Premier league CRM

Football clubs used to believe that they could count on their fans'
loyalty through thick and thin. Whatever the team put them through, the
supporters would still turn up to see them play, week in, week out. But
this belief led many clubs to overlook their fans, neglect the
facilities provided for them at the ground and, in short, take their
supporters' loyalty for granted.

In recent years, however, there has been a change in attitude. Clubs
have recognised the need to increase the revenues generated by
off-the-field activities in order to meet rising player costs and wage
bills - and they have witnessed fans voting with their feet when the
club goes through a bad patch. In line with businesses in other sectors,
some clubs have turned to CRM systems to help them increase customer
loyalty.

Yet the two are unlikely bedfellows. "Football is a curious business but
that's no reason not to try to understand it," says Chris Duncan,
managing director of Alchemetrics. "If you ran football as a CRM ideal,
and really listened to your customers, you would make very small profits
because everyone would want to get into games as cheaply as possible. In
fact, most football fans believe their club is not for profit but, at
the same time, they expect success - and that requires the club to have
enough money to invest in the best players. This is the circle that
football clubs have to square."

Norwich City, which was relegated from the Premiership last season, was
one of the first English football clubs to turn to CRM when it chose a
system from Talent Computer Software Group in 1999.

"Our main objective was to have a transparent view of the customer
across the business," says Norwich City head of IT, Mario Zambas. "We
were probably the first club in England to choose a CRM system, rather
than a ticketing system, but it was a strategy-led, rather than
technology-led decision.

We had a wake-up call when we were relegated. We had a massive problem
with fan relationships - the club was seen as arrogant - and so we
decided we had to do something about it."

To turn things around, the club introduced a supporters' consultative
group, which gives fans a say on issues such as ticket pricing while
giving the club an insight into how its supporters are feeling. A
roadshow tours Norfolk every couple of months and there is an annual
open day. A customer tracking study invites fans to rate the club's
performance in relation to its travel arrangements to away matches,
pre-match entertainment and the facilities at the ground compared with
those available at rival clubs and other entertainment venues such as
cinemas and bowling alleys.

There are also lots of non-football activities on offer, including
fishing trips with former player Jerry Goss and motor racing days with
another ex-player, Darren Eadie. Norwich City aims these activities at
supporters who have expressed their interest over the course of their
interactions with the club. According to Zambas, these efforts are
paying off.

"We have the stats to show that things are working for us," he says.

"We are 12th in the table, 40 points behind the leaders. We were
relegated last season, yet we have the highest average attendance in our
league - better than Wigan, Fulham, Portsmouth and Blackburn in the
Premiership.

Seventy-six of our last 85 home games have sold out. None of this really
equates with what we are doing on the pitch."

Season ticket sales tell a similar story. Over the past five years, they
have almost doubled from 12,255 in the 2000-01 season to 20,096 for the
current season - and that figure would have been higher had the club not
put a cap on it. Once again, this has not happened by chance. An
outbound telesales team has actively targeted supporters who do not hold
a season ticket but who attend several matches a season, first by
offering them a half-season ticket, then a full one, to deliver these
figures. "This goes against the trend of almost every team that has ever
been relegated," says Zambas.

Follow the leader

According to Alan Tapp, reader in marketing at Bristol Business School
at the University of the West of England, it is second-tier clubs such
as Norwich and Ipswich that tend to do CRM best.

"The big boys in the Premiership will be slick at the channel
management, merchandising and branding but does that translate into
looking after the fans?" he asks.

Tapp says a follow-the-leader mentality can develop: "You have the CRM
system vendors telling the clubs that Sunderland has it and Rangers has
it, so you need it. Before long, everyone's got it and half of them
don't quite know why or what to do with it."

According to Tapp, there is often a dislocation between what he calls
the "knowledgeable, committed people in the marketing departments of
football clubs" and the senior management and chairman, who are
typically "rich, powerful and often focused on player deals. They see
fans as a source of revenue and don't look much beyond the next couple
of Saturdays and whether they can do some half-price tickets to fill the
ground."

As Tapp sees it, this is a long way from the academic model of CRM, with
its focus on developing a long-term relationship with the fans and
planning for what would happen if the club were relegated.

To prove the point, he cites the example of a club playing in the
Premiership a few years ago, which was presented with a marketing plan
that suggested it spent £100,000 on a CRM system to help retain
the fans' loyalty after possible relegation. The club declined to spend
the money so, when it was subsequently relegated, average attendances
fell from 22,000 fans to 14,000. Multiply that 8,000 fall by a very
modest £10 per ticket, and then by the 23 home games championship
clubs play each season, and you end up with £1.8 million in
revenue lost from ticket sales alone, without even thinking about the
Bovril and meat pies. Food for thought.

When Manchester City was relegated from the Premiership a few years ago,
dropping two divisions below at one point, it managed to retain the vast
majority of its fans - largely as a result of the work that had gone
into building good relationships with them over many years. So when the
club moved into its hi-tech City of Manchester Stadium in 2003, it was
able to turn up the CRM heat a little.

Entry to the stadium is via a radio frequency identity (RFID) smartcard
ticketing system. On a logistics level, this enables rapid access to the
stadium at the rate of 1,200 people a minute via unmanned
turnstiles.

From a CRM perspective, it also makes it easy for the club to identify
ticket holders and track their behaviour.

