What's in a name? Lots of potential damage seemingly.I was planning to write a follow up to my previous piece on why Mike Ashley’s “rebranding” of St James’ Park was ill conceived from the very start and doomed to fail.
In it I was going to outline how the value of Newcastle United’s brand has been damaged so much by this that it will lose far more in the long term that the minimal amount gained through selling the stadium’s naming rights. Going on similar deals on considerably less problematic new build stadiums, this amount will be nowhere near the £8-10 million foolishly quoted in public by Derek Llambias in an interview with BBC Radio Newcastle. Going on similar examples such as Arsenal’s Emirates Studium and Borussia Dortmund’s Signal Iduna Park, it will be more like a third to a half of that sum unless a shirt deal is also included and even then, the price is still somewhat ambitious.
As most of you will know, current shirt sponsors, Northern Rock, recently pulled out of their recent rather meagre £2 million per annum shirt sponsorship deal, and it has even been suggested that the furore over the Ashley’s second attempt at a stadium rebrand will jeopardise this sponsorship, as potential sponsors distance themselves from this now toxic brand. As I mentioned in my previous piece on the subject the offer has been almost universally derided by the people in the sponsorship industry who advise corporations on the efficacy of such deals, with one exception, from someone called Jonathon Gabay, who was reported as being an “unofficial consultant” to the club on the renaming issue. (more…)
It's St James' Park!To say there’s been some opposition to Mike Ashley’s rehash of his previously botched plan to sell the St James’ Park naming rights would be an understatement.
However as more details have emerged it’s become ever more obvious that this 2.0 version is scarcely better than the previous one, and it seems more than likely that the club will once again end up with the worst of both worlds, a cheap tacky stadium with an awful name and nothing whatsoever to show for it.
Referring to sponsorship consultant Tim Crow’s “Six golden rules” of stadium naming rights, quotes from experts from the world of sports sponsorship about the naming rights offer, and some of my own personal thoughts, I will attempt to outline some of the reasons even this revamped naming rights offer will have scant chance of success.
Let’s begin with golden rule number one:
1. The stadium must have only one short name. If there are two names, one of which is the sponsor’s, guess which one the media, and the fans, will edit out? ‘The Reebok Stadium’ works: so does ‘The Emirates’. Conversely, horrors like ‘Sports Direct.com@St James’ Park’ always quite deservedly bomb.”(more…)
Derek Llambias: Absolutely full of it.With the news that Newcastle United will be changing it’s name to “Sports Direct @ St James’ Park”, the Managing Director of the club, Derek Llambias, has sought to reassure fans that the St James’ Park name would remain so long as he and current owner, Mike Ashley “reigned” at the club.
Firstly though, he told BBC Radio Newcastle about how this would be a “showcase” to lure prospective outside sponsors would would bring much needed revenue into the club saying:
“We will showcase Sports Direct until the end of the season,” then adding:
“I’m sure we’re going to get a sponsor in for next season.”
When asked if the name “St James’ Park” would always remain, Llambias then reassured fans by responding:
“Absolutely. In our reign, absolutely.”
“It’s adding to it, and if it brings in a good chunk of money to the club, that goes straight to the team, then do you know what, it’s a revenue we should look at.”(more…)
1/150th of Newcastle United's debt.Of course, Newcastle United have been riding along on the crest of a wave in our first seven games in the Premiership, with our unbeaten start currently seeing us in fourth. However we also stand in fourth place in another table too, that of Premiership debt.
According to the table compiled by Deloitte, Newcastle are the club standing in fourth place with a debt of £150.385 million, which is over £26 million higher than it was when Freddy Shepherd left the club in 2007. Over £111 million of this is immediately repayable on demand to Mike Ashley should Sports Direct go tits up, or he gets a little carried away in Asper’s Casino one night, the rest being recouped in installments and secured on broadcasting revenue.
Of course, the club’s catastrophic relegation to the Championship, resulting in a huge loss of television and other revenue, was responsible for most of this, despite a huge cost cutting excercise by owner, Mike Ashley.
Here’s the debt table with the top five, along with the Mackems at number 11.(more…)
More cash for the club?In my previous blog “The Lesser of Two Evils” many people commented that Mike Ashley has no commitment to NUFC and will sell up as soon as he gets the right offer.
The question that has to be asked then, is, “How attractive is Newcastle United for a takeover?”
If you imagine yourself as a potential investor of NUFC you have to admit that it does look an attractive business move. A huge loyal fan base, who despite their misgivings of the current ownership are relatively content at the moment. All the club debt is out in the open, in a manageable way and is a relatively small given the revenue of the club. The team is playing well and we are flying high in the leagues and cup competitions, if we had beaten West Brom last season we would have only been a few places short of Europe.
Once that debt is cleared (hopefully in a few years) provided we continue to reside in the Premier League we could prove to be quite profitable on a long term investment.
The relegation was fantastic for a new potential owner; all the dead wood and high earners are almost out of Tyneside (Alan Smith I’m looking at you) with a new sensible wage structure and transfer policy in place. I’d argue that maybe another £20 million in transfer fees to get us a new Striker and Right Back / Centre Back would set the team up for a few years; our squad is not in need of a complete overhaul as we have a relatively young squad. (more…)
