Strategic Audit of MLS

Major League Soccer (MLS) is the highest caliber soccer league in the United States. The league, formed in 1995, has grown from just ten teams to twenty-four, with more on the way. The league has rebounded from a period of losses in the early 2000s and has established new fan bases through the usage of the designated player rule. This paper analyzes the current situation of MLS, as of the spring of 2019, and proposes a strategic recommendation. The current situation of MLS is evaluated using SWOT and PEST tools, and the strategic recommendation is created based on MLS’s competitive advantages and resources. MLS gets its revenue in different ways, including the sale of broadcasting rights, merchandise sales, ticket sales, expansion fees, and brand sponsorship deals. It has a comparative advantage with United States soccer talent, and a distinctive competency at establishing lasting brand sponsorship deals. This has pushed MLS into a position to compete not only with United States sporting leagues, but also international soccer leagues. Some of the weaknesses the MLS has are its low salary caps, which restrict clubs from recruiting the best talent, and its reliance on the standard United States talent progression system, which sees athletes move from club teams or high school teams into college teams and finally to a draft. With the 2026 World Cup being hosted in the Americas, the MLS is in a great position to capitalize on growing interest in soccer in the United States. They face heavy threats from international soccer organizations like the English Premier League, who have secured broadcasting deals to United States viewers. The strategic recommendation for MLS is to capitalize on youth soccer talent in the United States by investing heavily in the academy teams under each MLS team. This will allow the MLS to gain revenue by selling youth talent to foreign clubs, and then use this new revenue to increase the salary cap and draw more talent. This strategy is easy to monitor, since players from academies will either have more playing time than previous college players or not. This will translate to higher profile sales, but if it doesn’t there is a backup plan for MLS to pursue