When Fenway Sports Group (FSG) acquired Liverpool FC in 2010 there was much enthusiasm from the fans that were aware of the owners’ history. The owners successfully adopted the Moneyball strategy at their MLB franchise, the strategy was first introduced to sports fans worldwide by Michael Lewis’s eponymously named book and the consequent movie starring Brad Pitt. There has been a lot written about it since the 2010 takeover as it has been a particularly expensive experiment with minimal return on the field of play. The strategy employs an array of on-field statistics in order to identify undervalued assets (players). In its simplest form Moneyball advocates the timeless axiom in finance: buy low and sell high.
Two years on and several ill-fated transfers later, Liverpool FC is clearly experiencing teething problems with the system. The system’s proponent and Director of Football Strategy, Damien Comoli is no longer at Liverpool FC. After this season’s transfer activity it seems these problems are far from being ironed out – Borini is a revelation. However, amongst all Liverpool’s on-field waywardness the cogs have been turning in the glass offices.
Liverpool secured the largest kit sponsorship deal for any Premier League club with US manufacturer Warrior. The deal is worth a reported £25million a year for 6 years. The clubs shirt sponsor Standard Chartered pays a reported £20million a year to embellish the chest of Jordan Henderson and his equally average Liverpool team mates. Chevrolet signed on to become the new car sponsor and Garuda of Indonesia has become the global official airline of Liverpool FC. The club also ramped up its efforts in the sports betting department by signing deals with both Paddy Power and 188Bet.
Liverpool’s endless drove of supporters around the world ensures it places within the top 10 clubs in terms of revenue earned according to Deloitte. It is the only club that holds a top 10 spot without playing in the prestigious (not so much after Chelsea won) Champions League. It seems Liverpool’s owners spotted an undervalued asset in the club itself. Commercial revenues are on the up and broadcasting revenues will increase significantly if Liverpool is able to qualify for the Champions League. Whilst the transfer policy will continue to vex even the most ardent supporters, at least the their finances are much healthier than their league position.
Author : Shiraaz Abdullah