Managing Euphoria

This week has seen two successful takeovers occur, with both Notts County and Portsmouth (alphabetical order, not importance) being signed over to Middle Eastern hands, and with that two significant staffing decisions announced.

Significant, but contrasting. Sven Goran Eriksson's arrival back in England stunned the footballing world, for both being sudden, and improbable. Who even knew Notts County were being backed by a foreign investor, before Sven was already holding a press conference? Owners Munto Finance and Chairman Peter Trembling have made an excellent acquisition, for both Sven's knowledge of football, and the media hype that comes with him. Notts County have received unprecedented media attention in the last week, and that can only help them try and turn things around.

Mohammed Al-Fayed made a similar entry into football with Fulham Football Club back in 1997. Fulham, like Notts County, were a small team with a bit of history that had found themselves in the shadow of their local rivals. Back then, Al-Fayed's inspirational move was to bring in Kevin Keegan, which gave his Fulham venture the impetus it needed to drive them into the Premier League.

"Now we need to look at getting the right players in to get this club to the Championship in the next five years" Peter Trembling

If Notts County are wise, they can benchmark the success of Al-Fayed's Fulham, and work their way up the league ladder. Fulham backed up their headline appointment of Keegan not with headline players, but with the right players for the right divisions. Players like Chris Coleman, Barry Hayles and Geoff Horsfield were never going to make it in the top-flight, but were the hardworking journeymen necessary for the lower leagues.

On the flip-side of the coin to Notts County's appointment of Sven, has been Portsmouth's take-over by Sulaiman Al Fahim and the two-year contract handed to Paul Hart. The takeover of Portsmouth Football Club has been a long time coming, and unlike at Newcastle United, there is a feeling that the last few i's that needed dotting may have been rushed through for the start of the football season. Hart's appointment is seen as a reflection of that, but Chairman Peter Storrie is quick to refute those claims, with the inspiring words, "People should just get off his back and give him a chance".

Let's compare that to Chairman Pete Winkleman's assessment of MK Dons new Manager Paul Ince, "He remains one of the most talented young managers in this country and I'm enormously excited about what he can help us achieve".

Or Chairman Sir John Madjeski's assessment of Reading's new Manager Brendan Rodgers, "Brendan is a bright young man with exciting ideas. His managerial credentials, vision for the future and years of experience with our club put him above all others we considered for the job".

You can understand why Portsmouth fans are not exactly optimistic about the appointment of Paul Hart, when their own Chairman is risking their Premier League status to "give him a chance". But Portsmouth fans shouldn't judge too hastily. There is an old adage in business that 'it is easier to stay afloat in management without making big waves', and the appointment of Hart is such a move. Portsmouth's undeniable aim is just to stay afloat next season, and the continuity of Hart during a time of background upheaval, minimises the elements playing staff must adapt to. If there is any concern, look again to Fulham's insistence on sticking with Roy Hodgson. Too often we hear Managers complain that they were not given enough time, and that the most successful Managers in football are the ones that have remained in their position through the initial rough period. Fulham's faith in Hodgson was rewarded with a 7th place finish last season and a ticket to the Europa League.

Perhaps there is a time and a place for the subtle promotion against the headline appointment. Sure, Portsmouth fans are not feeling the euphoria sweeping across Meadow Lane... but in 12 months time they might be feeling the euphoria of another European adventure. If that's still not enough for Portsmouth fans... remember this... at least you're not a Newcastle fan.

Shirt Sponsors; Money over Matter

As the 2008/09 season approaches, several football clubs will be playing in and retailing their brand new football kits. The launch of a new football kit is an exciting time for any fan, being able to get their first glimpse of what their favourite players will be sporting all season. These events are not always met with positive feedback; like Marmite, the new strip can either be loved or hated... but either way fans will begin to reminisce of their sides better strips through history.

The colours, design, even the shape of a new kit is vitally important to players and fans. It was always highly unlikely that Manchester United would release a collar-less shirt whilst Eric Cantona was wearing the no.7. However this article is not concerned with these aspects, but focussed on just one element; the shirt sponsor.

The great Liverpool side of the late 1970s receives many plaudits for its innovative success on the field, but off the field they were also leading footballing innovation by becoming the first top flight English side to wear a brand name across their shirt, with Hitachi sponsoring the Anfield side from 1978. The figure involved in that particular contract was certainly far from the £500,000 Sharp paid Manchester United in 1982 for a five-year shirt sponsorship deal, and a whole universe away from the £50m that Samsung have paid Chelsea for their five-year deal in 2005.

But whilst highlighting the extraordinary revenue stream that is shirt sponsorship, my main concern is with who, and why certain companies are sponsoring top-flight clubs. Last season's list of Premier League shirt sponsors is not the most recognisable list of companies. Does the average football fan know who are Chang (Everton), Karoo (Hull City), Garmin (Middlesborough), OKI (Portsmouth) or even AIG (Manchester United)?

Then there's the companies that people may know, but surely feel no influence over. Most fans will have heard of Fly Emirates, and know that they're an airline company, but who is more inclined to use their services from seeing their name on the Arsenal shirt? It's surely quite a select consumer that is influenced from that shirt sponsorship. The same must surely apply to Crown Paints (Blackburn Rovers), LG (Fulham) and Northern Rock (Newcastle United).