"It allows us to see whether a supporter came to the game and what time
they entered the stadium. From the retail end we can track each
supporter's transactional history with us so we can reward the
highest-spending fans," says Duncan Martin, Man City's head of retail.
"We recognise that we can't just assume our supporters will always be
there. There are other people competing for their money, so we try to
provide a quality product and we recognise that if they have bought a
season ticket and a replica kit for the past five years, for example,
they should get something more than the standard discount."

By tying the smartcard to each supporter, the club can communicate with
them using the medium of the supporter's choice, such as email and SMS,
and it now spends less on printed material as a result. By analysing the
smartcard data, which tracks all club transactions with the 85,000
cardholders in real time, Man City discovered that hardcore supporters,
who typically enter the stadium less than half an hour before kick-off,
did not have time to visit the main club store, which is on the other
side of the ground to where they sit. As a result, a mobile unit was
installed, which is now generating additional revenues from these
particular fans.

The club has also implemented a buyback scheme that allows smartcard
holders to receive a partial credit if they cancel their seat when they
are unable to attend a game. The club then resells the seat. Man City
estimates this scheme generates about £500,000 a season.

Its latest project is a pilot scheme to use RFID-enabled mobile phones
instead of smartcards for entry to the stadium. This would allow the
club to reward fans who arrive early with special offers such as a free
drink.

"The turnstiles are read/write, so we can already send the information
to the card but the supporter has no way of seeing it," says Martin.
"The mobile handset is the perfect device for this type of
application."

Don't take fans for granted

The likes of Norwich and Man City are probably atypical of how most
football clubs are approaching CRM. But if they are to survive, more
clubs will have to follow their lead. "I have done a fair amount of
research with Birkbeck College that shows it is clearly a myth that all
fans are undyingly loyal," Tapp says. "If you segment your fan base, you
will find a hard core of incredibly loyal fans who will come back for
more, however you treat them. But at the other extreme are casual fans,
who see football as a source of entertainment, and it's a different
story for these people.

They need to be looked after and entertained, otherwise they will drift
away. This is the business case for adopting a more hands-on
relationship-building approach, but I don't see that happening much at
most football clubs."

CASE STUDY - RED-BLOODED LOYALTY AT MAN UNITED

Manchester United is one of the biggest football clubs in the world, so
you could perhaps be forgiven for thinking it would not have to work too
hard to retain the loyalty of its supporters.

However, according to Steven Falk, the club's director of commercial
services, nothing could be further from the truth.

"Our CRM strategy is based on us behaving as if the ground was half
empty every week," he explains. "We look at the entire customer
relationship, from people who only want to come to a football match to
people who just want to buy things from us. We try to predict what they
want from us and satisfy their needs."

Man United embarked upon its CRM initiative about six years ago and
started to pull the disparate elements together three years ago. That
was when the club launched its One United campaign. Working with direct
marketing agency Iris and IT services company Data Dimension, Man United
set out to revamp its 100,000-strong supporters club. Its aim was to
increase membership numbers and improve the benefits of membership.

The benefits package was extended to include club store discounts, a
football skills DVD and a yearbook summarising the last season's
campaign.

Fans who did not attend matches were targeted through online and offline
surveys, roadshows and direct response advertising.

The campaign helped boost membership numbers to 160,000 - a size that
has been maintained in order to give each member a reasonable chance of
obtaining match tickets through a ticket ballot, another benefit of
membership.

Despite these figures, and the fanatical support the club enjoys, Falk
says Man United is not resting on its laurels. "It might sound cliched
but CRM is a journey, not a destination" he insists. "You never get to
the end of the process of continual development and improvement."

An important part of this process is to get the supporters'
feedback.

An annual satisfaction survey shows the club where it needs to
concentrate its efforts.

"Four years ago, the fans told us they didn't think much of the
scoreboard, so we invested a significant amount of money in improving
it," Falk says.

"The major issue at the moment is the speed of service in the catering
concessions at half time. Once we know what the issues are, we work hard
to put them right."

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NEED TO KNOW - OFF-THE-SHELF CRM

TeamCard offers a ready-made solution for football clubs that have not
got their CRM act together, and complements the systems of those that
have. TeamCard is a loyalty scheme that rewards football fans when they
buy merchandise at their club's store, as well as when they purchase
unrelated material at retail partners, such as Boots and Specsavers,
either on the high street or online.

Each time a partner issues a reward point, it is billed for 2.5p. A
penny of this goes to the supporter for redemption, by way of a payment
to the club in question. The remaining 1.5p is split between the club
and TeamCard.

"The supporter can see that one point equals 1p, so if they get 1,000
points, they have £10 to spend at the club," says TeamCard head of
sales and marketing, Cameron Pirie. "It's good for the club too because
the points are paid for by the external partners." These partners, Pirie
says, are also important from a data perspective.

"Most clubs are switched on to CRM but the only data they can gather is
based on what happens at the football ground. This extends the loyalty
programme out to the external market and delivers data from across the
retail market and the web," he explains.

In addition, TeamCard can interface with any existing CRM system the
club has in place, including access control and ticketing systems.

Seven football clubs - Chelsea, Bolton, Everton, Celtic, Millwall,
Crystal Palace and Ipswich Town - have signed up to the scheme so far
and Pirie says the company is close to launching in another major
European footballing country.

Cardholder numbers range from 7,000 supporters at Millwall to 80,000
fans at Chelsea.

POWER POINTS

- Football clubs are now realising they cannot take their fans for
granted

- They are turning to CRM to boost loyalty among supporters and generate
revenue from off-the-field activities

- Smartcards have enabled clubs such as Manchester City to track fans'
behaviour and offer them rewards.