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Footynomics: the economics of the AFL's future

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In a recent book titled Soccernomics, the authors, a finance writer and an economist, stated that sporting leagues like the NFL and the AFL were likely be overwhelmed by soccer. “But Aussie rules can exist side by side with soccer. We said in the book that it may be a subsidised folklore festival so it is not my bet but I do think it is a distinct possibility," says one of the authors according to SBS's Matthew Hall. One must worry at the outset that people who love soccer enough to write a book about it might be slightly biased in their opinion, but be that as it may. Does such an idea make sense? Does the economics of it make sense?

Pictured at left is Papau New Guinea as it celebrates winning the 2008 International Cup

Since the early 80s we have seen the AFL/VFL grow from the biggest sporting league in Melbourne to the biggest professional sport in Australia. Since the mid 90s we have seen Australian football grow at a huge rate across the United States, Canada, the UK, continental Europe, and Japan. In the last few years, footy has made great strides in South Africa, Papua New Guinea and New Zealand. This last week, the AFL announced that not one but two separate teams would represent international players at the 2010 U16 National Carnival. For a sport on its last legs it seems to be going out in style!

As someone who has been involved in footy's international development since the late 90s including helping to establish two clubs, holding executive positions in the USAFL, starting a junior program in the Washington DC area, writing for World Footy News and editing USFootyNews.com, I think I know a thing or two about footy's potential. I also have a PhD in economics and I have a number of publications in peer-reviewed academic economic journals, so I think I know a thing or two about economics. Does that make me qualified to discuss footynomics? Probably not. Is it going to stop me? Heck, no.

When thinking about whether a sport will be or is successful, one has to first consider the measure to be used. Is it participation? Is it the number of countries that play? Is it attendance? Memberships? TV Revenue? In the US, junior soccer is probably the single largest participation sport for boys and girls, but I don't think many would claim that soccer is successful in the US market. While soccer contends it is the "World Game", the two fastest growing and largest economies in the world don't exactly embrace it. In India, you would have to say cricket is the most successful sport. In China it is probably ping pong. Either is soccer such a big deal in Japan (sumo and baseball), New Zealand (rugby union), South Africa (rugby union, the host of the 2010 World Cup no less), Pakistan (cricket and squash), Ireland (Gaelic football and hurling), Wales (rugby union), USA (American football, baseball, basketball), Canada (ice hockey), Dominican Republic (baseball), Jamaica (cricket), Nauru (Aussie rules), Australia (Aussie rules, rugby league), Bangladesh (cricket), South Korea (baseball and taekwondo), Papua New Guinea (rugby league), Samoa (rugby union). Somewhere North of half the world's population doesn't care too much about the so called "World Game".

What about attendance? By that measure college football is much more successful than the NFL, but this has more to do with the fact that NFL teams make their money from TV. NFL teams purposely limit the stadium sizes so that they don't have TV blackouts in the local market. College football, like the AFL, makes more money from the attendees so they build very large stadiums to accommodate them. AFL is unique in world sport in using memberships so that is probably not such a great way to compare sports. Is it TV Revenue? Sony recently paid $1.9 billion, that's billion with a "b" for 10 years for the Indian Premier League Twenty20 cricket competition. But that is dwarfed by the NFL which makes $3.7 billion a year from TV contracts sold to the major US networks. This is about twice as much as the English Premier League makes from selling it's world-wide TV rights.

In standard economics, we think of a sport like footy as a product that is consumed when someone either plays the sport or watches the sport. We can think of a sport becoming successful if it increases consumer utility or welfare which we can measure by counting up how much people spend on membership fees, equipment, tickets, food at the stadium, merchandise etc. In this view, more sports in a market (country) can make everyone better off. In his Nobel prize winning work, Paul Krugman, showed how two similar countries could be made better off by trading relatively similar goods. The US and Australia can both be better off if the US exports cars to Australia and Australia exports cars to the US. The reason, is that not all products are the same, and different people like different things, so the more products there are, the more likely you will find a product that fits you well. If you have ever walked down the cereal aisle of a supermarket, you get the idea. The more sports there are to play, the more likely you are to find the sport that most suits your body size and temperament.

