Manchester United’s rise to the top of the Forbes list started in Tottenham

In the early 1990’s, Manchester United set out on a mission to conquer the world. First and foremost, they wanted to end their lengthy title drought and establish the club as the preeminent force in English football. However, unlike other clubs that enjoyed dominant eras, United set about consolidating their position using methods previously unseen in football. In a game that had never been regarded as a money making opportunity, United set the standard for commercial operations that exploited previously untapped riches.

Fast-forward to 2011, the recently published Forbes list of the 50 most valuable sports teams in the world places Manchester United at number one. To put that into context, United are now considered to be a more valuable proposition than the most famous names of American sports, including the New York Yankees and the Dallas Cowboys. To suggest this eventuality in the 1990’s would have been utterly laughable. The gulf between American sports and English professional football in terms of revenues was enormous. But, in the space of two decades the major European clubs have bridged the gap, and it was United leading the charge from the outset.

Though United are cited as the prototype for this flourishing commercialism in football, the first draft of their blueprint for success was actually mapped out in Tottenham. When you think of the men behind United’s modern success, it is unlikely that Edward Friedman will be at the forefront of your mind, but back in the early 1990’s his work at Tottenham Hotspur was causing a stir in English football. By 1992 Friedman had restructured Spurs’ marketing so successfully that their revenue from merchandising was the highest in England and 50% higher than that of Manchester United.

Not for the first time, United followed the modernisers from North East London – it was Tottenham who became the first football club to sell shares on the London Stock Exchange back in 1983; United floated in 1991. Unfortunately for Spurs fans, history suggests United have developed a useful habit of taking Tottenham’s ideas and improving them. Friedman’s success at White Hart Lane did not go unnoticed by an ambitious board at Old Trafford and United’s Chair, Martin Edwards, moved to appoint him as their new Merchandising Director.

Business practices that probably appear primitive by today’s standards were a revelation in the mid 1990’s. Friedman quickly set about ensuring United had full ownership of their brand. Most importantly, they began to produce their own goods rather than licensing them to third parties, meaning that United could claim all the revenue from sales and target their fans (or customers, as Friedman would call them) more directly. During this period the club’s ticketing policy was also structured to maximise the opportunities for United’s many supporter’s clubs, the theory being that a higher turnover of fans at the stadium would result in increased sales at the newly built United megastore. The balance sheets that followed proved the theory was correct.

To illustrate the rate of change driven by Friedman’s policies, consider that in 1994-95 United’s income from merchandise alone was almost equal to the club’s entire income just two seasons earlier. In 1997 United were reaping the benefits of success on and off the pitch, but Friedman was scathing of the performance of his peers in English football:

‘I’ve just been to an international conference and the only people who understood what we are doing are the NHL and NBA. They’ve studied Manchester United and are using us as a role model, changing the way they market American ice hockey and basketball.’ 

Prophetic words, given where United have ended up. By the mid-to-late 1990’s you would struggle to find a corner of the UK where United’s merchandise wasn’t clearly visible, and it was here that anti-United sentiment in England started to grow. It wasn’t just that fans grew tired of United’s success; it was the increasingly ubiquitous sight of adults in United shirts, parading through town centres in South East England on a Saturday afternoon when the local team was at home. The presence of the ‘Surrey Reds’ at Old Trafford might have been overstated by their rivals, but neither was this an entirely fictitious creation. At the same time the term ‘glory hunter’, although not new, had become firmly established in the football lexicon. But, were these fans recent converts, were they all the product of Friedman’s cynical genius, or had they always existed?

It’s obvious that United’s success in commercial ventures has been made possible because of their huge number of followers; it’s impossible to find a precise figure, but their global fan base is estimated in millions. However, it’s easy to forget that the club was starting from a strong position. United already had a substantial fan base in Manchester, but unlike many English clubs, they had developed support across the UK and in Europe during the club’s first golden era. The tragedy of Munich and the subsequent exploits of the Busby Babes gave United a powerful and unique image that fans wanted to associate with. In this sense the market was already there, they just had to reach out. The money of the new Premier League encouraged them to do so, but it was a unique set of circumstances that meant United were in pole position to exploit their status. Even if other clubs had employed a commercial operator like Friedman, it’s unlikely that many could have cashed in with the same impact.

However, there is one club conspicuous by their absence on the Forbes list – Liverpool, United’s historic rivals – another club with an iconic image formed over decades, and the only team with a comparable domestic and European trophy haul. The failure to ape United’s model and capitalise on Liverpool’s famous name has been a source of immense frustration at Anfield. While United have been pulling further and further away, the Liverpool board has seemed amateurish in comparison. That is unlikely to continue under the stewardship of American owner, John Henry. But, even if Liverpool’s bank account will benefit from Henry’s modernist approach, it’s a long road back to the top. United, who Alex Ferguson proudly claimed had “knocked Liverpool off their perch”, are exactly where they planned to be twenty years ago, and they will take some shifting.

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2 Responses to Manchester United’s rise to the top of the Forbes list started in Tottenham

  1. William says:

    Excellent article, Michael. United and Spurs do enjoy a close relationship. As well as the financial angle, their playing styles have historically been similar and (until the Premier League era) both sides had come to be known as good FA Cup sides mainly. In recent years, Teddy Sheringham, Michael Carrick and Dimitar Berbatov have all been transferred north (the latter two at huge expense).

    Had Paul Gascoigne not been injured in the 1991 Cup final and sold to Lazio, I wonder how Spurs might have capitalised (quite literally) on having England’s most important player in their ranks. Perhaps they could have challenged United’s commercial growth a little.

  2. Michael says:

    Thanks William, interesting points. It does feel like United and Spurs are destined to lock horns off the pitch every few years (we wait to see where Modric ends up…) Looking back, it seems there were missed opportunities for other clubs. They used to talk about a big 5 in the top flight: Liverpool, United, Spurs, Arsenal, and Everton. But, that was based on success and crowds, not balance sheets.

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