There has been a lot of expansion in Australian sport recently, with some great successes and some spectacular crash and burns. So what lessons have we learnt?

We have welcomed eight new clubs into the Australian football codes – Gold Coast Suns and Greater Western Sydney Giants went into the AFL, the Melbourne Rebels entered the Super Rugby, and The West Sydney Wanderers, Wellington Phoenix, Melbourne Heart, and ill-fated duo of North Queensland Fury and Gold Coast United joined the A-League.

Throw in the arrival of the eight new Big Bash League franchises, a re-re-re-return of the Sydney Kings to the NBL and a rejigged trans-Tasman ANZ Championship in netball, and that’s a lot of new sport.

Now is the perfect time to look at what works and, perhaps more obviously, what doesn’t.

Beware strangers bearing gifts
Or, more specifically, beware Clive Palmer. A man who has no interest in football, the Gold Coast, or the A-League was allowed to control an A-League football team on the Gold Coast.

We all know the disaster that occurred next. Crowds locked out. Controversies and personal battles between Clive Palmer versus anyone who did him wrong, including the league itself. This is a lesson the AFL had already learnt when Christopher Skase bankrolled the Brisbane Bears and used it as his own plaything.

There is nothing wrong with private ownership – Harold Mitchell at the Rebels, for instance – but they should only be allowed to have control with the purest of intentions, and with a plan set in so the organisation could survive if (and when) the owner left.

Location, Location, Location
The first factor in regard to location is, obviously, where the team will represent. The AFL and A-League’s move into Western Sydney was a must – a large, diverse, expanding population with no other nearby sport besides rugby league.

The move to the Gold Coast by the A-League, AFL, and even rugby league before that has been a lot tougher. Perhaps because even though the population is growing, the clubs are competing with a beach, good weather and great nightlife.

The writer may be about to be mauled by an entire state, but it is hard to see Tasmania garnering any sports team, and would be a poor choice to expand to. Why? The huge costs to update the facilities, compared with the relatively small population, means there will be limited gains.

What about the AFL? Well, they already control the state, and wouldn’t gain any new supporters from putting a team there.

Home is where the Heart is (as well as the Victory, Storm and Rebels)
The old saying, “build it and they will come,” should add, “as long as the food is good, the seats are comfortable, there aren’t massive queues at the dunnies and the viewing is worth the price of admission.”

It needs to check ease of access and public transport facilities, quality seating and viewing (including big screens), good food, beverage and toilet facilities, and great atmosphere.

AAMI Park is home to two of the more recent clubs in the Melbourne Rebels and Melbourne Heart, as well as the already established Storm and Victory. It has excellent facilities, easy access and great viewing from all areas in the ground.

Conversely Dairy Farmers stadium, home to the NRL North Queensland Cowboys and formerly North Queensland Fury, has some serious issues with public transport and ageing facilities. It is being replaced by a new stadium, to be located in the middle of Townsville.

If you were a neutral going to watch a new team, it wouldn’t take much to put you off, so the stadium really needs to be up to scratch.

Brand new toys
The branding of a new team is everything. Branding encompasses the name, colours, designs, even the culture of a team – anything that defines the organisation. It has to really engage the community, relate to them, and make the masses want to be part of what is going on.

The Melbourne Rebels have done this really well. The Rebels really embraced and pushed the fact that they were doing something different in Melbourne. They also pushed strongly their relation to the Eureka rebellion, which includes the five stars on the tops, and nicknaming AAMI Park the “Stockade”, all making the club feel distinctively Victorian.

The Western Sydney Wanderers also did well, especially in a short amount of time, in quickly engaging the community by very shrewdly taking the name of the Australia’s first registered club, which came from the area, and using community forums to let supporters choose aspects like name and colours.

Even though I don’t like the name GWS Giants, the colours of black, white, and orange are obviously aimed at the west Sydney tradesmen, who wear those colours daily as their safety gear.

Wellington Phoenix? Rising from the ashes of New Zealand Knights – nice.

On the other hand, North Queensland Fury and all the Big Bash League franchises are (or were) named and coloured like something I would pull out for a university assignment where I was creating a dodgeball league.

Gold Coast Suns and United are a tad boring.