If a country has soccer but not basketball, then all the tall guys play soccer, once basketball is introduced the tall guys can be better off shifting to basketball. Similarly, if you like watching a "bit of biffo" but you are in a country that just plays soccer, you may be better off if rugby league is introduced. In this way more sports actually make everyone better off. Not surprisingly, given this result, the trend in most markets including sporting markets has been toward more choices rather than fewer. Where once Ford sold a single model in a single color - black Model T, today's car buyer has the choice between hundreds of models and makes with many colors and other options. In the heartland of Australian football, the Melbourne Storm rugby league club have been pretty successful. Soon, the legendary coach Kevin Sheedy, will lead an AFL club into rugby league's own heartland, Sydney's western suburbs.


Melbourne Storm celebrate after winning the 2007 Australian Rugby League Premiership.

However, sport, particularly professional sport is not so much about selling a particular product to end customers (meat pies to stadium goers or footy jumpers to fans), rather it is about selling "eye balls" to advertisers. Advertising is where the big money is in sport. A sport that can turn its viewing public into advertising dollars will be very successful. How can this be done? Actually, it is not obvious. Certainly, if you can get a lot of people, say 1 billion, to view your ad, then that would probably make the advertiser pretty happy and they may be willing to give you a lot of money for the ad, particularly if there is some probably that a few of those 1 billion people will buy the product being advertised. Global brands like AIG, um, I mean VISA or Coca Cola, really value getting their brand in front of the odd billion people and there are not many sports or sporting events that can do that. Actually, it is probably just the Olympics and the World Cup, that have the ability to do this.

The economies to advertising during the World Cup final are astonishing. Just think that a single board with "VISA" painted on it in the appropriate location on the soccer field will be seen by hundreds of millions of people at exactly the same time. To get that sort of exposure any other way, Visa would have to paint thousands of billboards across hundreds of countries. Notice that neither the Olympics nor the World Cup is a "sport" as such, both are sporting events and both involve nations participating every 4 years. Even there, it is really just the World Cup Final and the 100 meters sprint where a billion people might actually see the word VISA flash up on a sign. So for global brands, a global marketing platform, like the Olympics or the World Cup can be very valuable. Maybe as we become more global, this is the future. I note however, that no real sport has yet been able to make it as a global platform for advertisers. Maybe F-1 comes the closest, although it is not watched in some very big and economically wealthy countries.

Could soccer become such a global advertising platform? To some extent the Champions League has been able to become such a platform, and we do see the global brands embracing it. But it is still only the final that really gets the big numbers watching. One of the problems is that it is difficult for all the different stakes holders to coordinate and create such a platform. The big European clubs are trying to make themselves into their own individual advertising platforms - so no matter what competition it is, Manchester United's AIG is seen around the world be the millions of Man United supporters. But AIG may not care particularly if the background is the red of Man United or the blue of Chelsea. Given this, individual soccer clubs may compete the benefits to being a global advertising platform away. The soccer leagues and federations have not yet been able to pull their clubs into line and the major clubs haven't been able to get into a smoke filled room to coordinate their activities (assuming this would be legal as it is for the major sporting leagues in the US).

Can other sports become global advertising platforms? Should they? It is not clear there are other sports that could move to become such platforms or if they could they don't seem to want to. Probably basketball has the next best shot given the huge following of the game and huge participation around the world, but the NBA seems uninterested in pursuing such opportunities. The NFL is certainly not interested and neither is Major League Baseball. Cricket? Rugby and Rugby league don't have the ability and AFL is a long way from even trying. Why not? Why isn't the NBA or the NFL interested in making the step up to the global big time? Part of it seems to stem from the way advertising works in the US sporting market. In Europe and Australia, leagues or teams sell advertising directly to the advertisers and then separately sell the TV rights. In the US, the leagues (and teams to a lesser extent - Notre Dame for example) sell the TV rights first and the TV networks sell on the advertising. This institution locks the major US sports into a national market where they are selling their product to the national TV networks - ABC, NBC, CBS etc. Because of this, the US sports don't care too much about putting advertising on their fields or their jerseys and so they don't care too much whether someone in India watches an NFL game or becomes a Redskins fan.

