Some background

Apparently sitting around at home watching a lot of football has convinced many Arsenal fans they are experts at management, coaching, scouting, contract negotiations, commercial deals and, last but by no means least, the proper color of the team kit. As some of my British friends have commented, it is similar to the delusion now held by many punters that they are now experts on furniture restoration after watching the long advert on the use of French polish by Quest tv during their broadcast of the recent Emirates Cup games. It is one thing to fumble through a DIY project over a weekend, it is an infinitely greater magnitude of difference to being the football manager of a multi-million business such as Arsenal Football Club.

The profound difference between being an amateur observer versus an experienced hands-on professional manager is apparently lost on many fans especially those who have gained some notoriety as tweeters, bloggers and podcasters.

When I first interacted with Arsenal fans via blogs some 11-12 years ago, my aspiration was to become part of a community dedicated to supporting the club we loved, to be the proverbial 12th man. Back then I thought this would be the goal of every Arsenal fan given the clear Man United bias in the mainstream media and the British football establishment. I could never have been more naïve in my expectations.

Far from becoming an alternative to the increasingly corrupt mainstream media, most, not all, Arsenal bloggers are less about supporting the club and more about their ego and identification with being a winner. Nothing was more illuminating than the absolute failure of most bloggers to communicate and educate their readers that post-2005 the club and Wenger in particular were competing at a ginormous disadvantage to Abramovich’s Chelsea and the commercial giant at Old Trafford. The club would have to sacrifice investment in players to pay for its new stadium. Worse was to come with the 2008 takeover of City by the sovereign wealth fund of the UAE. It meant Arsenal had slipped from the 2^nd biggest club in England financially to at least 4^th place.

It was during those lean years that most bloggers, some now turned tweeters and podcasters, began to assume an air of superiority to Arsene Wenger. His so-called failure up to 2013 to add any trophies to his three PL titles including being an “Invincible” as well as five FA cups, had not only sealed his fate in their eyes but they were now empowered to choose the color of the curtains in the manager’s office for the new occupant.

Most of these bloggers-tweeters-podcasters still remain unrepentant despite Wenger proving them stratospherically wrong since 2013, when the shackles imposed by deals necessary to obtain financing the new stadium were finally eased. Three more FA cups and 20 years straight in the Champions League has seemingly embittered rather than humbled them. Somehow they think the new commercial contracts with Emirates Airlines suddenly made Arsenal equally competitive with the three money-bag clubs. But as the historically pro-Manchester United newspaper, The Guardian, was quick to point out:

“£30m a year from the Middle East airline, who have extended their shirt sponsorship by five years until the end of the 2018-19 season and secured the stadium naming rights, which were due to expire in 2021, until 2028. This marks a significant increase in revenue on the previous deal but falls short of Chevrolet’s £357m, seven-year sponsorship of Manchester United.”

Fact is Arsenal remains the 4^th strongest Premier League club in financial capacity. As our blogmeister and twitter legend, the one and only @BlackburnGeorge, frequently reminds the factually and financially challenged members of the twiteratti, Arsenal’s objective expectation at the start of every PL season is to come 4^th and to make a good cup run. The fact that we usually punch above our weight is due solely to the outstanding leadership of Arsene Wenger.

Despite clear demonstration by the manager that he is approaching the new season with greater resolve, having thoroughly demolished his detractors in the board room battle over his new contract, the usual gaggle of bloggers-tweeters-podcasters continue their stupid little games hoping Arsenal fans will buy into.

As an American, most cringe-worthy is the role of certain gooners across the pond, who, from at least 3,000 miles away, have decided they have the gravitas to criticize the player management strategy of the manager and his transfers (Yes, I know that’s the info you want and I am getting there). They are the perfect carricatures of Graham Greene’s “The Ugly American”. Rather than being humbled by the generosity of our British friends in giving them a platform to speak, they act arrogantly and crow noisily on subjects they have no expertise. How longer will this embarrassment continue? Will this welcoming mat always remain?

