Thursday, 26 September 2013

Harry Iwuala On The Art Of The Deal And The Future Of Sports Marketing In Nigeria.

Harry Iwuala, Lead Consultant at Youdees
Harry Iwuala, Lead Consultant at Youdees Limited speaks on the art of the deal and the future of sports marketing in Nigeria

The discipline of sports marketing

To understand sports marketing, we look at three core elements- the first is the Sport such as football, Tennis etc. The second is the Sport Personality or asset such as the Club (e.g Enyimba International Football Club), an Association such as Nigeria Football Federation, or an Athlete like Usain Bolt. We then have the Sports Event such as the Glo Premier League or the French Tennis Open. These are the essential elements of sport marketing as they make up the ‘product’ or asset which could be marketed to  individuals, corporates and or rights buyers. In sports marketing, advisory services are provided by way of strategies to optimise the value of an asset, attract interest in the asset leading to consumption of the asset. I love a certain definition promoted by a school of thought which defined Sports Marketing as building highly and easily recognised solid fan base which compels the public, corporate/individual sponsors, media and even government to subscribe to the sport, personality or event for the advantages of social exchange and personal, group and community identity within a competitive environment.  While we have the four ‘P’s of general marketing as Product, Price, Promotion and Place, there is a further four ‘P’s of sport marketing which are Planning, Packaging, Positioning and Perception. These make up the sport marketing mix. The objective of sport marketing is to provide a client with strategies to promote the sport or use a sport platform to promote a brand or cause.

The skill set required to be a successful sports marketing consultant

The essential skill set required for sports marketing practice starts with having formal education up to University or Polytechnic level. A background in the Marketing Communication discipline will be an added advantage. A secondary skill set is a general and extensive knowledge of sports, sports personalities and sporting trends. You can’t successfully secure sponsorship for a football league if you don’t know the attributes of the league such as how many teams play in the league, venues, fan base, exciting star players and dates for matches etc. Those are what you will be selling to sponsors and it is also not possible to generate huge traffic to a club if the marketer lacks deep insight into the working and make-up of the Club. As the Marketing Consultant to Nigeria’s most successful club, Enyimba International, the Youdees team in pitching to potential sponsors and other prospects usually start by telling the story of Enyimba. We cannot do this successfully without knowing the players, the rich history of the club, the fan base etc. Successful sports marketing is basically dependent on providing insights for the client that will help the fans identify with the sponsor. When the fans can identify with a sponsored clubside by wearing branded shirts etc, this ultimately extends to goodwill, and the consumption of the products and services of the sponsor. Identification therefore can be premised to be a deeper degree of affinity and as a Sports Marketing Consultant; you must be adept at relationship management. It is also essential to have analytical skills which will aid in the evaluation of properties and pricing of offerings. This comes handy in negotiating acquisition or selling of sports assets and properties. This means that you need to be up to date with trends, be it marketing or sporting. For instance, the value of Enyimba International in the coming season will definitely rise as a result of their success in the 2013 Nigerian Federation Cup which gives them a ticket for continental football. Any sponsor riding on Enyimba now will have the added exposure benefit of being seen around the continent and being exposed to a larger television audience. This is the trend that has provided insight for the evaluation of the Club and which will be presented during any negotiation. Finally, communication skill is absolutely relevant to the practice. Oh yes, you must be good at speaking, writing, preparing and presenting sales pitches.
Present level of sports marketing and sports branding in Nigeria

Sports Marketing in Nigeria is yet to really pick up. Most practitioners are merely engaged in media content sales. Remember, there is a whole world of difference between selling and marketing. What we have currently for example is a situation where a couple of chaps put together stories downloaded from the internet and go on air to run through the scripts and then emerge later to claim they are into Sports Marketing. What they are engaged in is simply plagiarising stories to sell radio and television air time or put nicely, media selling. Again, the bigger problem that has resulted in low level of sports marketing in Nigeria is the absence of data. It is difficult to obtain accurate numbers at match attendance even from the Nigeria Football Federation (NFF). You need data to translate opportunities and using estimates leads to error in outcome. This has most times made sports events marketing not to attract right pricing and what we end up having is using relationship to secure under-priced deals.
What we have tried to do at Youdees with properties under our management is to develop them into proper brands, create platforms that sponsorships can anchor on and then pitch their attributes to corporate organisations. We are also working on ticketing to provide hospitality suites that individuals and organisations can use to reward loyalty either to friends or customers. We are doing pilot schemes with Enyimba International and Lobi Stars FC and in one instance; we just invited a couple of friends to see a match in Aba, gave them a good reception and entertained them with food and drinks. The message we passed on to them is that the stadium is safe and you can have fun while watching a football match.

