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CHAPTER 2

The origin of the discipline marketing (corporate image has its roots in marketing), is difficult to establish, but the exchange of goods has existed for many centuries in the crudest of forms. Marketing has developed over the years to become a well-respected business process, which holds its development roots in the division of trade, creating the need for goods and product exchange. Some commentators (including Stanton, 1971), believe that marketing 'really started' with the Industrial Revolution, and grew pace in the 1920's, the Chartered Institute of Marketing defines marketing as:

As previously stated the study of corporate image holds its roots in marketing in the Promotion P, as identified by Professor Phillip Kotler. Organisations are spending increasing amounts on identity and is a source of valuable business resources. The development of the corporate image (linked to corporate identity), is discussed by Wally Olins in his book "Corporate Identity" (1991):

"In order to be effective every organisation needs a clear sense of purpose that people within it understand. They also need a strong sense of belonging. Purpose and belonging are two facets of identity...identity must spring from the organisation's own roots...must be clear that it becomes the yardstick against which its products and actions are measured"

Olins has identified that although an organisation may have a better product or service if the image is not perceived positively or the image is not integrated into the product/service, consumers will not entertain the brand. Although this is not linked to the football 'terrace' customer (the supporter) it can negatively effect sponsorship and corporate customers. An example of a perceived negative image could be Millwall Football Club, which has traditionally struggled with a negative/violent image, to the extent that it is addressing the problem through its corporate image strategy:

"Our club (Millwall FC) is trying to create, through a corporate image strategy, an identity of not being so aggressive"

Dr Lynne Millward (organisational scientist) devised a two-stage three component conceptual viewpoint model offering another perspective. Millward felt that corporate image/identity should be discussed at the conceptual-philosophical level rather than determining the tedious definition of corporate image (see appendix 6).

Corporate Identity is a visual means of identifying everything an organisation is about and can be used as a strategic asset to achieve long-term goals and limiting confusion with competitors. It uses all means of everything available to the public and as P. R. Smith (1993) says: "it is more than just a logo" (page 440), and the image should reveal the essence of the organisation. For this reason the football club's overall image/identity is important as it displays the external and internal image of the organisation. Sunderland Football Club changed its nick-name when it redeveloped its badge, but due to pressure from supporters (again revealing the symbiotic relationship) and a redefinition of its image, is returning to the nick-name it changed (the 'Blackcats').

The management of the image is important (see appendix 7), whether the organisation recognise the fact or not, every organisation has a unique image, based around perception. Therefore what one thinks maybe different to another. That is why football clubs are in a unique industry. It will have loyal fans (despite the market share of the club in terms of financial capability, see appendix 8), who will maintain the positive nature of their club throughout their life, and hold perception about other teams. Often the image portrayed towards 'competitors' is often based on primal interests and local rivalry:

Corporate image relates to everything, which embraces everything of tangible points of public contact and includes items such as (for a detailed list refer to appendix 9):

• Buildings (the stadium)
• uniforms (or the playing kit in football)
• all communications
• all visual impressions (such as the club badge)

Thus corporate image/identity is about good communication, about building lasting relations (see later section on relationship marketing) with stakeholders -employees, suppliers and customers. If designed correctly it will deliver messages about the organisation/club to the target audience and if successful will be perceived positively (for corporate image success refer to appendix 9 and appendix 10 for advantages) and playing an increased part in the football industry:

The stadium for football clubs is one of the major image sources available. The stadium is the home, and discussing in primal terms is the 'castle' of the fan a place to be worshipped. Amy Lawrence (1996) discusses the strength of the stadium towards football fans:

The identity is so strong, they (stadiums) are now becoming an integral money earner for many clubs. Stadiums are now not just used on matchdays, but for every other conceivable activity (such as pop music concerts). In fact in some locations the stadium has become a part of the community. For example Huddersfield Town's McAlpine Stadium and Northampton Town's Sixfields Stadium are partly owned by the local council which helps the community nature of the image strategy. Many stadiums are becoming 'joint' stadiums for both the Town's Association football club and Rugby football club (such as the JJB Stadium in Wigan home of Wigan Athletic football club and Wigan Warriors RFL club):

