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Applied Strategic Management MAN0209M
Module leader: Dr Nikolaos Papageorgiadis
WH Holding Limited
UB number: 11007848
Word count: 1975
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Contents 1. Executive Summary ............................................................................................................................................... 3
2. Internal analysis..................................................................................................................................................... 4
2.1. Definition of the Organisation ...................................................................................................................... 4
2.2. Highlights of the year 2012/2013 ................................................................................................................. 4
2.3. Financial Information .................................................................................................................................... 5
2.4. Objectives ..................................................................................................................................................... 6
2.5. Current Strategy ........................................................................................................................................... 6
2.6. Strategic capabilities and VRIN Analysis ....................................................................................................... 8
3. External Analysis .................................................................................................................................................. 12
3.1. The Industry ................................................................................................................................................ 12
3.2. PESTEL Analysis ........................................................................................................................................... 13
3.3. Porter’s Five Forces Analysis ...................................................................................................................... 14
3.4. Benchmarking ............................................................................................................................................. 15
4. Internal and External Summary ........................................................................................................................... 16
4.1. SWOT Analysis ............................................................................................................................................ 16
4.2. TOWS Matrix............................................................................................................................................... 17
5. Strategic Recommendations ............................................................................................................................... 18
5.1. Six Evaluation Criteria ................................................................................................................................. 19
6. Implementation ................................................................................................................................................... 21
6.1. Strategy Timeline ........................................................................................................................................ 21
6.2. Allocation of Resources .............................................................................................................................. 22
6.3. Customer Driven Strategy .......................................................................................................................... 22
6.3.1. Customer profiling ............................................................................................................................. 22
6.3.2. Segmentation ..................................................................................................................................... 23
6.3.3. Communication with customers ........................................................................................................ 24
6.3.4. Pricing ................................................................................................................................................ 25
6.4. Type of Strategic Change ............................................................................................................................ 25
6.5. Styles of Managing Change......................................................................................................................... 26
6.6. Modes of entry and Internationalisation Drivers ....................................................................................... 27
6.7. The Balanced Scorecard ............................................................................................................................. 28
7. Conclusion ........................................................................................................................................................... 28
8. References ........................................................................................................................................................... 29
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1. Executive Summary
This corporate-level report aims to develop a strategic recommendation for WH Holding Limited based on
internal and external analysis. The first part of the report is represented by the internal analysis and
includes topics like the definition of the organisation, financial information, key objectives, current
strategy, strategic capabilities as well as a VRIN analysis. The second part of the report represents the
external environment and includes issues like the definition of the industry, PESTEL analysis, Porter’s
Five Forces and Benchmarking. Based on the internal and external analysis the report further presents the
SWOT analysis and TOWS matrix. The major findings of these analyses are the opportunities that the
organisation can address in order to further develop, such as targeting a foreign market using strengths like
the global awareness of the brand. The opportunities emerged from the SWOT and TOWS analysis
further generate three possible strategic recommendations which are briefly presented in the third part of
the reports. Based on the finding and as well on the identified objectives, resourced and capabilities of the
organisation, Strategy 2 is further investigated in terms of implementation procedures. The strategy is
consistent with market development and suggests the entrance in a foreign market, Australia through a
strategic partnership. Finally, the third part of the report presents the implementation procedures in terms
of timeline, allocation of resources, customer driven strategy, managing strategic change and
internationalisation drivers.
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2. Internal analysis
2.1. Definition of the Organisation
WH HOLDING LIMITED is a company based in London, United Kingdom which manages West Ham
United Football Club and its related activities. The Football Club plays in Premier League, the highest
division in English football. Due to the average results that West Ham United FC has accomplished in the
football-related activities in the last years, the club is not qualified in any European competition. Still,
Brandfinance placed West Ham United FC in the top 7 of Premier League clubs in the worlds’ 50 most
valuable football brands, fact that suggests the club’s popularity at a world-wide level.
2.2. Highlights of the year 2012/2013 The following figure presents the highlights of the year ended 31 May 2013, according to the Report and
Financial statements for the year ended 31 May 2013. These highlights suggest potential development of
the organisation, as the new sponsorship contracts will generate additional funding, while the 99 year lease
of the Olympic Stadium will increase the stadium capacity by 54% which will generate significant
additional revenue from match and season tickets.
