Friday, May 06, 2011

How Ian Ayre Transformed Liverpool FC's Commercial Fortunes

Liverpool FC’s latest financial results, for the year to July 2010, don’t look particularly positive: the club made a £20m loss, thanks partly to £17m in interest payments on the £123m debt piled onto the club by its much-despised previous owners, Tom Hicks and George Gillett. But there was some good news in there too: revenues climbed to £184m, as the club continues to benefit from the remarkable transformation in its commercial fortunes since hiring Ian Ayre in 2007. And now the club is largely debt-free, following its acquisition by US-based Fenway Sports Group in October, it should be well-placed to cash in.

Management Today (MT) spoke exclusively to Ayre – recently promoted to MD by the new owners – to find out what exactly he changed when he joined the business, and how he plans to build on this now he’s in the top job. We also asked him how he persuaded Standard Chartered to stump up £80m to sponsor the club’s shirts, what he thinks is special about the LFC ‘brand’, how he’d deal with badly-behaved players; what the club’s commercial plans are overseas; and what he thinks about the much-maligned 39th game...

MT: When you first came to Liverpool, what were the problems that needed fixing?
IA: Both as a fan, and as someone who'd worked on the commercial side of football, it was pretty evident that Liverpool wasn't punching its weight. It hadn't really capitalized on the growth of football. Revenues had grown for all clubs almost by default because of the size of media contracts and so on, but in Liverpool's case, the club hadn’t geared itself up to support and manages that revenue growth. It's like the corner shop growing into a superstore without bringing any staff in.

Was the situation worse than you expected?
Very much so. The biggest surprise was the lack of bodies in core areas. There seemed to be a whole layer of middle management missing, plus a whole layer of infrastructure. Lots of the commercial elements had been outsourced - sponsorship, the retail business, our media channels, even the catering - and these elements are at the core of how you globalize and develop a big football club with a truly worldwide reach. So we were at an immediate disadvantage.

So what did you do?
If you want to capitalize on opportunities and provide the right things for the fans, you need people who understand what makes this club special and unique, and what it is that makes people - either in Liverpool or in Singapore - support the club. So I hired six new senior managers in six different disciplines. Once we'd brought these people in to champion their different areas, we could start bringing all these elements back in-house.

The first hire was on the customer relationship management side. A club like Liverpool has an enormous number of connections with its fans every day - online, by phone, at supporter clubs - but nobody was capturing that data and using it to establish a two-way relationship with them. And if you don't know who your customers are, or where they are, how can you best serve them and make sure there are things for them to buy and enjoy? So we created something called The Single View of the Fan, which means that if you interact with the club in any capacity, we capture that data and create an individual identity for you. There's nothing worse as a consumer than being bombarded with information about stuff you have no interest in. My dad's 70, so he doesn't want to get an email about the new home shirt, because he's not going to buy it. Well actually, he doesn't want to get an email at all.

We also bought out our digital media joint venture (JV). Sponsorship was being sold by Granada as part of the JV, so we brought that back in-house too. And more recently we've also extracted ourselves from our JV on the retail side. So essentially, we were more in control of our own destiny. Since then, every single element of our commercial business has grown. Our revenues are up by 85% over the period, including one of the biggest shirt sponsorship deals in football.

How did you go about getting that deal with Standard Chartered? Was it a difficult sell?
Well we have 13 or 14 different sponsors now, and the approach is different for different categories - beer, travel and so on. But we always try to avoid a shotgun approach to selling anything, so we draw up a shortlist of people in each category. Not everyone does this, but we spend a lot of time before we go to market analyzing who's in that market and who's spending money - if we're looking for a £5m sponsorship deal, there's no point us knocking on the door of an electronics company that only has £500k to spend. The shirt deal was obviously a bit different as we looked across all categories - but we only did proper, well-developed pitches to about 15 companies, although we were very confident we'd reach the level we ended up reaching. We only targeted people who had already shown some interest in sport, who we knew would understand the value of working with a club like Liverpool globally; and, where possible, whose culture and values were similar to ours. We ended up with six companies at the final hurdle, all in a similar range financially.