This institution both makes it uninteresting for US sporting leagues and teams to look beyond the 50 states and makes it hard for sports like professional soccer to make a dent on the US market. To make it big in the US, a sport must convince a major TV network to carry its games and then that TV network must get advertisers to pay to advertise during the games. The NHL tried and pretty much failed to enter the US market in the 1990s. They moved a bunch of teams from Canada to warm weather US states and negotiated a lucrative package with the newest TV network - Murdoch's Fox. Unfortunately, for the NHL and Fox, they weren't able to convince Americans to watch ice hockey and advertisers were unwilling to pay to advertise during the games. NASCAR, on the other hand, has been able to transform itself from a sport based in the South Eastern United States to a national sport with large national TV deals. The indoor professional American football league, the Arena Football League (the other AFL) similarly seemed to be quite successful at growing until it went into bankruptcy this year. The XFL was probably one of the biggest flops in recent times. Unlike US sports, the AFL is not locked into national TV revenue. TV deals can be very lucrative for the AFL, but so can advertising deals with global brands such as Toyota. If there are opportunities to expand the sport internationally, the AFL's has the institutional structure to take advantage of firms looking for an international advertising platform.

For the most part, being a global advertising platform or a national advertising platform relies on broadcast media such as network television to push pictures of the game into millions of households at the same time. It is not the case that it is necessary for every broadcast market to have a large supporter base for the sport, but it is necessary that there be enough fans across the broadcast area (the country for example) for the broadcaster to be willing to carry the sport. Not everyone has to like ice skating, but there has to be enough people across the country for ABC to force everyone to watch it. The benefits to a sport of convincing a broadcaster to carry a game can be enormous. It quickly puts the sport's sponsors in front of millions of people. However, broadcast media seems to be on the wane. In the US, the major broadcast networks still get the largest share of the audience but it is no where near what it was and it is getting smaller every day as people drift to cable television, the Internet and computer games. Where once one was forced to watch the "college football game of the day", today it is possible to watch maybe up to 30 college football games across the weekend, assuming there enough hours to do that. The number of college basketball games available to watch is just insane. With the advent of cheaper camera equipment and websites like Youtube it is possible to watch hundreds of sporting events of all sorts of types. Given so much competition for mindshare, we are likely to see the benefits to sports of being on broadcast television decrease substantially.

While putting a single advertisement in front of a billion people is a great way to make money, Google has shown that putting a billion ads in front of a billion people is another way to make a heck of a lot of money. Google makes money by giving niche brands the ability to target their ads very precisely. If I own a flower shop in Arlington Virginia then I may only be interested in advertising to people who want to buy flowers and live in Arlington Virginia. Google makes this happen by allowing advertisers to buy ads for search terms such as "roses" for searchers in Arlington Virginia. Most products are not global brands and don't need global advertising platforms. If a sport can offer opportunities to an advertiser to target its advertising pitch to an audience interested in the product it may be very successful.

One quite odd example is the Seattle Mariners baseball team. The Mariners have one of Japan's greatest baseballers, Ichiro Suzuki (pictured left), and have grown a large fan base in Japan. But the Mariners haven't really been able to become a global platform, rather they are an advertising platform to two distinct markets - Seattle and Japan. If you look at the advertising around the stadium it is in both English and Japanese and includes brands that are very important in one market and completely useless in the other market. There are certainly no scale economies in advertising in Japanese in a US baseball stadium, but the Seattle Mariners offer the firms who advertise a targeted audience. Nikon is one brand that is valued in both places and has taken advantage of the unique platform offered by the Mariners.

According to Harvard economist and Microsoft's chief economist, Susan Athey, advertising is changing. It is likely that content providers like sporting leagues will need to rely on third parties such as Google to provide information on their customers and target the ads to those customers. Can the AFL grow internationally by being the "Google" of the sporting world? Certainly, rather than providing subscription Internet services, there may be more money in providing free content and letting firms like Google sell the advertising space to individual viewers who live in many different parts of the world and are interested in many different products. The AFL already has the content. Why not push it out over Youtube?

While Google is great at targeting ads to people searching for niche products it is not so great at targeting ads to people who already know how to find niche products. Google is not particularly good at targeting ads for websites that concentrate on a very specialized subject like Australian Rules football. Content providers and advertising platforms that can provide access to niche audiences that are interested in niche products may be very valuable to those niche brands. The AFL could become a platform for niche products. AFL fans the world over are certainly passionate and they also often have a passion for Australia. Maybe Tim Tams and Vegemite should hook up with the AFL as they look to take their brands global.


