Casa Milan press conference – the commercial direction of the club

Last week’s Casa Milan press conference – called to officially present the club’s new headquarter complex – provided some interesting insights into the future off-the-pitch direction of the club. It featured Barbara Berlusconi, Milan’s new commercial director Jaap Kalma, and Fabio Novembre, the designer behind the replacement for the club’s current Via Turati home.

It was Barbara Berlusconi’s first press conference as a Milan vice-president – we didn’t need any confirmation of her presence in the role, as that has been felt already, but it acted as a ‘baptism’ of Barbara’s taking over of the business side of the club. In the past, it would have been Galliani dealing with events like this.

Milan’s new offices – located in the Portello district – looked great, though we’ve known for some time of the existence of the new building. It will be open to fans, with a restaurant, a shop and a new museum – all the amenities that have become standard at most other club-specific fan areas around Europe, but that seem revolutionary in Italy. The main interest here, however, is not the change of headquarters, but Barbara’s various responses to questions put to her.

“Increasing our presence in Asian markets is of fundamental importance to the future development of the club. It is something that will allow us to take a huge step forward and compete with the bigger clubs, in terms of the commercial side, across the world.” – Barbara

Barbara clarified later that the club also intends to target the Middle Eastern territories, and not just the Far East, in an attempt to get local businesses and sponsors connected with Milan. Commercially, the club are still the best in Italy, particularly when it comes to marketing abroad. Compared to other big sides across Europe, however, they are still some way behind as a brand.

The club knows this, though, which is why they hired Kalma as the new commercial director. Asia is still considered an ‘emerging’ market – the opportunity exists to convert football fans in this region to support the club and the league. Barbara said that they have 22 million fans in China alone, and clearly believes there’s scope to increase this number.

“We would like to develop retail points in Dubai and the UAE. And also the same in China and Asia.” – Barbara

And this is probably one of the ways she intends to do it – stick some shops in these countries, increase brand awareness, and encourage the Chinese to become Milan supporters. If you are going to encourage foreign fans to engage with the club, you need to give them ways to do it. They can’t go to see the team play every other week at San Siro – they can’t even go on a semi-regular basis – so you have to offer different methods of engaging.

Having Milan games screened in these countries is only a starting point – merchandising gives fans a sense of belonging and identification to the club. Club shirts may not be particularly popular in Italy, but abroad they’re still the primary way a fan links themselves to a club.

“Another objective is the American market.” – Barbara

This came across in the conference as a bit of an afterthought – the first area she spoke of was Asia, before this was added in at the end. A few years ago, the US was an ‘emerging’ market in a similar vein to Asia, but football is now far more entrenched in the States, so the opportunities are not as readily presentable.

The Premier League has made great strides to converting US fans, but they recognised the opportunity almost 10 years ago, with many big clubs conducting annual tours across the US and South America. It helps that the league has greater visibility through TV – first from Fox and ESPN, and then this season with the advent of NBC taking over the live rights – and that increased visibility has allowed even the smaller clubs to decide a pre-season tour to the US is a commercially worthwhile opportunity, with Aston Villa announcing last week that they were heading Stateside to play a couple of Major League Soccer (MLS) teams.

Serie A hasn’t had anywhere near the same level of promotion. Those two factors, combined with the rising popularity of the MLS, means they are playing catch-up with a number of stronger competitors, and probably leaves this market lower down the list of priorities.

“We expect around 150,000 visitors to the museum in the first year” – Kalma

A club museum will feature as part of the new headquarters. Barbara was asked whether the intention was to copy Barcelona, who have a hugely successful museum of their own – to which they replied yes, that was the model they were looking at. She handed over to Kalma, who said they expected around 150,000 visitors to the museum in its first year.

So, in the interest of comparison, it’s worth looking at Barcelona’s numbers, given that the success of their museum is what Milan are supposedly trying to emulate. They received a record 1,626,990 visitors in 2011, making it the third most visited museum in Spain, and have broken the one million barrier in each of the last four years.

Kalma tempered this with a bit of realism, saying he would like the Casa Milan museum to be one of the top-10 attractions in the city – not quite going as far as top three.

Of course, Barcelona’s museum tour is combined with the stadium tour as well, which no doubt boosts the number of people interested. Nevertheless, it gives an idea of the sort of level Milan are aiming for, and indeed how far behind they are.

“Something different [from selling the club] is the possibility of a partnership that would allow us to approach the construction of new structures, such as a stadium, with more serenity.” – Barbara

The main headline you would have seen is that Milan are considering selling a stake of around 20-30% in the club. But at no point during the conference did Barbara say these words – some reports carrying this information have attributed the words to her, and they appear to have arisen from her conversations with the media that took place after the press conference. Such were the unconfirmed nature of these conversations that the Reuters story on this topic was a little more circumspect – they attributed the specific comments on the sale of a 20-30% stake to a club spokesman for Barbara.

In any case, she did confirm that her trips to the UAE, Asia and the US would not only be for commercial projects (such as the retail spots mentioned above), but also to scope out potential partnerships to make building a new stadium a little easier for the club to manage financially.

Given that nobody from the club has come out and vehemently denied those comments on a potential sale of shares in the club, it is probably safe to assume this is an option, but do not rule out the potential for a naming rights deal, or some other commercial arrangement, instead.

Silvio Berlusconi has always been against floating the club on the Borsa – the Italian stock market – which is why it remains the only part of the Fininvest empire not found on the stock exchange. And he has been equally reticent to sell part of the club to an outside investor. If the option of obtaining finance without selling a stake in the club is there, expect him to take it.

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One response to “Casa Milan press conference – the commercial direction of the club

  1. Another topic of interest. In my position I cannot say whether of an outside or an Italian investor would be better but in my opinion, a new major investor/partner is needed.

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