Monday, August 30, 2010

Manchester United Dumps Ugly Girlfriend Only to Hook Up With Another Woof-er

Last January, super club Manchester United began their search to sign a new beer sponsorship after their deal with Budweiser and parent company, InBev, was set to expire this season.

This week, the Red Devils announced they had partnered with Thailand brewers Singha to becoming the official beer of Manchester United. This follows news from earlier this month that Singha also signed on as the beer sponsor of United's EPL rivals, Chelsea. United's deal is worth a reported, $14-million over three years.

As we commented on Twitter the switch from United's previous beer sponsor, Budweiser, to Singha, is roughly the equivalent of dumping one ugly girlfriend for another. Both are mass market, bland tasting brews that are an insult not only one's taste buds, but an affront to the tastes of your local fan base.

Your friends were busy congratulating you for dumping the baggage and now are slapping themselves on the forehead as you bring home the next paper bag job (which is funny in an unintended way as most bad beer is also drank out of a paper bag).

Uhh.... question.
What ever happened to the local brews?
With the increasing globalization going on in global soccer it wasn't surprising to hear that yet another super club went outside it's borders to land a major sponsorship deal. With massive player salaries on the books and tough economic times selling out to the highest bidder made the most sense (even not in tough money times this is true). United recently signed a new shirt sponsorship deal with Aon Corp. worth nearly $125 million over four years making it the largest in soccer history and eclipsing their next largest deal by a factor of four (Bayern Munich and T-Mobile).

No one is going to fault Manchester United or any other club for seeking top dollar deals. They are a business after all. The problem is when these business calculations run in the opposite direction of common sense from several different perspectives.

United and other European clubs are looking towards the Asian continent as one of the last footballing fan frontiers (nice alliteration, huh?) along with the United States. By tapping (ha.. punny!) Singha Beer as a major sponsor they create one more powerful connection with one of the largest sets of fan bases in the world. In India alone the number of United "fans" out-numbers local United Kingdom fans by 6-to-1. The logic goes that if you want to capture the Asian soccer fan you need to make sponsorship in-roads into products they have a connection to.

Enter beer. Asia is fast growing market for many goods and beer is one more sign of a growing affluent continent. As the middle-class grows in nations like China, beer purchase and consumption is seen as a major harbinger of financial success.

The problem is when the European clubs' marketing departments treat Asian as one homogeneous group. Simply signing a multi-year contract with one Asian company doesn't make the in-roads that one might think. Moves to recruit foreign beer makers smacks of a lack of understanding as to how the world works.

The equation has to be more complicated that this:

Club's want of Asian market + sponsorship by beer drank in one specific nation = Converted Asian market

Signha doesn't have an iron grip on the Asian beer market. In fact, it hardly has a grip on the Thai beer market as it yo-yos between Thailand's number one and number two beer with Change (ironically the shirt sponsor of fellow EPL club, Everton).

Certainly Thailand is a valuable growth market for the Red Devils, but at the expense of South Korea, Japan, China, et al? These nations are all fiercely nationalistic and growing as producers of domestic beers. Do they really want to see Manchester United have such tunnel vision when it comes to hooking up with one Asian beer company?

Do I have a problem with Singha as a beer? No, not really. Truth be told I've never had one. I'm sure it's just one of those country-specific lagers that are unremarkable, but at a certainly time and place; refreshing. BeerAdvocate users give it a "C" rating (although the "Bros" give it a "B," but that might be because of their fondness in pairing it with spicy Thai food).

What we do have a problem with is cynical marketing. Does Manchester or Chelsea or Everton for that matter really expect that it's fans will begin drinking these Thai beers? At all? According to news releases these are now going to be made available in their stadiums. Certainly the sales figures for those will be barn burning.

As soccer clubs around the world, but particularly the massive ones that are reaching out from Europe, attempt to become global brands it is important that they not forget the fans that helped build them brick by brick and blade of grass by blade of grass to become what they are today.

I can hardly imagine the lack of a rush of fans to line up for United's previous beer sponsor, Budweiser, either. The problem with clubs looking past their local beers is that they're hardly considering the fans that pack their stadiums each weekend in the money making equation.

When the budget makers at super clubs like Manchester United, Chelsea, or Real Madrid look at their revenue streams how much cash is being made between the walls of their houses of soccer worship in Manchester, London, or Madrid versus the advertising and merchandise flow from the rest of the world?

For these clubs the beer is just a small part of a bigger globalization equation where the average fan that walks out his or her front door and takes the train to the stadium is becoming less and less of a factor. There particular taste in beer, say nothing of other sponsorships, coaches, players, and other things are increasingly unimportant.

This is why you see ownership backlashes at United (against the Glazers), Liverpool (against Hicks and Gillette) and to a certainly extent worries with new cash flows at clubs like Chelsea (with Abramovich) and Manchester City (with the Dubai backers).

The beer is just sitting, cooling, a top an iceberg of problems for mega clubs.

The sensibly solution to this all is to ensure that both local traditions and global reach exist peacefully. Why not have a tiered sponsorship system that allows the local or even national brands the ability to get a piece of the United pie? Even though "Britain's biggest brewers (were) among those that received footballs branded with each of their own beer marques and Manchester United logos." it had to be believed that it was unrealistic that their bids would win out.

Think locally? Drink locally?
Not that sports in the U.S. are the shinning beacon for the rest of the world always, but often times they have succeed in mending local concerns with a larger approach. Take, for example, Seattle's "Brougham Bitter" a beer named for the Sounder's supporters group on tap at Qwest Field. Back in the FBM's home state of Wisconsin the Milwaukee Brewers ballpark, named Miller Park, has several competing beers on tap including two local favorites, Leinekugel's and Lakefront.

The world is becoming more and more inter-connected everyday, but it's important that massice clubs like Manchester United keep in mind the people that brought them to the point where a Thailand beer company would drop $14 million just so they could get their names on an electronic sign board and a few taps in the stadium.

Those people probably deserve a beer. And one that came from nearby.
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