Top 10 finish in the FA Premier League
Awarded the Olympic Stadium on a 99 year lease, starting August 2016
Major new sponsorship contrcts secured with Adidas and Alpari
Significant financial support from makor shareholders of £10.5m
Highest average match attendance in the 118 years history of the club, achieving a number of 16 sell-out matches
The Retail Team recorded a 25% increase in sales, achieving a club record high in turnover
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2.3. Financial Information
The following table presents the profit and loss account for the years ended 2012 and 2013.
2012 2013
Operations
excluding
player
trading
£000
Player
trading
£000
Total
£000
Operations
excluding
player
trading
£000
Player
trading
£000
Total
£000
Group turnover 89,815 - 89,815 46,165 - 46,165
Other operating income 1,032 - 1,032 734 - 734
Administrative expenses (75,956) (13,838) (89,794) (58,687) (9,774) (68,461)
Group operating profit/
(loss)
14,891 (13,838) 1,053 (11,788) (9,774) (21,562)
Profit from disposal of
players
- 171 171 - 911 911
Profit/(loss) on
operating activities
before interest and
taxation
14,891 (13,667) 1,224 (11,788) (8,863) (20,651)
The table above shows significant improvement in terms of financial results in comparison to year 2012,
due to the promotion from Championship to Premier League at the end of season 2011/2012. The growth
in turnover and the growth in terms of profit before interest and taxation show great prospect for the
future, with potential investment being possible, as the organisation is more financially stable. Even
though an increase in administrative expenses was expected after the promotion to Premier League, the
table shows that the reduction of expenses can increase the financial stability of the club.
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2.4. Objectives The following table depicts both the objectives the management of West Ham United has set in order to
further develop the club, as well as the way in which each objective can assist the club in the development
process, according to the Report and Financial Statement of 2013.
Top 10 finish in FA
Premier League
The higher the club finishes in the
FA Premier League, the higher is the
revenue that the organisation receives
from the FA.
The increased
budget can be
used for
investments in all
the areas of the
organisation.
Increase the match
attendance after the
move on the
Olympic Stadium
A stadium with a higher capacity
increases the match attendance, and a
higher attendance increases the
revenues from ticket sales.
Make West Ham
United a global
brand
Making West Ham United a global
brand has the potential to increase
both the sales of merchandise and the
sponsorships, factors that increase
the revenue of the club.
Increase the sales of
merchandise
Increase of sales means an increase
in revenue.
Increase the revenue
from the
Commercial and
Sponsorship
departments
Increase the budget of the
organisation.
2.5. Current Strategy The following table presents the most expensive season tickets and the most expensive match day tickets
for the 2013-2014 FA Premier League Season.
Most expensive season tickets Most expensive match day tickets
Club Price (£) Club Price (£)
Arsenal 1995 Arsenal 126
Tottenham 1845 Chelsea 87
Chelsea 1250 Tottenham 81
Fulham 999 Fulham 75
Manchester United 950 West Ham 67
West Ham 910 Manchester City 58
Liverpool 850 Manchester United 53
Manchester City 780 Liverpool 52
Aston Villa 595 Aston Villa 45
Hull 405 Hull 30
Source: the Guardian, 2013
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The previous table suggest the strategy that West Ham United currently uses which on the Bowman Clock
can be positioned as presented in the following figure.
Considering both the fact that West Ham has high season and match tickets in comparison with other FA
Premier League club and also the fact that the club has above average prices for official merchandise, the
currents strategy of West Ham Unite can be positioned on the Bowman Clock as ‘Risky/High margins’, as
the average results suggest an average perceived customer value.
High
High
Low
Perceived Value to
Customer
Price Low
West Ham
Risky/High
margins
Hull
Arsenal
Focused
differentiation
Manchester City Differentiation
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2.6. Strategic capabilities and VRIN Analysis
Strategic capabilities
Resources Type Competences
Joint-Chairman David Gold
Vice-President Karren Brady.
Human David Gold is the former
Chairman of Birmingham FC
from 1993 to 2007. Karren
Brady was appointed Managing
Director at Birmingham in 1993
when she was just 23 years old
and is now considered as ‘The
First Lady of Football’. Both
have the experience in this area
to ensure the club’s success.
West Ham’s home stadium, The
Boleyn Ground.
Physical The stadium has a capacity of
35.016, the ticket sales
generating a revenue of £18
million in the year 2011-2012
The Olympic Stadium, West
Ham’s home stadium starting
from the season 2016/2017.
Physical With a 54% increase in
capacity, the new stadium will
assure an increase in revenue
from ticket prices.
The Financial Statements for the
years 2012 and 2013.
