Matchday Wrap Up

Clarification on Fan Protest

Updated On: October 4, 2018, 4:04 pm ET

I had a Facebook Messager conversation with Zach from Never Manage Alone last night that seemed worthy of a follow-up post.  Zach's position was that in dismissing the 77th minute walkout I was far too unsympathetic to the organization and passion that it took for the 10,000+ Liverpool supporters to do as much as they did and that was definitely not my intent.  The notion of organizing 10,000+ people who are only connected because of geography and their passion for a local club with the intent of launching a protest against the object of their passion is no easy task and should not be dismissed as a trivial act.  I applaud the effort and it was my intent to urge those efforts even further forward by trying to point out what I think it is going to take to create a real change in the Board Room at Anfield.  


Zach correctly pointed out that neither he nor I, growing up in an American society where we have a different relationship with our sports franchises (sports has really always been a business first here in the States rather than a civic institution), can really understand the nuances of the relationship between working class families that have been supporting their club (Liverpool in this case) for generations.  It wasn't my intent to get inside the heads of supporters but rather discuss something that I am pretty familiar with, what makes "management" tick.  I have been part of founding two companies both of which have been fairly successful.  I went to graduate school with and report to a Board of Directors who have deep experience in the world of Private Equity and getting a return for a syndicate of investors.  This is the Tom Henry and Fenways Sports Group world and, for lack of a better word, the opponent that Liverpool supporters are up against.  


My point wasn't that the Liverpool supporters shouldn't have staged their protest.  It was a great first step and has won them a temporary victory with FSG announcing at least a temporary freeze in the ticket prices that supporters were protesting against.  My point was that the letter sent to Liverpool supporters is a nice start but that the broader war is nowhere near over.  FSG only promised a two season freeze on ticket prices at which point their natural corporate culture will be to look at the fact that there are people willing to pay more for premium tickets to Liverpool matches and want to raise prices.  It is true that match day revenue will account for a smaller and smaller percentage of overall club revenue as the Premier League's TV package continues to grow but the notion that the TV contract by itself might provide "enough" revenue for the club to turn their heads away from other sources of revenue like match day revenue is a flawed one, at least when it comes to the mindset of the types of owners now controlling Premier League teams.  


These people have been given a fiduciary responsibility by the other, largely silent, investors in their investment syndicates to bring in profits on the money invested.  The charter is to maximize profit, not to uphold a civic trust.  My point in saying that supporters (at Liverpool and elsewhere) will have to be prepared to do more than just walk out after they've paid for their tickets and whatever else they probably purchased through the first 77 minutes is that they have to leave the corporate decision-makers who are used to maximizing profits with absolutely certainty that a significant increase in ticket prices will hurt them overall financially rather than help them.  The real threat of lower season ticket sales because supporters have proven willing to say no to renewals will do that. The real threat of lower value on kit and shirt sponsorships because sales on merchandise are tanking will do that.  The real threat of lower TV revenue in the next deal because one-time supporters have given up their premium digital cable/satellite packages that carry the Premier League will do that.  


The 77th minute walkout was, in my mind, the warning shot over the bow that supporters are disgruntled enough to start contemplating the more serious actions above.  It was obviously powerful enough to get Liverpool to respond in kind with a temporary victory for supporters' rights.  My point, perhaps poorly made, was that supporters should be preparing themselves to go to the mattresses if they want to win the war because the guys they're fighting against have something that lots of people are, for lack of a better phrase, addicted to and it is in their nature to continue to try to extract more and more money from that thing until they hit a wall where it becomes clear that there is no more money to be extracted.  They've hit the first solid substance, whether fan protest can become a solid wall over time remains to be seen. 


Oh, just to underline the point, Manchester United just recorded record profits.  The good news is that the significant changes are in TV money and sponsorship revenue.  The bad news is that the club still has £322.1m in debt despite years of supporter protest over the financial model that the Glazer family used to buy the club.  

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