Having just read the article concerning the 'New Sponsorship Deal', I am interested to read that Everton have agreed a deal which could be worth up to £12M. Could be... not is.
The recent spate of Sponsorship changes were (if I recall correctly) in the region of £8M a year, and some like Spurs, even have 2 sponsors, one for League and Cup and another for Europe. EFC sign a deal for what will be at most £4M a year, and this for a team which is routinely in Europe.
All of which begs the question, why do EFC stay with Chang? There is little or no mention of EFC on the Chang website; and a google search for Chang Beer yields a photo of Fellaini on Page 8 (compared to a picture of Rooney for AON on page 1, an LFC top on Page 2 for Standard Chatered, a Spurs top for Investec on page 2 etc...)
So what do Chang DO for Everton FC? Not much in the way of money, nothing evident in the way of publicity on their own website ? not even when you log your location as UK on the Chang website do you see mention of Everton FC....
Everton may not be the biggest football club in the UK, but surely the club should be capable of obtaining more money and a more productive partnership with a Sponsor.
Rupert Sullivan, Posted 25/11/2010 at 07:35:25
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1 Posted 25/11/2010 at 14:27:17
Everton £4M per year ? enough said. Another major coup by our marketing team!!! Always aiming high, but hey we will sometime get the best young Thai footballers... won't we!?!
2 Posted 25/11/2010 at 14:27:53
I know people are getting bored of it, but this can lie only at the door of one man: Billy Liar. He wants us to compete and says he wishes he had the money to get us closer to the Tottenhams and the Liverpools etc. When renegotiating deals like this, he has a massive opportunity to generate more money to bring us closer to them.
IMO he's failed us once again. How many more failings must we wait for?
3 Posted 25/11/2010 at 14:35:48
Add to the fact that Chang tastes like piss and nothing has came from these footballers we are breeding at this elusive "Thai school".
So nice one, Blues ? you've fucked up again and missed another opportunity to get us right up there with the big boys.
4 Posted 25/11/2010 at 15:00:36
John, How do you know £3-4m is FUCK ALL compared to what clubs who are "on par" with us are getting (as previously mentioned)?
5 Posted 25/11/2010 at 15:07:11
We are who we are.
6 Posted 25/11/2010 at 15:10:08
7 Posted 25/11/2010 at 15:35:38
8 Posted 25/11/2010 at 15:32:17
9 Posted 25/11/2010 at 15:52:42
This season has been piss poor in preparation, organisation, players playing for the fucking shirt... seriously, does our history mean jack to these overpaid donkeys and goats?
What's good about being an Evertonian?? From slogging all week to pay to see them draw with Blackpool, to watching Everton's Board being excited about building a shed at the end of the ground ? we are light years away from winning a trophy... in fact, I will say we won't win a trophy in my lifetime ? and I'm 36.
I have watched this club being ripped from its very foundations, and I've had just about enough ? I'm sure others feel the same.
10 Posted 25/11/2010 at 16:16:02
11 Posted 25/11/2010 at 16:02:42
"The contract boasts increased terms that could see the Club net more than £12M between now and the end of the 2013-14 season."So in other words the value of the contract is £12M over 3 and a half seasons or up to £3.4M per season.
Also, in the above article, Robert Elstone said that the value of the contract is worth 25% more to the club than the previous £2.6M per season sponsorship deal with Chang (75% of £3.4M is £2.55M, close enough!).
12 Posted 25/11/2010 at 16:23:19
Did I say I know how these deals are structured, protracted and executed? No, I never did I.
I know the value of our deal ? although as pointed out it is 25% on top of previous, so far dues there ? is less than those of Spurs, Villa and even Fulham and Newcastle because of similar announcements made when they made their recent sponsorship deals.
Also, touching on the fact that it is another opportunity missed covers a whole number of recent issues. This may sound daft (especially to those not from Liverpool) but we have missed a big chance of generating more revenue with our choice of Le Coq Sportif. Now never mind Le Coq being a shit make and also that chosen of lower league clubs, the old proverbial "we should get Nike or Adidas" comes up as not only would our kit be better, if you take a walk around any part of Liverpool you will notice that most teenagers are in trackies (as I used to be), in which if Adidas or Nike was our kit sponsor, I can guarantee you 90% of teenage scouse blues would have the trackie, not to mention all the training gear as well.
