Liverpool use social media to target Asian fans
Liverpool are attempting to leapfrog their Premier League opponents commercially by expanding to Asian markets
Commercial success has become an integral factor of success since the rapid growth of the financial sector in the footballing world.
Those Premier League teams that have capitalised by increasing their global brands at any opportunity have reaped the rewards.
The most successful example is Manchester United, who are the second-strongest footballing brand globally worth £535 million.
Liverpool are another club currently attempting to expand their commercial value as their brand is worth only £239 million.
The club are trying to emulate their rivals, who have at least 17 different sponsors in specific regions or countries.
Liverpool have targeted sponsorship deals in Asia and Australia whilst on their pre-season tour in the area. The squad recently played in front of a sold-out Melbourne Cricket Ground packed with 95,000 fans recently - the largest crowd the club has played in front of for 122 years. This proves that despite their recent on-the-field gloom, the club still has a strong fan base internationally.
Liverpool chief executive Ian Ayre told The Australian Financial Review the club has at least 15 commercial staff who will stay in Asia after the players return to England on Sunday after a match in Thailand.
The Merseyside club are trying to make up lost ground after failing to capitalise on the growth overseas like their rivals United. The club's revenues do not even compare to others continually competing for the domestic and international honours each season.
Liverpool's revenue has obviously expanded since the days of their dominance in the 70's and 80's but this has primarily been due to the expansion of media contracts within kit sponsorships and lucrative television rights deals from ESPN and Sky Sports.
Since Ian Ayre's recruitment in 2007, Liverpool's financial results have improved as the club benefits from the remarkable transformation in its commercial fortunes. After the acquisition of new American owners in the face of Fenway Sports Group the Reds also remain largely debt free.
Asia-focused bank Standard Chartered extended their £19.6m shirts sponsorship deal with Liverpool during the recent Asia tour and the club hopes a social media buzz would help them attract more country-specific sponsorship deals in Asia like their 2011 tie-up with Honda Motorcycle in Thailand.
Improved income from commercial sponsorships, despite a global recession and the lack of Champions League action, helped Liverpool raise revenues, even as they recorded a £40.5 million loss and raised debts to £87.2 million in their last accounts from August 1, 2011 to May 31, 2012.
The Reds have expanded exponentially within the social networking market in the past year. Engaging with their broad global support base via social media channels has become an increasingly essential way for the Merseyside club to attract new sponsors in emerging markets and convince the existing ones to stay on board during their transitional period on the field.
The club have made strides by introducing hordes of country specific websites and social networking accounts on behalf of the club. They recently launched an Indonesian language website in May and a Thai language website in June ahead of their summer tour in an attempt to target the four billion strong Asian consumer market.
"We made a conscious effort to boost our social media presence about 18 months ago," managing director Ian Ayre told Reuters in an interview.
"We took the view that the real relationship with a fan is having true engagement. You can have millions of fans as you want, but if you're not communicating with them, how are you really establishing that relationship?"
Ayre says Liverpool’s turnover will reach about £200 million this year, a number that could be significantly boosted by qualifying for the lucrative European Champions League, which is worth £30 million to £40 million income a year.
The club posted a £40 million loss in the 2012 financial year, but Ayre says the result can be influenced by transfers of players. Rivals Arsenal, for example, this week lodged a £40 million plus £1 bid for their Uruguayan star Luis Suarez.
Liverpool placed tenth on the Deloitte Football Report in terms of revenue, but each of the nine clubs above them – led by Real Madrid with annual turnover of €512 million ($730 million) – play in the Champions League.
Bar exile from the Champions League football the major significant reason that has been cited as Liverpool's downfall is Anfield's capacity. Their home stadium holds only 45,000 fans on a match day whereas Old Trafford can seat 75,000. the Emirates stadium 60,000 and Manchester City have revealed proposed plans to increase the Etihad stadium's capacity to 60,000.
This therefore represents a massive weekly loss on the club's income in comparison to their rivals. The club have suffered as a result of repeated delays in their effort to move to pastures new.
In 2013, it was confirmed that rather than move to a new stadium Liverpool would opt to stay at their current home and increase it's possible capacity with expansive redevelopment to the Main Stand and the Anfield Road end.
Ayre said: “We know we have a massive following for general tickets, there are 30,000 on the waiting list for season tickets, but you have to get the economic modelling right because we are not just doing this to let more people in, we are doing this to generate more revenue to invest in the team.”
Speaking to Liverpool Echo in March: “Turnover if taken over 12 months, would show a reasonably healthy increase.
“The unaudited turnover which we shared with Deloitte for their publication this year £188.7m - an increase on last year’s £183.6m. So we are growing – we continue to grow." insisted Ayre.
“Our commercial revenues continue to grow and I think that is the key message.
“There is still a lot of work to do to restructure, particularly the football and I think everyone is aware of that.
“But that said our business is growing year on year. These accounts represent a year when we didn’t play European football. But we still grew our revenues."
Write for GiveMeSport! Sign-up to the GMS Writing Academy here: http://bit.ly/12evFlH
DISCLAIMER: This article has been written by a member of the GiveMeSport Writing Academy and does not represent the views of GiveMeSport.com or SportsNewMedia. The views and opinions expressed are solely that of the author credited at the top of this article. GiveMeSport.com and SportsNewMedia do not take any responsibility for the content of its contributors.