So at that stage is it just about taking the biggest cheque?
We didn't actually choose the one offering the biggest amount of money; another company offered significantly more. But what Standard Chartered had that we thought was more valuable than that additional 20% or whatever, was that there was a real match in terms of what kind of business they are; how they conduct themselves; what markets they're targeting for growth; and how they were going to go about activating the sponsorship internally. And I think it was absolutely the right choice. Even in one season you can see how much value they've gained from being a partner of ours, and vice-versa.

What exactly do they expect to get out of it?
That will probably develop over the term of the relationship. At the outset, it's all about raising the profile of their brand; they're very successful in Asia, Africa and the Middle East, but less well known in the rest of the world. So they want people to know about the bank, and for people in their core markets to know more about the bank. They say that every internal metric they've set to measure the success of this relationship has been surpassed by an unbelievable amount already. So it clearly works for them, and it works for us.

But nothing's set in stone; we've agreed we'll have an open mind about how we'll work together as things progress. Perhaps for the first couple of years it's all about being on the TV channel or the website. But if in later years it's more about other aspects, we'd absolutely have the flexibility to address that.

What's vital is that every year they're with us, and every dollar they spend, they absolutely believe that they get a return on that investment. A lot of sponsorship deals I've been involved with are a bit like, 'this is what it says on the contract, so this is what you're going to get'. But I think that's a very narrow-minded view. It's much harder to get a new sponsor than it is to keep an existing one, and this is a philosophy I've tried to instil in my team - we want to keep everyone we've got, so we'll develop with them and they'll develop with us. Carlsberg's a great example - they were Liverpool's shirt sponsor for 18 years but they didn't walk away at the end; they decided that they wanted to remain part of the Liverpool family.

You said that you think the Liverpool 'brand' is special/unique. Why?
I think the thing about Liverpool is the sense of inclusiveness, going right back to the socialist ideals of Shankly, if you like - the idea that we're all in this together, that we look after each other. There have been lots of examples of that over the years, and I think over the years that's resonated outwards. I've spent a lot of time in Asia, and it mirrors the values in a lot of Asian countries - it's about family, about looking after and having respect for each other. It's little things, like the fact that when teams come to Anfield and beat us, the fans will stand up and applaud them at the end - I've never seen that anywhere else. There's also a lot of respect for the way Liverpool has conducted itself in times of adversity.

Someone said to me recently that if you take a club like Man United, people either love them or hate them - it's the Marmite effect. But with Liverpool, we're more like everyone's second favourite team. So when you're responsible for selling and marketing the brand, you've got to keep that in mind. Part of our attraction is that we're not confrontational; you've got to understand how precious certain things are and not go out and market them to death. Of course, there's no shortage of people who tell me every week that we shouldn't do this or that. But it's about finding the middle ground. And it's also about educating fans in different places - what fans in Merseyside think or want is not necessarily what fans in other places think. So you have to explain sometimes: this product we're making is not for you - it doesn't matter if you don't like it, because it's not targeted at you. It all comes back to knowing the individual customer, and providing a much bigger range of options for people.

Fans often talk about 'The Liverpool Way'. Do you think the recent boardroom shenanigans undermined that? And did that affect the way the club was perceived externally?
There's maybe a bit more cynicism around now. I think it's true that Liverpool lost its way, but it's now coming back to the way it used to be and wants to be. It's a real testament to this football club that through all those difficult times - the sale, the court case, poor performances, managers leaving - through all of that, the business not only survived but grew. That's testament to the loyalty and commitment of our fans, and the commitment of the staff who work here. For the people who work here and support the club, it's not about today or next week. The easiest thing would have been for the fans to vote with their feet, but we were still selling out pretty much every game - they were protesting in the car park, and then filling the stands. I know from my friends on the Kop - they might not have been happy, but they were there to support the team. That's a great thing for the football club.

