Sports sponsors look for success

10 May 2013

LONDON: Observers have warned that managerial changes at Manchester United Football Club could be a concern for the club's sponsors such as Chevrolet, the automaker.

The club's announcement of departure of Sir Alex Ferguson "will be a worry for sponsors," Rob Mason, managing director at IMG consulting international, told Marketing. Chevrolet recently signed a seven-year shirt sponsorship deal with the club worth about £25m a season.

"Manchester United is the best-supported club in the country and there will be a worry as to whether this success will be continued under the new manager," Mason added.

"Ferguson has been a fundamental reason for the success of the club and you are now taking that away."

Meanwhile, Andre Spicer, professor of organisational behaviour at Cass Business School, pointed to the impact on an organisation of forceful individuals such as Sir Alex. "Typically, the retiring leader casts a shadow over the whole organisation for many years," he told the BBC.

During his 27-year tenure, Manchester United has developed into a global brand, with sponsors in Europe, Africa, Asia and the Middle East.

Harry Philp, football finance expert at Portland Advisors, said the club's commercial success was in part due to a strategy of segmenting commercial partners and seeking different sponsors in different countries in different markets.

Others were more sanguine about Sir Alex's retirement. "Ferguson is obviously an incredible asset to the club and actually is likely to have more involvement with sponsors commercially, as he moves to be a club ambassador and director," said Rupert Pratt, managing partner of Generate Sponsorship.

Nike, the club's current kit supplier, concurred with that view, saying they were "delighted" he would continue his involvement with the club in that role.

The news comes as one of Nike's rivals stands ready to replace it as the kit supplier to another Premier League club. Puma is understood to have agreed a record £30m a year deal with Arsenal.

Further down the pecking order, upmarket grocery retailer Waitrose plans to renew its sponsorship of Reading Football Club, despite the club being relegated from the Premier League. As part of the deal, special offers will be made available to season ticket holders.

Waitrose also extended its sports sponsorship in a new direction to become the official sponsor of the England cricket team, a move aimed at building its brand around the world.

Data sourced from Marketing, BBC, Marketing Week; additional content by Warc staff