Sports retailing and spending what you earn
You get the sense that the Sword of Damocles is hanging over Newco Rangers. Some wondered about the sense in Mike Ashley controversially renaming Ibrox as the rumoured ‘Sports Direct Outlet Village’ but having bought the rights to do so for £1, he is now able to leverage this detail in his earlier loan.
He has the retail and stadium naming rights but ownership of the club badge, details of which it appears the Newco board leaked to the Daily Record yesterday, would allow him to control the strips, novelty ducks and other tat, no matter where it’s sold. Any future shirt deal would need his authority, as it would require use of ‘his’ logo. Which would inevitably lead to shirt deals being concluded by one of Ashley’s in-house brands.
All this makes sense if you are a retailer with notions of monopoly status. ‘Rangers’ branded pencil cases, alarm clocks and shirts will continue to sell, no matter in which league Newco inhabit. It’s a straight merchandise play from the retailer, who is the only person in the UK in a position to exploit clubs going through a hard time, like Newco.
Ashley is thick-enough skinned after sitting through all that Newcastle fans could throw in his direction for years. He doesn’t need to be liked, and with control over intellectual property like the badge, he doesn’t even need to be the retailer to make money every time club merchandise is sold. Newco wouldn’t even be able to put the badge on their tickets without his agreement.
In many ways this proposed deal is an inevitable step. Clubs are enormous merchandising opportunities, the people who can profit most from this are the retailers. It is, of course, only inevitable because of the state Sir David Murray left oldco in. As soon as he handed the keys to a liquidation specialist the game was over.
News in today’s Herald that an S&P study makes Celtic the least likely publicly listed football club in Europe to default is likely to sound a little hollow to some who watched us against Accies on Sunday. There are many ways to build a sustainable and successful football team, but none of them involve spending more than you earn.