Liverpool FC commercial chief on new kit deal and capitalising on Premier League success
Liverpool FC is in talks with New Balance and other sportswear brands as the club looks to strike the most lucrative kit deal in its history.
Liverpool FC chief commercial officer Billy Hogan
In an interview with The Drum, chief commercial officer Billy Hogan confirmed discussions were underway with New Balance, whose £45m-a-season kit contract is due to end next year, and others eager to replace the Boston-based manufacturer.
“We are in conversation with New Balance and we are in conversation with others as well,” Hogan said.
“[The kit deal] is an incredibly important partnership – not just for the financial support it delivers for the club but also from the distribution standpoint.”
Sitting second in the Premier League with a game in hand and with glory tantalisingly within reach for Jurgen Klopp’s side, the club is in a strong negotiating position as it opens talks with potential partners.
But while Hogan acknowledges a first league title in 29 years would be “helpful” to the club’s commercial cause, he said his remit was to ensure there was enough success off-the-pitch so as not to become reliant on what happens on it.
“While it's always about success on the pitch, it's also about ensuring we build really strong relationships as you can't always count on the on-pitch performance because it's such a competitive league.”
Liverpool’s latest accounts, published last week, showed the club broke the world record for the biggest pre-tax profit made by a football club during the 2017-18 financial year. Commercial revenue grew £17m to £154m.
A roster of 30 brand partners support the Anfield side, including main club sponsor Standard Chartered, shirt sleeve sponsor Western Union and training kit sponsor BetVictor. There are also partnerships with Carlsberg, Levi’s, Avon and Vodafone.
Hogan said the revenue from such disparate deals is used to directly finance football operations, explaining: “A partner invests with the club. And that investment is directly impacting what happens on the pitch. That revenue is then transferred into the opportunity to run the club and to invest in players.
“That's a benefit to us. But we need to be able to then deliver a benefit to that partner and so that comes through a shared understanding of what their business objectives are, and then how we can use the various mechanisms that we have to help deliver against that.”
Although some of the club’s commercial partners can raise eyebrows – such as ‘blockchain-based trading app’ TigerWit – Hogan said its team was capable of striking successful partnerships with brands even if they have no apparent connection to football.
Sponsors are sold on the notion that by backing the club, the club's supporters will back them. Hogan claimed the club's own data bears this out, but The Drum has not been shown the figures to verify this.
“When you consider different categories it might not seem like there's an exact fit with football or with sports but actually when you start to think about what every organisation is trying to do, it is to try and influence people's behaviour and ultimately we have an incredibly passionate and global fanbase.
"When you look at the data, it will show Liverpool fans are more likely to support our partners because they see the support those partners are delivering to the football club.”
The club's brand partnerships span categories as diverse as Thai coconut water to Liverpool vodka, a byproduct of sponsors in mainstream categories demanding exclusivity.
Hogan said: “Having a partnership with New Balance is not going to negatively impact a partnership with Standard Chartered and vice versa.
“When we think through [deals] it does come down to where there might be challenges from one brand to another and we would of course make sure there's never a situation where there is a negative impact from one to the other.”
Another consideration when scoping out new deals is what demands they would place on the playing staff. Nivea and Lavazza have activated their sponsorships with TV ads featuring current stars Alex Oxlade-Chamberlain, James Milner and Joe Gomez. Their boss Klopp has previously fronted BetVictor spots.
Hogan said: "We're in a situation where we're of course absolutely monitoring [demands on playing staff]. That's frankly the benefit of having somebody like Jurgen leading the football side – he absolutely gets that and is supportive of it.”
As well as selling sponsors on the club's proud “history” and “tradition”, Hogan is increasingly pitching to them the opportunities afforded by its modern-day global scale. Liverpool's own content has racked up 1.1bn video views so far this season, and Hogan is targeting the US, China and India as regions where he hopes to grow its fanbase further.
It will face stiff competition, however, with local Premier League rivals Manchester United and Manchester City also aggressively building out their fanbases and commercial functions in recent seasons.
“It's a competitive marketplace. Not just those in the Premier League but across Europe. And we would argue wider than that – outside of football even. From our perspective, there is obviously an incredibly deep and rich history over the course of 126 years here at Liverpool FC which is based upon extremely strong values.
"When you think about what that means in terms of the reach and the size and the scale, bringing that to a partner, there are very few other properties within sport frankly that can offer that."