Financial The profit and loss account for
the year 2013 shows an increase
in revenue comparing to 2012
from £46,165,000 to
£89,815,000. This suggests a
more stable financial position of
the club which can assist the
organisation in making further
investment.
Two Official Stores located in
London and the online store
with global reach.
Physical These stores suggest the ability
of the club to reach all the
customers willing to purchase
official merchandise, generating
which generates extra revenue.
Global fan support with
affiliated fan clubs located in 31
countries in Europe, United
States, Oceania and Asia.
Reputational The immense fan support
ensures both the promotion of
the club at a global level and
potential increase of sales in
terms of official merchandise.
The Academy of Football – is
the name given to West Ham’s
Youth Academy, due to the
quality footballers developed.
Human/Financial The Youth Academy of West
Ham is recognised as being one
of the best in the world,
developing footballers like Rio
Ferdinand, Joe Cole, Glen
Johnson, Michael Carrick,
Jermain Defoe or Sol Campbell.
The Academy has different
functions, as the players can be
either used to increase the
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quality of the squad or sold to
increase the financial stability of
the club.
Resources Competences
Threshold Capabilities - West Ham’s home
stadium, The Boleyn
Ground.
- Two Official Stores
located in London and
the online store with
global reach.
- The home stadium
generates revenue from
ticket sales.
- The stores generate
revenue from official
merchandise sales.
Distinctive Capabilities - Joint-Chairman David
Gold Vice-President
Karren Brady.
- The Olympic Stadium,
West Ham’s future
home stadium.
- Global fan support.
- The Academy of
Football
- Both have experience in
this area to ensure the
club’s success.
- The future stadium will
increase the revenue
from ticket sales and
has the potential to
assist the club in
reaching the next level.
- Ensures the promotion
of the club and potential
increase of sales in
terms of official
merchandise.
- The Academy has
different functions, as
the players can be either
used to increase the
quality of the squad or
sold to increase the
financial stability of the
club.
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The previous tables present the strategic capabilities of West Ham United, divided into threshold
capabilities and distinctive capabilities. The threshold capabilities represent the basic requirements for
West Ham United to be able to compete in the market, such as the home stadium and the stores, both
representing important sources of revenue. Still, more focus will be given to the distinctive capabilities
which will assist the organisation in achieving advantages over the competitors. Like presented in the
tables above, the future stadium of West Ham United, the Olympic stadium will add extra revenue in
comparison to the Boleyn Ground Stadium. Still, there are more benefits to come from playing home
games on a modern arena, such as increasing brand awareness and brand value, both of which have the
potential to increase the future sponsorships for the club.
The following table will present the VRIN assessment of the club’s capabilities.
Capability Value Rarity Inimitability Non-
substitutability
Joint-Chairman
David Gold Vice-
President
Karren Brady
This human
capability offers
strong
competitive
advantage due to
the experience
that David Gold
and Karren Brady
can offer
Relatively rare at
Premier League
level. The current
trends see foreign
investors
acquiring football
clubs without
previous
experience in this
market
Can be imitated
only by
investing
contracting
experts with
experience in
the field
Average, possibly
hard to substitute.
Significant
investment is
needed.
The Boleyn
Ground Stadium
This capability
has good value,
but the average
capacity does not
provide a
significant
competitive
advantage
Not rare, as the
capacity is
average at
Premier League
and
Championship
Level
Can be imitated
as most
Premier League
and
Championship
clubs have
similar
stadiums
The Boleyn Ground
will be substituted
with the Olympic
Stadium starting
from the season
2016/2017
The Olympic
Stadium
This capability
has an immense
value and can
generate
important
competitive
advantage
The Olympic
Stadium will be in
the UK’s Top 5
stadiums by
capacity which
makes this
capability rare
This capability
is very hard to
imitate without
significant
investment,
which most
clubs are not
intending to do
Hard to substitute
The Financial
Statements for
the years 2012
and 2013.