How important is the behaviour of the players to the Liverpool 'brand'? What would you have done in the Wayne Rooney situation, for instance?
Nobody should be above the rules. If players or staff don't conduct themselves in a manner befitting of the rules and culture and honour of the club then they'd need to be disciplined. But we've been very fortunate that we haven't had that type of issue.

Would the Liverpool Way mean dealing with the problem behind closed doors? Or is it important to do it publicly?
If someone does something publicly that's disrespectful and brings the club into disrepute then we might deal with it behind closed doors, but it will be pretty public what's happened. There's a great sign up at the Academy, which says that when you come through those doors and join this club, make sure you understand what it means. When anyone arrives here - whether they work in the canteen or play for the first team - they have to understand and respect what this football club is all about and what it means to so many people. Anyone who disrespects that has to face the consequences. People commit a lot of money, time and effort to this club - as fans, as employees, as owners - so it's not fair for people to disrespect it.

Will there be any change to the commercial strategy or focus under the new owners?
The strategy doesn't change, it just moves ahead more positively. The plan was always that we'd clean up the house, surround ourselves with good and effective partners, and bring back all our assets so we're in control of them - that was the first major stage of my business plan. The second phase is to reach out and globalize what we've created - to offer the same level of product to international markets as we do locally. We want to be able to offer a fan in China a similar but different level of buy-in to Liverpool, in different forms and languages and currencies.

What will that involve in practice?
All manner of things. It means real infrastructure and people in certain markets; we've got an office in Singapore, and FSG's sports marketing team are picking up the US for Liverpool, so we've effectively got an office in the US too. We'll also going to be expanding into some other markets - we're just circling in at the moment which ones, and at what size. Then the next stage will be more localized products - local language TV and websites; retail products that are more geared towards that particular market/region at that particular price point. And there's our soccer school business, which is growing significantly at the moment - we've started 6 new schools in the last 8 months. So it's a combination of all of these. The idea is that wherever you are in the world as a Liverpool fan, you should be able to reach out and touch some of our products in a local language/ currency. But it's not one size fits all, it's got to be as tailored as possible.

We'll support that with other things like touring - we'll go on tour to three key Asian markets this summer, for example. But we see tours as the icing on the cake, as opposed to being big revenue generators in themselves. It's all about creating the other things that are going on week to week. Going on tour doesn't make you significant money or build a significant fanbase - what does that is being in people's eyeballs every day. That's what we're trying to create. The team turning up is just the icing on the cake.

Are you a believer in the 39th game?
I don't know - it's fraught with lots of issues. But somehow we have a duty to fans around the world to give them access to the product. So never say never. What was unfortunate about last time was that the idea was created as some kind of reality before it had been thought through. And whatever's going to happen in football, it needs to have been absolutely thought through and every element considered - what's right and proper for the fans, the club, the league, the confederation, the local markets where you'd play. It all needs to be properly considered and I don't think last time that was the case.

Do you think the fans are more accepting of the commercial side of football these days?
I'm a Liverpool lad. We'd all love to think that this is our football club from our city; that we own it. But the absolute reality - in the case of Liverpool, not everyone - is that this is a global brand, one of only a handful of clubs that are truly globally recognized and supported. So you can't have it both ways. You can't hope to be one of the biggest football clubs in the world, with some of the biggest revenues and some of the greatest players, and you can't invite people from the other side of the world to support your team and contribute to your revenues and therefore your success, and not expect to let them in and let them participate in some way in what you do. If we want to be a small parochial club, and close our doors to anyone outside the city, we won't get very far in this global football market. So whether it's what people like is irrelevant - it's absolutely what people have to accept and expect.

Gerrard Praises Carragher's Influence Ahead Of Landmark Liverpool Appearance

Steven Gerrard has paid tribute to team-mate Jamie Carragher as the defender prepares to make his 666th Liverpool appearance to move second on the club's all-time appearances list.

If selected against Fulham on Monday, Carragher will surpass club legends Emlyn Hughes and Ray Clemence to take second spot outright behind Ian Callaghan, who notched up 857 appearances for the Merseyside club.

