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The Super League drama, or a lesson in mass vs premium in sport. Episode 3: Generations, real profit, and a business approach

Our expert: Miklós Palencsár, CEO of RISE Human Development System, business strategist and mentor

We already know the meaning of real premium and mass from a business-strategic perspective. We also understand that football is a huge business, so the strategic laws of business cannot be bypassed in this sport. But then, what is the specific problem with the concept of the Super League? Is there a real problem? With the help of Miklós Palencsár, private mentor and co-founder of the RISE Human Development System, we try to answer these questions.

Business is business

No matter the end of the line of thought, one group or another will feel “attacked”. This is always the case when tensions arise between two such different groups of consumers. But should the whole process and issue be “simplified” to target groups, consumers, or in other words, the harsh language of business? “I think that is precisely the difficulty of this issue. Because football is a symbol which for many people represents a way of life, for many people a way of relaxing, a lifestyle, and for many people an escape from the real problems of life. For this very reason, there is no clear right or wrong direction. Or, I would say, there is certainly no solution that will appeal to everyone,” says Mr Palencsár. So, what should be done? Why is it important to look at the issue in the context of business? The main reason is that football can only be sustained by money, and a significant part of the income comes from sponsors. And sponsors are controlled by businesspeople. They accept many things, but they expect a return on investment. It is clearer than ever that where players are being sold for tens of millions of euros, or hundreds of millions, it is business that dominates, not the will of the people. The extent to which the two are related is always open to question and often changes. What do we think if we look at the whole process from a purely business perspective?

Generational issues

“I deal with strategy in several national teams, federations, and international clubs. If I want to assess the situation from a purely business point of view, we have to realise that where the state does not intervene in the financing of clubs, they have to manage on a business basis, i.e., they have to be able to make a profit on their own. And sponsorship plays a very important role in this. Sponsorship, in turn, comes from business operators who have to follow business trends in order to make a profit. And in business, the aforementioned gap between the real premium and the mass is real and stark. In fact, it has widened significantly since the 2008 crisis, and with the 2020 crisis, the gap is almost incomprehensible. It is not just because the rich have become richer and the poor poorer, although this is also fuelling the process. There is a very serious generational shift in business, which is adding real turbulence to the process. The generations of Diplomats — born 1973-1984 — and Ambitionists — born 1985-1996 — have gained considerable power, replacing the previous generations of Authoritarians — born 1949-1960 — and Precisionists — born 1961-1972. The younger generations are no longer afraid to show their differences, are proud of their achievements, and want to share them with the outside world. There are several reasons for this, which I will not analyse here, but it is the reason why the richer members of the two younger segments of the generations mentioned here have become truly premium consumers. Well, this process is also seriously represented in the Super League issue!”

So, our generation-driven decision-making mechanism is responsible for the decisions we make, which they already know in business but are unwilling or unable to accept in sport. It is not a good sign, because this generation trend also means that Super League is not just a fling, but the start of a long and enduring process. “Football has changed over the last two decades. A much larger number of countries are involved in international competition, which has drawn these countries and their populations into the real fan base. That is very positive. On the other hand, it has indeed led to a significant shift towards a mass product from which there is no turning back. It has been observed that viewership is on a downward trend, and the greatest problem for sponsors (although this information is published only cautiously) is that they are losing spectators and potential customers at the higher end of the spectrum in terms of ability to pay. They are choosing other sports that they can now enjoy with their true premium counterparts. Let us just look at the sectors that used to be considered elite, premium sports and have grown enormously in terms of audience, awareness, and business value. Well, that’s where these ex-football fans have landed. I know it must be shocking to read about it from this perspective, but I stress that we are talking about business, which is motivated by profit in most cases. And there you have to know these laws” – the strategist stressed.

So, what can we expect in the future? And if the process is so clear, where did it all go so wrong and turn into such a scandal?

To be continued…

Prev episode

The Super League drama, or a lesson in mass vs premium in sport – Episode 2: Decision-making mechanisms and personality-based strategy