Melbourne Heart, well, it’s hard to know. They are Victory’s rivals, mostly because they are in the same town. Maybe when they define themselves a bit more, they might be more of a CBD team (the Heart of the city) as opposed to suburban Victory. They really need Kevin Muscat to sledge John Aloisi or some event like that to separate them a bit.

Put up the marquee
A marquee player is a good thing. They can get a new club a load of publicity for the signing, as well as bring supporters through the gates to watch them play.

I would argue the Biggest Bash League is solely running on big names. This writer tunes in to watch Shane Warne, not because he is devoted to his beloved Melbourne pop tarts or whatever it is.

Same with Gary Ablett at Gold Coast Suns, Stirling Mortlock when he went to the Rebels, Shinji Ono at WSW, Ronnie Fowler at Fury, even back to Dwight Yorke at Sydney FC, the list goes on.

Get down to the grassroots
I mentioned this in my first article on the Roar, but sport really does need to think wider than the playing field, to bring more importance and relevance to the club in regards to being an important part of the community.

As much as the AFL wanted media coverage from Israel Falou, visiting a school or charity low key and then letting word-of-mouth spread is a longer lasting and more penetrative piece of marketing than a 30 second news story that will be forgotten the next morning.

It makes people feel like they have a stake in the club, and the club is part of their lives.

Just keep rollin’
Firstly, I apologise for the Limp Bizkit quote, but it is a fact. A new club is under more pressure not only to gain fans but to keep them. GWS signed Tom Scully not on his current, but his future ability. It gives the fans a reason to stick around. North Queenland Fury definitely lacked a bit of that.

A better example is perhaps Western Force in Super Rugby – they have yet to make any sort of impact anywhere, and are starting to lose relevance.

So there you have it – the expansion present. I am looking forward to finding out what we learn in the future!

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The Crowd Says (38)

  • January 5th 2013 @ 7:34am
    Kasey said | January 5th 2013 @ 7:34am | ! Report

    Simple question: Why is this on the football tab?

    • Roar Guru

      January 5th 2013 @ 10:20am
      Cappuccino said | January 5th 2013 @ 10:20am | ! Report

      This. Most of the article doesn’t address football at all.

      • January 5th 2013 @ 5:22pm
        Kasey said | January 5th 2013 @ 5:22pm | ! Report

        Taking off the tin foil hat, I think Fuss has hit on the reason in a reply in past threads, there just isn’t any traffic on the other sports’ tabs. If you want a topic to be commented on it should at least make a passing reference to football so it can be placed on the football tab. Short of a blatant code war article, that is the only way to get comments.

  • Roar Guru

    January 5th 2013 @ 8:37am
    Fussball ist unser leben said | January 5th 2013 @ 8:37am | ! Report

    The creation of WSW is, for me, the blueprint for successful expansion in the A-League.

    Whilst the club is currently owned by the FFA, it was established in a region where there was a massive unmet demand for professional club football & the FFA actively engaged with fans in the region to ensure the club represented what fans wanted.

    By contrast, GCU & NQF were established in regions with low demand for professional club football, purely to assist the FFA with the WC2022 bid.

    Whilst I have contempt for the way Clive Palmer treated GCU players & fans in Year 3, lets not forget Clive invested significant cash into GCU. Perhaps, in the vicinity of $20-30m. Prior to GCU’s inaugural season, Clive was interviewed on the TV show, “60 Minutes” and his enthusiasm & ebullience for GCU was infectious.

    My gut feeling is Clive’s money & enthusiasm would have had greater impact in Townsville, rather than the Gold Coast.

    Henceforth, I would like all new A-League clubs to be created by the people.

    If Tasmania, Canberra, Woolongong, Geelong, North Qld, Gold Coast etc. want an A-League team, I’d like to see football people in these regions working together to create their club.

    It’s widely reported that A-League clubs require $6m to operate, with $2.5m of this revenue being the FFA’s TV rights dividend.

    My “back of the envelope” calculations indicate a loyal supporter base of 8-10k fans is all that’s required for an A-League team be profitable/annual loss less than $500k.

    The other essential is the stadium. If we are relying on 8-10k supporters, it’s ridiculous to hold the event in a stadium that seats 30-50k people. A-League clubs need to invest (co-invest with local communities or State Government) in boutique rectangular stadiums.