Gerrard, who, like Carragher, came through the club's Academy at Melwood, had high praise for his fellow Liverpudlian ahead of the milestone.

He was quoted as saying by The Mirror: "Carra is unbelievable, and I am one of his biggest fans.

"I have seen his attitude for more than a decade and I don't believe he gets enough credit for it."

The Reds midfielder, who was part of the team with Carragher which completed a famous Champions League final comeback against AC Milan in 2005, praised his vice-captain's approach to the game, singling it out as the reason for his success.

He said: "What some people don't appreciate with Carra is he puts his body on the line. Week in, week out, he will push through the pain barrier for himself and the club.

"He's breaking records right at the highest level of the game because of his attitude. He's an absolute credit to himself."

Luis Suarez Has Settled In Well, Says Dirk Kuyt

Dirk Kuyt believes few foreign players have made the immediate impact Luis Suarez has in the Premier League.

Suarez has been a huge success since arriving at Liverpool from Ajax for £22.8m on transfer deadline day in January.

The 24-year-old netted the third goal of his Anfield career in the 3-0 win over Newcastle United last weekend and, with fellow new boy Andy Carroll’s season hampered by injuries, has forged a fruitful strike partnership with Kuyt.

“There are few players to come from abroad and settle like he has done,” said Kuyt. “It has been said before, but we speak in Dutch together on the pitch.

“But Luis’s English is not bad either and that has helped him settle quickly.

“Although we are different players and offer different skills to the team, we are also both hard workers. Kenny has emphasized to us that he wants us to press high up the pitch and that has suited us.”

Suarez’s arrival has coincided with a rich vein of form for Kuyt, whose goal last weekend was his eighth in his last seven Premier League games.

It was enough for the 30-year-old to win the vote from Liverpool supporters as player of the month for April.

And Kuyt added: “It’s great to win the award. It’s been a great month, especially for me.

“To score in four games in a row, and to be important for the team, is a great feeling.

“Hopefully we can keep it going.

“To be important for the team is giving me a great feeling. The team is playing really well with confidence which makes it easier to play.

“The team is doing so much better, showing more confidence. Everybody looks in better form, including myself.

“It’s down to the manager, and all the lads who are working really hard to play better.”

Liverpool Playmaker Target's Transfer Decision Pending

Borussia Dortmund midfielder Nuri Sahin is set to make a decision on his future at the end of the week.

The Turkish international has been linked with a number of clubs across Europe, with his current deal in Germany set to run out at the end of next season.

Real Madrid are thought to be one of the leading clubs taking an interest in the 22-year-old, who made his senior debut in 2005 and has only spent a season away from the Signal Iduna Park on loan at Feyenoord.

After claiming the Bundesliga title last week, Sahin is now considering his options over his long-term future and could open the door to Liverpool should he decide on a move away from Germany.

“At the end of this week, along with the club, I will make a decision. My motivation is to win more and more in my career. Someday I want to win the Champions League.”

Kenny Dalglish is known to be in the market for an attacking midfielder, with a string of playmakers linked with a summer move to join Liverpool at Anfield.

Sahin is the latest name in the frame, and joins Ashley Young, Eden Hazard and Ezequiel Lavezzi as speculative Liverpool targets.

With American owners Fenway Sports Group vowing to invest in new players at the club and Kenny Dalglish eager to put his own stamp on the team, it could be a busy summer for the Liverpool hierarchy, with or without the addition of Sahin.

Vertonghen Wants Ajax Stay Despite Interest From Liverpool

Jan Vertonghen wants to reject interest from the Premier League and remain at Ajax this summer.

The Ajax defender is wanted by numerous clubs across Europe but the most interest has come from the Premier League.

In recent weeks, Liverpool has been credited with an interest in the versatile Ajax star, who can play in midfield as well as defence.

However, Vertonghen is keen on remaining at Ajax for the time being and he has told the coaching staff at the club that he wants to play for them next season.