The financial
stability of the
club is a very
important aspect
The financial
stability of
football clubs at
Premier League
level is not rare,
considering the
investments that
owners and
shareholders
make, but has the
Like stated
before, this
capability is
currently easy
to imitate by
competitors but
the situation
might change
with the
implementation
Not substitutable
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potential to
become rare one
the new Financial
Fair Play
regulations are
implemented
of new
regulations
Two Official
Stores and the
online store
This capability is
valued and can
provide
competitive
advantage in
financial terms
All the English
football clubs
from Premier
League and
Championship
have this type of
facilities, making
this capability not
rare
This capability
is not hard to
imitate
Even though the
clubs consider
official stores as
very important, this
capability has the
potential to be
substituted by non-
official merchandise
Global fan
support
This capability is
highly valued and
can provide
significant
competitive
advantage,
especially in
financial terms
FA Premier
League is
considered to be
the world’s top
division and
English football
clubs have great
world-wide fan
support, making
this capability not
rare
This capability
can be imitated
with
investments in
promoting the
club at a global
level
In the case of non-
UK fans, this
capability might be
easy to substitute as
in the majority of
cases there is no
emotional
connection between
the club and the
supporter
The Academy of
Football
Being one of the
best Youth
Academies in the
world, this
capability has a
recognised value
and can provide
competitive
advantage
The Academy of
Football is often
considered to be
in the Top 10
Youth Academies
in the World and
in Top 3 in
English football,
making it a rare
capability,
considering the
current trends to
acquire players
rather than invest
in the Youth
Academy
This capability
is hard to
imitate as
significant
investment is
needed.
Moreover, the
current trends
are to acquire
players rather
than invest in
Youth
Academies
Considering the
reputation of The
Academy of Football
and the results it had
throughout the
history, it is not
likely for this
capability to be
substituted
The VRIN analysis suggests that different capabilities that West Ham United has can offer significant
competitive advantage. Capabilities like the Olympic Stadium, The Academy of Football and the
experience of the management can assist West Ham United to overcome their competitor not only in the
United Kingdom, but also at a global level.
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Matchday23%
Broadcast50%
Commercial27%
Sources of revenue for Premier League clubs
3. External Analysis
3.1. The Industry West Ham United operates in FA Premier League, the highest ranked division in English Football.
According to Deloitte, football finance experts, Premier League clubs had cumulated revenue of £2.36bn
in 2011-2012. Moreover, Deloitte estimates that the revenue grew to £2.5bn in 2012 and that it will reach
£3bn for the first time in 2013-2014. The following figure presents the sources of revenue for Premier
League Football clubs for the season 2011-2012, according to Deloitte. Moreover, according to the
football financial experts, in the summer of 2012, the Premier League clubs had a total debt of £2.4bn.
£1.4bn of that was represented by interest-free soft loans from, of which around 90% related to three
clubs: Chelsea, Newcastle United, and Queens Park Rangers.
Source: Deloitte, 2014
Source: Deloitte, 2014
League Revenue 2011-2012 Wages 2011-2012
Premier League, England 2.9 bn euros 2 bn euros (70% of revenue)
Bundesliga, Germany 1.9 bn euros 1 bn euros (51% of revenue)
La Liga, Spain 1.8 bn euros 1.1 bn euros (60% of revenue)
Serie A, Italy 1.6 bn euros 1.2 bn euros (75% of revenue)
Ligue 1, France 1.1 bn euros 0.8 bn euros (74% of revenue)
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3.2. PESTEL Analysis The following table illustrates the PESTEL Analysis for the industry in which West Ham United operates.
The table presents the industry’s major issues that create a better understanding of the industry in order to
develop a more feasible strategy.
Political/Legal -Employment Laws for players, such as Work Permits
-Consumer protection by price caps set by the Government
-Imposition of high taxes by the Government
-The new Financial Fair Play regulation by FIFA which is meant to increase cost
control and profitability for football clubs
Economic -Shift in the economic environment, from recession to recovery
-High concentration of people in London, due to high immigration rates leads to an
increase in production rates
-Low inflation rates which increases the spending power
Social -Improving living standards due to increase in pay
-Football is the most popular sport in the United Kingdom, fact that makes
consumers more keen to acquire the club’s products
-Increasing interest in English football from Asia, United States and Australia
Technological -Increase in the use of E-commerce
-Utilization of PROZONE3 for match day analysis
-Emergence of cloud computing which along with Enterprise Resource Planning
systems can increase the productivity of the organisation and assist the club in
increasing the match day experience for fans
Environmental -Emphasis on Environmental protection in relation to aspects such as noise pollution
The most important issues that will dictate the changes within the industry are the taxes charged by the
Government, the Financial Fair Play regulation and the increasing interest in English football. The
Financial Fair Play regulation prevents the football clubs spending more money that they earn in order to
achieve success. These regulations are meant to balance the gap between the most powerful clubs and the
others and in the future, will offer benefits to clubs like West Ham United which do not have the financial
capability that other clubs like Manchester City and Chelsea have. The increasing interest in English
football will benefit the organisations that are seeking to extend in different markets.
