Football as a business

Football is an exciting sport, the most popular across the world. Even though India doesn’t a team to boast about, but  India has the big fan base here. Mostly fans of big English Premiere League teams like Manchester United, Chelsea, Arsenal, Liverpool, and of course few of the clubs from Italy,Spain and Gemany. South Asia has a big fan base, it has grown rapidly in the past decade, and is growing at an even faster pace.  Here are my thoughts on football clubs as a business house, albeit these are not conventional business houses.  

The Red Devils made headlines recently with the plan of an IPO to hit Singapore Exchange. There is approximately 190 million Manchester United fans in South Asia. This will give them a chance to own part of the club. Manchester United has a debt in the tunes of $500 million. Glazer family hopes to raise about a $1 billion via IPO, major chunk of the offerings would be in preference shares, allowing Glazer family to retain control. Man U was expected to be listed in October, however due to volatile market conditions it has been postponed till the end of this year. Man U was listed on London Stock Exchange before it was bought out by the Glazer family.

Football clubs in Germany, the Bundesliga operates on 50+1 rule. At least 51% of the club should be owned by members. As per reports from Reuters Bundesliga is the most profitable league in the world, with it’s operating profit about 172 million euros, whereas English Premiere League has an operating profit of 93 million euros, nearly half of Bundesliga’s. The maximum cost of running a football club goes towards wages of players. Most clubs shell out about 70% of their revenue as player wages. Incidentally  the culprits of such high payouts are not the major clubs but the small ones, who are under pressure to keep up with the titans. Recently 1860 Muenchen, a football club based in Munich,Bavaria was bought out by a wealthy Arabian business man for similar reasons as that of Man U.

Investing in a football club is more of sentimental in nature, or a boost to the ego, rather than being a sound business investment strategy. Revenues for most footballs clubs are on the rise, one MIGHT be able to make a profitable investment. But, personally I think it’s an irrational business and there is lot of irrational capital floating about it. These not like other corporate entities, sentiments attached to football clubs are lot different from any other business houses. 

RockMelt- The Social Media Web Browser

RockMelt is a social media web browser developed by Tim Howes and Eric Vishria. RockMelt is based on Google's open-source project Chromium, now on version 12. This is a cross-platform family of browsers (available for Windows, Mac and Linux) that use the open-source web layout engine WebKit jointly built by Apple, Google and the open-source community—but have the JavaScript engine replaced by Google's own V8, also open-source.  It was launched in the month of October, 2010 as a beta version. Soon, in March 2011 it was made available to all users.

Well, you might ask what is so special about this web browser, when there are plenty on the web. Well, this web browser is particularly meant for social media enthusiasts and addicts. RockMelt integrates a technique for surfing the web that focuses on Google Search and Social Media, in  particular  Facebook and Twitter.  RockMelt has an optional side bar, where one can see all his Facebook friends who are online. Once you click on the online contacts, a little window pops up at the bottom right corner where one can chat. Near the top, one can all so see all notifications and messages on facebook. All of that without even logging into facebook on a separate tab or a window. RockMelt also integrates twitter in a side bar, where you can see all tweets, and you can also send tweets via the side bar. There are host of other cool applications to stay in touch with the latest in your choice of fields. I have been hooked onto this browser for few months now, all I can say is that it is just fantastic, albeit for a social media enthusiast like me. But, if you want to go ahead and give it a shot, here are the links to download and read more about this browser

RockMelt 

RockMelt Blog  

Klout-Brand Equation

Yes, it's indeed Klout and not Cloud. In the recent times Cloud computing has got lot of attention. But, I am not referring to that. It's KLOUT..... check it out. 

Here’s a bit about a company called Klout.  

Klout is a San Francisco based company that provides social media analytics that measures a users influence across their social network. The analysis is done on data collected from sites such as Twitter and Facebook  and measures the size of a person's network, the content created, and how other people interact with that content.  

Here’s how they do it :  

 Klout measures influence by using data points from Twitter, such as: following count, follower count, retweets, list memberships, how many spam/dead accounts are following you, how influential the people that retweet you are, and unique mentions. This information is blended with Facebook data such as comment, likes, and the number of friends in your network to come up with a "Klout Score" that measures a user's online influence.

What’s new:

Now a klout score will determine your access level to different brands on facebook pages. This could get you some perks that is of course if you have sufficient klout score. A company called Involver has teamed up with klout and developed an application, through which brands can tailor facebook experiences for different users depending on their klout scores. To quote a senior VP of Involver “We’ve taken Klout’s core business and brought it into our platform. The first application is a simple coupon-esque experience. A brand will be able to bring an application out of their Page, configure to deliver content to people above and below certain Klout scores, and then input whatever that content is”

The content can take various formats, like an extended trailer, more engaging pages, special discount offer. In fact the possibilities seem limitless. Now brands can maneuver into the right target audience. This will allow brands to access fans who really matter, and conversely people who are fans of brands will have to work hard to get there. The first brand to integrate this application is Audi USA. Starting from 22.06.2011.

There is a term called “like-gating” aka “fan-gating”, something all facebook users have experienced it sometime or the other. It’s simple, unless you ‘like’ a certain page, you won’t get to see the contents of the fan page. One can sense a paradigm shift to ‘klout-gating’.

My personal views:

This might be a game changer. Brands can customize by personalizing the facebook pages to different users based on their Klout score. Which simply means users with higher score gets better offers. Effectively brands can transform each user into brand ambassadors. Thus, this will get the consumers to play a bigger role with more involvement, after all who doesn’t want to be pampered a bit.

This can challenge the management 20-80-20 formula. Which means 20% of consumers account for 80% of a company’s revenues, and the other 80% percent of consumers account for 20% of a company’s revenues. If this venture of Klout catches on, thousands of brand fanatics will perhaps increase their activity on facebook, befriend more, to get a better klout score. Clearly the winners would be the brands who take it up. Not to forget increased activity on facebook will lead to bigger revenue for facebook too, as other companies would like to capitalize on this big traffic by strategically placing their ads. This brings branding at a greater level. Competition between brands has become competition between consumers too. I think it’s brilliant! Here's the link if you want to check out Klout 

Snapdeal.comnagar, Promotion or CSR?

Shivnagar a remote village in Uttar Pradesh has been rechristened to snapdeal.com nagar. Snapdeal.com is a year old company allowing consumers to get great deals through group buying. This online venture would develop the overall infrastructure including installing water pumps, developing local schools. It’s a cool CSR initiative. If snapdeal achieves what it has set out for, it will be a land mark in the history of CSR, keep in mind snapdeal is only a year old venture. CSR is not just giving back to the society, it’s a way to instill brand image too. But, after this news flash, many believe it is a promotional activity. I think one cannot just view this as a promotional activity. Sure, this will help snapdeal to greatly improve their public image, will certainly grab a lot of attention. But, why not, when they have ventured into something worthwhile, which even the government has failed to do so, they deserve a pat on the back. The various responses shows otherwise, people just see this as a promotional activity, but fail to see the benefits to the society. The cause of this reaction can be found in the roots of Indian culture, where modesty is held with the utmost esteem. You can do great things for the society, but you should keep it hush hush too, to show that you are modest, the best quality possible. But, if businesses strive for a pressing social issue, why shouldn’t it be acknowledged, and if businesses use it to leverage their own brand image, why not. Another thing I would like to point out, the villagers themselves agreed to change the name to snapdeal.com nagar from shivnagar, to show gratitude. Snapdeal.com didn’t force it on them. I think it’s a great move by this company, which is still in a nascent stage. Like I said before, if they achieve what they had set out for, it would indeed be a remarkable achievement.