This may look like I am ranting over a stupid issue considering we need to sort ourselves out on the pitch first and foremost, but since I can remember or PR / media / marketing department has always been lacking.
13 Posted 25/11/2010 at 16:50:06
14 Posted 25/11/2010 at 16:58:15
At the minute, we are no better than Sunderland, Bolton, Newcastle, Blackpool or Fulham.
I'm not saying the new Chang deal is the greatest for the club, but on current form, you can't even talk about us with the likes of Utd, Chelsea, Arsenal or Spurs. I don't like it but it's true.
15 Posted 25/11/2010 at 17:27:03
16 Posted 25/11/2010 at 17:27:41
17 Posted 25/11/2010 at 17:16:40
Sponsorship is far more complicated than just the money a club is being paid by a brand, there are more revenue streams to be exploited and as such there are different methods of getting the customer to use the product.
Beverage companies use football clubs to drive sales ultimately; a perfect example of this is Tennents sponsorship of Rangers, Celtic and Preston. It is purely in order to drive as big a volume of sales as possible on a matchday and push as much to the punter and changing people's buying tendencies. Everton will therefore receive royalties in unit sales on a matchday which are not part of the sponsorship deal, which is only the amount to sponsor the club and have the right to slap their brand everywhere.
The royalties will be formed in a corkage / sale-under-licence type agreement which we could have had with any other drinks maker. Chang probably only offered to sponsor the club if they had exclusive lager rights within the stadium as otherwise.
The key difference is that Standard Chartered or Investec can't activate their audience in the same way within the stadium as say a gaming company or drinks maker and therefore they will pay a larger sponsorship fee as the most important thing for them is to be able to display the brand everywhere... And why Investec sponsor the CL games, as it has a much wider audience.
Spurs' model of two sponsors is great and many more clubs will go down this route in time. I am not saying that we are getting as much as Spurs or Liverpool as we aren't but just to say that the gap is less than you think. I hope this all makes sense as I am rushing to get home.
With regards to the sportswear, I don't agree. Again it boils down to money and LCS are paying Everton for more than Nike or Addidas would to make our kits because they are world renowned businesses and have the likes of United and Madrid to do their marketing. We are a developing club in a different league to the big boys and this is much the same as LCS, they pay us more as they need a us more. They will never be able to afford to sponsor United and Madrid so they go to the next tier and get the likes of Everton, they pay us a premium as, if not, they get a Wigan type.
The other thing is, and something I do think the club shouldn't have done, that we outsource our retail operation so Kitbag pay us a large licence to sell all out product. They also pay us a small royalty but at the end of the day it doesnt really matter to Everton how many trackies the kids wear as with their current busines model they won't make any more money the more kits are on the streets. The structure they have got in place in terms of outsourcing but given that's what we have, the commercial deals around it are as they should be until things change.
18 Posted 25/11/2010 at 18:01:39
19 Posted 25/11/2010 at 17:40:38
I think that, in these circumstances, acheiving a rise of 25% is indeed a good deal, because any new deal negotiated will be based around the old one, especially if you stay with the same company. In the current economic climate, could we really do much better than this? I'm not sure...
20 Posted 25/11/2010 at 18:50:37
I remember when we played in Norway a couple of years ago, couldn't display on our shirts any reference to alcohol and we walked out with blank shirts, City of Culture etc coming up, negotiate a deal with someone for a one-off televised 90 mins... no.
Shanghai Expo, Liverpool negotiate a deal for the Chelsea game, shirts sponsors written in Chinese etc, easy isnt it?
Have a look at the lack of queues for drinks, food etc in the ground since rip-off Sodexo took over the food franchise: £3 for a sausage roll, £2 for a bottle of coke... this is not Wembley, these people are ripping off Everton supporters with the clubs agreement.
Nothing this club does fills me with confidence that we are securing deals in the best interests of the club.
21 Posted 25/11/2010 at 19:06:54
What I don't understand about the outsourcing to Kitbag is how this can possibly be better for the club than running the main outlets (Everton One, Two, website store) themselves. Yes, Kitbag may be more efficient... have more stores (with miniscule Everton turnover) but they must be sucking up the lion's share of what is in this particular revenue stream??