There is an increasing belief that the stadia are becoming self-sufficient. The sponsorship of the customer's temple in the English game is increasing dramatically. The sponsorship of stadiums grew in the United States where 46 stadiums from a total of 89 in NBA (basketball), NFL (American football) and Major League Baseball, are sponsored these include: RCA Dome (Indianapolis), Cinergy Field (Cincinnati), American Airlines Arena (Miami), Tropicana Field (St. Petersburg) and Bank One Ballpark (Phoenix). Although English football grounds are following this American model of stadium it is not on the same grand scale but there are an increasing number of the 92 league clubs, whose home is sponsored:

• McAlpine Stadium (Huddersfield Town)
• BT Cellent Riverside (Middlesborough)
• JJB Stadium (Wigan)
• Bradford and Bingley Stadium (Bradford City)
• Reebok Stadium (Bolton Wanderers) 

From the clubs identified, there is a clear consensus that stadium naming has become an increasing force following the redevelopment of the game. Only Bradford City's home is not a new one, clearly showing that the Bradford commercial department has identified the benefits obtainable from having a sponsored stadium

Consulting again the American sports image, Darrell Fry states:

Therefore if a football club holds a positive corporate image, it can help gain much needed revenue from stadium sponsorship, but it is only possible if the club holds an image sponsors like, as no corporation will want to be associated with a negative image.

Corporate image is a result of everything the organisation does and there are advantages (see appendix 10) to be gained through having a successful image (see appendix 9). In the football industry there is little difference in the products/services offered, each club needs each other to survive and thus the individual clubs require a successful image to create differentiation from the other offerings available. Football is a unique industry in that it's customers are very loyal to a particular brand and so the image (in terms of attraction) will be billed mainly to non-affiliated customers, corporate sponsorship and customers and attracting better players to help strengthen the image. The success of football clubs is not like any other organisation (see appendix 4) and a positive image, which is perceived by all stakeholders, is necessary. What a club does is under great scrutiny and the way its 'internal customers' (supporters) is linked to the image is unlike any other industry. The relationship between customer and club is symbiotic, what the customer does and how it behaves affects the so-called supplier (the football club) and so the image of the supporter is critical to the football club (as Millwall have found to their detriment). 

Jack Yan (see appendices 11 & 12) believes the role of corporate image is unique to all organisations and thus there is no "typical method". However Yan does create a model of corporate image (see appendix 11), which can be applied to any organisation in any industry. Image is important, as it is part of a chain that leads to "business performance", whatever the definition of performance is. The strength of the portrayed image affects the brand equity (see later 'Football as a brand'), but can help to reinforce and introduce brand associations. Yan identifies image, as being what is perceived and thus there can be multiple images for one organisation. This is typical for a football club, take the ultimate English model Manchester United. The following will hold a perception over Manchester United:

• customers/supporters,
• the players and backroom staff,
• shareholders
• media
• community
• other brand customers and suppliers (domestic and foreign)
• the industry as an whole
• City investors

The Manchester United brand (model) is so strong, that every other brand supplier in the world of football wants to emulate it's success (first £1 billion club) and its brand is available throughout the globe:

(unknown, "Dreams extend to Middle East, FT.com, 1999) 

Jack Yan also identifies the notion that a positive image encourages improved performance as audiences are prepared to deal with an organisation it deems to hold a positive image. The profitability of the club and community goodwill will increase and the overall respectability of the club will be strengthened. The unique position offered by the organisation will offer either a positive or negative perception, with image often being bound by what the audience wants. A football club must be clear who or what its audience is (i.e. supporters in the stands, corporate supporters, sponsorship) and offer a sustainable product aimed at these different segments, who will essentially require the same product/service, the success of the football club. It is often believed that although football clubs market to different segments, it needs "a corporate vision that encompass the entire organisation" (Yan, J. 2000). Football clubs usually portray one overall image, to the different markets, much like the Virgin Company. Clubs will have an overall strategy linked to the corporate goals of the club, with the difference in the football product been deemed along democratic and psycographic ratings rather than along divisional product lines. Jack Yan displays the overall essence of a corporate image:

(For further information regarding Jack Yan, refer to appendix 12 and chronology)

The football industry is unique, its customer (the supporter) is a central part to the development of the individual brands and the customer often adds value and strength to the organisation. It is a risky industry one which is subject to on the field success and thus related to the fitness of those who partake with the on the field activities. All other products/services offered by the industry help to augment the core product. Currently football is under a revolution, from the 1980's image to the now more respectable 'modern' image. As discussed earlier, Hillsborough created a substantial change in football, especially its temples (the stadiums), and the football restructure came in 1992, following the formation of the Premier League. The fabrication helped the Sky satellite company to survive (and it too to became a catalyst to the image change), following the television deal with the Premier League. The Satellite Company has become so strong it now owns shares in various clubs and was on the verge of buying the whole of Manchester United:

Football was the saviour of Sky; it is now becoming the owner and controller of football with share issue stakes in five clubs. Despite the strength of Sky in the football industry, if it had not been for the activities of Alan Sugar (owner of Tottenham Hotspur), Sky would never have got its clutch on the wonderful game. To coin the Sky catch phrase it certainly is "A whole new ball game". The former head of Sky (Sam Chisholm) announced in 1997, that football was the turning point for Sky. Revealing that the telephone call from Sugar (who was to make millions out of producing the equipment to receive Sky transmissions following a deal in 1988) was an important element to take football into the new Millennium. Sky is credited with helping the image of football, Chris Akers says:

The head of merchant bank 'Singer and Friedlander' reveals the turning point and transformation of English football and reveals the nature of commercialisation:

The change of the football industry following the Hillsborough tragedy is credited to the Taylor report. Lord Justice Taylor commented:

The Sports Minister Tony Banks (who has now been replaced), commented on the reformation of the football game in England, ranking amongst the best and most comfortable in the world, with the generation of "new modern all-seater facilities".

The transformation of football has been great in the area of who owns football clubs. Clubs are now owned, controlled and developed by businessmen with business acumen, who clearly understand that the image of the club is vital to the success of the football club:

Football is a rich and thriving industry (Manchester United is now worth £1 billion), and it is the owners who are carrying on the Taylor transformation of football. The 'new owners' of the game, are the ones behind the increase in television deals. As one First Division Chairman said:

Many clubs are now on the stock market, and so will have investors to keep happy, whilst keeping happy those who invest in the club via their entrance through the turnstile (both who mutually exist and benefit). Some believe football has made businessmen very rich. An example of this is David Dein (Arsenal). In 1983, Dein paid £290,250 for a stake in Arsenal, he is now worth an estimated £35 million. There are many examples of this throughout the industry. None more so than Manchester United. Sky were ready to offer around £500 million for the club, they are worth double that, and in the 1989 the Manchester United Chairman Martin Edwards nearly sold his interest to Michael Knighton for £10 million. This revealing just how far the image of football in the City has come in just a short space of time. The income of football clubs can be broken down:

• gate receipts
• television money
• merchandising and branding
• sponsorship
• asset utilisation (the transfer of playing staff)
• stadium development/activities
• financial institutions (i.e. City investment)

The football industry in England has never been stronger than it is now. The image and finances are in a strong position and attendance's are generally on the increase. It is believed that the latest television deal could be sanctioned in a deal worth around £1 billion (over five years). Television money, increasing gate receipts, merchandising sales and the Internet boom will all ensure that club finances (especially in the Premier League) remain healthy.

The customer in football is unique and special. The relationship between the customer and the club is a special case. The customer internally supports the club (without them there would be no club), but the strength of the affiliation is stronger than any other industry, the customer actually regards the organisation as its own. The Tony Fraher quote on page 19 reveals that the football customer has been transformed and that the support is much more family-orientated. One Chelsea supporter reveals the passion of football fans:

The supporter's revelation, shows that football customers are unique and that they stick with one brand often created by genealogy. Attendance at football stadiums has risen dramatically over the past decade. Football owners can charge whatever they want for admission to the stadium, as they know the customer will pay it (unlike in other industries therefore not bound by traditional economic rhetoric), as there is no substitute or alternative product, other than not going. The reason behind this is discussed:

In the same article a study into the customer enthusiasm for the industry, revealed:

• family influences
• locality
• style of play and exciting players
• team uniform/kit
• child enthusiasm
• seen on television

...are all issues which the customer revealed for their 'preference of a particular club' and so can be the basis of revenue for the modern football club. Football is predominately engulfed by young people. 80% of Leicester City supporters are between 15-49, with 30% of all season ticket holders earning £30,000+, revealing again that the image of the football club is big business and if the image is consistent, there are considerable financial rewards to be obtained. Alan Sugar regards business-to-supporter relationship:

Abdul Rashid (Commercial Manager: Aston Villa) sums up the overall essence of the customer-club relationship, which if successful can help the image of the club tremendously:

The television deal discussed in the previous section will also effect the customer. Although it is predicted Sky will maintain the hold on the majority of the live games, more will be back onto terrestrial television.