A source at Ajax said: "It is good that Jan wants to stay with us. He is an important player, one of many, and he will continue here."

Liverpool Target Romelu Lukaku Looks Set To Join Chelsea

Anderlecht has reportedly opened negotiations over a summer deal that will see 17-year-old strike sensation Romelu Lukaku join Chelsea according to the Metro.

The heavily coveted Belgian star has been linked with a number of Barclays Premier League clubs, with Chelsea likely to face competition for his signature from Liverpool.

But Belgian sources now claim that Anderlecht general manager Herman Van Holsbeeck has made regular trips to London in the past couple of weeks, to try and wrap up an agreement for Lukaku to move to Stamford Bridge.

Blues boss Carlo Ancelotti has been tasked by Chelsea owner Roman Abramovich with revamping his squad with a series of new signings.

An emphasis has been placed on up-and-coming talent, to freshen up an ageing first-team, with Lukaku earmarked as Chelsea’s number one summer target.

The Blues spent big in January when they moved for Fernando Torres and David Luiz, in a combined fee which exceeded £70million.

And the spending looks set to continue as Chelsea look to attract some of the greatest talent Europe has to offer.

It is believed that Anderlecht will be willing to sell Lukaku to Chelsea for £15million, providing they can themselves secure the signing of highly rated Genk winger Kevin Du Bruyne – another reported Blues target.

As part of an increasingly complex deal, Chelsea will be given first option to buy the 19-year-old Du Bruyne once he sees out the initial deal on offer to him in three years time.

Following the arrival of Kenny Dalglish as manager at Anfield in January, the Daily Mirror reported that Liverpool made contact with Anderlecht over a potential £20 million move.

Damien Comolli, director of football at Liverpool, was behind the Reds' pursuit of the player at the turn of the year, and will again be instrumental in attempting to lure the player to Anfield over Stamford Bridge.

Fenway Sports Group, the club's owners, proved they are willing to back the club financially in the transfer market, and could be called upon again to bring one of the brightest young talents in world football to Liverpool and continue the club's growing policy of developing young talent.

Baggies Star Linked To Liverpool

West Brom midfielder Chris Brunt is a target for Liverpool in the summer, but they face a battle with Aston Villa for his services.

West Brom boss Roy Hodgson is keen for his skipper to sign a new contract at the club. And the chances have increased since he turned things around at the Hawthorns, but Liverpool and Aston Villa are very keen.

Liverpool's director of football Damien Comolli is set to oversee a summer of changes at Anfield and Brunt is the latest in a long line of players who have been linked to the club as Comolli is a big admirer of the £8million-rated midfielder.

Brunt has two years left on his contract at West Brom and Hodgson has confirmed they would like to keep him.

John Arne Riise Refuses To Rule Out Return To Liverpool

Former Liverpool defender John Arne Riise has fuelled speculation linking him with a return to Anfield, after refusing to rule out a move away from Roma this summer.

The Norwegian only has one full season left to run on his contract for the Italian side, who are likely to may well listen to offers for the left-back this summer to avoid losing him for nothing next.

The 30-year-old departed Rafa Benitez’s Liverpool side in 2008, but reports suggest current boss Kenny Dalglish is keen to bring him back.

The Merseysiders seem desperate to sign a left-back, having been forced into playing England right-back Glen Johnson in the position of late.

There have already been rumours linking the club with a move for Everton’s Leighton Baines, and Riise would be a less complicated, costly and controversial target.

"I am flattered by reports linking me with a return to England," Riise, a Champions League winner with the Reds, is quoted as saying by Sky Sports.

"Liverpool are close to my heart. They are a great club and I have some good memories. I have a contract here until June 2012, so you never know."

Another club interested in Riise is Marseille, and the Norwegian has past experience playing in Ligue 1.

Riise said: "I love France as well. I played in Monaco and also enjoyed my time there."

Shelvey Fires As Reserves Draw

Jonjo Shelvey fired as Liverpool Reserves ended the season with a 2-2 draw against Manchester United on Thursday night.

