On a warm summer’s evening, a young Argentinian runs onto the pitch at the Etihad Stadium for the first time. Sergio Aguero’s debut for Manchester City is one to make the hairs stand up on the back of your neck. His entry results in by far the loudest roar of the game, and the grinning superstar is quickly into action, harrying defenders and making bursting runs. And above all the action at the packed Etihad Stadium, a lone sign – requested and paid for by local fans – stands out. “Manchester thanks you, Sheikh Mansour”, it reads – in both English and Arabic - in huge letters plastered at the top of the stadium above the half-way line.
Five minutes’ walk from the stadium in which some of the world’s highest paid football stars are plying their trade, the scene could not be more different. By virtually any measure you care to choose, East Manchester is one of the most deprived areas in the UK. A report from the Save the Children charity earlier this year claimed that levels of child poverty in the city had reached 27 percent, amongst the highest in the country. Furthermore, the land that sits nearby the stadium itself has been so polluted by commercial and industrial use that it actually has a negative property value.
Reconciling these two seemingly polar opposites is the job of Manchester City’s executive management team. In tandem with recent successes on the pitch, the club is tailoring the second phase of its development under the ownership of the Abu Dhabi United Group (ADUG). While, naturally, that will aim to incorporate even greater success on the pitch, a renewed focus will be placed on community involvement, job creation and corporate social responsibility.
But back on the pitch, and the signing of Aguero, and French midfielder Samir Nasri, marks an end to ADUG’s initial investment phase in the club, much of which was focused on players. Ever since Sheikh Mansour bin Zayed Al Nahyan swooped to take over City three years ago, expectations in the blue half of Manchester have been raised to fever pitch. But it’s not only in the city itself that attitudes towards the football team have started to change. News stories about Manchester City inevitably shoot to the top of the most viewed pages on international newspaper websites. The club’s recent tour of America helped US fans of the Manchester City Facebook page shoot up by 403 percent, while 1.2m viewers watched the team play its various games on ESPN.
Far more ominously for City’s Premier League rivals, the club now ranks as the most improved football brand over the course of the last 12 months. Brand Finance’s annual rankings showed that the City brand was now the 11th most valuable brand in football – up from 19th last year – with a value that had almost doubled to $168m. City are steadily creeping up on their arch-rivals, Manchester United, who regained the top spot with a brand value of $644m.
On the morning of the first day of the season, the club’s employees gather in the bowels of the Colin Bell stand to hear a series of presentations from senior management. The mood is understandably buoyant; Manchester City have qualified for the Champions League for the first time, and the club has also signed what is being reported as the biggest sponsorship deal in football history with Etihad Airways. Furthermore, the meeting is held in the august presence of the FA Cup, one of football’s most famous trophies, and the first major piece of silverware that City have picked up in 34 years.
But the meeting is not the usual dusty affair that one would expect from an institution that has been around for well over a century, and whose founders believed that Manchester City’s launch would cure a litany of social ills in one of England’s most industrialised cities. Indeed, the flashy presentations, interspersed with blasts of dance music, seem more suited to the boardroom of an advertising giant than an elderly sports franchise.
It’s all emblematic of the change that has been brought about since ADUG took over the club; while the world outside has been fixated on petrodollars, a quiet revolution has taken place in Manchester.
Article continues on next page…
From a corporate perspective, the changes that have taken place are immediately apparent. The club’s non-player staff are now comfortably housed in a new block separate from the stadium, and a new human resources department has been put into operation. More focus is being given to innovative branding deals, such as that with EA Sports, which will see City players take on a more prominent role in the developer’s blockbuster FIFA Soccer franchise. The club is also looking to double the number of retailers which sell branded merchandise, and aircraft repainted in Manchester City livery fly around the world at a cost to the club of just $800 a week. Altogether, 35 separate infrastructure projects – from those based in Manchester to elsewhere around the world – have been completed in the last two years. More than the physical changes, a shift in mindset is most obviously apparent.
“Yes, we’re all excited about what goes on on the football pitch, but unfortunately, if you were to make business decisions based on the outcome of a sports event, you’d find yourself on a pretty volatile rollercoaster,” says Brian Marwood, the club's chief football affairs officer. “You wouldn’t be able to plan for the future. So we try and divorce the two – one is very short term, extremely volatile and unpredictable, and the other one has to encompass some consistency and continuity.”