There has been an increase in the number of online casinos and poker sites that are sponsoring within sport, noticeably Mansion's deal with Tottenham Hotspur and SBOBET rescuing West Ham United's blank shirt. These are collaborations with conceivable potential. Alcohol (Carlsberg and Liverpool) is an understandable venture too as, to football's detriment, there's a strong relationship between the pair.

In 1995, the FA Premier League Fan Survey showed that almost a third of fans found the products affiliated to their club as "more attractive". So should sponsors not aim to reach the largest target market? The 18-30 year old is almost certainly the ideal recipient to a Premier League football club, young enough to be influenced, but old enough to have disposable cash. In truth, should we not be seeing more football shirts like La Liga's Getafe? It could be argued that Burger King advertising on your shirt isn't exactly promoting a healthy lifestyle, but in that case how much longer can Carlsberg exist on the Liverpool shirt? Perhaps we should all take the Aston Villa route and give up the advertising space for charity.

Economic Lessons Taxing for Premier League

In this never ending time of recession, transfer activity has been somewhat low key. Manchester City and Real Madrid aside, globally excessively large foreign purchases have been on the decrease. However what appears to be on the increase is domestic transfers. Emmanuel Adebayor, Gareth Barry, Frazier Campbell, Glen Johnson, Roque Santa Cruz, Carlos Tevez and Antonio Valencia have all moved between Premier League clubs, with a further few acquisitions from the Championship - yet there has only been one significant purchase from overseas, that of Thomas Vermaelen from Ajax to Arsenal.

There are a number of arguments for this trend, but two particular arguments stand out. Primarily, there have been a lot more players coming to England with the intention of using their first move as a stepping stone to the 'Big 4'. Steve Bruce, now Sunderland Manager, has said himself that his success at Wigan Athletic was due to selling players "the dream of using the club as a stepping stone". This has been effective for Wilson Palacious and Valencia at Wigan, succesful too for Javier Mascherano and Tevez at West Ham United and Santa Cruz at Blackburn Rovers. This stepping stone strategy allows two benefits to prospective buyers, the ability to scout players close up on a week-to-week basis, but more importantly the ability to assess how the players adapt to the cut and thrust of the Premier League. Judging their adaptability takes a large element of risk out of bringing in new talent.

The second argument is economic. The recent Kaka transfer from AC Milan to Real Madrid raised an unprecedented issue with transfer records. Kaka's transfer fee of £59m smashed the previous record fee of £47m paid by Madrid to Juventus for the services of Zinedine Zidane. However both of these transfers were actually made in Euros, and the Euro has strenghted in that period of time, thus making Zidane's fee still higher at 73m Euros, as Kaka's fee exchanges to only 68m Euros. The argument seems pedantic (particularly given that Ronaldo's fee of £80m/94m Euros is definitively the new world record), however the drastic change in exchange rate is important. £20m used to be able to purchase 31m Euros of talent, however now it is merely worth 23.5m Euros, which sadly to the likes of the Premier League hierarchy is still twenty million in Pound Sterling. Essentially this means that it is increasingly more expensive for British clubs to buy players from Europe. Not only do their costs increase, but European clubs themselves need to raise less to compete. This is why it's fundamental to British clubs that the Premier League continues to be so globally attractive and obtain such high revenues.

A further economic issue soon to cause Premier League clubs problems is the government's decision from April 2010 to increase the highest tax band to 50% of earnings. This will apply to almost every footballer in the top flight, and hugely affect their net income. Deloitte Sports Business Group report that for a Premier League club to remunerate a 3m Euro net salary, it would cost the club 6.8m Euros gross. However the same 3m Euro net salary in Spain would only cost a La Liga club 4m Euros. And of course, the modern player is demanding to be remunerated in Euros with its current strength over the Pound, creating more problems for the Premier League.

Liverpool's Xabi Alonso has voiced his concerns, "When you see your contract down by 30 per cent you cannot be happy. I cannot do anything – it must be Gordon Brown or David Cameron". Alonso's comments fuel the belief that Premier League footballers are only in it for the money, but the figures do not make pleasant reading for his peers. Alonso's £65,000 p/w salary signed in 2007 was worth 96,000 Euros p/w... but with the fall of Pound Sterling, and the increased tax rate, that will only be worth 69,000 Euros p/w from April 2010; a loss of £1.2m a year.

Many see this as the beginning of the end for the Premier League's dominance of European football, with Arsenal Manager Arsene Wenger commenting "The new taxation system, and the collapse of Sterling, means the domination of the Premier League will go... It will be a financial problem for all the English clubs".

However, I can see not just a silver lining, but perhaps even a break in the clouds. Primarily, this will force Premier League clubs to turn their attention to domestic purchases, which will keep increased revenue within the UK, potentially helping the country out of recession. But from a footballing point of view, youth development will become increasingly more important, and with increasingly larger funding, lower league clubs will again find themselves a necessity in the league ladder.

And... if Sepp Blatter does succeed in implenting his 6+5 plan for the future... will the Premier League not have been given an accidental head start in proceedings?