Calgary's Dane Rolfe flies at the 2009 USFooty National Championships in Mason OH. Photo by Damien Moore.

What does economics tell us about the future of sport and the future of footy in particular? The late Nobel prizing winning economist, Paul Samuelson, quipped "If you must forecast, forecast often." That said, it is unlikely that one single global sport will make us, the viewer and participant in sport, very happy. I personally, love my footy. I also love to watch college football, particularly the Penn State Nittany Lions. I love to play basketball. I love watching my son play soccer. If you have never seen the great Alex Ovechkin play ice hockey then you have really missed something special - check him out on Youtube! For me, the more sports the better - well maybe less cricket...

There are enormous economies of scale in being able to offer global brands a single sign in a single stadium that will be viewed by millions, perhaps billions of people. If a sport like soccer can become a global advertising platform it may make huge amounts of money. Unfortunately for soccer there does not seem to be one organization able to bring the major clubs and leagues together so that they can cooperate rather than compete away the benefits of being a global advertising platform. Neither do other sports seem to be ready or have the incentives to go global. While the AFL is very much focused on Australia because its audience is there, it has shown in the past that is willing to upset its major stakeholders in order to achieve its goal of national if not global domination. The AFL has very cleverly designed its institutions so that all potential competitors, from clubs to leagues must agree that AFL is the "keeper of the code". If the AFL decides to go international, it won't have the institutional impediments that soccer, basketball, American football, and baseball face.

Further, the old model of having a sign shown to millions of people through broadcast television is coming to an end. Sports that can adjust to the new world order may be able to take advantage. In the new world, it doesn't matter if you live in Calcutta, Ringwood or Arlington. AFL fans in Denmark, the USA and Queensland may not be too different - all equally interested in watching footy and buying roses for their wife from the local flower shop. One of the Baltimore Washington Eagles junior players became a Brisbane Lions fan this year - with a Lions guernsey and all. So why would a 8 year old American living in Washington DC be a Lions fan? While Eagles and Blues guernseys feature most prominently on Saturday mornings, this particular player was watching footy on Youtube and just loved the speckys taken by the Lions players - apparently they were the best!

As an economist, I can't tell you what the future will be for the AFL, but I can ask you to believe what you see with your own eyes rather than the ramblings of a couple of Englishmen who love the "World game" enough to write a whole book about it.

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Footynomics: the economics of the AFL's future | 9 comments | Create New Account
The following comments are owned by whomever posted them. This site is not responsible for what they say.
Footynomics: the economics of the AFL's future
Authored by: seanlacey on Tuesday, December 29 2009 @ 06:17 pm ACDT

Fantastic Article Chris and if I may say, an encouraging one.

There are other forces at work locally that I would like to discuss though.

I have become increasingly concerned, from my vantage point here in Melbourne, of what I consider to be attempted sporting regime change by the FFA (Football Federation Australia) from their main staging point which seems to be 1116 SEN, the local AM sporting channel. I see the charge lead by its drive time presenter Francis Leach and his sidekick Ox who used to be an Australian Football legend however has now become brow beaten into a Sutherland supporting intellectual subordinate to the far more savvy Leach.

Leach has a long career in Australian Radio and has an active interest in politics (Labour/Democrat) and studies a Bachelor of Arts in such in his off time. Having this background and learning enables him to have a fine grasp of the English language and associated debating techniques. He is easily able to control and dictate terms on “The Run Home” and the Ox is often left floundering in his intellectual wake.

Recently, with the debate on whether the soccer World Cup should be staged in Australia, it has been one Francis Leach leading the charge to re educate his listening audience in believing that soccer has a God given right to stage its premier event in Australia and anyone who dares disagree with this is obviously an uneducated bogan. Apparently it is incumbent upon the AFL and the NRL (and to say nothing about the Australian Cricket Board) to forgo their rightful income from Stadiums and TV rights and allow FIFA, that’s right both codes biggest potential competitor, to do as it pleases if Australia is so fortunate to be “anointed” a World Cup.

We see Francis Leach effectively without any competent debate from his overwhelmed counterpart Ox, spewing out 3 hours of free FFA spin on the premier Melbourne sporting station SEN in their prime time drive show. Ben Buckley must have posters of Leach up in his bedroom.