Halfway Into This Transfer Window

Unlike my compatriots who prefer to highlight their own opinions, in preparation for this blog, I spent quality time retrieving and making sense of the data from Transfermarkt from an Arsenal point of view. Before I present my findings let me remind you of some of the main characteristics of the transfer market:

• Unlike various well known stock or commodity markets, it was designed by FIFA and the big clubs to restrain trading activity to a fixed period of time and to restrict freedom of buyers and sellers. It is no supermarket shelf where Arsenal can identify and target, for example, all central midfielders available.
• Knowledge of willing buyers and sellers is restricted. Due to restrictions on tapping up, player agents play the main role of putting buyers and sellers together. Arsenal relies heavily on agents, not Dick Law, to make initial contact and bring the parties together.
• Information is restricted. Due to the opacity of the market, third party interests whether as owners or agents are now flourishing in the grey area of the market. Due to this grey activity Arsenal reportedly refuses to do business with certain super agents.

Findings as of July 30^th based on the top 100 transfers:

• £1.645 billion is the value of transfer fees worldwide mostly in Europe.
• £1.363 billion is the market value of the players acquired.
• Clubs worldwide paid a 17% premium in transfer fees vs market value.

Premier League is the biggest spender:

• £649 million in transfer fees or 39% of total fees spent.
• £415 million in market value of players acquired.
• 36% premium in transfer fees vs market value, i.e. double the worldwide premium.

In contrast to the Premier League, the Bundesliga clubs are very value conscious:

• £192 million in transfer fees.
• £188 million in market value of players acquired.
• 2% premium in transfer fees vs market value, i.e. 800% less than the worldwide premium.

Who doubts Bayern will hand it to a PL club in next year’s champion’s league?

Manchester City is the PLs biggest spender:

• £194 million in transfer fees.
• £103 million in market value of 5 players acquired.
• 47% premium in transfer fees vs market value, i.e. nearly triple the worldwide premium.

Check/Cheque Guardiola indeed!

Chelsea is no slouch:

• £119 million in transfer fees.
• £69 million in market value of 3 players acquired.
• 42% premium in transfer fees vs market value, i.e. 250% above the worldwide premium.

Manchester United have distinguished themselves as making the biggest splash in the transfer market so far. Their purchases show the same trend as City and Chelsea:

• £102 million in transfer fees.
• £61 million in market value of 2 players acquired.
• 40% premium in transfer fees vs market value, i.e. 250% above the worldwide premium.

Contrast Arsenal with the big money  clubs:

• £45 million in transfer fees.
• £47 million in market value of 2 players acquired.
• -4% premium in transfer fees vs market value, i.e. 400% less than the worldwide premium.

Value wise AFC has limited downside risk to the players acquired yet they are clear degrees superior in value to the players they are nominally replacing. Lacazette’s market value is £34m vs Perez which is £12.75m. Similarly Kolasinac is valued at £12.75m versus Gibbs who is rated £8.50m.

Most importantly, Arsenal has improved the quality of players in both forward line and in defense. It is self evident that the next area for improvement is in central midfield. My confidence is based on the research I have done demonstrating, with data, the critical importance of missing Santi Cazorla during our last two failed league challenges. Additionally I did two blogs in the second half of last season quantifying deficiencies in central midfield. I am therefore convinced this is Wenger’s focus.

By the way almost all the bloggers and podcasters are now singing the same tune we wrote months ago, i.e. the need for a central midfielder acting as a secondary playmaker. Seemingly they all read this blog while pretending they don’t. As we always remind ourselves at PA, we rely on the unbiased data. It is constant, silent and unemotional but it is undeniable. By trusting the data we almost always arrive at the correct conclusions.

As usual I leave the final word to the genius, who is again playing the transfer market like a fine fiddle, i.e. to Arsene:

“I believe there are actually two ways to improve the team. First of all to improve the quality of what we do in training to improve the squad and improve the players we have, and secondly to bring more top-level players in. 

“The difficulty is to bring top-level players in because you pay a huge amount of money for very normal players at the moment. As well, all the big clubs are chasing the same players and that provokes huge inflation. Maybe this will be the first time we [football clubs] pay over £200m, maybe over £300m with Neymar and around £200m with Mbappe. 

“So there is a huge inflation. But we are active, we are working hard and I think we have done well with Kolasinac, we have done well with Lacazette and we are continuing to work.

“There’s the usual acceleration in the final part of August,” added Wenger, “But I think you have always to be on alert every day, because a good opportunity might turn up. 

“Sometimes people you are after for a long time are not available and suddenly they become available. So you have always to be on alert. That’s what we do.”

I will do a follow-up at the end of the window.