    • January 5th 2013 @ 10:02am
      nordster said | January 5th 2013 @ 10:02am | ! Report

      And if clubs require 6m based on the current parameters they operate under with the participation agreement and cba… why not reform and renegotiate those (will likely be well received by clubs) and they could make some serious cuts to the figure. I dont know if 8-10k avgs have been enough so far to operate break even…looking at the short history so far…

      Do all clubs need to reach such a high level in order to participate, especially in their formative years? Does ffa want to be supporting all new entrants ala WSW or bridging them when they lose their benefactor? If the league is to grow, they need to look seriously at lowering the bar for entry, at the same time freeing up some of the bigger clubs in the restrictions they have on them.

      • Roar Guru

        January 5th 2013 @ 12:56pm
        Fussball ist unser leben said | January 5th 2013 @ 12:56pm | ! Report

        The $6m figure is not an FFA requirement to participate, it was a figure provided by Geoff Lord, who Chairman (and a significant shareholder) of MVFC for the 1st 6 years.

        My back of the envelope revenue calculations are:

        Membership: 5k x $200 = $1m
        Gate receipts: 5k x 13 (home matches) x $20 = $1.3m
        Sponsorship: 10 x $100k = $1m
        Merchandise: 5k x $50 = $0.25m
        FFA dividend: $2.5m

        Total revenue = $6.05m

        • January 5th 2013 @ 1:29pm
          nordster said | January 5th 2013 @ 1:29pm | ! Report

          But the cost of competing comes as a result of the ffa requirements to participate…the regulations…so not as a fee to entry, but a cost of the regulatory framework which they set…loosen that and could the costs come down considerably? (At least as an option for smaller clubs.)

    • January 5th 2013 @ 5:26pm
      Kasey said | January 5th 2013 @ 5:26pm | ! Report

      I’ve mentioned it many times to our good friend jb…. the break even mark is not a 10k crowd. The break even point is unique to each club and is a direct consequence of how good a stadium deal each club has. The 10k mark was a self declared aspiration all goal mentioned by Lowy at the launch presser of the A-League. I think the problem with averages is that one big or small result can too easily slew the average. Perhaps it’s time to start looking at medians? Or weighted averages?

  • January 5th 2013 @ 8:53am
    Christo the Daddyo said | January 5th 2013 @ 8:53am | ! Report

    “My “back of the envelope” calculations indicate a loyal supporter base of 8-10k fans is all that’s required for an A-League team be profitable/annual loss less than $500k.

    The other essential is the stadium. If we are relying on 8-10k supporters, it’s ridiculous to hold the event in a stadium that seats 30-50k people. A-League clubs need to invest (co-invest with local communities or State Government) in boutique rectangular stadiums.”

    If A-League clubs have to invest in their own stadiums, then surely that throws out your budget calculations? Even AFL and NRL clubs can’t afford to do this…

    • Roar Guru

      January 5th 2013 @ 8:59am
      Fussball ist unser leben said | January 5th 2013 @ 8:59am | ! Report

      “If A-League clubs have to invest in their own stadiums, then surely that throws out your budget calculations?”

      Stadium investment would be classified as Capex – not operating expenditure.

      There are all sorts of funding structures for infrastructure investment. Perhaps, a debt instrument like a “stadium bond”, which converts to an equity instrument giving fans a shareholding in the stadium.

      Who knows, maybe a company – like Westfield – may see the benefit of creating a boutique football stadium within a shopping centre? Heck there’ll be no more marital arguments from spouses, who like shopping, but hate watching football! 😉

      • January 5th 2013 @ 9:10am
        vinie said | January 5th 2013 @ 9:10am | ! Report

        Hey Fuss, can you explain how Sydney fc have lost an average of up to 5 million a season when their crowd averages have been above 8-10K?
        genuine question just really amazed how they keep losing millions per season.

        • January 5th 2013 @ 9:26am
          Titus said | January 5th 2013 @ 9:26am | ! Report

          Because vinie, things like stadiums and training facilities are more expensive in the city compared to say Parramatta or Blacktown. SFC is also the only club that has always had 2 big money marquee’s.

          SFC has a long way to go to get it right but as we see with the Del Piero effect, all clubs should be secretly thanking them and be greatful.