I write this as a warning as the FFA, with SEN in tow (re Melbourne Victory sponsoring the station and logo on SEN website), are attempting to buy goodwill and support by pretending to be the underdog. Imagine that. The biggest sport in the world attempting to be the underdog, and the Melbourne sporting public are being fed it on a stick every 4 to 7 pm and the tax payer funding it to the tune of what 20mil, 30 mil? Your taxes at work.

But I digress…

I do have one question though Chris, with regard to the economics, its all well and good to say with media diversification different sports will find their demographic home etc but what concerns me is this, Australia is a country of 20 million people and only half of those have any interest in AFL. A small base by any measure. NFL, NHL, NBA, MLB all have a base of 300 million mostly English speaking cashed up westerners as a base.

The AFL has a fundamental branding problem for international use in that its “Australian”. Not like Soccer (or Football) Rugby or Cricket. No mention of a nationality there, any nation can embrace that. But having the word Australian in the name will be a marketing impediment. No wonder the South Africans call it Footywild. Smart move.

Thoughts?

Sean Lacey

Footynomics: the economics of the AFL's future
Authored by: Christopher P. Adams, Ph.D. on Wednesday, December 30 2009 @ 01:13 am ACDT

On branding. It is definitely and issue that lots of people in international development have thought about, discussed, argued about, thrown chairs at each other over. In the US, it was decided to use "Footy" and "USFooty". It has the advantage of having "US" in the name and not being "Aussie Rules" which to many Americans conjures up ESPN's "No Rules Football" coverage in the 80s. Other countries have taken similar approaches - FootyWild, KiwiKick etc. This is certainly a problem for the AFL. The AFL has worked to get "AFL" to be the name of football with "AFL Canada", "AFL Tonga" etc, but they have a hard slog.

On being overwhelmed by bigger numbers and economic wealth. I guess that was part of the point of the article in saying that it wasn't obvious this would happen given the big US sports have no incentive to look outside the US, and soccer has too much incentive and have difficulty getting everyone to tow the line.

---
Carna Revos!

www.usfootynews.com

Footynomics: the economics of the AFL's future
Authored by: Costa on Friday, January 01 2010 @ 08:00 pm ACDT

Yes Australian Rules football lives in a competitive marketplace and will have to manage its affairs shrewdly to continue to prosper. I think that the present custodians of the game have demonstrated that they have the business acumen needed to meet this challenge.

The AFL is clearly the market leader in the Australian sporting marketplace. Market leadership is a powerful advantage, and to an extant it is self perpetuating.

Market leadership just doesn't evaporate overnight. Before predicting the demise of the AFL, I wonder if these soccer scribes stopped for a moment to ask themselves what, if anything, the AFL is doing wrong that could possibly cause their market position to slip?

On field and off field you'd be hard pressed to say that Australian football's administrators are making too many mistakes. The game itself is healthy. Income and interest is growing.

In comparison lets look at the FFA. In it's short life span the FFA have had some terrific achievements. But they've also made some key mistakes. Here's a few reasons why the soccer in Australia has a more tenuous foothold than most people think:

* There are too many clubs, diluting resources and talent. The FFA has eagerly jumped to cash in on the game's current place time he spotlight with a raft of new licenses. It's the same mistake that killed soccer in the US during the late 70s, wiping out the momentum generated by the razzle dazzle of the New York Cosmos.

* The FFA's reliance on private ownership is a recipe for self-interest and volatile club management. Private club ownership in the Australian marketplace has a checkered past. The FFA have given non-soccer people like Clive Palmer an undue degree of influence over how the game is run, leading to farcical situation where an expansion team turns it's back on it's local community by locking fans out their own home ground.

* The financial position of most A League clubs is poor. You can't be successful if you're not making dollars and cents.

* The game rushed too quickly to pay TV. You need free TV to get people into the habit of watching the A league. The A league should have been all about educating the casual fan and getting them emotionally involved with their home team. The hard-core familiarity and loyalty to the game needed to make domestic soccer a TV blue-chip just doesn't exist yet. If you are trying to bring a new domestic league into the mainstream why narrow it's exposure by jumping into bed with Foxtel?

