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Real Madrid

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by

Abbey DeSpain

on 10 February 2015

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Transcript of Real Madrid

BY ABIGAIL DESPAIN,EMILY LYONS, MATT BIONDO, RODRIGO AMARAL, CAROLINE ZIGOWSKI
Weaknesses Prior to Plan
Strengths '03
"Our Vision to be the best soccer club in the world"
Goals
Debt
Lack of Assets
Unstable Success
Unclear Mission
Marketing & Operations inadequate
Established Name Recognition
Talent
Established Management and Staff
Ability to Plan Ahead
Leveraged Fan Base
Threats
Uncertainty of Future Talent
Chelsea
Keeping the border between Fans v. Customers
Opportunities
Continue International Marketing
Continue to Improve Fan Loyalty
Continue to Grow Company
1. Financial Flexibility
2. Top Players
3. Leverage Brand
Determinants of Success
Audience Size
Frequency of Audience Engagement
Sociodemographic Characteristics
Bridges
Leveraging the Brand
Using a variety of channels to promote the Real Madrid Brand
Converting a fan into a customer no matter their location
Gaining Financial Flexibility
Real Madrid Television
- Launched in 1999
Assembling the Galacticos
- 16 hours of daily coverage
- Included training,soccer and basketball matches,player
interviews and historical highlights
- Mission pursued because in Spain alone, there were 3.5 million pay-TV companies
The Club's Website : RealMadrid.com
- Featured interviews of players, live feed, and club news.
-Served as a community creator, where inaccessible fans could be reached
- Revenue derived from T- Shirt Sales and Advertising
Results
Sold old training pitches - 500 million
Recaptured exploitation rights (perimeter signage, VIP boxes) - 16 million
Annual website revenues reached 1M Euros annually Views reached 2M per month in 2001 and 18M pages forecast for 2004
Stand alone legal entity (Sociedad Mixta) that owns and manages some rights
Sold 20 percent stock share to Caixa Madrid for 78.1 million
Sold 10 percent stock share to SogeCable for 39.05 million
Made Adidas and Siemens as major sponsors 39 million - 83 million 2003-2004
- Struck a four year deal with Telefonica to provide mobile and internet/ broadband services for Real Madrid content
Real Madrid Stores
- Began opening stores, offering fan cards and managing a magazine
- Launched six franchise stores, including one in Barcelona
- Fan card offered discounts to holders which came with a free magazine subscription, no-fee Visa Card and commercial discounts to partner companies, giving leeway to exclusivity.
Real Madrid
Case Study
The Retail Approach
Results
-190,000 Fan Cards issued by 2001
- Retail Revenues reached 4M Euros by 2001
Results
- Marketing Revenue was projected to rise from 39M to 83M
-Ticking Revenues increased 55%
- Stadium sold out 24 matches in a row
One of Real Madrid's 3 main goals was to build a team of superstars. To do this, each player received large salaries. Real Madrid's players received 5 spots on Forbes Highest Athlete Salaries List. The club initially took out a loan to finance transfers of top players to the team
Real Madrid sought to acquire a new star player each year. According to the club, "We are buyers more than sellers.
Real Madrid was a team comprised of mainly star players. Christian Ronaldo states that this made it easier to focus on the team aspect of the games
Real Madrid's star studded roster was an investment into the Real Madrid brand
The Three Goal Assessment
- Gain financial flexibility to acquire talent and expand brand
- Assemble a team of top
players
-Leverage the Real Madrid brand across variety of channel
Real Madrid in 2003
-Second-largest live TV audience ever
"One of the most important things to have happened in Spain in a decade"
- David Beckham begins playing for Real Madrid
- Best soccer club of the 20th Century
-Real Madrid was the world's 4th wealthiest soccer club
233M Euro Estimated Revenue Projection
How Did Real Madrid Do It?
- In 2000, management of Real Madrid had drastically changed for the better. The new management team consisted of President Perez, a coporate general director Carlos Martinez de Alboronoz, a marketing manager Jose Angel Sanchez and a sport management director Jorge Valdano who sought to create a revolution for Real Madrid
Mission
Value: To Be the Best Soccer Club in the World
-Size of audience
-Frequency with which the audience engaged with the brand as a measure of commitment
-Sociodemographic characteristics of the audience
-Bridges (usually in the form of local fan associations) to link the brand and the audience

“Our mission is to nurture and project the Real Madrid brand worldwide”
The Futbol Culture
World
The world’s most popular sport
Simple rules, minimal equipment accessible
Over 240 million people played at least once a week
Symbol of national pride
Europe
Big-five soccer countries: England, France, Germany, Italy, Spain
Spain
Over 10000 soccer clubs
Nearly 620000 players – 1200 of them professional
Largest clubs: Real Madrid and FC Barcelona
two-thirds of all the national championships of league and 39% of all cups
Soccer added 1 billion euros to Spain’s government coffers every year
80% men and 28% of the country’s women considered themselves soccer fans

Expenses and Revenues of Real Madrid
- European soccer followed an open league system: Performance did not dictate your position in the league, wealth and prestige did.
- Expenses included Talent acquisition and retention, stadium costs and fees paid
- Revenues derived from Match Day income, Merchandising, TV Rights and Public Share Offers
Goal
To achieve low expenses and high revenues with a 3 step plan
SWOT ANALYSIS
INTERNATIONAL MARKETING
WHAT IS REAL MADRID?
Real Madrid continues to be the most valuable sports club in the world, increasing its value to 3.44 billion dollars, according to the prestigious Forbes magazine
EXPANDING INTERNATIONALLY
- TAKE ADVANTAGE OF CLUBS INCREASED GLOBAL BRAND EQUITY
-CAPITALIZE THE CLUBS ASSETS BY GENERATING RETURNS IN THE U.S MARKET
-CREATE A VIRTUOUS CYLE IN WHICH ECONOMIC RETURNS STRENGTHEN THE BRAND IN THE U.S AND VICE VERSA
-ESTABLISH A FOUNDATION
ALL DONE THROUGH THE FOLLOWING WAYS
- CONTENT DEVELOPMENT
-FAN LOYALTY
-DEVELOPMENT OF INTAGIBLE ASSETS
-ASSET DEPLOYMENT
REAL MADRID AND BARCELONA
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