        • Roar Guru

          January 5th 2013 @ 12:49pm
          Fussball ist unser leben said | January 5th 2013 @ 12:49pm | ! Report

          vinie

          If clubs are losing $5m a year, then their operating expenses need to be curtailed.

          The $6m figure was provided by Geoff Lord, who was the Chairman of MVFC for the first 6 years.

      • January 5th 2013 @ 10:08am
        nordster said | January 5th 2013 @ 10:08am | ! Report

        Re bonds…as long as they are not sold as a magic pudding/free money as they are with government debt…the money has to come back down the line and paid for at some point…i have a feeling u are a fan of financial trickery Fuss 😉 Raising debt is not free money and can create future problems if assumptions on cost and operating the stadiums are not met…

        I love the Westfield idea though, assuming they can find the correct sites..maybe buying air space over railway lines who knows…always thought Westfield Football City had a nice ring to it, from a spun out Westfield Football Trust (WFT) lol

        • January 5th 2013 @ 7:40pm
          Kasey said | January 5th 2013 @ 7:40pm | ! Report

          I seem to remember the old Hartford Whalers(NHL) played out of a rink attached to a shopping centre (sorry in US English ‘ center’)

    • January 5th 2013 @ 1:10pm
      CallmeeAl said | January 5th 2013 @ 1:10pm | ! Report

      If A-League clubs have to invest in their own stadiums, then surely that throws out your budget calculations? Even AFL and NRL clubs can’t afford to do this…

      Mostly AFL clubs aren’t in a position to contemplate this – as few play at their own grounds. Geelong is the exception and the GFC plus AFL plus Govts have invested in Kardinia Park which is owned by the City of Greater Geelong.

      Outside of that, the main investment is in training venues – and all club have invested heavily in those along with, as with any other local club/organisation, accessing Govt grants that normally require maximum public access where possible.

      Other match venues tend to be more public – the MCG has a huge amount of AFL funding based on a 45 year lease arrangement that is effectively paying off the 100% rebuild of the venue over the last 20 years – however, it will always remain owned by the state, managed by the MCC on behalf of the MCG trust. Etihad over 25 year lease sees the AFL effectively buy out the venue which will leave the AFL with 100% ownership inc management rights.

      It will be interesting to see if cashed up NRL now looks into greater venue/ownership options of venues if they move down a match day ground rationalisation program as has been hinted at.

      • January 5th 2013 @ 5:42pm
        Evan Askew said | January 5th 2013 @ 5:42pm | ! Report

        I’m not an expert on NRL but wouldn’t the Sydney based clubs such as Cronulla, Parramatta, Manly, Penrith and St George own their own stadiums already?

        • Roar Guru

          January 5th 2013 @ 5:54pm
          Fussball ist unser leben said | January 5th 2013 @ 5:54pm | ! Report

          Bit of spare time before I leave for AAMI Park …

          According to Wiki:

          Parramatta: Parramatta Stadium, owned by NSW Government
          Manly: Brookvale Oval, owned by Warringah Council
          Penrith: Penrith Stadium, owned by Penrith City Council
          St George:
          – Jubilee Oval, owned by Kogarah Council
          – Woolongong Showground, owned by Woolongong Sportsground Trust

          Only
          Cronulla: Endeavour Field is owned by the RL club.

          • January 5th 2013 @ 6:30pm
            Kasey said | January 5th 2013 @ 6:30pm | ! Report

            And Cronulla’s deal has seen them asset rich and cash poor since they bought their stadium. I am far from an NRL expert but as I understand it, there is no guarantee today’s shark fans will be able to watch their team in the Shire in 20 yrs time, Central Coast Sharks?

  • January 5th 2013 @ 10:28am
    nickoldschool said | January 5th 2013 @ 10:28am | ! Report

    Interesting subject. As a euro expat who has been here for ever a decade, I have always been sceptical about ‘new clubs’ popping up. I have seen quite a few in different codes recently and IMO WSW is the biggest success of all, on and off the pitch. I didn’t see it coming and still don’t understand it tbh but I just love seeing that some ppl have embraced and identified with this new team. I do think that they are also surfing on the fact SFC are having a nightmare of a season despite the arrival of the biggest football star (all codes included) on our island.

