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During WWII, Brazil sided with the Allies. Soon, any reference to the Axis powers was prohibited. These were difficult times in Brazil for persons and institutions of German, Italian or Japanese descent.

On the day preceding the São Paulo state championship final, the Verdão was forced to change name, from Palestra Italia to Palmeiras.

On game day, 19 minutes into the second half, Palmeiras were beating São Paulo FC 3 goals to 1. A penalty was marked in Palmeiras’ favour and to general astonishment, the opponent abandoned the pitch, ending the duel and confirming Palmeiras’ championship title.

Poetically, Palestra died a leader and Palmeiras were born a champion. The feat became known as “Arrancada Herócia”, the Heroic Jolt.

This season’s 3rd uniform is dark green, featuring gold details on the sleeves, collar and sides.
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Palmeiras today launched the 2nd jersey for the 2017/2018 season, inspired by one of the club’s most iconic achievements: the São Paulo State Championship title of 1942. It will be first used against Cruzeiro, on 9 July, at the Mineirão stadium.

The white jersey sports green, vertical stripes and a badge bearing resemblance to the classic emblem used in 1942. On the back of the jersey, under the neckline, the phrase “and the champion Palmeiras is born”, a reference to the forced name change the club was submitted to in 1942.
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During WWII, the Brazilian government demanded that clubs and other institutions linked to the Axis countries Italy, Germany and Japan change their names in case they were referring to any of the aforementioned countries. Thus, Palestra Italia, founded in 1914, changed into “Palestra”, keeping only the single word of Greek origin as the club’s name.

The change did not soothe political and sporting pressures. Under the threat of having to forfeit all the club’s assets in addition to being expelled from the championship that they currently led, Palestra had to change their name a second time. The night before the final game of the State championship, scheduled for 20 September 1942, the Palestra board of directors held a heated meeting. Dr. Mario Minervino took the floor and asked club Secretary, Dr. Pascoal W. Byron Giuliano, to note in the minutes: “They don’t want us to be Palestra, so then we shall be Palmeiras – born to be champions.”

The following day, tension flared as Palmeiras played opponent São Paulo Futebol Clube – a club linked to the current political elite of São Paulo which was laying claim to the assets of the former Palestra Italia. Palmeiras were soon winning 3-1 and when a penalty was called in Palmeiras’ favour, SPFC pulled their side off the field, proclaiming the Palmeiras squad “an enemy of the homeland”. With this, Palmeiras were crowned champions.

The new jersey has been very well received by supporters, sales will certainly soar.

Scoppia che la vittoria è nostra!

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How about a 360 degree HD snap view from inside of the Allianz Parque on game day, with teams on the pitch and supporters on the stands? How about being able to zoom in and out? How about being able to identify your own face, or that of your friend, in the crowd, mark the spot, and leave a comment on the notice board? That’s what Palmeiras 360 degrees is all about: making the Família Palmeiras, step by step, a little more familiar.

Scoppia che la vittoria è nostra!
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360

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Palmeiras qualified to the Paulistão semi-finals like a breeze, beating Novorizontino 3-1 (away) and 3-0 (home). The team is evolving game by game, Eduardo Baptista clearly understanding the squad he has at hand and players feeling confident about their leader. And although it is still early, there are hints of something else, which we have not seen in a rather long time at Palmeiras: the drive to play well the full 90 minutes and transform a good performance into an excellent one. With Borja and Guerra adapting to their new team and country, Palmeiras look stronger than ever.

São Paulo FC are through, and so are Corinthians. Today Monday, Santos and Ponte Preta battle it out for the last spot. Next weekend sees the first leg of the semi-finals, but who takes on who will only be known after the final whistle tomorrow.

Not that Palmeiras waste any energy thinking about possible upcoming Paulistão opponents: focus is on Wednesday’s bout against Peñarol in the third round of the Libertadores Cup group stage. Jean has been recovering well after the foot injury and is likely to be found on the bench against the Uruguayans.