* It's been said that there is too much meaningless B-grade soccer being played internationally these days. Being part of the Asian confederation Australia contributes to this glut. I was amongst the barely 20,000 to watch Australia play Oman at Etihad Stadium this year (yes, I actually have been a lifelong follower of the sport!) Given the meagre quality of the spectacle it's hard to argue that it was a poor crowd. You can't expect rivalries against nations like Qatar, Bahrain and Oman to ignite the imagination of the Australian public. And to anyone who carries on as though it's your patriotic duty to watch the Australian soccer team in action, I wonder if you also feel the same way about going out to watch the Australian hockey team in action, or the Australian netball team, or the Kangaroos in the Rugby League? Purely relying of parochial nationalism to get people through the turnstiles is a lazy way to run a sport. (I find it funny how all of these Australian soccer fans love their country so much that they hold churlish contempt for the one sport that Australians actually invented.)

* Without World Cup qualification the FFA's whole house of cards comes tumbling down. The way our national side plays we're only ever an injury to Mark Schwarzer away from meeting this fate. It's a mistake to think that soccer has been an overnight success in this this country. Soccer has always been immensely popular. I've been in sold-out MCG qualifiers and Olympic group matches that testified to the love that Australia has for the sport. The only difference now is that Australia are perceived as winners, and Australians love winners (why do you think we cheer for Lleyton Hewitt? Do you think people genuinely like the guy?) The moment Australian soccer stops winning then the FFA's marketplace changes dramatically.

* The Melbourne Victory are the A League's golden goose. They are the one standout glamour team. So why dilute their support by rushing the Melbourne Hearts into the A League? It's a completely different equation to the AFL's West Sydney expansion . For starters the Swans have been in Sydney now for almost thirty years over which they've slowly cemented a core supporter base (as evidenced this year by reasonable crowd figures despite limited onfield success). Melbourne Victory haven't had that same period to properly settle in and become a rock solid part of the Melbourne sporting landscape. Also, with Swans supporters concentrated in Sydney's eastern suburbs, the West Sydney team is all about building support in a new region. The club has been designed for somebody... it has it's own clear identity. In contrast Hearts ironically has no supporter heartland, be it defined by the borders or geography, class or ethnicity. Victory have consistently marketed themselves as the one catch-all Victorian team.. they even wear the Big-V. So who will Hearts' constituency be? The second Melbourne A-League team will be nothing more than a monumental drain on the A-League, nullifying any advances made by the Victory.

I could go on. There's problems with player inflation, stadium infrastructure and the cloud that hangs over the Auckland franchise given the Asian Football Federations desire to banish them from the reason. The point is, for soccer to knock off the AFL the FFA has to be doing everything right. And it's not happening... not by a long shot.

But hang on. Isn't soccer globally much bigger than the AFL? Isn't it only a matter of time before the AFL is subsumed by the FIFA behemoth? Isn't that what globalisation is all about?

These assumptions might seem plausible to pointy-headed academics, but in the real world of business the lesson taught time and again is that it pays to be a specialised and highly focused enterprise. Success belongs not to the sluggish corporate giants that try to be everywhere and do everything at once. Instead it's the highly targeted 'category killers' that win big. Your growth will be more dynamic if you can focus on a unique core business or particular consumer group. Carve your own niche and take ownership of it instead of merely trying to be bigger than your rivals. Australian football has a unique product and a market in which it enjoys a strong position without having saturated it. The size of FIFA is irrelevant to the potential growth of the AFL.

If anything globalisation and media decentralisation is providing the opportunity for greater plurality and market diversity, as the op-eds anecdote about YouTube testifies. I love soccer (and yes, soccer is the valid English abbreviation of the game's true name, Association Football), but soccer is the 'World Game' in the same way that the Big Mac is the World Food and Baywatch was once the World TV Show. And that can get boring. (You wonder why SBS, a station that exists purely to promote cultural diversity and minority programming is so slavish in its coverage of the world's most generic sport?)

As for the name 'Australian Football' being an impediment to growth, that's about as true as saying that no one one outside of America takes any interest in American Football because of it's name. American Football has a massive following because it is promoted as being an exciting, unique and physical contest. Australian Rules football is a great name for our sport because it already means something. Say 'AFL' to an American and you'll get a blank stare ... what's an AFL?: a trade union, a bank, a free trade zone? (More likely they will think of the Arena Football League indoor American Football competition). Say 'Aussie Rules' and there's likely to be some level of recognition. The hardest thing for any brand to do is get in people's heads. How do you do it? For starters, you use words. Words mean things. People remember words because we become emotionally attached to them. Cold corporate acronyms are lifeless and forgettable. AFL, ANL, ADA, AFE, AGC, ABC... none of these cut through the way that 'Aussie Rules' does. If you decide you don't like the 'Aussie' part, it's better to abbreviate the name and go with 'Rules Football' than trying to re-invent the wheel.


