Would the value of the Rangers FC brand be improved by a move to England?

First published on IPKat.com here.

In the US, franchise models for sports clubs are the norm. A team might up sticks and head a few hundred miles away, change their name and carry on as before. Us Europeans however are a lot more parochial than that and moving a club just a few miles down the road has fans reaching for the pitchforks. Severing that umbilical cord between the local supporters and the club is often too controversial but in some very rare circumstances it might be the better move for the brand overall.

The news that Rangers FC, a famous old Scottish football club, would be liquidated caused a shock in the world of sport.  Here was a sporting institution, founded in 1872 and league champions a record 54 times, being dissolved forever… at least in the legal sense.  The goodwill and the brand, if not the club, will undoubtedly live on.  However, this Kat wonders whether rebranding an English football club as Rangers FC and playing in the English league would bring greater fortune for the brand, or kill it altogether.

As with the assets of most companies in administration, the trade mark rights relating to Rangers FC, have reportedly been sold on to a ‘newco’.  Although this phoenix club will play under the Rangers badge next season, the right to play in the Scottish Premier League has been forfeited.  The newly-formed club, whose predecessor had an average attendance of around 45,000 spectators per match last season, will begin next season in the fourth tier of Scottish football; an exiled king banished to suffer the ignominy of playing in front of one man and his dog (or should that be Kat?).
 
 The financial effect of Rangers’ punishment will be severe, not only for Rangers but for other clubs who rely on the gate receipts from Rangers’ huge support as well as the league itself (the Brand Finance Football Report 2012 ranked the Clydesdale Bank Premier League as 16th in Europe, just below Romania and around 3% of the value of the Barclays Premier League).  Without the ‘old firm’ matches between Rangers and Celtic (one or the other having won the league every year since 1984), television receipts will be significantly lower.  South of the border, in the English Premier League, things look a bit rosier: income from television alone is around £1 billion per season.  As the financial gulf grows between Scottish football and its counterparts, the incentive for Rangers, and indeed any other Scottish club, to leave and start in another league grows greater.
 
One method of achieving this would be for Rangers’ owners to rebrand an existing English club.  Such a suggestion is anathema in the world of modern football, though it does not seem to have always been this way [I wonder if Newton Heath’s rebranding to Manchester United in 1902 was controversial – Merpel].  Today’s game, with its vast investment and commercialism have inevitably raised the stakes.  But it can be done… just – witness Wimbledon FC’s move to Milton Keynes, a town 56 miles away, in 2003.  The host club would simply become licensee of newco’s UK trade mark registrations for the Rangers brand.  However, fundamental problems are inevitable with the transfer to the rebranded club of Rangers’ goodwill and the disposal of the rebranded club’s goodwill.
 
There is no doubt in this Kat’s mind that the asset sale agreement transferring the trade mark rights also expressly referred to the sale of accompanying goodwill associated with the Rangers brand.  However, ownership of goodwill on paper and control of supporters’ goodwill are entirely different beasts.  Football support is often very tribal and the support very local.  Even though the brand may have a reputation across Europe, the goodwill is very concentrated within a few miles of the team’s home ground. That makes it virtually impossible to transfer to another part of the country.
 
One alternative is to have two teams, one playing in Scotland and a rebranded one playing in England.  Again however, given the tribal nature of football supporters, it is virtually guaranteed that fans of the rebranded club will prove hostile to their new name and prefer to maintain their allegiance to their old club.  It is therefore a gamble as to whether the goodwill of old Rangers can inspire a new generation of English fans.
 
Moving a football club even just a few miles away from the local area presents a huge risk of alienating its fans.  And without their support and income, the club will fail.  Only where a club has enormous goodwill and an international reputation is there likely to be any degree of ‘portability’.  A franchise model will inevitably prove to be extremely acrimonious.
 
As it stands, Rangers’ season will likely start with an away game at Peterhead FC, a team with a ground capacity of 4,000 who were playing in the Highland Football League until 2000.  It may take a sobering trip to Aberdeenshire for Rangers to appreciate the magnitude of the situation.  At that point a move away from Ibrox may seem worth the short-term fallout.  For the future of the brand overall, a move away in one form or another seems necessary.
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