bieber_allianz_croppedEnd of March, the pitch at the Allianz Parque was completely removed. Three shows took place in the first week of April: two performances by Justin Bieber and one by Elton John. Then, last Friday, some 14.000 square meters of grass was taken from a farm in Tremembé and installed at the arena. The stadium manager promises that the pitch will be ready by Wednesday, thanks to machines imported from the United States and Europe, capable of cutting a thicker slice of grass: 4.5cm instead of 1cm. The thicker cut allows for not only grass and root, but also part of the rooted soil. In theory, three days should be enough to extend the grass rolls, the pitch being ready for play already on the fourth day.
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Compared to the conventional model, where the pitch needs 30-45 days to reach ideal conditions, this is a huge step forward, albeit expensive: each swap costs approximately R$ 300.000 (US$ 95.000), with the arena constructor foreseeing another four swaps during the year. Those Bieber shows are clearly very lucrative. Palmeiras and sponsors cannot complain either: there has been tremendous visibility and branding, as indicated by the picture featuring the Canadian megastar wearing our jersey. That said, Palmeiras forced out of their home grounds time after another is unacceptable and we need better harmonisation of schedules, combined with a permanent solution addressing pitch quality. On the latter, let’s see how far this thick cut technique takes us.

Scoppia che la vittoria è nostra!

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Palmeiras and Crefisa last week announced the renewal of their sponsorship agreement, securing the highest amount paid to any club in South America and the 10th highest in the world, pushing Juventus (US$ 19 million/year) from the list. Although figures were not disclosed by Crefisa president Leila Pereira and Palmeiras president Maurício Gagliotti at the announcement, they are known to sum approximately US$ 24 million/year, for two years, bonuses for championship titles not included.

In addition to the sponsorship deal, Crefisa continues to boost Palmeiras’ contracting power. The acquired outstanding 50% of Dudu’s economic rights is an example, the recent signing of Miguel Borja, at a US$ 10.5 million price tag, another.

In 2016, Crefisa saw a record profit, some US$ 325 million. It is hard to calculate the impact of Crefisa’s increased visibility on its profits, but without doubt the deal with Palmeiras brought the company into the spotlights. Some sports journalists insinuate money laundering to explain the relatively high sponsorship deal, ignoring the splendid results Crefisa presents. It is rather revolting how a well-established private financial institution suffers accusations, while state-run companies like Petrobras and Caixa use public funds to sponsor many a team in Brazil, little questions asked.  

Below, a list of the ten biggest sponsorship deals worldwide in football (according to Forbes).

#1 Manchester United (Chevrolet) – US$ 80 million/year

#2 Chelsea (Yokahoma Rubber) – US$ 57 million/year

#3 Manchester City (Etihad) – US$ 57 million/year (including stadium naming rights)

#4 Liverpool (Standard Chartered) – US$ 43 million/year

#5 Arsenal (Emirates) – US$ 43 million/year (including stadium naming rights)

#6 Barcelona (Qatar Airways) – US$ 41 million/year

#7 Bayern Munchen (Deutche Telecom) – US$ 34 million/year

#8 Real Madrid (Emirates) – US$ 34 million/year

#9 Paris Saint-Germain (Emirates) – US$ 28 million/year

#10 Palmeiras (Crefisa) – US$ 24 million/year
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Palmeiras v Internacional - Brasileirao Series A 2016

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by Douglas Monaco*
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A likely, eminent mixing of football sponsorship with club politics frightens some and leads others to, tentatively, pull legitimacy from a late XX century example. Clarification is in order.

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Concerns about Palmeiras and Crefisa/FAM
On these early days of 2017, one theme has drawn the attention of Brazilian football followers in general and Palmeiras supporters in particular: the recent growth in prominence of Crefisa/FAM both in their role as sponsors of the team and in their political aspirations within the club.

The sponsorship contract is about to be renewed: a rumoured R$ 80-100 million (US$ 25-31) per year for the next two years, with additional bonuses for titles. If numbers are correct, it is by far the most valued sponsorship contract in today’s Brazilian football scene.

In the political realm, it is a given fact that the sponsor’s owner – Mrs. Pereira – is running for a seat in the club’s Deliberative Council with, some say, the ultimate goal to one day become club president.

This likely enmeshing of sponsorship with sharing in the club’s governance has made some – supporters, members etc. – worry because, as it stands today, there is no clarity about the configuration such a mixture of roles would end up having.

Another contentious point is the uncertainty about Mrs. Pereira having or not complied with all membership requisites to run for the Council, let alone to aspire becoming the president. Membership time needed to run for council is 8 years and then another 8 years as counsellor to be an eligible presidency candidate.

So, was she to be successful in these elections, her political involvement would be marred both by controversy in its functioning and by a possible breach of the club’s bylaws in its beginning.

