[GreatBriton]

The Times March 20, 2006


How Red Bull can give soccer wings
By Gabriele Marcotti

An advertising deal energising the American game


LOOK AT AMERICAN SPORT FROM A European perspective and you are bound to get confused. In the land of free markets and meritocracy, commissioners run their leagues with an iron fist. At the same time, a cornucopia of rules aimed at fostering parity effectively rewards the lazy and the incompetent. If Margaret Thatcher were a fan of American sport, she would be horrified.

Is your team useless? Don’t worry. Next year, we will give you one of the top picks in the draft, which means that you can simply sign the best newcomers to the league.

Are you lazy and do you make no effort to market your team and your fans? No problem. Institutions such as the National Football League share 95 per cent of revenue equally among all clubs.

Did you work hard to build a championship-winning team, carefully scouting talented players and negotiating long and hard to bring them on board? Tough luck. We have a “hard” salary cap, which means that when some of your stars’ contracts expire and they ask for a pay rise, you will not be able to offer it to them.

It is a remarkable situation. Equally bizarre is how a nation where seemingly everything is advertiser supported — right down to those schools who take money from soft drinks manufacturers in exchange for selling them the exclusive rights to sell their fizzy drinks on campus — is horrified at the notion of shirt sponsorship in professional team sport.

If the mainstream cared about soccer, they would probably have been outraged at what happened last week, when Major League Soccer’s New York/New Jersey MetroStars were bought for about £65 million by Dietrich Mateschitz, an Austrian entrepreneur, and promptly renamed them New York Red Bulls, after the drink.

The move is part of a transparent effort by Red Bull to get its brand name into the sports pages. Previously Mateschitz had bought the football club Austria Salzburg and the Formula One teams Jaguar and Minardi, renaming them Red Bull Salzburg, Red Bull Racing and Toro Rosso (“Red Bull” in Italian).

New York Red Bulls will now feature the company’s corporate logo and distinctive blue and red colours. There was a general outcry among the MetroStars’ small but vocal support, just as there had been among Salzburg’s fans when they were taken over last summer, but the protests are quickly waning.

This is partly because the company is careful to market itself as a friendly, low-key brand. Company lore has it that Mateschitz concocted the drink after a trip to Thailand, where he befriended rickshaw drivers. They revealed to him the secret of how they managed to stay active all day while carting around tourists — Krating Daeng, a centuries-old local beverage.

Mostly, however, protests were muted in American soccer circles because MLS needs the money. As the league enters its tenth season, it is in an anomalous position. On the pitch, it is relatively successful, with average crowds of 15,000. In the boardroom, however, it is a different story.

Lamar Hunt and Phil Anschutz, who sold Mateschitz the MetroStars, own seven of the ten clubs. Hunt and Anschutz were among the league’s original investors and they were responsible for the “single entity” structure, in which there is a rigid salary cap, marketing and merchandising are centralised and foreign stars are bought by the league (rather than the clubs) and “allocated” to a team.

While those restrictions helped to keep the league afloat and avoid the excesses of its predecessor, the North American Soccer League, they also made it unattractive to investors.

Even with all of MLS’s draconian restrictions, the deal was attractive to Red Bull. Its £65 million bought it the club as well as a 50 per cent stake in a new soccer-only stadium across the Hudson River in New Jersey and the stadium naming rights. Compared with what it costs to run, say, a Formula One team, it is a bargain.

Indeed, it is the kind of entrepreneurial, free-market ingenuity that is supposed to be at the heart of the American Dream. The funny thing is, there is no such thing when it comes to American sport. It took an Austrian fizzy beverage vendor named Dietrich to introduce it to the Americans.

thetimesonline.co.uk

[kitty]

red bull and vodka is my drink of choice