In the first part of this article, we just scratched the surface of the lopsided sponsorship deal that benefited Air Asia more than MAS although the latter paid more money into the coffers of QPR.
But that’s not all. There are more serious issues at stake.
If we imagine all of us are the Board of Directors in MAS, which team should we put our money into; QPR, Manchester United, Arsenal or Liverpool?
If Telekom and even Mister Potato can sponsor Manchester United, why on earth would Malaysia Airlines sponsor a newly promoted team like QPR?
The next question is, how long had the marketing team in MAS looked into advertising in an English Premier League teams? Was decision made before the share-swap or after?
Why were better and bigger clubs not selected?
I suspect, just like how any normal consultant turned management person like Danny Yusof would react, the deal was a kneejerk reaction after being cajoled by Tony Fernandes and it was shoved into MAS’ throat without any proper marketing analysis on return on investment.
There is no way a sane Marketing head of a GLC would give away RM18 million knowing full well that the return on investment of its advertising value will be much higher if he had sponsored other bigger clubs.
Who in MAS decides where the advertising and promotions money should go? What kind of marketing clause been inserted in the share-swap deal? Was there an ‘advertising collaboration’ clause or a ‘joint marketing’ clause in the agreement? That will spell disaster in terms of MAS’ branding.
We often hear ad nauseam after the share swap that MAS is a premium airline. So why is this premium brand putting its hard earned millions into a team which has no significant brand value at all? Shouldn’t a premium airline sponsor a premium EPL team?
What is wrong with the Deputy CEO of MAS, Danny Yusof? Did he knock his head on the way to MAS’ office some time ago?
The exposure of MAS logo in home games at Loftus Road stadium is lower when compared to the exposure Air Asia logo will get when they go away to play other teams. This is common sense.
The EPL limits the number of live matches on TV in order to protect the stadiums’ revenue from ticket sales. Out of 380 matches in a season, the maximum number of live matches on TV is set at 138 per season. How many live matches QPR could get as compared to Liverpool, Arsenal, Tottenham, Manchester City or even Everton?
Is Azman Mokhtar, representing the biggest shareholder of MAS, really that wise? Logic says otherwise.
Not to mention the risk of QPR getting relegated this very season.
How many games from the 2nd tier Championship League have we watched from Astro or from all around the world?
Tony Fernandes said this in an interview:
Expressing all the right sentiments to soothe QPR fans’ sullen resentment over the price hikes that immediately followed May’s promotion to the Premier League, Fernandes, in an interview with the Guardian, was not all soft soap, however. He made no secret that he was motivated to buy QPR for £45m not only for the love of football, but as a sponsorship, marketing vehicle for AirAsia, where he remains a significant shareholder, and Malaysian Airlines, in which he and a partner more recently bought a 20% stake.
“Many people do not realise the power of sport to market a brand,” said Fernandes, whose Lotus Formula One team is sponsored by AirAsia, which also sponsored last year’s British Grand Prix and, for a time, Manchester United. “You can spend £40m on advertising and have nothing like the same effect. Around the world, everybody watches Premier League football.”
What happens if that ‘marketing vehicle’ has no value in terms if advertising potential? Easy for Tony to say that there is always risks when doing business. It is always easy to say that when RM18 million is not his money to begin with.
And of course, not everyone watches QPR and certainly QPR is not the team to be given priority to be shown on TV. And for what is worth, we all know QPR isn’t the first team that Tony wants. He had to settle for QPR after his foray into buying Wet Ham United did not materialise.
If you were MAS shareholder, wouldn’t you be mad? If a minority Air Asia shareholder can get angry when Air Asia discontinued sponsoring Manchester United and parked their RM12 million into one of the smallest team in EPL, shouldn’t we, MAS’ ultimate stakeholders demand an explanation from Danny Yusof and his boss, Azman Mokhtar?
There is a serious corporate governance issue here from both MAS and Air Asia’s shareholders’ point of view; why should Air Asia and MAS direct its advertising money to AirAsia’s Group CEO and MAS’ executive director, Tony Fernandes?
But that is not all what Azman Mokhtar failed as the Managing Director of Khazanah Nasional.
In the recent spat between Tony Fernandes and Malaysia Airport Holdings Berhad (“MAHB”), Azman Mokhtar seemed incapable and lacking the testicular fortitude to defend MAHB.
Khazanah owns 54% of MAHB whereby the latter had given out dividends of more than RM150 million on yearly basis since 2007 and yet, Azman Mokhtar seemed to cower in fear over someone who owns only 20% of MAS.
To be continued..