Not good omens.

Some try to assuage these concerns, primarily eyeing the growth in cash injection that the renewed sponsorship contract would bring – however politically fuelled. They do so by citing the Parmalat Era as a precedent in this kind of arrangement in the club; a precedent that would legitimize the current situation.

In their 1992-2000 Partnership, Parmalat not only contributed millions of US dollars but was also involved in Palmeiras’ management. Why not allow Crefisa/FAM the same freedom now? the argument goes.

This article does not seek to question nor validate any current or future arrangement: after all, we do not know what it will look like if, and when, it comes into existence. This is simply an attempt to provide an accurate point of comparison. Those wanting to validate the present by quoting the past, must have a clear picture of what the past looked like.
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Description of the Partnership

Below, the general characteristics of the Palmeiras/Parmalat partnership:

1. Per the contract, Parmalat paid Palmeiras a monthly standard sponsorship fee and, simultaneously it bought highly qualified players and made them available to the club, without charging for it.

2. When these players were to be sold, Palmeiras had the right to a percentage in the profit – 20% – as a “showcase fee”.

3. The basic advertising spaces granted by Palmeiras were connected to the football team and, for some time, to the volleyball team: the company’s brand was printed alone in the chest-side of these sports’ uniforms.

4. There were also advertising spaces in the stadium: during a lengthy period, Parmalat’s brand was the only one in the placards around the pitch. Later, other brands were re-allowed.

5. The agreement also established co-management of the football department. Decisions about organizing, planning, directing and controlling of the football department were always to be shared among participants of the club and of the company, two each.

6. The figures were astronomical for the Brazilian market that, at the beginning of the Partnership, was still suffering hyperinflation:

  • The “standard sponsorship” raised a relatively reasonable monthly income to Palmeiras: 750,000 cruzeiros (the Brazilian currency at that time)
  • The player signings were outstanding: in 1992, Sorato, Cuca, Maurilio, Zinho and Mazinho; in 1993, Roberto Carlos, Antonio Carlos, Edilson, Edmundo and Cleber; in 1994, Rincon, Rivaldo, Alex Alves and Paulo Isidoro; in 1995, Cafu, Mancuso, Muller, Nilson, Djalminha and Luisão; in 1996, Junior, Sandro, Viola and the return of Rincon; in 1997, Oseas, Euller, Alex and the return of Zinho; in 1998, Arce, Paulo Nunes and Junior Baiano; in 1999, the return of Cesar Sampaio and of Evair, Asprilla… it’s a lengthy list of excellent players.
  • The average cost per signing varied between 700k and 3.5 million US dollars. Zino and Roberto Carlos cost around 700 thousand each, Antonio Carlos 1.4 million, Edilson 1.3 million, Edmundo 1.8 million, Rivaldo 2.5 million, Cafu 3.5 million (plus a fine imposed by a restrictive clause SPFC added to Cafu’s sale contract that forbade him to sign with Palmeiras for at least 1 year), Djalminha and Luisão cost together 5,5 million, Paulo Nunes a little above 3 million etc.

7. The results were remarkable: 3 State League wins, 2 National League wins, 2 Rio-São Paulo cups, 1 Brazil Cup, 1 Mercosur Cup, 1 Libertadores Cup; 10 titles in 8 years!
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Analysis and theoretical foundations

Beyond the facts and figures, it is important to retrieve the meaning of the agreement for the Partners, i.e. which benefit they derived from the relationship.

For Parmalat, Palmeiras meant:

1. Quick visibility: a conventional sponsorship contract – one in which no players are lent by the sponsor to the sponsored – would have brought a degree of exposure significantly lower than the incandescent visibility the Partnership generated at the time. The media agency then in charge of tracking citations, said the number of spontaneous media was equivalent to 20 times paid ads in the same media outlets.

2. Brand positioning: the Parmalat logo and its attributes were perceived in a qualified way by the consumers’ market in general and also by media companies.

3. Impact on general growth of the company: the massive growth in Parmalat’s buying of milk in the primary market and the acquisition of factories were viable due to the rapidly increased visibility and brand positioning experienced by the company.

4. Impact on sales: milk and dairy products had tremendous expansion in sales.

5. Football as a profit centre: sometime down the line, the transactions with players generated net cash for the company. Sources at the time stated that parts of this net cash were reinvested in the Partnership.

