SPORTS RETAILING REDUCES POLLUTION.

Image: Josep María Martínez

ABSTRACT

There is no reason for suporting Real Madrid or Barcelona or Ceuta. Indeed, there are emotions and shared social values.

Without them, a sports club has no future as a business model that hinges on implicit aspects in common sense.

Although it may seem strange, that’s totally applicable to the marketing of any company in retail.

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“The referee’s whistle is the only thing capable of stopping traffic in Barcelona,” declares Xavier Querol, a researcher at the Institute of Environmental Diagnosis (Idaea-CSIC). Car emissions dropped sharply around 9 pm on March 6th, 2007, just before the start of the exciting Champions match between Barcelona and Liverpool.

40% of football clubs’ income stems directly from this type of consumer behaviour, while teams in the Spanish BBVA League only earn 33% of their income from ticket sales.

Despite the industry’s importance, however, their general economic results are very poor, including some in a critical situation.

Sports clubs’ retail marketing strategies

The marketing aim is – to succeed, in becoming the preferred option in a sustained way, all the while being profitable. It is not just about advertising or promotions.

Continued preference translates into sustained cash flow. For top competition sports club management, the sustainability of this cash flow has been demonstrated to be directly related to the sports teams’ performance. Over the long term, the latter is determined by the quality of a club’s players and trainers. As such, being able to have the economic power to be able to hire the best ends up being a key factor for their success.

It’s a bit like the fish biting its own tail: if there is a chronic lack of titles, that team’s supporters will flounder and, in the end, so will its sponsors, leading to insufficient income with which to sign on great players who will contribute to the club earning more victories.

The aim is not to win titles every year, but to ensure that there isn’t a chronic lack of titles. A bad season doesn’t imply a serious problem so long as that sports club shares certain human or social values with its supporters. Without these values, a sports club has no future because it is a business model, which hinges on implicit elements and commonly shared feelings.

There is no specific reason why people support Real Madrid, Barça or Ceuta. What there is are shared emotions and social values. Barça’s slogan Más que un club (“More than just a club”) offers a glimpse of this. The same can be said for Atlético de Madrid’s (Atleti) famous ads, a team which succeeded in not losing any of its supporters when it fell to the second division.

Industry concentration

 

The current situation in the first division is no different to that occurring in other industries: a special type of de facto oligopoly. The Pareto Principle is also valid here: the top two Spanish clubs concentrate 53% of all income, and 25% of the income in Europe as a whole is channelled to only 20 clubs.

What is different compared to other industries is that this small number of very powerful clubs needs others to be able to compete. Without matches against these adversaries, they cannot demonstrate their superiority. A league is like an ecological system, similar to that occurring in nature.

That notwithstanding, there is greater unpredictability in sports retailing. In fact, teams train all week long, while their actual “production time” tends to represent only 90 minutes per week. The ratio between the time a club has to “demonstrate its power” versus the time to prepare, implies great risks in terms of guaranteeing results for its supporters.

Are we talking about football or about retail sector?

 

Don’t the growing concentration of protagonists, the sector’s poor economic results and the fight for sustained preference sound familiar?

Perhaps a lesson that can be learnt from sport teams is that the enormous power they have regarding customer preferences is based on sharing strong emotions and human values with their supporters.

References

www.lavanguardia.es/vida/20110312/54125164753/gol-a-la-contaminacion-del-aire-en-la-ciudad.html

Havas Media: www.slideshare.net/dolivo/foro-futbol-espaol-marcas-y-negocio

Gay de Liébana, J.M., Futbol español: Marcas y negocio. Univ de Barcelona.

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Lluis Martinez-Ribes

Source: Distribución Actualidad, the spanish retail magazine

(nº 424, april 2011)

FAN OR AIR CONDITIONING_Are “best practices” useful to innovate?

Mirror Neurons, responsible for empathy

Image: pdginnovates.files.wordpress.com

 

ABSTRACT

Best practices do not lead to innovation. Air conditioning was not invented by improving a hand fan. Not even improving the best one.

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When we are in a party and a lot of people start laughing, we will probably end up laughing too. But if some people are yawning, it is also very probable that it will spread.

There is a biological base that explains it all: the so-called mirror neurons lead us to imitate what we see in others.

That is probably why we enjoy detecting the company that is the best in a field, and then copy its best practices in our company.

It is not casual that field trips for visiting stores to far away countries arouse so much interest.

Carlos Losada and his thesis

Carlos Losada, Director of Esade Business School for the last nine years, wrote in his Doctoral Thesis (1) about the validity of the best practices.

He discovered that there are no absolute best practices. They may be the best in a specific context. Thus they not always work well when other companies use them in different circumstances.

From my point of view, I would also add that the best practices about topics that the customers can’t see (back-end ones) have a higher probability of success when adopted, than the ones affecting visible aspects for the customers (front-end ones).

For instance, it is more probable that introducing the best software to detect the opinions about the company in social networks is more successful, than applying an efficient range of sausages for supermarkets.

The reason is simple: in the back-end, technology and rationality are key factors. But the front-end is influenced by specifically human factors, like the cultural ones.

Next practices

One of the purposes of the managers is to devise a piece of future, and that entails innovation.

The best practices do not lead to innovation. Air conditioning was not invented by improving a hand fan. Not even improving the best one.

Managers should be interested in the practices to come (“next practices”).

To approach it there is a way that has shown to be effective: the innovation that comes from and is inspired by the life of the customers as a whole. This goes beyond the shopper marketing approach, because it includes the pre and the post shop.

Here comes the pack

Visualize a cycling pack sprinting to the finish line. How do you imagine the cyclist that wins?

 

Exactly like the one in this photo: risen arms, expressing the well-earned victory.

And how – on the same picture – do the ones that haven’t won appear? As you can see, pedalling with the best technique.

Human mind, for example the customer’s one, detects the emotional expressions of the leader. It doesn’t matter if his posture in that moment doesn’t have the best aerodynamics to pedal.

On the other hand, the ones that loose, even though they are showing the best practices for pedalling, are perceived as “one more” in the pack. Let’s not forget that 80% of the human brain activity is driven by the emotional, the unconscious, or the implicit.

That is why semiotics is more important than a bunch of good reasons when we want to achieve the sustained customers preference.

(1) Losada, Carlos. A Contribution to the Study of the Differences in Managerial Function: Political Managers’ Function and Civil Service Managers’ Function. ESADE FUNDACION, 09/2003

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Lluis Martinez-Ribes

Source: Distribución Actualidad, the spanish retail magazine

(nº 421, december 2010)