Don’t products have to evolve?

Let’s take the recent rumblings within the Premier League and other leading European teams about forming a European super-league.

Liverpool and Manchester United seem to be leading the UK, with Manchester City, Chelsea, Arsenal and Tottenham Hotspur said to be involved too.

Also mentioned are Spain’s Real Madrid and Barcelona. With Juventus (Italy), Bayern Munich (Germany) and Paris Saint-Germain (France) also in the mix.

A breakaway European super-league has been muted for years, but this one seems to have got funding and some legs.

Product Progression:

Yes, the top teams want a bigger slice of the pie and to grow financially, through extra broadcast payments and by increasing their global fan base (which will increase merchandise sales).

But it’s more than just the money. They know that football as a product must keep evolving, to keep existing audiences interested and to attract new audiences too.

You see, footballs competition isn’t each team against each other. Footballs competition is Baseball, American Football, Cricket, Rugby, Cycling, Athletics etc. Any other sport with a large fan base.

Football Hierarchy:

Football’s complicated. No. I don’t mean playing the game (stop the ball going in and score more than the opposition). I mean the set up. It’s like a big global franchise, with complicated power-bases.

FIFA are the headline act with 211 global members and is the overall governing body of recognised international football. Making its money (circa £4 billion annually) from broadcasting, merchandise, hospitality, ticket sales and World Cup licensing rights.

UEFA is a FIFA member (they call them confederations). UEFA has 55 members and represents European nations in football. It makes its money through European nation and club competitions.

Beneath UEFA you have each country’s own football associations. In England it’s slightly more complicated. As you have The FA and the Premier League both vying for control and power.

The FA was the overall governing body, until 1992, when the top English teams broke away to form their own league (the Premier League), which acts as a co-operative, each club being a shareholder.

Each individual club is also independent, working within the rules of football, as defined by the Premier League, The FA, UEFA, and FIFA, as well as being subject to English and European law.

As well as being responsible for the national teams, The FA is the governing body for football in England and is responsible for sanctioning competition Rule Books and regulating on-field matters.

Then you’ve got the English Football League (EFL), which consists of three leagues sitting below the Premier League (Championship, League One and League Two).

Promotion and relegation between these divisions is a central feature of the League, which also allows the top clubs to exchange places with the lowest-placed clubs in the Premier League.

When products need to evolve:

Back in 1992 the leading English football clubs agreed that football in England had to evolve, it had become stale, and it was time for a revamp to create excitement, demand, and more money.

At the time, the EFL weren’t happy about their top members breaking away and taking most of the broadcasting revenues with them.

Obviously, the other stakeholders (FIFA, UEFA & The FA) might not be happy too. But it turned out The FA, didn’t have a great relationship with the EFL at that time, so gave their backing to the move.

Seems like things have now come full circle, where the top teams in the Premier League (and other top European leagues) think it’s time to evolve the product again.

It’s not yet clear, whether the teams involved will pull out (or be kicked out) of the Premier League, or if the two leagues will run (or can run) in parallel.

But we’re sure the Premier League won’t be happy, as they’re likely to lose some broadcasting revenue, and are unlikely to receive any share of the European super league revenues.

What happens if products don’t evolve:

History shows us they get overtaken by their competitors and eventually disappear.

Blockbuster was the market leaders in video and DVD rental. Until Netflix came along. Netflix started out by offering a mail order service in a monthly subscription.

Initially Blockbuster copied them, but couldn’t see where video was heading, like Netflix could. Netflix started with a long-term strategy to provide a video on demand streaming service.

Blockbuster even had the chance to buy Netflix, for what now seems a very nominal fee (circa £40 million). But their CEO (John Antioco) seemed not to believe video on demand would ever happen.

Kodak is another example of a company unwilling to evolve. They dominated the photographic film market during most of the 20th century. But blew its chance to lead the digital photography revolution as they were in denial for far too long.

Then there’s Nokia, who was the first to create a cellular network in the world. In the late 1990s and early 2000s, Nokia was the global leader in mobile phones.

With the arrival of the Internet, other mobile companies started understanding how data, not voice, was the future of communication.

Nokia didn’t grasp the concept of software and kept focusing on hardware because the management feared to alienate current users if they changed too much.

Nokia didn’t want to lead the drastic change in user experience. This caused Nokia to develop a mess of an operating system with a bad user experience that just wasn’t a fit on the market.

Example of brands who do evolve:

Apple is perhaps the best example of a company that made evolution its identity. Initially pioneering the personal computer and the graphical user interface. And it’s never stopped evolving since.

And we’ve got to include Blockbuster nemesis Netflix.  Who are now a part of everyday life for millions of people around the world. The Netflix of today looks very different than the Netflix that started in 1997 mailing out videos.

We’ll even add ourselves into this category. Initially starting out in a network of retail stores selling printer consumables.

Transforming into an office technology and supplies company, then creating a series of subscription-based office technology products to provide business with certainty and peace of mind.

Our vision is to make ‘office technology affordable to all’ through affordable monthly subscriptions with everything included, on rolling monthly agreements with no strings attached.

Evolution conclusion:

Evolution in business happens for a reason, which is to make sure organisation stay current in the eyes of their customers, fueling their growth.

Every so often a major world event happens (inflection points, as described by former Intel CEO, Andy Grove), which create opportunities for business evolution.

Events such as the internet, a global financial crisis, the smart-phone, and a global pandemic can change the business landscape and create opportunities for business evolution.

In other instances, organisations take it upon themselves to evolve, to create more interest and excitement. Like the Premier League elite helping to create a European super league.

If it happens, we’d expect other leagues to follow suite with super-leagues created in the world’s continents. Then in another 20 years, don’t bet against further evolution with a global super-league.

…be warned though, if you decide not to evolve, you could end up like Blockbuster.