.com.