The Strangest Piece of Nike's History 🤯
+ FIFA Launches Netflix of Football and UEFA's New Financial Rules Explained.
This is the story of how Nike faked their own sneakers to get around a destructive U.S. customs law that threatened to close Nike down forever…Enjoy 😎
40 years later and…
👟 Apparel News of the Week
What Is the Biggest Apparel Brand in the World 🌎?
Gucci or Nike, which brand do you think is more valuable?
The sophisticated Italian fashion house that convinces people to sell their souls for a handbag or the American sports apparel company that has spent the last few decades squeezing middle-aged people into lycra?
The answer is Nike. In fact, Nike is the most valuable apparel brand on the planet, beating Louis Vuitton into second place by almost $10 billion.
The Swoosh saw its brand value jump 9% over the last 12 months. This is the eighth straight year that Nike has topped the ranking.
While the majority of the rest of the top 10 are luxury fashion brands, Adidas also managed to secure 5th place on the list with a valuation of $14.6 billion (up 2%.)
In fact, it was a strong year for sportswear as a whole, with the aggregate brand value of sportswear brands in the top 50 growing by 10% to $74 billion.
For those wondering how the ranking is calculated, the judges - Brand Finance - consider “the value of the “names, terms, signs, symbols, logos, and designs” that a company uses to identify and distinguish its “goods, services or entities” from those of others, thereby creating “distinctive images and associations in the minds of stakeholders, and generating economic benefits” for the company as a result.”
In other words…the value of the brand 😅.
🗞 Story of the Week
FIFA Launches ‘Netflix of Football’ 🎬
Everyone has heard of Netflix and Chill but what about FIFA+ and Chill?
That’s right FIFA has just launched its own streaming service. So what are you waiting for? Invite that special someone over for an evening they will never forget.
If they don’t sound convinced just remind them that, much like Netflix and Chill, FIFA+ is full of men playing with balls.
Disturbing visual metaphors aside, this is an interesting move by FIFA.
FIFA + will provide users with an extensive archive of historic World Cup matches as well as the ability to stream more than 40,000 live matches across men’s and women’s football.
Fans of documentaries will also have access to hundreds of hours of original programming about footballing legends such as Ronaldinho, Dani Alves, Ronaldo Nazario, Romelu Lukaku, Lucy Bronze, Carli Lloyd, and many more.
Interestingly, FIFA + does not currently have a subscription fee.
‘There is no plan to charge a subscription fee for the service,’ explained FIFA Director of Strategy Charlotte Burr.
‘That doesn't mean to say that we may not evolve over time should there be a value proposition that allows us to charge subscription if we step into premium rights or adopt other kind of models. (...) But there will always be a free experience on Fifa+.’
This wording suggests that FIFA is considering eventually cutting out traditional broadcasters in favour of showing live football on their own service. This could be an extremely lucrative move for FIFA.
Football clubs and Associations suffer from the middleman problem. They may receive billions for their TV rights but companies like Sky or Amazon make even more. In fact, the Premier League makes little more than €1 per fan per season through broadcasting rights while Sky sells subscription plans for more than €300 a season.
If the original rights holders (e.g. FIFA, UEFA, Clubs, etc) were to bundle their rights into a package and sell them directly to fans in the form of a subscription service they could make far more money per fan.
Of course, such a strategy comes with higher upfront costs (presenters, cameras, marketing, etc) but football clubs are hungry for extra cash and will be watching the trajectory of FIFA+ to see if they should follow.
Imagine the amount of money FIFA would make if FIFA+ became the exclusive broadcaster of the World Cup!
Hosting a World Cup is a long way off and in the short term, FIFA+ seems to be focused on consolidating the billions of football fans onto one platform so they can more effectively market their sponsor's products.
By enticing fans in with a free service and capturing their data, FIFA has a better understanding of the world football audience and can market their sponsors more effectively. This will in turn allow them to charge higher premiums for sponsorship.
For those concerned that FIFA is simply trying to make money from their love of football, the federation does claim to have a far more admirable motive.
By focusing on live games which are not generally broadcast outside of their home nation, it is making the sport more inclusive.
“FIFA+ represents the next step in our vision to make football more global and inclusive, as this platform supports FIFA’s core mission to expand and develop football globally,” explained FIFA President Gianni Infantino.
Money-making scheme or altruistic mission? Perhaps both? Either way, FIFA+ is clearly an attempt to prove to clubs and federations that there is an alternative to traditional broadcasting and, if successful, will loosen the tight grip that the traditional broadcasters have on everyone’s footballs.
🧮 Boring Financial News of the Week
UEFA Unveils New Financial Rules 💰
While we are on the topic of Football Finances, here is another interesting development…
UEFA has unveiled its latest financial sustainability regulations. (Calm down! No need to get too excited.)
These new rules, which reform the rather controversial ‘Financial Fair Play’ regulations, were triggered by the extreme financial uncertainty that the pandemic has placed over football.
In the words of current UEFA President Aleksander Ceferin, “These regulations will help us protect the game and prepare it for any potential future shock while encouraging rational investments and building a more sustainable future for the game."
So what exactly are the new rules and what do they mean for your football club?
There are three pillars to these ‘Sustainability Regulations.’
Solvency,
Stability and,
Cost control.
Solvency will be encouraged under the ‘no overpayment’ rule. This essentially bans football clubs from having any overdue payments to a select number of creditors (including employees, tax authorities, FIFA and other football clubs.) Clubs will have their accounts checked every quarter to make sure they are paying their bills on time.
Stability rules will focus on helping football clubs control debt and spend within their means. Clubs will now be allowed to lose €60 million over three seasons, up from €30 million under FFP. UEFA will also allow clubs to lose an extra €10 million if they are deemed to be ‘in good financial health.’ Although it is still unclear how this exception will be measured, we assume that the extra allowance is supposed to encourage long-term sustainable investments.
Cost control will be managed by limiting spending on wages (players and managers), transfers, and agents fees, at up to 70% of the club’s annual revenues (including each transfer window.)
Clubs hoping to boost their revenues by signing inflated sponsorship agreements with affiliated companies (Man City just entered the chat) will find this practice more difficult. UEFA is said to be in consultation with outside agencies that will be tasked with assessing the fair value of any sponsorship agreement. Those shown to be inflating their deals will face fines.
These rules are set to enter into force this June but will be phased in over the next three years.
Any club found to be breaking the rules is likely to receive a fine. Further breaches could lead to sporting sanctions that are said to include points deductions and European bans.
While these rules may seem strict, UEFA chief Ceferin is reportedly happy with the initial response from clubs and federations.