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Thursday, Sept. 20, 2007
TAKING A CHANCE
IN A LEAGUE OF HIS OWN
Soccer pitchman scores big in small-market Niigata
Sunny but not too hot, the weather on the afternoon of May 6, 2001, was perfect for watching a soccer match. But there were only 4,800 people on hand to see Albirex Niigata take on Yokohama FC in the 18,671-seat Niigata City Stadium.
Only two weeks later, on May 19, some 32,000 Niigata fans, eager to see Albirex's new home stadium, dubbed Big Swan, filled the seats to see the match between Albirex Niigata and Kyoto Purple Sanga, who were both in the J. League's Division 2 at the time.
"I think most people there didn't know soccer at all . . . but there was a sense of unity that they shared in cheering for the home team," said Hiromu Ikeda, chairman of Albirex Niigata Inc. It was Ikeda who had orchestrated the opening of Big Swan, now called Tohoku Denryoku Big Swan Stadium.
It was a good game. Albirex Niigata scored a late goal to tie the score against the higher-ranked Purple Sanga. Though Niigata lost in the end, it was a dramatic moment for the fans.
Since then, Albirex Niigata has seen the number of soccer fans steadily increase in a city never known for its love of the sport. From 2003 to 2005, Albirex Niigata attracted bigger crowds for its home games than any other team in the J. League.
The success of Albirex Niigata, later referred to as "The Miracle of Niigata," proved that professional sports teams can be profitable in smaller cities if they have the backing of the local community.
"The key is to fill the stadium with people," said the 58-year-old Ikeda, then the club's president. "It's about experiencing the atmosphere of a packed stadium, the waves of people, the roar. That's entertainment."
Ikeda distributed 100,000 free tickets for the big May 19, 2001, opening. And he continued to pass out free tickets for the matches that followed so that the people of Niigata would get used to watching soccer in a stadium rather than on TV.
As the team rose in the Division 2 standings, more people began to purchase tickets. When Albirex Niigata was promoted to the J. League in 2003, the team quickly sold out its 20,000 season tickets.
The 2002 World Cup was also a great experience for the people of Niigata, who witnessed the international popularity of soccer firsthand when their northern port city was flooded with fans from around the globe.
Previously, people in Niigata watched popular sports like baseball and soccer mainly on television. Pro baseball teams hardly ever came to Niigata and the high school teams that local communities usually rally behind so enthusiastically were usually defeated in the early rounds of national competitions.
The idea of creating a new soccer team in Niigata would probably never have come up were it not for the 2002 World Cup, cosponsored by Japan and South Korea. Niigata was determined to be a host city.
"It was more for the sake of the World Cup," said Ikeda. "Even if we could form a team, nobody thought it could actually become strong enough to win matches in the J. League."
Sports teams in Japan are typically sponsored by corporations. In many cases, the teams are actually money losers for their owners.
For his business model, Ikeda looked to European soccer clubs, which are often supported by a wide range of local businesses and individuals. By the time he launched his team in April 1996, he had gathered ¥500 million from about 150 companies and organizations.
The road got rough from there. In each of the first two years, the team lost about ¥200 million, coming close to burning through all its money.
Cash-strapped, Albirex Niigata was on the verge of folding. Investors urged Ikeda to get rid of the team when he came asking for more money. But he refused to give up.
"I wanted to keep the team going," he said. "I knew it would be a big asset for the region."
For Ikeda, the son of a chief Shinto priest, Albirex Niigata was not just a soccer team, but a key to revitalizing the local community.
"Shinto priests pray for the happiness of the local people through festivals and prayer," said Ikeda, who himself is a chief priest. "It's the same. This may be a sports business, but it's similar to a public project aimed at developing the region."
Ikeda, who is also chairman of the Niigata Sogo Gakuin group of educational institutions, kicked in his own money and sacked 17 of the team's 26 players. He even waylaid then Niigata Gov. Ikuo Hirayama at a crossing and spent an hour trying to persuade him not to cut off subsidies for the team. The governor eventually caved in.
After that, the team's fortunes began to turn around.
The governor's support led other investors, who were initially reluctant to get on board, to back building the new stadium.
In fiscal 2005, Albirex Niigata was the fourth most profitable of the 18 J. League teams in terms of net profit. The top three all were located in heavily populated areas: Osaka, Nagoya and Urawa, Saitama Prefecture.
Encouraged by Saburo Kawabuchi, president of the Japan Football Association, Ikeda organized five more teams — in baseball, basketball, winter sports, marathon and cheerleading — all under the Albirex brand.
Kawabuchi was inspired by FC Barcelona, which operates four pro teams other than soccer as well as other amateur teams under the Barcelona brand.
Ikeda's ultimate goal is to see Albirex Niigata compete with the big-name soccer clubs and spread the Niigata name worldwide. As a first step, he created a new soccer team, Albirex Niigata S, currently playing in the Singapore soccer league.
"The small port city of Liverpool became famous through soccer," Ikeda said. "I want to make a team that local people can be proud of."
In this occasional series, we interview entrepreneurs whose spirit may hold the key to a more competitive Japan.