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| The history of global economics... in football shirts | The history of global economics... in football shirts |
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| From Japanese electronics to reckless banks and middle eastern airlines, the fate of Premier League shirt sponsors has been tied closely to that of the world economy. West Ham United was the latest club to be sideswiped by the financial markets this month when its main commercial backer, foreign exchange dealer Alpari, was forced into administration by the Swiss central bank suddenly abandoning the Swiss franc’s peg against the euro. | From Japanese electronics to reckless banks and middle eastern airlines, the fate of Premier League shirt sponsors has been tied closely to that of the world economy. West Ham United was the latest club to be sideswiped by the financial markets this month when its main commercial backer, foreign exchange dealer Alpari, was forced into administration by the Swiss central bank suddenly abandoning the Swiss franc’s peg against the euro. |
| It is the second time the east end team has been caught offside by global events, having lost XL Airways in 2008 when the UK carrier - its backers caught up in the Icelandic banking meltdown - collapsed in the same month as the Lehman Brothers implosion. | It is the second time the east end team has been caught offside by global events, having lost XL Airways in 2008 when the UK carrier - its backers caught up in the Icelandic banking meltdown - collapsed in the same month as the Lehman Brothers implosion. |
| Charting the evolution of shirt sponsors over the history of the Premier League also gives an insight into how the world and UK economies have evolved since the 1990s. | Charting the evolution of shirt sponsors over the history of the Premier League also gives an insight into how the world and UK economies have evolved since the 1990s. |
| The rise and fall of Japan: 1992-2002 | The rise and fall of Japan: 1992-2002 |
| No foreign country sponsored more teams in the Premier League than Japan did in 1992-93 when it backed five teams. JVC’s and Sharp’s logos had been on the shirts of Arsenal and Manchester United, two of the old first division’s top teams, respectively since the early 1980s as Japan came to dominate the global electronics market. By 1992, the Premier League’s debut, those companies were joined by Mita Copiers, Brother Industries and NEC, taking the number of Japanese sponsors to five and making IT, gaming and electronics the biggest sector for sponsorship. | No foreign country sponsored more teams in the Premier League than Japan did in 1992-93 when it backed five teams. JVC’s and Sharp’s logos had been on the shirts of Arsenal and Manchester United, two of the old first division’s top teams, respectively since the early 1980s as Japan came to dominate the global electronics market. By 1992, the Premier League’s debut, those companies were joined by Mita Copiers, Brother Industries and NEC, taking the number of Japanese sponsors to five and making IT, gaming and electronics the biggest sector for sponsorship. |
| But that year, the Japanese asset bubble burst and the country’s economic power began to decline along with its companies’ knack for coming up with gadgets that caught the public imagination. | But that year, the Japanese asset bubble burst and the country’s economic power began to decline along with its companies’ knack for coming up with gadgets that caught the public imagination. |
| In 2000, Vodafone, fresh from completing the world’s biggest takeover of Mannesmann, took over from Sharp as Manchester United’s sponsor. Japanese companies were largely small players in the mobile phone boom, whose pre-iPhone hardware was dominated by Nokia of Finland and South Korea’s Samsung. When the Premier League marked its first decade, there were no Japanese shirt sponsors for the first time and there have been none for the past six seasons. | In 2000, Vodafone, fresh from completing the world’s biggest takeover of Mannesmann, took over from Sharp as Manchester United’s sponsor. Japanese companies were largely small players in the mobile phone boom, whose pre-iPhone hardware was dominated by Nokia of Finland and South Korea’s Samsung. When the Premier League marked its first decade, there were no Japanese shirt sponsors for the first time and there have been none for the past six seasons. |
| Taking their place have been other Asian companies from Thailand (brewer Chang at Everton and duty free outfit King Power at Leicester), South Korea (electronics giant Samsung at Chelsea), Malaysia (Air Asia at QPR) and China, which has overtaken Japan as the world’s second-biggest economy (insurance company AIA at Tottenham). | Taking their place have been other Asian companies from Thailand (brewer Chang at Everton and duty free outfit King Power at Leicester), South Korea (electronics giant Samsung at Chelsea), Malaysia (Air Asia at QPR) and China, which has overtaken Japan as the world’s second-biggest economy (insurance company AIA at Tottenham). |
| The rise of China and emerging markets 2001 to now | The rise of China and emerging markets 2001 to now |
| When the Premier League launched in 1992-93, shirt sponsors were all from developed markets. In addition to Japan’s five brands, there were household European names such as Peugeot from France, Holsten from Germany and Denmark’s Carlsberg. | When the Premier League launched in 1992-93, shirt sponsors were all from developed markets. In addition to Japan’s five brands, there were household European names such as Peugeot from France, Holsten from Germany and Denmark’s Carlsberg. |