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0
1
2
3
4
5The threat of entry
The bargaining power ofbuyers
The threat ofsubstitutes
The bargaining power ofsuppliers
The extenct of rivalrybeween competitors
Porter's Five Forces Analysis
3.3. Porter’s Five Forces Analysis The following figure presents an overview of the industry using the Porter’s Five Forces analysis.
The following table explains the different aspects of the industry using Porter’s five Forces analysis.
The threat of
entry
The bargaining
power of buyers
The threat of
substitutes
The bargaining
power of
suppliers
The extent of
rivalry between
competitors
The threat of new
entry is average in
this industry as
immense
investment is
needed in order to
enter in the
market. The only
threats are the
clubs promoting
from
Championship to
Premier League
which usually
have little
resources, fact
that makes them
unable to compete
with the top clubs
The bargaining
power of buyers is
low in this
industry as the
fans have little
influence on the
decisions
regarding ticket
and official
merchandise
prices. Clubs
reduce buyer
power by offering
loyalty schemes
(such as season
tickets) and
discounts for
different segments
(such as under 18
customers or over
65 customers)
The threat of
substitutes is low
in the industry as
football is the
most popular
sport not only in
the United
Kingdom, but also
at a world-wide
level
It is average -
high in the
industry.
Organisations that
supply football
clubs with sports-
related products
or services (such
as turf,
merchandise,
training and
match equipment)
are usually
official sponsors
of the club (such
as Adidas in the
case of West
Ham) status that
increases their
bargaining power
It is high in this
industry. Clubs
invest more and
more in squad and
facilities as higher
positions in the
league generate
more income in
terms of revenues.
Moreover, the top
5 positions in the
league ensure the
club’s presence in
European
competitions
which generates
further revenues
and increases
brand equity
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3.4. Benchmarking
The following table presents a comparison between West Ham United and other football clubs. The table
includes two types of competitors: top Premier League clubs and clubs that West Ham is currently
competing against.
Factor West Ham
United
Tottenham
Hotspur
Fulham
FC
Southam
pton FC
Arsenal
FC
Hull
City
Stoke
City
Revenue (2013)
£000
89.815 147.392 N/A 71.800 280.400 N/A N/A
Profit/ (loss)
before tax
(2013)
1.224 11.461 N/A (6.600) 6.700 (28.00
0)
(31.000)
Stadium
Capacity
35.303
(60.000
from 2016)
36.240 25.700 32.251 60.355 25.404 27.743
Squad Value
(Source:
Transfermarkt
)
£million
85 240 71 90 325 54.5 78.5
No. of stores 2 4 1 1 4 1 2
2012-2013
league position
10 5 12 14 4 - 13
The following table depicts the competitive gaps between West Ham United and other players in the
market.
The gaps in the table represent the opportunities that can further develop West Ham United. For example,
Arsenal recognised the immense support from the fans and decided to charge very high prices for the
tickets. Even so, the stadium is almost full for every match, increasing the revenue from the tickets.
Moreover, Arsenal’s stadium capacity assists in increasing the revenue, gap that Wet Ham United will
close in 2016 when the club will make the move to the Olympic Stadium.
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4. Internal and External Summary
4.1. SWOT Analysis The following table presents the summary, in terms of strengths, weaknesses, opportunities and threats
emerged from the Internal and the External evaluations of West Ham United and the industry in which the
club operates.
Strengths Weaknesses Opportunities Threats
-Globally recognised
brand, with an increase
in awareness in Asia,
US and Australian
markets
-High quality
merchandising
-Future home stadium
with increased capacity
-Associated sponsors
like Arsenal, Alpari or
SBOBET
-Great fan support
-Stable financial
position in comparison
with competitors of the
same size
-Less global awareness
and popularity in
comparison with other
English clubs like
Manchester United or
Liverpool
-A lower financial
power in comparison
with some competitors,
like Manchester City or
Chelsea FC
-Targeting foreign
markets, like Asia,
Australia or the United
States of America
-More advertising in
foreign markets will
increase the brand
equity
-Benefit from ticket
revenues after the
move on the Olympic
Stadium
-Other football clubs
being acquired by
financially strong
businessman
-The new Financial
Fair Play regulation
-Other football clubs
following the trend and
targeting foreign
markets
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4.2. TOWS Matrix The following table presents the TOWS Matrix generated from the Internal and External evaluations.
