MANAGEMENT MARKETING - Syndicate Groups #8

Lecture : Dr. Asnan Furinto S.T., MBA

Date : Wednesday 17 September 2019

Member of Groups :
1. Donafeby Widyani - 29319057
2. Muhammad Hermosa Widiadi - 29319119
3. Muhammad Wildan F - 29319008
4. Nadia Farahiya Rachmadini - 29319083
5. Rico Kresno - 29319100

The Branding Of Club Atletico de Madrid: Local or Global?

1. About The Case

Atletico de Madrid (ATM) is one of famous football club from Spain playing in La
Liga Primer Division, founded in 1903. ATM known in Spain because of their
advertising as for its play on the field During 2000s. The reputation of ATM were
overshadowed by their home town rivals, Real Madrid and its neighbour, Barcelona.
Based on the financial overview, we can infer that the revenue was hiking, meanwhile
the operating cost is fluctuate, stay negative and the net profit was hiking in to positive.
In the period 2006-2008 total income was increasing significantly. However, total
expenses were also inclining resulting negative operating profit during those period,
in conclusion the net profit were declining. Debt to equity ratio was really worst, from
the calculation the number above 12, in fact the appropriate number is 1. By now ATM
is a strong and powerful brand, however they have been making little net income and
even debt in the last few years.

ATM has most of it time been in La Liga, meaning that it has always been in
competition with Real Madrid, who won over 30 championships and Barcelona who
won 14. These two biggest teams of La Liga have been maintaining their high ranking
worldwide and revenue (1stand 3rdin the world) due to many different factors which
make the difference between all the other teams:
● Real Madrid and Barcelona have for a long time been on public television which
allowed them to attract many supporters and interest from the population all over
Spain.
● Barcelona decided to form their players rather than recruit them in the transfer
market. This allowed them to save a lot of money, yet made them invest a lot of
money at first in their youth players.
● They have been implemented and advertising not only in their respective cities but
all over the world which led to an interest from new fans abroad. This allowed them
to increase the traffic on their site.
● According to a study, about 500 million people had heard of the Real Madrid team
and about 150 million considered themselves as true fans of the club.
Atletico has had the best season in the last few years by finishing four of the
league, however, revenue growth did not match the expectations.

ATM has been having a bad reputation through the eyes of football fans and others
which made them hard to grow leading to low broadcasting revenues, low commercial
revenues but also led them to a low match day revenue with relatively cheap tickets.
ATM have been with Nike since 2001 which is great for the club as they also are the
rival of Adidas being on the real Madrid jerseys.

ATM has a strong awareness and visibility in spain and was seen by people as
familiar yet neutral. This was seen by the whole country rather than just in Madrid. The
brand itself provides excitement and energy yet, Atletico have earned this reputation
for failure and low branding. One of the biggest weaknesses of ATM is its debt which
makes it hard for them to compete with such internationally known brands.

2. Issues

In purpose to increase revenue through a renewed focus on marketing and brand

building intended to increase awareness and attractiveness of the ATM brand,
moreover, the operation profit was loss and have a debt. Should and could it to try
to make ATM a household name around the world?

3. Analysis Of Alternative Actions/Options

A. SWOT Analysis
Strengths Weaknesses

● Had strong awareness and visibility
in Spain.
● Great history as one of the best clubs
in Europe.
● Supportive and loyal fans based.
● Affordable match ticket price
compare to any other rivals.
● Experts and visioners management.
● Good relation with partnership and
sponsorship brand.
● ATM brand well known only in
national scope
● Losing great players on the transfer
market.
● Unstable performance on the field
that affect the income.
● Club largely dependent on debt.
● Low price tickets means low
margins.
● Low average rights fee per season.

Opportunities Threats

● Well established role of advertising ● Relegation structure in the league

and sponsor in football club. will be affected for the club financial.
● Growing international support. ● Big comparison rivals Real Madrid
● Negotiate new media/advertising and Barcelona.
contract
● Reach International market such as
Asia, USA and Middle east.
● Develop youth talent.

B. Alternative Recommended Actions

From the analysis above, we divided the alternative options into 2 options, they
are:

● Option 1, Focus on local branding

● Option 2, Expand the global market

The chosen of the options is considered by the pros and cons analysis below:

PROS CONS ANALYSIS

 N Scenario Pros ( +) Cons (-)
o

Option 1 ● They already have ● Not growing market for a

fanatic and loyal club like Atletico
Focus on local
supporters that
branding engage with them ● In the local area, real
and easy to catch Madrid as a competitor
them. in Madrid city area is too
superior instead the
Spanish.

● If Atletico define their

local as spain market
each city already has
their own hometown
club.

Option 2 ● Has bigger market. ● Need more budget,

● Increase the amount especially in marketing.
Expand the
of loyal supporters ● Fan loyalty may be
global market and easier to build a damaged within spain.
fanbase outside
spain.
● Many options to get
into the market.
● Opportunity to more
collaborate with
international brand.
● They can gain
revenue faster.
● Easy to get top
quality player who
can win the trophy
and will expand the
achievement.

C. Recommended Action
 From the pros and cons in each options that we have analysis above, we
choose Option 2 which is:

Expand the global market.

Through expand the global market, ATM have many options to get into market,
such as:

● Attracting sponsors which offers high visibility, value of excitement and

energy, and opportunity to more connect the football to the fans.
● Grow revenue from official fans club license, expand the retail
merchandise store and official tv broadcaster.
● Attracting youth talent from around the world because exposure of the
branding and it’ll help the club to get revenue from the transfer of their
academy player.
● Hiring a top and famous coach and player to fulfill desires of the fans.
● Develop youth academy to increase the attachment of supporters from
country with a big market possibility.
● Focus and sponsor the youth teams and junior football academy which
will allow ATM to create branding since they were a kid to gain a new loyal
fans.
● Create a local tour and exhibition match with local south east asia,
america, middle east football team to gain an exposure from their local
football fans.

We prioritize a global expand target to Asia, USA and Middle East market and
positioning ATM as a potential club to become one of the top 20 clubs in the
world.

4. Lesson learned
From analyzing and discussing this case we got several lessons learned specifically
in Marketing Management area such as:
 ● Wherever in the world to decide the target brand you have to positioning your
business perfectly to the target market.
● Being in the comfort zone can be a cause of difficult business growth.

● Serving the best service for the customers/fans will help to enhance the fans
growth and the profit.

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