Real Madrid -The Galacticos Era

            
 
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Case Details:

Case Code : MKTG126
Case Length : 18 Pages
Period : 2000-2006
Organization : -
Pub Date : 2006
Teaching Note : Available
Countries : Spain
Industry : Sports and Entertainment

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.



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Excerpts Contd...

Corporate Sponsorships

In 2005, Real Madrid signed a contract valued at US$ 118 million with BenQ Corporation to advertise the BenQ-Siemens brand from the 2006-07 season to the 2010-11 season. The double brand BenQ-Siemens was to be advertised on the back of Real Madrid's players' shirts and advertising spaces in Real Madrid's home stadium, the Bernabéu.

Other marketing activities that would advertise the BenQ-Siemens brand across the world would also be undertaken. Clemens Joos, CEO of BenQ Mobile, said, "More than almost any other club, Real Madrid stands for professionalism, quality, teamwork, and best entertainment.

Hence it exemplifies precisely what it is that sets our mobile phones apart: the combination of top quality, passion, fascination and enjoyment for technology.

In addition, this sponsoring is a logical progression from BenQ's involvement in the 2004 European Soccer Championships in Portugal and Siemens' soccer sponsorships."

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Perez Resigns

On February 27, 2006, Perez made the sudden announcement that he was resigning as President of Real Madrid. Sports fans and experts were taken by surprise as Perez had been upbeat about his presidency and had been re-elected in 2004 with 90% of votes in his favor. But many felt that though Perez's resignation was unexpected, trouble had been brewing for quite some time at Real Madrid. The club had not won a single trophy in the 2003-04 and 2004-05 seasons.

Nor was it expected to win any trophies in the 2005-06 season. This kind of a barren phase that extended over three successive seasons had occurred only 54 years ago. Initially in 2003 and 2004, Perez endured criticism from several quarters about the team's inability to win any trophies. Though the club's commercial performance was impressive off the football field, it was not winning any trophies on the field. The flashpoint for Perez's resignation came when Real Madrid lost a league game on February 26, 2006, to Mallorca, a team which had a low league ranking. Moreover, a few days prior to the game with Mallorca, Real Madrid had lost a crucial Champions League game at the Bernabéu, its home ground, to English club, Arsenal...

Exhibits

Exhibit I: Deloitte Footbal Money League 2004/05 Rankings
Exhibit II: Brief Profiles of the Galacticos
Exhibit III: Real Madrid's Logo
Exhibit IV: List of Trophies Won by Real Madrid (as on March 2006)
Exhibit V: Beckham's No. 23 Jersey in 2005/06

 


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