TOWS Matrix Strengths Weaknesses
Opportunities Follow the objective to expand
into foreign markets, especially
in the regions with the highest
fan density
Strategically use the future
Olympic Stadium to increase
revenues and brand equity
Invest in marketing the club in
foreign markets in order to
compete with other English
clubs in the specific market
Threats Use the current awareness to
overcome the possibility of new
entrants in a foreign market
The Financial Fair Play
regulation can benefit clubs
with lower financial power, as
more financially stable clubs
will be prohibited to invest
money that do not come from
the revenues
Invest in marketing the club in
foreign markets in order to
compete with possible new
entrants in the specific market
18
5. Strategic Recommendations The following figure depicts the three strategic recommendations for West Ham United as well as the
description regarding what each strategy involves.
The first recommended strategy is for
West Ham United to aquire
a smaller footbal club
from a market like Australia or China. Following the example of
Ajax Amsterdam owning Ajax
Cape Town in South Africa, the new club
will be named for example West Ham
Sydney and will use the same logo as West Ham United.
The new club will be used to promote the
West Ham United brand in
the foreign country in order to increase the brand equity
and the sales in merchandise. Moreover the
new club will be used to develop football players,
that can be used by the parent club, West Ham
United in the future.
Strategy 1:
Market Development
The second recommended strategy is for
West Ham United to sign a
partnership with a company operating in a
foreign market. For example, Manchester
United signed a three-year partnership
with Unilever which implies
that the Unilever
products sold in South-East Asia
will bear the crest of
Manchester United on the
packaging.
The same approach can
be undertaken by West Ham
United in order to promote the brand of West
Ham United in a foreign market. This strategy is
meant to increase the
sales in merchandise
and the brand equity.
Strategy 2:
Market Development
The third recommended
strategy involves the development of a new product under the logo of West Ham United.
The recommendation
is for West Ham to develop a rugby team, as rugby is the second most popular sport in
the United Kingdom after football. This
strategy will see West Ham United
making use of their knowledge
and experience in sports
management in order to increase the revenues by a new addiction to their products.
Strategy 3:
Product Development
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5.1. Six Evaluation Criteria The following table presents the six evaluation criteria for the three recommended strategies. After being
examined from this perspective, a decision will be taken regarding the strategy which will be further
recommended and implemented.
Evaluation Criteria Strategy 1 Strategy 2 Strategy 3
Consistency Strategy 1 is consistent
with the club’s
objective only
regarding making West
Ham United a global
brand.
Strategy 1 is consistent
with the club’s
objective regarding
making West Ham
United a global brand.
Strategy 3 is not
consistent with the
club’s goals and
mission.
Suitability This strategy is suitable
for the environments in
which West Ham
United operates, as
many football clubs
follow the trend of
targeting a foreign
market.
This strategy is suitable
for the environments in
which West Ham
United operates, as
many football clubs
follow the trend of
targeting a foreign
market.
This strategy is suitable
to the environments in
which West Ham
united operates, as
rugby is the second
most popular sport in
the United Kingdom.
Validity This strategy has been
tested once, by Ajax
Amsterdam, and
proved to be successful
in some regards. Still,
more research has to be
done regarding this
strategy as Ajax
Amsterdam might have
different expectations
and different
capabilities from West
Ham United.
This strategy has
already been tested by
multiple other
European football clubs
and proved successful.
Some examples are:
Manchester United,
Liverpool, Tottenham,
and Real Madrid.
Rugby is a very
popular sport in the
United Kingdom and
the industry has been
consistent in terms of
revenues. Still, no
football club has
attempted to implement
this strategy which
makes the possible
outcomes
unpredictable.
Feasibility This strategy is feasible
as West Ham United
has managers with
significant experience
in the football industry.
Still, there are
problems with the
market the club might
choose, as in a different
market the managers
will face different
issues (regulations, key
drivers of change)
This strategy is feasible
as West Ham United
has managers with
significant experience
not only in the football
industry. Using their
knowledge they can
tackle the issues they
may face and they will
ensure the new
partnership will act in
the club’s best interest.
This strategy is not
feasible, as the
managers and
employees of the club
have experience in the
football industry and
not in rugby.
Business Risk The risk for this
strategy is high, as a
The risk for this
strategy is low, as a
The risk for this
strategy is high, as the
20
Considering all the evaluation factors presented in the table above, Strategy 2 is the one that is going to be
further discussed in the remainder of this report and implemented by WH Holding Limited on a timescale
of 3 years.
foreign market might
not be as developed as
the FA Premier
League, therefore the
investment made in
implementing this
strategy might not have
the expected results in
terms of financial
results.
partnership does not
involve high
investments and the
risks are divided by the
two collaborating
organisations.
knowledge that the
employees have in
football industry does
not fully relate to the
rugby sector.
