Stan Kroenke lifts lid on why Arsenal prioritise business foundations over spending big on transfers
12 March 2016 11:53am
by Joe Hall
Arsenal majority shareholder Stan Kroenke has lifted the lid on his approach to ownership - but risked invoking the wrath of fans by claiming "if you want to win Championships then you would never get involved".
The American real estate magnate discussed his belief in prioritising the building of a sports team's business foundations in a rare public airing of his thoughts at the MIT Sloan Sports Analytics Conference in Boston.
Kroenke, who has earned the nickname "Silent Stan" from Arsenal after keeping schtum at recent AGMs, also discussed the importance of statistical analysis at the Premier League club.
Some Arsenal fans have recently expressed exasperation over the team's loss of form in the league and the club's supposed reluctance to spend big on players despite having cash reserves of £160m.
Billionaire-bankrolled Chelsea and Manchester City have won the Premier League six times between them since Arsenal last lifted the trophy in 2004, but Kroenke warned against a model that relied on a wealthy benefactor to spend big.
On a panel entitled Evolution of Ownership Kroenke said: "For me, being an individual owner, I have to have some sort of reality involved.
"If you want to win championships then you would never get involved. I think the best owners in sports are the guys that sort of watch both sides a bit. If you don't have a good business then you can't really afford to go out and get the best players unless you just want to rely on other sources of income.
"Over there [in the UK] it was sort of like 'well, we've got guys from the Middle East, the oil price is over $100, they can spend anything they want'.
"But the problem I saw with all of that; those people can lose interest. It doesn't mean that they will, but I sort of threw that out there: 'What happens when the Middle Eastern family, this thing's costing a lot of money and they decide to go home?' I said what really happens in those situations is the fans get hurt because the players get picked up and paid if they're good, the front office gets other jobs."
Kroenke said he has long been a fan of the moneyball approach first popularised in baseball by manager Billy Beane and the Oakland A's who interrogated statistics to find undervalued players.
His belief in the power of analytics motivated Arsenal's purchase of Chicago-based analytics company StatDNA for £2.2m in 2012.
"I was always interested in Moneyball," said Kroenke. "Billy Beane, one of his heroes happened to be our manager at Arsenal, Arsene Wenger. Arsene has an undergraduate degree in economics and has always had that analytical thing going on.
"When we acquired a controlling interest in Arsenal in 2011, after that we started pushing pretty hard because it seemed to me that there were some people who were a bit more advanced in that area and so we were fortunate in that we acquired StatDNA. They gave us a big lift in the soccer business."
Kroenke, who owns NHL franchise Colorado Avalanche, MLS team Colorado Rapids, NBA franchise the Denver Nuggets and NFL franchise the Los Angeles Rams as well as Arsenal explained that his various sports franchises learn from each other in the fields of marketing, finance and player analytics.
"Are you sacrificing anything by working on multiple teams? I don’t think so," argued the multi-billionaire.
"Because I feel like when I work on things at Arsenal I learn things that I can bring back here. I feel like when I work on things here I learn things that I can take back there.
"Player analytics is something that goes across these different teams, but our marketing people talk to each other, our finance people talk to each other. You’re benchmarking and you’re trying to find best practise in the middle of it."
On what he'd learned from the Premier League in particular, Kroenke talked about the power of a club's "brand" to hold customer loyalty and generate revenue - something which could irk Arsenal fans charged with the most expensive season tickets in Europe.
"What did I learn specifically [from England]? You learn very quickly what that brand means," said Kroenke.
"We have a gentleman who comes to Arsenal games, he flies his helicopter from South Africa, Cape Town to London quite often [to watch Arsenal]. It’s just an example of what a brand can mean, and what we can do in sports.
"We’re all working on that and that’s the big opportunity. Michael Jordan showed it - you can get paid a whole lot more if you can extend your brand. Manchester United showed it. They established benchmarks that people had thought heretofore unattainable, but their brand extension made people want to pay for it."
Kroenke also revealed he was approached to buy an Indian cricket team around a decade ago but declined - something he conceded may have been a mistake - and that Arsenal would play and train in Southern California this summer in a bid to raise their profile in the US.