And surely if Everton are on royalties, would these not be by volume? Surely for each trackie, they now get £1.50 in royalties... whereas Kitbag are snorting £15 in pure profit? Wouldn't it be in the better interests of the club to get that full profit, without the Kitbag middlemen?
22 Posted 25/11/2010 at 19:24:29
"Hello, can I speak to the person who deals with marketing please"
Come on Rob, it's not rocket science lad.
23 Posted 25/11/2010 at 20:13:51
24 Posted 25/11/2010 at 20:27:14
25 Posted 25/11/2010 at 20:33:31
The structure they have got in place in terms of outsourcing (isn't, I believe in the best commercial interests of the club) but, given that's what we have, the commercial deals around it are as they should be until things change (and the club decides to employ specialists in each area and bring the whole operation back into the club).
So I agree that outsourcing Kitbag is the wrong thing to do but, as we have done the deal with LCS, it is better for us than getting a Nike or Addidas supplier as they wouldnt pay us the licence fee to produce our kits. The kit payment from the manufacturer shouldn't be confused with royalties from retail outsourcing.
Again the same thing with Chang and Sodexho, we outsource to Sodexho (even the little corporate) and they pay us a licence for that. Chang will probably pay us a royalty on sales by volume as it is a more fast moving product with less value. Effectively take Chang for LCS and Sodexho for Kitbag.
In the case of Kitbag, providing product which is higher value, the deal is likely to be whereby Kitbag will have a threshold of revenue before they pay Everton royalty fees. They may even just offer the club a guaranteed kick back at the start of every year instead of, and of less value than, royalty by volume.
Yes, it would be in the best interests to have everything in house but, when you look at it in purely business terms and take the football and passion out of it, the club is an Small to Medium sized business with a relatively small turnover of circa £70m. It's very difficult in a business of that size to operate a successful first team and reserve squad, academy and retail, catering, maintenance, security, logistics and media operations.
It is very difficult and expensive to find the expertise to come and work client side for you and leave the likes of Sodexho and Kitbag who have made very successful businesses of far greater size and financial success than Everton by providing the expertise. They keep their staff industry side by offering the better compensation (they have far more money, don't forget) and career progression than an SME can do. Who says major players in any industry don't dictate market forces, purely by starving their clients of the staff to do things successfully in house.
Sorry for boring, hope it makes a bit of sense.
26 Posted 25/11/2010 at 20:53:02
27 Posted 25/11/2010 at 21:01:05
Cashflow is king rather than cash is king.
28 Posted 25/11/2010 at 20:55:29
The only major corporate shirt sponsorship we've had in the last 10 years has been one-2-one. The worse part is that Chang isn't even Thailand's largest Brewer, it's Singha Beer.
AIG, Emirates, Investec, Ethiad, Standard Chartered... and we getting fucking Chang, seriously we are shitter than shit.
Wouldn't even get sponsored by Durex,I mean who would want to sponsor eleven dead rubbers!
29 Posted 25/11/2010 at 21:18:20
30 Posted 26/11/2010 at 00:53:55
The club?s not perfect, but I?m sure they?ve got people who are qualified to negotiate what a sponsorship is worth better than a bunch of keyboard warriors.
31 Posted 26/11/2010 at 02:00:26
Premier League football is big in Thailand and the neighbouring Asian countries which is Chang's aim for market dominance and none of their competitors sponsor a footy team.
32 Posted 26/11/2010 at 02:14:58
Kunal #28, Chang is the number 1 selling beer in the Thailand market even though the parent brewing company is smaller than Singha.
33 Posted 26/11/2010 at 02:45:01
I am sure a number of posters are far better equipped than Elstone to negotiate sponsorship or to oversee our undoubtedly "piss poor" commercial department.
For a start, any good marketing function would "listen" to it's customers ? something Kenwright's EFC will NOT do ? and when you get the Chairman making stupid statements like "Only Newcastle supporters buy shirts" you can understand the frustration of the "keyboard warriors".
34 Posted 26/11/2010 at 08:44:56
This site never stops amazing me.
When we have an injury within the squad half the site become medical experts.
When we had the issue about the "shadow director" we suddenly had a number of legal experts.
When we had the issue about shares etc we suddenly had stock market experts.
We now have a number of marketing experts on the site.
