Most observers would agree that club football, in particular the Premier League, is enjoying a golden age of prosperity and popularity. Football in the UK, and Europe more widely, has arguably never been more successful than over the past decade. Clubs use their stadia, players, coaches, and the collective reputation of their league to develop and leverage the equity of their “brand” and the resultant commercial opportunities have been fully exploited through lucrative television deals and sponsorship contracts.
The Premier League has had little past competition in terms of attracting and keeping its star players. Spain’s La Liga, spearheaded by Real Madrid and Barcelona, is perhaps its closest commercial rival having tempted the likes of Cristiano Ronaldo, Gareth Bale, and Luis Suarez in the past. But there is a cloud on the horizon for Europe’s footballing elite. The January transfer window may have offered us a glimpse of the future, with reports of Chelsea’s Diego Costa being tempted by a big money move to China.
Enter The Dragon
In 2012 Chinese club Shanghai Shenhua lured former Premier League stars Nicolas Anelka and Didier Drogba to the Chinese Super League (CSL). Internationally, the deals attracted the usual passing glance but nothing too inquisitive. The general “Western view” was that this was just another example of a developing football nation spending money on players soon to be retired – nothing more than a PR stunt.
At the same time President Xi Jinping made it clear that football was now (almost) top of the Chinese political agenda. China’s strategy is two-fold; first a state modified grassroots campaign that is anything but organic, starting with the development of a target 50,000 football schools to boost Chinese footballing talent.
Second, more relaxed public sector restrictions and encouragement for market innovation has led to China’s business moguls to re-position and extend what they do in business to support their leader’s footballing ambitions. This example of “political guanxi” allows for the lines between private and public sector networks to merge creating significant market opportunity. Activities include local market investment, and overseas acquisitions – Chinese firms spent lavishly on investment throughout 2015 and 2016 in the purchasing of European football clubs. The signal of intent is clear, but surely they are still no match for the mighty Premier League?
Player acquisitions are important in football on and off the pitch. They bring with them global fan bases, TV spectatorship, online activity and digital exposure. While deals to bring Nicolas Anelka and Didier Drogba were reminiscent of strategies from other emerging football markets – such as Major League Soccer (MLS) in America – subsequent transfers between 2013 and 2015, bringing the likes of Tim Cahill, Asamoah Gyan, Obafemi Martins, and Demba Ba to the CSL showed that China could, through mostly financial incentives, attract a reasonable quality of foreign players.
The bar however was soon to be raised. In January 2016 China cracked the luxury end of the football market. Atletico Madrid star Jackson Martinez, despite interest from Arsenal, swapped La Liga for the Middle Kingdom, arguably at the peak of his game. Alex Teixeira, hot on Liverpool’s radar, snubbed England in favour of China. Ramires left Chelsea for China despite a regular first team role at Stamford Bridge. China was starting to flex its financial muscle, and Chinese business quickly jumped on board.
The January 2017 window (so far), goes a step further. Former Manchester City, and Juventus striker Carlos Tevez earns a reported £615,000 per week playing in China. While Tevez could be considered as past his best, Chelsea star Oscar has arguably traded London for Shanghai before reaching his peak as a player.
These deals were sandwiched between rumours of hundred million-pound offers for Cristiano Ronaldo, and strong recent interest in Chelsea star Diego Costa. These are the fine wines of world football, the household names that drive Europe’s commercial supremacy. Yet now they are starting to turn the wheels of China’s latest industrial revolution. In a market of potentially hundreds of millions of football consumers, a burgeoning middle class with sizeable spending power, a move to China naturally boosts the potential of more lucrative sponsorship deals and greater media exposure. And so the cycle intensifies.
There is no doubt that the Premier League helped drive the commercialisation of football in Europe. China is trying to do the same, but rather than creating star attributes, it is buying them.
The implications of China’s growing commercial strength for the rest of the world stretch beyond mere competition and commercial muscle in football. Whether or not contracts and transfer fees can be matched in the West, the question is – should they be? Market inflation and a widening wealth gap within the global football market are just some of the short-term consequences. The longer-term opportunity costs in other sectors could be far more serious. If English and European football clubs want to continue enjoying the premier position they hold in world football, its time to start reshaping the market in which they operate, before the market begins to reshape them.
(THE AUTHOR DAVID COCKAYNE, SENIOR LECTURER, MANAGEMENT SCHOOL, UNIVERSITY OF LIVERPOOLTHIS ARTICLE WAS ORIGINALLY PUBLISHED IN THE CONVERSATION.)