Looking back to the day of ADUG’s takeover, club officials recall that time, not money, or players, has been the most vital commodity. How long will it take to bring success to the club, especially since a sustainable platform of results appears to have been impossible to achieve for four decades? Can we get there in 10 years, or five years, or three?
“The plan that we put forward in the first phase was one of ‘fix and build,” says Marwood. “So if it was broken, it needed fixing, and if we didn’t have it yet, we had to build. Our initial focus was very much about creating a first team that was capable of competing for domestic honours and importantly, for qualification into the European Champions League.”
Job done, in that respect - but why the fuss over the Champions’ League? The reasons are two-fold; prestige and money. The 2009-2010 edition of Europe’s top club tournament saw the 32 clubs taking part share a colossal prize-money pool of just over $1bn, derived from performance-related payments and revenue from the television market.
The winner that year, Bayern Munich, took $66m in prize money. For City, that sizeable television revenue will be funneled straight back into club development. And as the first stage of the City project comes to a close, it’s clear that a chapter is being closed on the litany of player purchases – made specifically to get the team into the Champions’ League at the earliest possible point - that have made the club headline news across the world. A total of 24 top-level players were brought in over the course of a year, which equates to one every two weeks.
“Over time, the next phase is that next level down – so where is the next Lionel Messi, how old is he today?” says Marwood. “So our focus is far less on the senior squad, the finished product, and is more about developing asset strategy. When we look at the teenage kids we’re bringing in, they have the opportunity to go to Real Madrid, Barcelona, Chelsea and Arsenal. We’re all looking at the same players, and I think the last five additions to our development squad have all been world-class under-20 players – so that’s the sign, really.”
Article continues on next page…
But it would be wrong to suggest that, even with City’s deep pockets, the process of buying new players was easy. Marwood points out that potential sellers were well aware that the club was on a short-term buying assignment, and that a premium was probably paid – like in any corporate field – in an attempt to entice other teams’ core assets to the Etihad Stadium. He estimates that of the recent purchases, the club had to walk away from “three or four” targets due to the over-high valuations slapped on them. But Marwood is also very keen to point out that City’s spending has actually had a beneficial effect on English football.
“We’ve been a good addition to the industry, and sometimes people forget that,” he points out. “There’s always an investor – whether it’s in the world of property or banking – and there’s always someone fuelling growth. So you could, say, look at Arsenal, who have sold us in excess of $95m worth of footballers, which in turn means they can afford to go and buy players, which means they are fuelling the football family.
“Sometimes you have to be thankful there’s economic growth, and you have to be thankful that at any point in time, there’s an investor. A few years ago it was Chelsea, and let’s not forget that Spurs and Manchester United have all played their part over the last few years. We just happened to do it in a very condensed period of time,” Marwood adds.
For City’s staff members, the ties with ADUG appear to run deep. Each of the employees interviewed by Arabian Business makes it clear that they hold the reputation of Sheikh Mansour's investment in their hands, and that it’s a responsibility that they take seriously.
“We have a very clear vision of social responsibility, we have a critical path that we follow in that area,” Marwood adds. “Youth development is very much a part of the future, so sustainability and success will be over the long term, not the short term. Leadership is about taking people to the unknown and that’s what we’re doing.”
City’s rapid growth appears to have chimed well with its fanbase. Always known for their die-hard support, the average fan was older than the league average (68 percent were over the age of 35 at the time of the ADUG takeover, reflecting the club’s poor record of success), and surveys carried out by City staff showed that most of those fans didn’t even enjoy the matchday experience.
Three years on, and that experience has been voted independently as the best in the Premier League. Fan reaction on websites such as Blue Moon has changed from apathy and despondency to hope and appreciation of a new sense of community involvement from the club. There is considerable appreciation, also, for the role that Sheikh Mansour and the executive management have played in the club’s meteoric rise. And as the club starts the process of giving its owner a return on its considerable investment, the future looks just as electric as Aguero’s debut.
"We've got a very good story, and I think that sometimes people forget that the case for the story is a business case," Marwood says. "It's a three-year business case, and it's a story of lifting something up by its bootstraps, picking up, and moving on - and, with the help of ADUG, it's been pretty good."For all the latest sports news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
Subscribe to Arabian Business' newsletter to receive the latest breaking news and business stories in Dubai,the UAE and the GCC straight to your inbox.