35 Posted 26/11/2010 at 09:03:34
Our sponsorship deal is worth what someone is prepared to pay. Everyone here presumably knows someone who will pay more? FFS, tell the club in 3 years will you ? you're a bit late this time.
36 Posted 26/11/2010 at 09:08:09
37 Posted 26/11/2010 at 09:26:22
38 Posted 26/11/2010 at 09:51:35
You are correct in thinking that it isn't to drive sales at just Goodison Park, it is far more than that. What I am trying to say is that, as part of the sponsorship arrangement, they, the club and several other partners, such as Tesco and Change UK PR /Marketing agencies are heavily pushing experiential and acitvation marketing campaigns to change people's buying habits and increase the consumer use of Chang beer in the UK.
Experiential and activation campaigns are exactly what they say they are, giving the consumer experience and acitvating the brand with them. To such fast moving products, activation is more important than brand presence ? the opposite to Standard Chartered and Investec, as I mention above.
My point is that Everton are benefitting from this in terms of royalty payments and their the gap is smaller than you think. A perfect example of this is the Tesco / Everton / Chang deal offering 4 free cans of Chang from Tesco outlets when purchasing a ticket for the Everton FC v CD Everton game.
This is called affinity marketing as it is effectively an affinity between a number of partners / stakeholders in a campaign with everyone benefitting. Everton sell tickets, Chang further promote their brand and product with the intention of getting consumers to by Chang next time they go to the offy instead of Fosters or Carling, and Tesco drive footfall fans into their stores who, whilst they are in their to get their free cat piss, they then spend on average another £43 (the average spend per person per visit).
So you are correct: Chang are not sponsoring Everton to drive sales at Goodison but it is absolutely about driving sales across the UK and Everton is their vehicle.
39 Posted 26/11/2010 at 10:11:16
Yes, it seems like a pitifully low figure. So why doesn't another company step in and pip Chang with a slightly higher bid?
The answer is that £4 million a year (or whatever) is evidently all we are worth as walking adverts.
If we were worth more, then another company would offer us more. Simples.
Conspiracy theories don't apply to issues like this; are you saying that literally every commercial company in the world undervalues the Everton brand? The money men are not stupid.
40 Posted 26/11/2010 at 10:44:05
Of course. How could I have forgot that.
41 Posted 26/11/2010 at 13:04:53
BK has deliberately organised a low sponsorship deal in order to make the club look less attractive to potential buyers.
42 Posted 26/11/2010 at 13:40:50
In this context it looks even worse, Standard Charted went with Liverpool because of the brand, imagine how much Chelsea, United or Arsenal (excluding the stadium deal) could demand if they looking for new deals. You're talking £30 million plus a season for a global brand with Champions League football exposure.
Another issue also has to be that our deal must include having Chang as stadium beer provider, how much do other clubs recieve on top for exclusivity?
43 Posted 26/11/2010 at 13:48:12
44 Posted 26/11/2010 at 14:02:35
The following is from the OS:
'Since first joining forces with Chang in 2004, Everton have negotiated steadily better terms and Elstone believes that speaks volumes about the Club?s attractiveness to investors.
?It is a great deal for us financially,? Mr Elstone told evertontv. ?It is probably about four times the original deal and is at least 25 per cent more than the current deal, so we are showing good growth rates.'
45 Posted 26/11/2010 at 14:10:42
Eric @ 32, 33, 34 - you might want to pay particular note of the section copied below which discussed the sponsorship activation and is what I believe Chang and Everton are doing well.
It also briefly touches upon the difference in sponsorship value between CL, PL and Championship but as an interview to the layman it could be covered in a lot more detail.
Honestly guys, the Chang deal is a pretty good one.
46 Posted 26/11/2010 at 14:14:48
MBA Soccer: How are other professional teams faring in their sponsorship efforts and how is this affecting the way clubs are managed?
Chadwick: ?After the top four or five clubs, things fall away very sharply. Consider the case of English Premier League football club West Ham United. They lost their shirt sponsorship deal, worth an estimated £7.5 million over three years, when XL Airlines went into administration. That has since been replaced by a far less attractive deal with online gambling company SBOBET, an 18 month deal worth £2 million.