Corporate image is all about creating long-term relationships, the success of football clubs is concerned with creating relationships (i.e. with supporters/customers who will purchase season tickets if satisfied by the service/product). Analysing the notion that marketing as progressed from Kotler's 4p's approach, is clearly shown through the football product which aims for long-term relationships, rather than the often-suggested transactional-base of the 4p's. The entire organisation/club must be subjected to the needs of the customer: 

If the customer-club relationship is handled correctly, it will add value to all stages of the value chain, with the key to customer satisfaction shown across the value-chain model. There are many advantages of a relationship approach:

-Single sale -Customer retention

-Service features -Service benefits

-Short-time scale -Long-time scale

-Little emphasis on customer service -High emphasis on cust'r service

-Limited customer commitment -High customer commitment

(Source: McDonald et al. 1996 page 25) 

Wally Olins discusses the relationship aspect of corporate image:

Thus by creating a sense of club togetherness the club can prosper mutually through relationship retention. Evert Gummesson, who identified the shift from the 4p's to the 30r's, discusses relationship marketing in depth. The essence of the shift to relationship thinking in the football industry is shown through:

Rubery identifying that everyone in the club (like Gilliver) has a part to play in creating and satisfying the needs of all stakeholders.

Gummesson (1999) identified 30 relationships (30r's), of which the eleventh such 'R' (The customer as 'member') sums up the football relationship coherently. The customer is central to the success of the football club so what better way to describe them (supporters) but as 'members'. Football relationships are a complex web of interaction (see appendix 13), with the season ticket holder being the ultimate 'member' throughout the season -who will also purchase tangible products (i.e. replica shirt) to supplement the intangible core product of the football game on the field. The season ticket holder also offers the club a specific database of target market, all that have the same interest, the success of the football club. Gummesson identified three purposes membership serves for the supplier (the club):

• it helps increase retention and share of customer,
• it provides more information about customers, and IT makes it possible to build a database of any number of customers, thus replacing blunt mass marketing with targeted communication and customised offerings,
• if the competition offers membership, an individual supplier may have to join in order to stay in the market

By following such a method, the provider (the club) and the customer (the supporter) become co-producers of value to the club and create what Gummesson believes is a "win-win relationship":

Value-added chain (adapted)

(Glazer, R. 1991 "Marketing is an information intensive environment: Startegic implications of knowledge as an asset" page 4)

Corporate image is a tool to reinforce associations and create "brand equity" (Aaker, 1991), helping to create brand associations, perceived quality, brand awareness, brand loyalty. It as been found (by research by Jack Yan) that positive corporate image leads to and encourages consumers to "deal positively with the organisation" (Jack Yan, 2000). Brands have become icons and symbols of quality and value (see appendices 14 & 15), and brand helps to distinguish the product. In football the product is the same, the brand (the club) is the differentiation factor to create a Unique Selling Proposition (USP). However, brand value and customer value must be similar, if not problems can occur and the brand management discipline is now deeply rooted in the football industry, creating a "one-man-one-brand" club, much like the Proctor & Gamble Company. The football brand has now become an augmented product, football clubs have added value and strength beyond the core product/service (the physical playing of the game) and as such this area of thinking as become a critical matter for increased turnover. Simon Knox and Stan Maklan discuss the essence of the value of brands (see appendix 16):

(1998 page 17) 

Football as a brand is strong and as an entity it is stronger than the likes of the Nike brand is discussed:

The strength of the associations with football clubs is unlike any other industry, the loyalty is demand inelastic, therefore the club has support through bad times, as well as the good times and the loyalty is unsurpassed. The football brand loyalty is built out of tradition, passed down through the family and thus the club will have brand loyalty to rely on in later years. Supporters/customers are prepared to buy literally anything with the club crest on it. Everton owner Peter Johnson commented:

Football clubs are finding outgoing expenses increasing and as such will require a strong brand and a strong image to achieve success. The Manchester United brand is being controlled by Gary Mackenzie a leading marketer responsible for many top companies, revealing how football as progressed in the business world:

Following the assessment of the current literature available, the paper will now look at primary research (chapter 4) and the methods (chapter 3) used to obtain this data.

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