Moreover, rugby is less
profitable than football
so the investments
might not have the
expected results.
Attractiveness to
Stakeholders
The attractiveness to
shareholders is low for
this strategy as it
necessitates significant
investments. Still, the
suppliers might be
attracted by this
strategy because they
will add another client
to their portfolio.
The attractiveness to
shareholders is high for
this strategy as it
involves the possibility
of making West Ham
United a global brand
without significant
investment. The rest of
the shareholders will as
well be attracted by this
strategy because
increasing the club’s
equity will have
immense benefits for
them.
The shareholders of
West Ham United
might not be attracted
by this strategy as this
strategy requires
significant investment
that might not have the
expected result. Still
the suppliers, for
example might be
attracted as Adidas, for
example, is specialised
in different sports, not
only football. A new
activity would mean
extra revenues for the
suppliers.
21
6. Implementation The internal and external analysis on West Ham United illustrated different opportunities that the
organisation can use in order to further develop. The most important factors that suggest the
implementation of this strategy are: the increase of interest in English football from foreign markets like
Asia, US and Australia, the fact that West Ham United is a globally recognised brand and the fact that the
club has leased the Olympic Stadium in London for 99 years, starting from 2016, which will increase the
brand equity.
Considering both that the United Kingdom and Australia are both part of the Commonwealth and also the
fact that West Ham United has six Affiliated Supporters’ Clubs in five cities in Australia, this strategy
aims to further advertise West Ham United in that geographical area, through a strategic partnership with a
company that already operates in that area.
6.1. Strategy Timeline The following figure presents the strategy’s progress in the next three years.
2015: Implementation of Strategy 2
2016: West Ham moves to the
Olympic Stadium
2016-2017: Increasing
awarness of West Ham
2017: Building West Ham
Official Stores in Australia
2017-2018: Increase in
sales of merchandise
End of 2018: Sucessfull
implementation
22
6.2. Allocation of Resources An important part of the implementation process is the way the organisation manages to allocate the
resources in order to ensure the use of the best practices. The following table presents the allocation of
resources that will assist in the implementation of the strategy.
Resource Contribution Risk associated with this resource
Marketing Team The Marketing Team will work along
with the Marketing Team from the
collaborating company in order to ensure
the best design of the packaging that will
incorporate the West Ham United crest.
Low: The Marketing Team that is
already working for the organisation
will be in charge of this assignment.
Financial Financial resources will be needed in
order to pay the marketers and to cover
the operating costs of the implementation
process.
Low: The club has a stable financial
position that makes the risk concerned
with the availability of finances to be
low.
Executive Team The Executive Team will be in charge
with overviewing the implementation of
the process.
Medium: Even though the Executive
Team is part of the organisation,
considering the high amount of
operations in the club, the team will
not be permanently available to assist
the process of implementation.
6.3. Customer Driven Strategy Considering that the value of the strategy is given by the perceived value from the customer perspective, it
is paramount important to target the right market segment.
6.3.1. Customer profiling
The following table presents the profile of the customer that this strategy is targeting as well as the
purchasing decisions made by the customers, who are of great importance in the targeting and positioning
decisions.
Men Families with children Tourists
Football enthusiasts aged 18-65:
This represents the usual majority
of season ticket holders and
match day ticket holders.
Football is currently promoted as
an activity to be undertaken by
the entire family. West Ham’s
official merchandise includes
clothing for man, woman,
children and also infants
Tourists that visit London can
have a great experience of
watching a football match in
England. This segment will be
especially targeted after the move
to the Olympic Stadium which
will attract tourists due to its
modern design. The official store
inside the stadium provides
customers with the opportunity to
buy West Ham’s official kit but
also memorabilia and souvenirs.
23
6.3.2. Segmentation
The following figure presents the market segments that the organisation is going to target. Is important to
realise that each segment has different approaches and makes the purchasing decisions in different ways.
As part of the strategy, the organisation aims to target all the segments with more emphasis on Men aged
18-65, Families with children and tourists.
Target
Men 18 to 65
Men over 65
WomenTourists
Families with
children
24
6.3.3. Communication with customers
Due to the low budget that can be allocated for promotional purposes it is very important that the
organisation uses cost efficient approaches to communicate with customers. This can be done by the
Official Website that has in incorporated customer data-base and by collaborating with the Affiliated
Supporter Clubs in Australia. The following figure presents the ways in which these tools can be used for
an efficient communication with customers.