Shelvey was one of a clutch of senior stars on show at Anfield and his spectacular effort was the pinnacle of an excellent individual performance.

Nikola Saric was the other scorer after deflecting a Joe Cole effort into the goal.

The result means Liverpool finish third in their section of the Barclays Premier Reserve League North.

The fact our already-depleted U18s are set to contest a title decider on Friday morning meant second-string boss Pep Segura drafted in first-teamers Christian Poulsen, David Ngog, Cole, Danny Wilson and Shelvey for this dead rubber.

With so much experience in the side, it was hardly surprising that the Reds enjoyed the best of the early chances. On six minutes a delicious ball from Steven Irwin set Ngog on his way. The Frenchman prodded through for Tom Ince but the 19-year-old's run proved better than his touch.

A Suso corner then invited Wilson into a diving header which flew the wrong side of the woodwork at the Anfield Road End.

But it was United who struck first on 18 minutes when Marnick Vermijl navigated Irwin in the box before cutting back for Nicolas Ajose to sidefoot beyond Deale Chamberlain.

A Petrucci ricochet following decent work from Irwin almost led to a fluke equalizer seconds before Gabriel Obertan found himself with a superb opportunity eight yards out. The former Bordeaux winger skewed wide.

Next to threaten was Ngog, who swept past ex-Red Scott Wootton but in doing so found himself at an acute angle. Too acute to worry United goalkeeper Ben Amos.

Instead it was Shelvey who whacked the leveller on 32 minutes after being teed up by Cole 10 yards outside the box. Amos could only watch as the ball whizzed past him into the bottom corner before Shelvey arched away in celebration.

Ajose stung the palms of Chamberlain as the oranges were being cut but there were to be no more dents on the scoresheet before the break.

Liverpool made one change at the interval, Nikola Saric taking the place of Ngog.

It took a while for the game to get going again, with neither goal being tested until an imaginative stab from the edge of the box by Shelvey which landed on the roof of the net.

Joshua King came close to giving the visitors the lead once more on 67 minutes after going one-on-one with Chamberlain. Liverpool's stopper did just enough to slow the ball on its route towards goal before scrambling back to collect.

Chamberlain had to have his wits about him again when Obertan found himself in a shooting position. The goalkeeper used his legs and United were denied once more.

Irwin twice tried to take the initiative at the Kop end and on the second occasion it required a superb block from Vermijl for him to be denied.

One of the best opportunities of the second period fell to Cole following an inviting cross from Shelvey. The No.10 stretched to get there but his shot spun wide.

Shelvey smacked another long-range effort towards the net with 10 minutes to go but Amos dived low to keep the scores level.

If anyone was going to score it was Liverpool. Next, Ince wiggled his way through the visiting defence but lost momentum before he could get a shot away.

What looked like the winner finally arrived on 84 minutes when Shelvey fed Suso, who found Cole in the box. The England man's shot was then deflected off Saric on its way into the net. Replays showed it to be the Dane's goal.

But there was to be another twist on 87 minutes when Oliver Norwood's free-kick pinged back off the post into the path of Obertan, whose effort was too clinical for Chamberlain.

Reina Salutes Title-Chasers

Pepe Reina has paid tribute to the club's Academy staff as the U18s go in search of the Group C League title against Wolves this afternoon.

The Reds need three points from their final match to leapfrog Everton into top spot and book a place in the national play-off semi-final.

Reina admits he has been impressed by the progress being made in Kirkby and feels it bodes well for first-team squads of the future.

"Both Rodolfo (Borrell) and Pep Segura have shown in just a few years that they are working really well along with the other Academy staff," Reina told

"It is important for us to develop these type of players because it can be very helpful in the future. The likes of Flanno, Spearo, Martin Kelly and Robbo are important for us now and it has to be like that every season.

"Credit to the lads but also to the people who have helped them on their way up."

Reina added: "We are improving in all areas of the club and the Academy is the same."