| Companies from emerging markets did not start to make an impression until 2001-2002 when South Korean electronics manufacturer LG signed a deal with Leicester City and Emirates, the flag carrier airline for the United Arab Emirates, began sponsoring Chelsea, which was an emerging football power at the time. | Companies from emerging markets did not start to make an impression until 2001-2002 when South Korean electronics manufacturer LG signed a deal with Leicester City and Emirates, the flag carrier airline for the United Arab Emirates, began sponsoring Chelsea, which was an emerging football power at the time. |
| Until 2006-07 there were never more than two emerging markets sponsors but that season the number rose to three. This season, the number reached a high of nine, including Samsung of South Korea (Chelsea), Malaysia’s Air Asia (run by by Queen’s Park Rangers’ proprietor Tony Fernandes) and two Philippines-based betting companies (12bet at Hull and Dafabet at Aston Villa). | Until 2006-07 there were never more than two emerging markets sponsors but that season the number rose to three. This season, the number reached a high of nine, including Samsung of South Korea (Chelsea), Malaysia’s Air Asia (run by by Queen’s Park Rangers’ proprietor Tony Fernandes) and two Philippines-based betting companies (12bet at Hull and Dafabet at Aston Villa). |
| The first Chinese company to go into the shirt sponsorship market was the telecoms operator Kejian, which sponsored Everton between 2002 and 2004. Now, China is represented by AIA, the Hong Kong-based insurer. Along with growing economies, the Asian markets have also provided a growing viewership for Premier League games. Last season, 38% of the 2.7 billion Premier League viewers were from the region. United Arab Emirates is represented by airlines sponsoring two of the big four, Arsenal (Emirates) and Abu Dhabi-owned Manchester City (Etihad Airways), reflecting UAE’s desire to diversify out of oil and into tourism and leisure. | The first Chinese company to go into the shirt sponsorship market was the telecoms operator Kejian, which sponsored Everton between 2002 and 2004. Now, China is represented by AIA, the Hong Kong-based insurer. Along with growing economies, the Asian markets have also provided a growing viewership for Premier League games. Last season, 38% of the 2.7 billion Premier League viewers were from the region. United Arab Emirates is represented by airlines sponsoring two of the big four, Arsenal (Emirates) and Abu Dhabi-owned Manchester City (Etihad Airways), reflecting UAE’s desire to diversify out of oil and into tourism and leisure. |
| Emerging markets’ participation goes beyond these eight companies because the draw for global companies of Premier League shirt sponsorship is not to reach a UK audience. Standard Chartered, a UK bank that has no high street branches in Britain, began sponsoring Liverpool in 2010 to reach consumers in Asia, Africa and the Middle East. Similarly, Chevrolet, the General Motors-owned US car brand, did not sponsor Manchester United to raise its profile in the UK, where it does little business, or the US, where watching football on TV is a niche pastime. The deal with Manchester United, the most popular team in Asia, is all about associating Chevrolet with a premium football brand in China and other markets. | Emerging markets’ participation goes beyond these eight companies because the draw for global companies of Premier League shirt sponsorship is not to reach a UK audience. Standard Chartered, a UK bank that has no high street branches in Britain, began sponsoring Liverpool in 2010 to reach consumers in Asia, Africa and the Middle East. Similarly, Chevrolet, the General Motors-owned US car brand, did not sponsor Manchester United to raise its profile in the UK, where it does little business, or the US, where watching football on TV is a niche pastime. The deal with Manchester United, the most popular team in Asia, is all about associating Chevrolet with a premium football brand in China and other markets. |
| Charles Wright, principal at Wolff Olins, the brand consultant, says: “Manchester United is a legend in terms of building its brand in Asia and Chevrolet has long been the leading foreign carmaker in China and has ambitions to grow further. As yet, it’s hard to tell if its generous deal with Manchester United is genius or laziness.” | Charles Wright, principal at Wolff Olins, the brand consultant, says: “Manchester United is a legend in terms of building its brand in Asia and Chevrolet has long been the leading foreign carmaker in China and has ambitions to grow further. As yet, it’s hard to tell if its generous deal with Manchester United is genius or laziness.” |
| Going global, at the expense of UK PLC: 1992 to now | Going global, at the expense of UK PLC: 1992 to now |