For Palmeiras, Parmalat meant:

1. Human resources: quality players that Palmeiras could only dream of signing in those days.

2. Direct income: the sponsorship fee plus the showcase fee.

3. Impact of the other income sources: tickets, TV broadcasting and general football income were enhanced due to the technical level reached by the team – proportional to Palmeiras’ tradition – and made possible by the Partnership.

4. Managerial capacity: Parmalat’s expertise in managing sports was much more qualified than Palmeiras’ at the time. In the context of the Partnership, that competence was made available to the club.

5. Football administration was segregated from other activities in the club: the Partnership allowed the segregation and that alone mitigated the impact of the club’s politics on the management of the football team.

6. The presence of a blockholder:

  • In business, it is generally accepted that a blockholder is seen as a potentially positive factor in corporate governance.
  • The colloquial expression that portrays this situation says “the eyes of the master fattens his cattle”.
  • For club football, a blockholder is not a usual character because managers have a mandate and even the highest-level directors are not “owners of the club” (though some seem to believe they are….).
  • The system of co-management emulated the blockholder situation, thus making the decisions more aligned to football’s utmost purpose: convincingly wining.

This reciprocity in gains between the partners is recognized by the Economics of Contracts – a research line – as a bilateral dependency, a situation in which partners, by means of a contract, can extract continuous gains in a relationship without the need to a formal integration between the parties.
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Conclusion
As seen above, the Palmeiras/Parmalat Partnership was constituted by a series of explicit rights and obligations between the parties, kept intact their legal constitution, had solid theoretical foundations, and produced concrete results for both participants.

Any comparison between that Partnership and the current situation involving Palmeiras and Crefisa/FAM must depart from the above-mentioned characteristics.
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CAMPEONATO BRASILEIRO DE 1994.
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*Douglas Monaco is 57 years old, Brazilian, and the biological child of an Italian man and a Brazilian women. Early in life, Erasmo was adopted by a family of Italian descent: becoming a passionate palmeirense was definitely his destiny. Holding two university degrees (Economics and Administration), he works as project auditor for a Dutch humanitarian entity.

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This text is a slightly modified version of the one originally posted, in Portuguese, at the Verdazzo! website.

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From time to time, you will find contributions from guest writers, on a variety of topics, here at Anything Palmeiras. Feel free to leave your feedback – either directly in the comments field or contacting the author.

And if you yourself would like to contribute to Anything Palmeiras, enter in contact through anything.palmeiras (at) gmail.com.

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Palmeiras and Esporte Interativo announced on Tuesday morning an agreement for cable TV broadcasting rights of the Brazilian Championship for six years, from 2019 to 2024. Palmeiras are to receive some USD 28 million just for signing, in addition to upcoming yearly revenues from broadcasts.

Esporte Interativo is part of the global media company Turner, which includes heavy hitters like CNN, TNT and Cartoon Network. The deal is not only major in terms of financial revenues: Palmeiras and Esporte Interativo will jointly develop projects aimed at expanding the club’s supporter base and boost internationalisation of the Palmeiras brand. In addition, no more of the “here at the Arena Palmeiras” nonsense from Globo network commentators: Esporte Interativo will always call the Allianz Parque by its name.

Esporte Interativo might be a relatively new player on the market, but Turner as a company has been present in Brazil for three decades. Palmeiras studied the options long and hard before making a decision, taking full advantage of the fact that the club has not anticipated any its future broadcasting revenues (same cannot be said for many other Brazilian football clubs).

In addition to Palmeiras, Esporte Interativo has also signed with Atlético Paranaense, Coritiba, Internacional, Ponte Preta, Bahia, Ceará, Sampaio Corrêa, Criciúma, Joinville, Paysandu, Paraná, Fortaleza and Santos; Palmeiras being the obvious crown jewel.

According to Brazilian legislation, a station is only allowed to broadcast a game if it holds the rights of both clubs. Unless a deal is worked out between Esporte Interativo and SporTV of the Globo network – which should be considered likely – many a game will be restricted to PPV or, eventually, to open TV, as these broadcasting rights are negotiated separately.

Hats off for Palmeiras, keeping their cool to get the best possible deal financially and strategically speaking, while siding with the only stakeholder capable of challenge the Globo network’s monopoly.

Scoppia che la vittoria è nostra!

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