    I don’t think they are any rules or recipe to success tbh. I even think that a football team well marketed in Hobart could succeed. they are many sport hungry fans in Tassie and to have one team playing at the highest level would attract many fans of all ages.

  • January 5th 2013 @ 11:29am
    Andyroo said | January 5th 2013 @ 11:29am | ! Report

    I think the size of the stadium isn’t as important as how much you pay for it.

    It hurts atmosphere but I don’t now how important that really is to preventing people from going. People do complain about big empty stadiums but if it is convenient to get there most will still go if they have any inkling to see the game.

    What killed the two QLD teams was their poor stadium deals that meant the clubs lost too much money on match day. It meant Nth Qld were always struggling and sent Palmer ballistic.

    The K League teams all play in massive stadiums but usually get a good deal on the rent. That means they can be more generous with ticket prices and investing in the team.

    Comment left via The Roar’s iPhone app. Download it now [http://itunes.apple.com/au/app/the-roar/id327174726?mt=8].

    • January 5th 2013 @ 12:36pm
      clayts said | January 5th 2013 @ 12:36pm | ! Report

      I agree with this. Having gone to all roar’s games through the early years, no one cared about 40k empty seats, more the fact they needed 20k people to break even. Lets not forget Roar were broke at one stage. Suncorp is really a great stadium and pretty easily accessible but no good if it sends the team broke.

      While playing at somewhere like Ballymore might look better on TV, most people would be more concerned with the extra effort to get there rather than the perhaps better atmosphere created

      • January 5th 2013 @ 1:36pm
        nordster said | January 5th 2013 @ 1:36pm | ! Report

        The stadium deals are what they are largely due to the cost of running such a big venue, as well as australias very high wage costs especially penalties for weekends and nights. I doubt any stadiums are fleecing clubs…so how to reduce those costs? Is not as simple as a better stadium deal on a big venue …where do u actually cut costs from? Unless the suggestion is to have govt owned venues subsidising the deal…more govt handouts are not the answer…

        What about having twin venues…so in the case of brisbane, have big drawing games at suncorp…the lesser ones at ballymore perhaps. Though that would require a new suncorp deal as it is most likely exclusive.

        • Roar Guru

          January 5th 2013 @ 1:46pm
          Fussball ist unser leben said | January 5th 2013 @ 1:46pm | ! Report

          “I doubt any stadiums are fleecing clubs”

          Nordster you should have a chat to AFL club Nth Melb. Their deal with Docklands Stadium was much much worse than other AFL clubs.

          And, MVFC’s deal with Docklands stadium is much much better than other AFL clubs using the same venue – albeit demand for the stadium during summer is much lower.

          • January 5th 2013 @ 2:04pm
            nordster said | January 5th 2013 @ 2:04pm | ! Report

            Weird, wonder why that is?

            Still i think the point may still stand that the HAL stadium deals are what they are for underlying reasons for the most part…running costs primarily

            then market factors with a privately owned venue especially…like u say with MVFC docklands are desperate for a tenant. Maybe the management there has too many teams there in winter and wants to push a club out by offering them a bad deal they didnt think would be taken up…are the Roos one of the lower drawing teams?

            • Roar Guru

              January 5th 2013 @ 2:42pm
              Fussball ist unser leben said | January 5th 2013 @ 2:42pm | ! Report

              Yes, Nth Melb are one of the lowest drawing AFL teams, but Docklands – like all sports stadiums – operates well below capacity.

              Stadium management would be negligent if they tried to turn a tenant away – there are no other sporting clubs waiting in the wings.

            • January 5th 2013 @ 4:27pm
              Timmuh said | January 5th 2013 @ 4:27pm | ! Report

              North had no choice. The AFL had a contracted number of games to each stadium, which when North’s contract renewal came up left North negotiating with only Docklands and no bargaining power so the AFL’s contract could be met.

  • January 5th 2013 @ 2:32pm
    Titus said | January 5th 2013 @ 2:32pm | ! Report

    What sort of rebels are the Melbourne Rebels meant to be? Rouge traders?

    • January 6th 2013 @ 9:58am
      Kasey said | January 6th 2013 @ 9:58am | ! Report

      Ironic Hipster Rebels rebelling against the Mainstream??..expect a Cardigan jersey paired with corduroy shorts and Ironic mustaches next season:)

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