We can only begin to celebrate sports marketing in Nigeria when Adidas, Nike and other international sports brands open shops here, take up events and also sign kits sponsorship deals with Nigerian clubs, stars and acquire naming rights to events. But there is a huge market here for sports which needs to be professionally harnessed. For instance, there is just one company, Arena Signages that is into match day branding and even at that, we are yet to appropriately price and sell perimeter advertising boards. There are so many other areas including the organisation of top grade tournaments that will attract international ratification, athletes’ endorsements and replica shirt sales.
Why the Glo Premiership League is not yet as attractive as the Barclays Premiership

Remember, I spoke of the additional four ‘P’s of sport marketing and the relevant one here is packaging. It is a term you can construct to include club organisation, stadium facility, league administration and of course media led by television. We have not treated football as entertainment which is why its perception index is so low. There is unbelievable quality in Nigerian football, skilful players but they are not reaching their full potentials due to poor administrative and management structures at the clubs. You hardly can see a club with a decent club house and welfare package. The entertainment treatment must be applied to the Glo Premier League to make it attractive for empowered youths and adult youths to show interest. It is no longer hip to identify with the Glo Premier League as a result of the comparative exposure to the English Premier League and the role of the media here is very germane. SuperSport is doing a relatively good job but a whole lot of miles still need to be covered in live television presentation of match days. You will start by improving the camera numbers at the stadium, improving in the directing of broadcasts and in the commentaries which adds to the excitement of watching the EPL. Pre-match analysis helps to hype and heighten expectations and these are not done here and I am not sure we have the right kind of personnel to handle that. Our facilities are not built for entertaining experience as they are just concrete slabs with no rooms for tea, beer and food shops. You get to a match and find it very irritating to leave your seat because you may return and find someone else on it. They lack decent conveniences and these are the total package of match day experience. We also have to employ competent persons to manage the administration of the league and these must be people with private sector competence and track performance at very high management positions. You cannot employ someone who earns less than N20M annually to manage a league with an estimated worth of N10B.
What clubs competing in the Nigerian Glo Premiership league should do to attract sponsors

Clubs in the Glo Premier League must be properly structured and we are getting there because the Confederation of African Football (CAF) seems to have woken up to its responsibilities. In 2006, FIFA initiated and approved a global regime for Club Licensing which CAF adopted in 2009 but surprisingly didn’t implement. It was only at their Exco meeting of September 21st and 22nd 2013 that Federations were handed an ultimatum to implement Club Licensing Regulation before the start of the next season. This regulation is a basic working document that serves as guidelines for clubs to be in existence and they will not be granted license to operate football business without fulfilling the guidelines. I can assure you that this will be the catalyst for Clubs to operate professionally and when they do, there will be the right kind of personnel, facilities, players’ welfare and general packaging of their business to attract corporate interests and confidence. It will bring to an end government ownership of clubs and with this will come a forced deregulation of football club business.
Is any Nigerian Glo Premiership Club side worth up to a billion naira (about $7M) in brand valuation terms?

The answer is yes and no. We cannot answer in absolute terms since it has been pointed out that the full potentials of football are not being exploited in the country. A case study is Kano Pillars FC with a regular attendance of over 25, 000 every match day. Is the ticketing appropriately priced? The answer is no and are there leakages? The answer is yes because the numbers you have on the stands don’t correspond with the revenue declared from the gates. Pillars are a club with so much fanatical following that club merchandising sells with the speed of typhoon wind. Again, there is evidence to show that those items are not issued by the club and neither do the producers and merchants pay royalty to the club.
Another Club close to Kano Pillars is Enyimba International which records attendance of upwards of 15,000 and given its success on the continent in 2003 and 2004, Enyimba commands an international fan base that has been estimated to close to over 3 million. I will stop at the two and then point out that if they have had the right kind of management over the years, we will be discussing a net brand value of over $15m (N2.1b) for each of the club sides.

What brands should look out for when evaluating a sports asset to sponsor
There are two key criteria that must be met in any sports sponsorship and these are brand fit and also how the asset meets the overall business objectives of the potential sponsor. When we talk about brand fit, it pre-supposes an asset that enhances the potential sponsor’s brand values and attributes. We are looking at what adds stature to the brand as a result of sponsoring an event or endorsing an athlete. There is very little by way of bottom line that Venus and Serena Williams delivered when they were brought to Lagos in 2012 but brands benefitted in terms of perception of quality by associating with the event they featured in. When you bring Usain Bolt to Nigeria, it is not likely he will drive numbers but the market will begin to view the brand as being up there. We have seen some Nigerian brands increasingly adopting this approach, for example Etisalat sponsored the Chris Brown concert in Nigeria in 2012 and are also sponsoring Mary J Blige’s concert in 2013.

Secondly, you also evaluate the rights owners to ascertain if they have the capacity and track record to deliver on their promises and also on the potentials of the asset itself. It is a common problem in this environment where most of the organisations discuss sponsorship in terms of mileage and by this they are referring to publicity to be generated. I call it noise value when it does not impact on the brand on a mass scale especially when the asset is such that is targeted at the mass market. At Youdees, we take pains to evaluate assets being proposed to us, this is to ensure that our clients derive value for their spend rather than just jump into the fray to add to our list of projects.