| The Premier League has flourished as the global economy has rocketed by importing players and exporting its following to new international fan bases. In the 23 years since the league launched, Western companies have shifted production to emerging markets such as China, fuelling the rise of an Asian middle class keen to buy Western products, including top-flight English football. During the same period, companies such as Samsung of South Korea have become global forces and have sought to strengthen their brands through shirt sponsorship. Premier League teams are now owned by proprietors from Russia, the US, Malaysia and the Middle East, among others. As it stands, fewer than half of the clubs in the English league’s top division are majority owned by those from the UK. | The Premier League has flourished as the global economy has rocketed by importing players and exporting its following to new international fan bases. In the 23 years since the league launched, Western companies have shifted production to emerging markets such as China, fuelling the rise of an Asian middle class keen to buy Western products, including top-flight English football. During the same period, companies such as Samsung of South Korea have become global forces and have sought to strengthen their brands through shirt sponsorship. Premier League teams are now owned by proprietors from Russia, the US, Malaysia and the Middle East, among others. As it stands, fewer than half of the clubs in the English league’s top division are majority owned by those from the UK. |
| Looking back at the Premier League’s first season, 10 of the 22 teams had UK sponsors. Though the Premier League’s story has been one of globalisation, the number of British sponsors has fluctuated around the 10 mark. This season UK sponsors dropped to a low of seven but as recently as 2010-11 the figure was a joint record high of 15. But these days UK companies, apart from emerging markets bank Standard Chartered, tend to sponsor smaller and recently promoted teams as global and Middle Eastern brands dominate the top teams. | Looking back at the Premier League’s first season, 10 of the 22 teams had UK sponsors. Though the Premier League’s story has been one of globalisation, the number of British sponsors has fluctuated around the 10 mark. This season UK sponsors dropped to a low of seven but as recently as 2010-11 the figure was a joint record high of 15. But these days UK companies, apart from emerging markets bank Standard Chartered, tend to sponsor smaller and recently promoted teams as global and Middle Eastern brands dominate the top teams. |
| It is not just Asian companies that the Premier League has spread out to though. In recent years, companies from Finland, New Zealand and Australia have also sought to benefit from the league’s stardust, albeit sponsoring relatively minor teams. | It is not just Asian companies that the Premier League has spread out to though. In recent years, companies from Finland, New Zealand and Australia have also sought to benefit from the league’s stardust, albeit sponsoring relatively minor teams. |
| Perhaps the most notable, and sizeable tie-ups, are with the UAE airlines Etihad and Emirates. As well as sponsoring Arsenal’s stadium, Emirates agreed to a £150m deal in 2012 to extend their shirt sponsorship of Arsenal through to 2019. | Perhaps the most notable, and sizeable tie-ups, are with the UAE airlines Etihad and Emirates. As well as sponsoring Arsenal’s stadium, Emirates agreed to a £150m deal in 2012 to extend their shirt sponsorship of Arsenal through to 2019. |
| A similar shirt/stadium deal was cut by Etihad with Manchester City. The link to the Gulf states is even stronger here though, given the club is owned by the Abu Dhabi royal family. | A similar shirt/stadium deal was cut by Etihad with Manchester City. The link to the Gulf states is even stronger here though, given the club is owned by the Abu Dhabi royal family. |
| Wolff Olins’ Wright says: “Last year two of the biggest sponsors of English teams were Emirates & Etihad, who between them accounted for almost a quarter of total sponsorship. Etihad did not exist when the Premier League started and who had heard of Emirates in 1992?” | Wolff Olins’ Wright says: “Last year two of the biggest sponsors of English teams were Emirates & Etihad, who between them accounted for almost a quarter of total sponsorship. Etihad did not exist when the Premier League started and who had heard of Emirates in 1992?” |
| The financial crash – 2007 to 2009 | The financial crash – 2007 to 2009 |
| The financial crisis was played out in Premier League shirt sponsorship. XL Airways was a victim of the Icelandic financial crash and a slump in air travel but banks at the centre of the turmoil were also kit sponsors. | The financial crisis was played out in Premier League shirt sponsorship. XL Airways was a victim of the Icelandic financial crash and a slump in air travel but banks at the centre of the turmoil were also kit sponsors. |
| Banking and financial companies had steadily increased their presence in the league in the 2000s from no sponsorship at the start of the decade to four by 2007. The most prominent were AIG, the giant US insurer that sponsored Manchester United, itself bought by the Glazer family in a debt-laden deal in 2005, and Northern Rock, the mortgage bank whose name was on the shirts of Newcastle United, the company’s local team. Northern Rock started sponsoring Newcastle in 2003 as the former building society embarked on the lending splurge that saw it nearly collapse as the financial crisis took hold. | Banking and financial companies had steadily increased their presence in the league in the 2000s from no sponsorship at the start of the decade to four by 2007. The most prominent were AIG, the giant US insurer that sponsored Manchester United, itself bought by the Glazer family in a debt-laden deal in 2005, and Northern Rock, the mortgage bank whose name was on the shirts of Newcastle United, the company’s local team. Northern Rock started sponsoring Newcastle in 2003 as the former building society embarked on the lending splurge that saw it nearly collapse as the financial crisis took hold. |
| In 2008, Northern Rock was nationalised and AIG met the same fate in the US as its investment in sub-prime bonds threatened it with bankruptcy. This resulted in US-owned Manchester United, with a US-government owned shirt sponsor lining up against UK-owned Newcastle United, with a UK government owned shirt sponsor. AIG is gone as a shirt sponsor but its Asian arm, spun off in 2012, now sponsors Tottenham Hotspur. | In 2008, Northern Rock was nationalised and AIG met the same fate in the US as its investment in sub-prime bonds threatened it with bankruptcy. This resulted in US-owned Manchester United, with a US-government owned shirt sponsor lining up against UK-owned Newcastle United, with a UK government owned shirt sponsor. AIG is gone as a shirt sponsor but its Asian arm, spun off in 2012, now sponsors Tottenham Hotspur. |
| By 2008-09 Britannia building society was a Premier League sponsor after its local team, Stoke City gained promotion. Britannia, it turned out later, probably would probably have gone bust if it had not merged with the Co-operative Bank in 2009. | By 2008-09 Britannia building society was a Premier League sponsor after its local team, Stoke City gained promotion. Britannia, it turned out later, probably would probably have gone bust if it had not merged with the Co-operative Bank in 2009. |
| The return of volatility 2015 onwards | The return of volatility 2015 onwards |
| The collapse of Alpari coincides with renewed uncertainty in markets and the global economy. Fears have grown about the fate of China and other emerging markets that have helped keep the economy afloat since the recession ended, while the threat of deflation has finally forced the European Central Bank to join the US and the UK in launching quantitative easing. In what could be a prolonged period of economic volatility, clubs may want to think more carefully as they choose their sponsors if they want to avoid West Ham’s fate. | The collapse of Alpari coincides with renewed uncertainty in markets and the global economy. Fears have grown about the fate of China and other emerging markets that have helped keep the economy afloat since the recession ended, while the threat of deflation has finally forced the European Central Bank to join the US and the UK in launching quantitative easing. In what could be a prolonged period of economic volatility, clubs may want to think more carefully as they choose their sponsors if they want to avoid West Ham’s fate. |
| Austin Houlihan, a senior manager in the sports group at Deloitte, says: “Income from shirt sponsorship is an important revenue stream for most clubs so they will want the financial security of getting the money they have signed up to. If you have a partner with a substantial proportion of their activity in a geography that is slowing down you will be a bit more wary. If the sponsor is global in scale, that covers your risk to a certain extent but where activities are a bit more localised and they have been affected by the wider economy then probably you might be a bit more wary.” | |
| And some things will never change: booze and betting | And some things will never change: booze and betting |
| The online betting market has rapidly accelerated in the past decade and its deep intertwinement with sport is reflected in the number of clubs it now sponsors. In 2009-10, as well as 2011-12, seven out of the 20 clubs were sponsored by an online gambling service. This season there are four. | The online betting market has rapidly accelerated in the past decade and its deep intertwinement with sport is reflected in the number of clubs it now sponsors. In 2009-10, as well as 2011-12, seven out of the 20 clubs were sponsored by an online gambling service. This season there are four. |
| The first betting company to feature on a Premier League shirt were Betfair, who sponsored Fulham in 2002-03 - a full ten seasons after the competition was formed.Short-term lenders Wonga are among the alternative financial providers that have also risen in recent years, sponsoring former Premier League team Blackpool as well as current side Newcastle.Reflecting the Japanese dominance in the league’s early years, IT, gaming and electronics companies were the biggest single category in the 1992-93 season. | The first betting company to feature on a Premier League shirt were Betfair, who sponsored Fulham in 2002-03 - a full ten seasons after the competition was formed.Short-term lenders Wonga are among the alternative financial providers that have also risen in recent years, sponsoring former Premier League team Blackpool as well as current side Newcastle.Reflecting the Japanese dominance in the league’s early years, IT, gaming and electronics companies were the biggest single category in the 1992-93 season. |
| Interestingly, alcohol companies also used to be a much bigger presence with Holsten (Tottenham), Shipstones (Nottingham Forest), Carlsberg (Liverpool) and McEwan’s (Blackburn) all present. Now Thai beer Chang is the only alcohol brand on a top flight shirt this year, with their sponsorship of Everton. However, doctors have recently called for the advertising of alcohol on shirts to be banned. | Interestingly, alcohol companies also used to be a much bigger presence with Holsten (Tottenham), Shipstones (Nottingham Forest), Carlsberg (Liverpool) and McEwan’s (Blackburn) all present. Now Thai beer Chang is the only alcohol brand on a top flight shirt this year, with their sponsorship of Everton. However, doctors have recently called for the advertising of alcohol on shirts to be banned. |