• Make use of the data-base to inform customers regarding the new products provided by the club.
• Gather information from website users in order to gain a better understanding of the customer
Official Website
• Gather information about the foreign customers through surveys carried by the Affiliated Supporter Clubs
• Market the new products of the organisation through the Affiliated Supporter Clubs
• Organise Social Events
Affiliated Supporter
Clubs
25
6.3.4. Pricing
Pricing is a paramount important factor for the organisation’s success and the pricing approaches within
this strategy are presented in the following figure.
6.4. Type of Strategic Change The following figure depicts the position of West Ham United in the context of strategic change.
•The prices for merchandise will remain as in the season 2013-2014 for UK stores, while the prices for Australia will see a 10% discount in order to encourage consumption.
•Men over 65 and children under 18 will benefit from further 10% discount both in Australia and In the United Kingdom.
Merchandise prices
•Season and match tickets will have the same prices as in the season 2013-2014, until the season 2016-2017 when the prices will see a reduction of 10% in order to increase the number of season ticet holders . the objective of this decision is to increase attendace in the new stadium.
•Men over 65, children under 18 and women will benefit from discounts of 20% on both season and match tickets.
Ticket prices
Adaptation Evolution
Reconstruction Revolution
Extent of change
Realignment Transformation
Incremental
Nature of change
Big Bang
26
The previous figure depicts the type of change that the organisation will undertake. Considering that the
organisation will realign step-by-step with the latest trends in the industry, the type of strategic change the
organisation will face is Adaptation.
6.5. Styles of Managing Change The following figure presents a concept of styles regarding change management. The style that is going to
be used in the implementation of the new strategy within West Ham is a hybrid between participation and
education. Humans are usually resistant to change but in this case, the management carries the roles of
leaders, making sure that the process of change management is gradually implemented. In order to ensure
that the employees will not resist the changes, the management will previously inform the workers
regarding the changes that are going to happen and moreover, will try to involve employees in the
implementation, making them less-likely to resist change.
Styles of managing
change
Education
Collaboration
CoercionDirection
Participation
27
6.6. Modes of entry and Internationalisation Drivers In the case of West Ham, the mode of entry will be by an alliance. This is represented by a partnership
with a company that is already operating in Australia, dividing in this way the risks between the two
organisations.
The following figure presents the Internationalisation Drivers. The impact of these factors on the
implementation of the strategy will be further discussed.
Drivers impact on the implementation strategy
Type of driver Risk
Market Driver Low: Considering that football is a globally
recognised and appreciated sport and that the
interest in the FA Premier League is growing
constantly, existing global customers have
developed similar needs as the customers from the
host country.
Cost Drivers Medium: The global economic is currently in an
uncertain position, changing from recession to
recovery. Therefore, the cost drivers might have an
impact on the implementation due to the instability
in exchange rates and oil price.
Competitive Drivers High: Considering that the current trend in the
industry is for organisations to tap foreign markets,
the risk that a competitor might have the same
approach in the same market needs to be
considered.
Government Drivers Medium: The fact that both countries are part of the
Commonwealth facilitates the trades between the
United Kingdom and Australia.
•similar customer needs
•global customers
•transferable marketingMarket drivers
•scale economies
•country specific differences
•favourable logisticsCost drivers
• interdependece between countries
•competitor's global strategiesCompetitive drivers
•trade policies
•technical standards
•host government policiesGovernment drivers
28
6.7. The Balanced Scorecard
The following table presents the Balanced Scorecard for this strategy.
Strategy Perspective Example Key Performance Indicator
Financial -increase sales of merchandise by
50% by 2018
-increase ticket sales by 50%
from 2016 to 2018
-increase turnover by 25% by
2018
-sales revenue
-ticket sales revenue
-total group turnover
Customer -customer satisfaction with match
day experience and merchandise
-sales of merchandise
-average match attendance
Internal -recruiting and retaining the best
employees
-employee performance
-organisational performance
Future -increase brand equity -number of foreign customers
-level of sponsorships
7. Conclusion This report has examined the internal and external analysis of WH Holding Limited, the parent company
of West Ham United in order to recommend a strategy that would assist in the further development of the
organisation. The most important findings of the analysis showed that is an increasing interest in English
football from foreign markets which generates the opportunity to target a foreign market in order to make
the club a global brand. Considering that the findings are consistent with the objectives of the
organisation, the strategy to target an external market has been further discussed in the third part of the
report, which is concerned with the implementation procedures for this strategy.
29
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