One final angle that points to a rosy future for Australian Football. Imaging if soccer was only played by the English. Imagine what the sport would look like without the flair of the South Americas. Without the Dutch concept of 'Total Football'. Without the defensive tenacity of the Italians. Imagine no Maradona or Pele. Now imagine what a South African or a Papua New Guinean superstar could bring to the AFL. Imagine the next generation of Irish superstars who might come, some perhaps growing all their lives dreaming of playing on the MCG. To coin footy-ism fromt he commentary box, Aussie Rules has 'enormous upside'. Who knows where the world might take it.

Footynomics: the economics of the AFL's future
Authored by: Brett Northey on Saturday, January 02 2010 @ 12:28 pm ACDT


Lots of well made points there Costa. I'm always a fan of the soccer = MacDonald's argument as well.

And yes it's true that soccer has some major local financial issues.

I suppose my biggest worry would be if FIFA decided to actively bankroll national bodies to snuff out local sports. If they decided it was in their interests to clamp down on competitors I think they could do a lot of damage. Maybe they can't actually make such a coordinated attack due to other interests, I hope so, I just don't think anyone can be definitively sure.

Of course there are plenty of AFL clubs with issues as well. I think the solution there over the next 20 years will involve some or all of: more professional management (we've slowly seen the elimination of "jobs for the boys", i.e. former players etc), perhaps less clubs in Melbourne, some kind of regulation of football department spending. On the latter, as long as there is no limit there will be an arms race that will ensure the weaker clubs are always in debt.

I'm a fan of the term Aussie Rules or Australian Rules and using the Rules term globally, but the AFL are very much against it. If Frisbee hadn't taken the Ultimate name I'd also throw Ultimate Football / Ultimate Footy out there as well, as my left field suggestion. But it seems to me that what recognition the game does have internationally really does still have a strong connection to Rules. But while the AFL are so strongly against it then there is unlikely to be any momentum towards its wider use.

---
Brett Northey - Co-founder and Chief Editor of WFN

Footynomics: the economics of the AFL's future
Authored by: Costa on Monday, January 04 2010 @ 01:34 pm ACDT

Couldn't help but notice this quote from the article you've just posted about the Birmingham Shark's guide to starting a footy club at a UK university:

"Over the summer before the sports fair, create a facebook group which makes it clear what your intentions are, with a clear searchable name, eg. ‘University of XXX Aussie Rules Football team’. Don’t use the acronym AFL, as not many will know what that means.... On your noticeboard, ensure ‘Aussie Rules Football’ is clear, large and bold. The timing of Sports Fairs in the UK is perfect, as the AFL season is just culminating and many will have watched bits on ESPN and be curious as to how the sport works. Have a ball on hand, and encourage people to play around with it."

Seems like there's sufficient familiarity with the name 'Aussie Rules' abroad to tweak people's interest. Why fight what works?

Using 'Aussie Rules' over AFL is in keeping with the groundbreaking early 80s theory of 'positioning' developed by marketing gurus Al Ries and Jack Trout. Have a read of their landmark book Positioning. It's sums up in a very powerful way why a branding strategy around 'AFL' is counter productive and downright damaging to the goal of bringing Australian Football to a global (not to mention NSW or Qld) audience.

Footynomics: the economics of the AFL's future
Authored by: Michael Christiansen on Monday, January 04 2010 @ 09:15 pm ACDT

Good article.

I still work on the theory that 'globalisation' is a oft misused term to imply homogenisation (culturally/economically etc).

Reality is that the 'free information globalised pathway' of the internet is a localisation re-inforcement tool. It allows grass roots to have global reach.....or....at least have access to such. Who knows how long it'll last - - in many ways, the internet as is - is probably too good to be true.