?Outside the Premier League, the picture is even more worrying. Sponsorship values have fallen dramatically and some clubs are finding themselves having to play without sponsors. The current climate has resulted in two changes. First, rather than chasing the short-term buck, clubs are now thinking more carefully about how their deals can help them generate long-term value. Second, a number of clubs have assumed far too much about themselves and the power of their brand, and have therefore lost out on deals in an environment where sponsors are clearly looking for good value. This has led some clubs to reappraise their ?offer? and think about what they can give to sponsors who engage them.?
MBA Soccer: Do certain sponsors benefit more from their relationship with a club? If so, what accounts for the difference in sponsor benefit?
Chadwick: ?There are two main issues here. First, some sponsors simply assume too much about the power of football. Putting a logo on a shirt has never necessarily been the most effective form of communication. Moreover, sponsors also tend to assume that clubs will help them get the most out of their deals. Too often, they don?t. Clubs variously don?t have the inclination, the interest, nor the competence to help sponsors in the way the sponsors would like help.
?Secondly, and linked to this, some sponsors don?t activate their deals properly. Activation figures in the UK, especially in football, are very low and often compare very unfavorably with rates of activation expenditure in the US.?
MBA Soccer: What new techniques are being employed to make sponsorships more effective for both the team and the sponsor?
Chadwick: ?Historically, clubs employed ex-players to work as managers, looking after everything from tickets to sponsorships to paying the bills for cleaning the bathrooms. This led to a very introspective, often disorganized and sometimes unprofessional approach to managing sponsorship deals. But things are changing. Clubs are employing specialist staff. They are now far more market-facing, strategic, and recognize there is a need to treat sponsors as customers."
47 Posted 26/11/2010 at 13:43:33
According to Elstone today: ?There were other brands out there who were interested in sponsoring us."
Of course there's no mention of 'names' nor the financials of these apparent 'offers' but maybe we are not so unattractive as some would have us believe.
Anyway, Elstone goes on to clarify by claiming it was due to the "partnership that works for us and for them" that swung the deal.
As always, the devil will be in the detail, something that we as supporters/minor shareholders can only guess at.
Ah well, I'm sure the management/executives are thoroughly enjoying the other recent tie-up with Jaguar:
48 Posted 26/11/2010 at 15:10:20
49 Posted 26/11/2010 at 16:11:31
Here there are Chang Sports Bars which provide Everton promotional merchandise when you consume their beer.
50 Posted 26/11/2010 at 17:00:17
51 Posted 26/11/2010 at 18:24:27
I know we blow off steam here, but I do wonder why some peoples default position is set at 'criticise the club'. In this case without bothering with relevant facts or comparisons.
52 Posted 26/11/2010 at 20:47:44
Did you have some link to add? I'm not coming up with anything...
53 Posted 26/11/2010 at 20:57:22
The again, maybe Nike phoned up and said "we will treble your deal if you sign with us". Moyes and Kenwright got together and said "no we don't want this because we don't want extra revenue coming into the club cos that way we might be able to buy more players". Get a grip some of you.
54 Posted 26/11/2010 at 20:42:30
We're the only EPL club so far this season that hasn't been blown out or squandered a commanding lead.
We start putting the ball in the net, sponsors will line up.
Chang is what we have so far.
55 Posted 26/11/2010 at 21:35:07
"Do people honestly think it is as easy as saying "we should go with Nike"? and there Nike appear, offering more than Le Coq Sportif?".
The worrying thing is looking at posts such as number 22, I think some people do.
56 Posted 26/11/2010 at 21:39:39
.......Liverpool Audi team to Finch Farm as the car manufacturer became the Club?s official car supplier.
The new partners have agreed a three-year deal worth £100,000 per annum, which will see the luxury car firm supply the Club?s coaching staff and senior management team with executive transport.
57 Posted 27/11/2010 at 00:37:23
They pay us sponsorship money. It is us who have the responsibilty to do something for them. They are investing in us and Everton put Chang on most merchandise, playing apparel and website in return. They are trying to make money from that investment in us. There seems to be this idea that they pay us money and they then go and shout it from the rooftops that Everton are great. Its the other way around I am afraid.
And to complain about the level of sponsorship is a bit silly also. We are a club that after years of being a lower table team that has only recently started performing in a manner that is worth investing in. As a result of this we are starting to move up the sponsorship table to be mid table now. If we ever do get to be a club that actually wins anything we will get more money.
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