A certain Dr went into neighbouhood hoping to reduce the wastage that comes with the consumption of energy. He decided to hang signs on the doors of the residents. The first was “Please reduce energy consumption to reduce expenditure of resources on the planet”. Off course no one listened to him. And then he decided to try “Please reduce energy in your home in order to save money at the end of the month”. That did not work too, so he tried again “Please reduce Energy consumption for the sake of your children and the future generation” hoping that will work. That again sadly did not work. Finally he decided one last try “The majority of your neighbors are making efforts to reduce energy in their homes, please follow. Strangely that worked and energy consumption began to drop.
That little experiment performed by Dr Robert Cialdini was an epic illustration of the concept of the herd mentality. In his interview at freakonomics radio podcast, he alluded to how the herd mentality “can be used to get people to do things that are collectively better for all”. Unfortunately, that same mentality has been more widely used collectively to do damage for all. The world is still reeling from the damage done by bankers who collectively invented complex financial products for the sake of borrowing money to people who cannot afford to pay in return for higher profits and mega bonuses.
But that is banking and not football and besides how can one relate that to the beautiful game? The game is about winning trophies and not lending money. That would be correct to the most loyal of all fans. Recently, my loyalty was questioned as an Arsenal fan when I surprisingly supported the sale of Robin Van Persie, the sixth, yes sixth Arsenal captian that has been sold and probably the 1oth top player that has been sold to a rival club in England or in Europe in the last decade. Arsenal, I told him could not compete with the rest. This wasn’t about rivals on the football pitch it was about rivals on the pitch of “Sugar Daddies”. Arsenal is no rival to Man City, Chelsea and Man Utd. Neither are we rivals to PSG, Real Madrid or Barcelona. These guys belonged to the herd mentality.
A mentality where it is globally acceptable for footballers to be rewarded with salaries only CEO’s of Wall Street Banks can boast off. A mentality where clubs sign up players for £80m and fans turn out in their thousands to celebrate. How does one justify paying 2 footballers £250,000 per week each or £26m per year. Thats about 24% of what Manchester United Earned on Matchday Revenue (8% of total revenue) last financial year, and 12.46% less than their pre-tax profits. For a club like Arsenal, that comes to about 10% its turnover for 2011 and 85% higher than its pre-tax profits for that year. In fact as this article puts it, to afford a player like Yaya Toure, Arsenal will have to invest a sum of £92m over 5 years to meet £250k/week £26m sign on fee Man City paid for his services. A whopping 57% of our pre-tax profits for the last 5 years combined. Its no wonder clubs like Man City and Chelsea report losses and win trophies, whilst club like Arsenal who are self sustained, report profits but don’t have trophies to show for it in the last 7 years since the money bags came into the game.
Arsenal is a football club I agree but first and foremost it is a company. I respect companies who grow organically and are able to cut cost whilst remaining competitive. Competition, is not only shown on the football field like most fans would like to believe, it is also shown in the bottom lines of the clubs who are more or less companies. A football club like a company must show profitability, liquidity, sustainability and long term viability. They must spend what they earn and repay what they borrow. But that is not the norm now. Arsenal is an island for “heartbreakers”.
I have thus accepted my fate as fan who will repeatedly be kicked down the road by Arsenal players who who seek pastures lined around their neck and in their pockets. I have also accepted my allegiance to a club who rather than join the herd will stick by the principles of financial fair play whilst still cashing in on the recklessness that is now so accepted by many. Football, like any other game is won or lost everyday. You can loose and go without trophies for a decade and come back to win consecutively for the next decade. Sadly, businesses are not like that. You cannot continue to loose money for a decade and remain as a company. That is where my love for Arsenal lies.
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Ugodre,i cam also confirm to you that Arsenal fans(includes me) are suffering a certain type of herd mentality. The culture of frugality and sustainaibility have seeped into the psyche of most Arsenal fans so much that we frown at paying some obscene money to some footballer. Infact, most fans supported the sale of RVP becaus of the financial implications-we cant allow him to leave for free. We have accepted fate and celebrate any success we get along the way.
However, this does not excuse the egregious mistakes and sheer incompetence of Ivan Gazidis and Wenger. Even when we have surplus cash after satisfying the repayment covenants provisions, they fail to spend at all or at the wrong time a la deadline day 2011. We resort to fringe, high wage, gone past their prime players- Park, Chamakh, Squilacci, Benayoun and now maybe Essien. We cant continue like this.
Financially, we are a decent but the club is not getting the on-field succeesses we deserve.