For now though, the world of soccer is so big and crowded that - as the author comments - there's very little true 'global' attention rather than that there is a vast aggregation of competing forces under the banner of 'soccer'. This sort of intra-sport 'competition' worked well for cricket via the 'Packer' era. And may work well now for cricket with the IPL etc shaking the game up.

Soccer is a different matter altogether. In essence, the soccer world is made up of a dozen competing 'IPL' leagues......and that's full season rather than a 3-4 week window.

And so back to Aust Footy - - - in some ways, why should 'Australia' in the name be a hinderance? Sure, let the local 'introductory program' have a local flavour, but, Manchester United retains 'Manchester', the New York 'Yankees' retain 'New York'. Whilst the AFL is run from Australia and the international cup and new U-16 talent pathways are all centered around nice, pretty, 'safe'(!?) and remote Australia - then, why not?

The simple fact in recent years that we have seen non-Australian 'expats' starting up clubs and leagues from scratch, or 2 Aussies and 20 locals etc.....illustrates that for a portion of any population, the game sells itself.

We know that from a skills basis - that 'product' football has 3 distinct groupings....that effectively places Soccer on one pole, the Rugby codes and Grid Iron at the other, and Aust Footy pretty well in between. surely there's a marketplace demand for the void to be populated.

Footynomics: the economics of the AFL's future
Authored by: TimSmith on Tuesday, January 05 2010 @ 01:55 am ACDT

I wholeheartedly agree with you Mick, there is space for that void to be filled, its just a matter of people knowing that there is a sport for them to play.

Costa, I wrote that piece about the AFL term not being recognised internationally (Uni article) - because it isn't!! And this written before I'd seen your comment on this article. Just like you were saying if you asked an American what AFL is... even in my 3rd training session with the Sharks (with no players who had ever played footy before) I mentioned AFL and some people had never heard of the term. The fact is its just not a known term outside of Oceania.

However, people do know of 'aussie rules', even if they've just heard the name. I believe as the sport expands it should be expanded through the use of the sport, not one league which most people can't even watch on free TV channels. Saying that, if AFL was on free-to-air TV in this country it would undoubtedly encourage growth in the sport, but you need the sport here in the first place for the free-to-air TV channels to be interested. Catch 22

Cheers,
Tim Smith
President, University of Birmingham Sharks

Footynomics: the economics of the AFL's future
Authored by: Michael Christiansen on Tuesday, January 05 2010 @ 09:25 am ACDT

In the USA, 'AFL' means 'Arena Football League',

'Aussie Rules' sadly seems to work for many people,.....but,.....I guess it sums it up pretty well as a nick name.

re economics - - for now, surely we need to get Simon Crean to back up his 'export product' statement and get the Fed Govt doing some serious work to support an 'export' of Australian culture and effectively establish a position of cultural/sporting hegemony.

Perhaps an evolution of these 'international' junior rep sides in the National Championships is a logical start to progress to a point of greater Aust Govt support (greater......some to start with!!!).

Footynomics: the economics of the AFL's future
Authored by: Brett Northey on Tuesday, January 05 2010 @ 03:59 pm ACDT


We should be careful to recognise support when it does occur though. Let's brainstorm for a few minutes:

- There have been a few multi-million dollar handouts to Victorian AFL clubs for facilities in the last couple of years.

- When the Pacific Islands Leaders Forum was on a few months ago, the AFL and AFL Oceania staged the exhibition game between the North Queensland selection and a Pacific selection. That was great promotion and done with all those Prime Ministers etc watching and must have been done in collaboration with the Federal Government.

- There is an expectation that the Federal Government will kick in up to $100 million for the Adelaide Oval redevelopment of AFL moves there.

- The Federal Government is contributing $36 million towards the Gold Coast's stadium

- There continue to be AusAID placements of Youth Ambassadors in several Pacific locations who are in Australian football roles.

- I expect the Shanghai AFL exhibition match later this year will be interwoven with Federal Government and state government business efforts. In the lead up to its announcement Simon Crean talked about the opportunities so obviously they are involved.


So some of those are in-country funds and some promote the growth of the game internationally. I think that's a pretty good contribution during the first two years of the new government. No doubt there's more behind the scenes in development. We'd love to see more but we probably shouldn't grumble too much - if the game is seen to be ungrateful they'll either throw more at it or spend the money somewhere else!

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Brett Northey - Co-founder and Chief Editor of WFN