“Two weeks ago our chairman Graeme McMahon publicly requested this investigation take place so that we could put this issue behind us. We would not have made such payments unless we had taken every precaution to ensure it was within the rules. We have done that and are comfortable that we have acted reasonably,” Jackson said.
Essendon’s decision to purchase the rights of two of its star players can be traced back to the club’s decision to opt out of the AFL / Telstra deal. It was two years ago that Essendon Football Club took that decision - no other club in the AFL decided to go it alone. Financially there were short-term gains in going with AFL / Telstra but it was the long-term that Essendon Football Club was focussed on. What drove that decision, what were the key strategies behind it and two years on has it been a prudent business decision?
Initially there were five main reasons that Essendon decided to retain 100% control over the content and development of its own website. These were:
1. The Telstra agreement was contrary to the club’s sponsorship with Hutchison.
2. The website was seen as the most cost-effective method of this club communicating with its estimated one million supporters Australia wide.
3. Essendon wanted to develop a business plan to increase revenue, including sponsorship, as a result of accessing those supporters.
4. The website was seen as an effective medium to market EFC’s brand around Australia.
5. The Club was not prepared to license its website rights for a figure that might have been well short of what the true market value could be in two or three years time.
“We think the reasoning behind our decision was sound and the progress we have made in the past couple of years has justified the decision,” Essendon chief executive Peter Jackson said. “Obviously it is something we need to keep working at and improving but to this stage we believe it was the right decision for this club.”
“Our website strategy underpins the business plan of this club. We want to create business partnerships with companies from consumer marketing industries. Website traffic and our database is growing to the point where such deals can be justified.”
As part of this business strategy, Essendon purchased the website rights of two of its star players – James Hird and Matthew Lloyd. We have also secured the exclusive rights of Kevin Sheedy. Both players had previously been made offers by on-line competitors of essendonfc.com.au.
With both players secured – at market value - essendonfc.com.au now had exclusive rights to the images of these players when promoting the website. Lloyd writes a weekly column – one of the most popular reads in season; Hird promotes the club’s unique on-line footy tipping competition – Give Us The Tip. One drives traffic, the other drives database registrations.
“Planning and sensible business practice is critical to the ongoing success of clubs both on and off the field. Off the field we have put in place a business plan that we believe will drive this club into the future and the success of the website is central to that plan,” Jackson said.
“And the success of the website is very much driven by the likes of James Hird and Matthew Lloyd – they are two of our star players who give the site exclusive content and a profile. We didn’t want those players promoting or providing content for on-line properties that we are in direct competition with. That is a critical part of our website strategy and ultimately a critical part of our business plan.”
Essendon has generated in excess of $1.15 million of revenue via its website to this stage of the season. This figure comprises sponsorship, membership sales and merchandise sales. As of March 27th, and since November 1st 2002, membership sales on the website stood at $761,962. Merchandise sales in the same period stood at $47,480.
Website traffic has also grown significantly in the past two seasons. Figures in 2002 for the months of May, June and July were up by an average of 68% when compared with 2001. In February this year page impressions per day were up by between 20 – 50%. The club has consistently been the number one club website in the AFL for the past two years and has also been in the top four AFL sites for the majority of that time. The market share of essendonfc.com.au has been up to four times greater than its competitor website – bombersfc.com – created by the AFL / Telstra network. It is noteworthy that bombersfc.com does not have access to unique content. If these players (James Hird / Matthew Lloyd) had licensed their rights to other websites, Essendon’s business plan would have fallen over as we could not provide the unique content that its supporters demand.
BomberLand itself has undergone its second major facelift in the past two years. It has a state-of-the-art navigation system that makes it simple to use and it provides unique content for its growing band of users. The members’ only website – the Engine Room – has also proved to be very popular since its inception. It currently has in excess of 3000 members.
“Sports’ content is a huge driver of internet traffic and we provide the very best for Essendon fans,” Essendon communications manager Simon Matthews said. “And it is information that our users will get first and much of it won’t be found anywhere else.”
“But we also focus very much on getting our supporters involved with the club. They deserve to share in any success we have and the website is a great way for them to do that. It also gives them the chance to have their say and if some of that feedback isn’t positive then so be it. That’s the attraction of football – everyone has an opinion.
“We have introduced Match Day Mailbox in 2003. Win, lose or draw, Essendon supporters can get on the website the moment game finishes and tell us what they thought.”