On what informed the recent seminar on sports marketing in Nigeria organised by the Lagos State chapter of Sports Writers Association of Nigeria (SWAN)

We as consultants to the Lagos State chapter of Sports Writers Association of Nigeria (SWAN) are worried about the declining interest in Nigeria’s domestic football which is the focal point of our industry. It is not just a case of disappearing fan base but a case of domination of the media space by foreign football, specifically, European football. We are equally troubled by the quality of reporting, the language being used to communicate the little that appears in the media, especially the print and radio. There is an increasing lack of creativity in the media contents and the seminar which held in Lagos on the 12th and 13th of September 2013 was initiated to build capacity to breach this gap.
It was also targeted at the Club administrators and rights’ owners whom we sought to take through product management and branding. We chose resource persons that are well grounded in integrated marketing and social media utilisation. The first speaker, Dr. Ken Onyeali Ikpe of Allseasons Mediacom dwelt extensively on brand architecture and brand building which is the basis for Club business development. And we had Mr. Colin Udoh, a FIFA Media Officer examine strategies for the optimisation of social media in club communication for the benefit of Sports Journalists.    Mr. Jenkins Alumona took the Journalists through exercises in features writing and appropriate reporting of sports events.

Key revelations from the seminar and next action points
One key revelation was the low turn-out of the Club administrators as only one of them, Alloy Chukwuemeka of ABS Football Club who incidentally is a former Sports Journalist participated. It explains the chaos we have in football club management in Nigeria and their aversion for professional structuring of their operations. On the positive side, Dr. Ikpe drove home the point that we must first create a Brand Nigeria football before we will start engaging in marketing it. He aligned with the observation that the potential for sport in Nigeria is huge and vast but requires product development approach to thrive.

Why African footballers based in Europe have not been able to attract the kind of endorsement deals their colleagues attract

Here again, we must make reference to the management and structure of football business in Africa having used Nigeria as a case study all along. What obtains in Nigeria is pervasive of the African environment except perhaps for South Africa which is some notches ahead. You also cannot discount the fact that product owners are targeting audiences outside of Africa and therefore will seek brand fit with faces that appeal to their target market. You don’t expect for instance MacDonalds to endorse an African athlete when they don’t have outlets on the continent.

We also have situations where African players do not get premium agencies to manage their affairs and this brings about their low endorsement deals. While working at the Sponsored Assets Unit in Globacom Nigeria years ago, I was a member of the team that negotiated a number of endorsements for the company with Nigerian and Ghanaian footballers but what you find is that when they don’t negotiate directly, they come with relatives to act as Managers and these chaps know next to nothing about endorsement deals. Small figure as $100, 000 gets them excited and they don’t push hard to earn more for their supposed ‘clients’. In the circumstance, you can see that their lack of exposure and absence of professionalism are perhaps some of the reasons we don’t see such mega endorsement deals happening in Nigeria and in Africa.  

There is a point of view that some multinationals operating in Nigeria do not show the same level of support to sports sponsorship in Nigeria as they do in their home and other countries where they operate, for example, in South Africa, many of these companies sponsor football clubs, build sports parks and stadia etc. How can we change this trend, what can the Nigerian government do?

It is the responsibility of government to make policies that will either stimulate or compel the activation of corporate social responsibility projects. Such policies must confer tangible benefits to compliant organisations and has the potential to create opportunities for jobs outside their core businesses. It is a fact that Shell sponsors a football club in Gabon but they can only do that in Nigeria if Government directs them to. This is because Shell in Nigeria operates a joint partnership and government can through this partnership prevail on Shell to say we have a need to empower youths through football club sponsorship. But overall, corruption has been a key driver of corporate disinterest in sports sponsorship. We have had a Mobil FC that was disbanded when natives of its operational base engaged in a violent fight that led to loss of lives. Most of the multinationals are securing contracts from both state and federal governments but are not made to plough back their profits into public interest projects.
What Youdees Offers

Youdees unique proposition in sports marketing is our application of out of the box solutions to the needs of our clients. Within a year of working with Enyimba, we secured shirt endorsement for the club which last enjoyed shirt branding in 2006. We had open discussions with Adidas towards securing a more lucrative kitting deal and this is on-going. Our launch of the Nigeria National League (NNL) logo and brand was the first of its kind in the country. We have raised the profile of the Nigeria Bankers Game, the foremost corporate games in Nigeria. Youdees  took the defunct Nigeria Premier League to the first ever Soccerex in Lagos and we are currently working with the Leadership of the League Management Company (LMC) to transform the Premier League in Nigeria so the league can realise its full commercial potentials.

Harry Iwuala is Lead Consultant at Youdees Limited, a sports marketing agency and can be contacted via

No comments: