Real Madrid’s game plan for global digital domination
When Real Madrid take on Manchester United in the Uefa Super Cup final on Tuesday night, they will be playing not only for more silverware, but to add even more supporters to their near 500 million-strong global fan base.
When you are already reigning Champions League and La Liga holders, not to mention World Club Champions, there would not appear to be too many goals left to achieve.
But the Spanish giants have realised that in the modern sporting world, sustained success does not only take place on the field of play.
Off the pitch football clubs are up against other leisure activities and interests for the attention – and finances – of potential new followers around the world.
So, to keep ahead of the game, Los Blancos are working with US technology giant Microsoft on a “digital transformation” – one that will “put the fan at the centre” of everything they do.
The goal is to make its digital operation into a revenue generator for the club.
“In our work with Real Madrid, it is important to realise that we are not just competing on the pitch, we are also competing off the pitch,” says Sebastian Lancestremere, the general manager of Microsoft’s sports business.
“As well as being a sporting organisation Real Madrid is a media organisation – one that is providing not just sporting, but also entertainment, material. It is also a huge social platform.”
Because 99% of the club’s fans cannot get to the Santiago Bernabeu Stadium on matchdays, then exciting content and digital services have to be created for these other far-flung millions.
That includes things such as the creation of a virtual stadium that can be accessed on multiple devices.
Meanwhile, Microsoft’s cloud and analytics capabilities can highlight key statistics, and also allow fans to make comparisons between different players and different matches.
And, while actual matches provide an exciting 90 minutes and more of content, Real Madrid believe there is other content that can be just as enjoyable – such as training action and behind the scenes insights.
For example, how are player workout regimes organised, to the role of tennis balls in training.
Previously it was felt that the relationship was too one-way, and that the club was just throwing out content in the hope that some of it would stick.
“Now the aim is to be very agile on content,” says Mr Lancestremere. “The fan base is very fragmented, socially and geographically.”
One of the club’s biggest fan bases is in Indonesia, and like other top European sides Real are also looking to grow their presence in China. As well as these languages the club also provides content in Spanish, English, Japanese, Arabic and French.
“Also, football fans are different from how they were 15, 10, even five years ago,” Mr Lancestremere adds. “They now consume what they want, when they want, and how they want through different channels.”
The club estimates it has 15 channels through which it has a digital relationship with its fans – including via apps, its website, social media, online store, club TV, membership, ticketing, and more.
These are split between first-party channels such as the app which are fully owned by Real Madrid, secondary channels – which have the club logo but are operated by other companies, and third-party channels such as social media.
At present the club is represented on eight different social media platforms: from Facebook and Twitter to Japanese social network Line.
Mr Lancestremere says that it is important for Real Madrid, and other football clubs, to be going down this path now in order to capture a growing, digital-savvy, young audience.
“Millennials are going to make up 40% of the global population by 2020, and they spend an hour and a half per day on social media, they consume videos, they play games.”
In return the club gets back intelligent information and data about fan likes, their preferences and their choices. That enables the club to tailor its commercial services and offers to supporters, not only for its own products, but towards those of its 13 business partners, such as Adidas or Emirates.
It also means when Real Madrid looks to sign new sponsor deals, they can bring added value in being able to deliver such a large digital audience to potential commercial partners – who will pay more for access to such a sizeable consumer base.
‘Could do more’
According to valuation and strategy consultancy Brand Finance, the 12-times European Cup-Champions League winners are already the most powerful club brand in the world.
But it says that the club is not leveraging its brand to the maximum commercial advantage in a way that tonight’s rivals from Old Trafford are doing.
“Whilst Real can bask in the glory of its unparalleled reputation, it could be doing a lot more to capitalise on its on-pitch success,” said David Haigh, chief executive of Brand Finance.
“Despite being football’s most powerful brand, in terms of brand value, it still trails Manchester United by a considerable margin.”
It estimates the Manchester club’s brand is worth some $1.733bn (£1.33bn) to Real’s $1.419bn.
“Real must now pay as careful attention to its off-pitch strategy as it does to its on-pitch performance,” Mr Haigh added.
Hence, the added importance of the creation of a new digital business model in the social media age.
Indeed, Mr Lancestremere says Real Madrid could be considered more like Netflix, in that it creates and streams content, rather than a traditional football club.
“Sports clubs have to be entertainment powerhouses. Football is now part of the entertainment world, 365 days a year,” Rafael de los Santos Navarro, global digital director for Real Madrid, explained at a football business forum in London this summer.
“We want to reach, retain, and monetise engagement.
“At the end of the day we are a football club, but we are also a content company, and this is the asset we bring to people. You have to think about all the sources of revenue and positioning yourself for the revenues you are going to make tomorrow.”
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