Friday, May 15, 2009

Brisbane Roar Update

This week it is all about ticket that look set to rocket up by 40% in a global recession.

Why would a club do this? I think it is because they are doing what they are told to by the FFA.

I believe that a guy with a spreadsheet in Sydney is basically telling the Roar what to do. The press implied the FFA 51% acquisition of the Roar as bringing new quality management. Unfortunately for the Roar and its fans this does not appear to be the FFA mindset. The priority is that the Roar does not generate a negative cash flow for the FFA.

So, I believe they will manage cash flow into breakeven by increasing prices.

I believe the guy in Sydney with the spreadsheet may have worked out that if ticket prices go up 40% then they can breakeven at 10,000 rather that 15,000 fans per game. This means that they don't have to worry too much about fans 'price elasticity' - the extent that fans stop coming if the price increases. Further, they know that the Roar has a, relative to other A-League clubs, small base of season ticket holders. And that is has a high percentage of fans that infrequently walk up to the game and therefore people won't notice the relative price of tickets.

The real shame is that in targeting 10,000 rather than 15,000, Suncorp is going to sound empty and will reduce the appeal of the night out.

What the FFA needs is a different mindset. They wasted $1 million on an Auckland audience that was not interested in their product. Now they should invest in a local city with massive sporting interest - the Broncos are getting 20,000 to 40,000 to Suncorp in the FFA's offseason.

What they need to do is hire some sports marketing expertise and either look for a big investor to buy 100% of the Roar and take the club where it needs to go, or re-structure the Roar for members as owners. Like the English 'myfootabllclub' concept, the members would vote for board members. then you could ask the members to pay a premium.

Unfortunately the route the FFA is taking with the Roar is not maximising its value to a new 'big investor.'


Anonymous said...

seems like the ffa is saying that they cannot, or will not, do anything more than try to create a holding pattern with the brisbane market.

what happens if these big investors don`t come on board? you got BR and AU currently in holding patterns ...

what if cranky, stingy con rides off into the sunset - would anyone else want to bankroll NJ? probably not.

i don`t think that the benevolent chairman is the only ownership model out there that works.

eh, no-one said it was gonna be easy.


john said...

Ah yes Honourable Clayton san

The membership model is one. But who has the pockets to bale out teams?

The GFC has smashed corporatism.

Bring back Frank Lowy. Anthony La Palia has a connection to Brisbane...