Football has continued its outstanding commercial and financial growth in recent years, and has come a long way in the recent times.
Football is serious business these days. According to the latest Football Money League from Deloitte, the combined revenues of the world’s 20 highest earning football clubs have surpassed €4 billion for the first time. They generated a total of €4.3 billion in revenue in 2011, up 8% on the previous year, thanks to increased television revenues. This clearly underscores the extremely commercial nature of football. Needless to say, running a football club as a successful, commercially viable business venture is a whole different ball game.
According to the global consultancy firm, Deloitte’s latest Annual Review of Football Finance, UK’s Premier League clubs’ (the biggest earners in the world football) revenues have increased substantially across all areas of their business. The Premier League now generates more revenue than any other league across each of the three primary revenue categories; match day, broadcast and commercial. This has enabled them to recruit and retain the best players which attracts fans and fills stadia resulting in on pitch success at home and abroad. The global interest in the game of football from broadcasters, viewers and commercial partners is expected to continue to grow and add further substance to a business model which remains primarily financially based on a successful domestic market.
Most Prominent Game
Football, the most popular game on the planet earth, remains a sport in the growth phase and the popularity of club football in top leagues of Europe is ever-increasing—with fan bases in over 150 countries across the world. Top football clubs have done a great job of tapping their local markets and have taken bold first steps towards engaging their wider international fan base. In today’s globalized world, it is this international market that holds the key for the next wave of revenue growth for these football clubs. Some will do this better than the others, but on the whole, the future looks very bright for the top European football teams and hence the game. Football has continued its outstanding commercial and financial growth in recent years, and has come a long way in the recent times. Ten years ago in the 1996/97 season the collective revenue of the 20 Premier League clubs was £464m – by 2011 revenue increased manifold. Since its formation the Premier League has grown tremendously, with the profile of the league reaching unprecedented levels and relentlessly driving the clubs' revenues upwards. The clubs have been able to simultaneously develop state of the art stadia and other facilities, while attracting some of the world's greatest players in the prime of their careers, appealing to a new and increased fan base and completing a virtuous circle of growth and lessons in branding/merchandizing, globalization among many others.
Corporate branding on football jerseys is among the most potent way to embed advertising in live content. For the duration of live games (uninterrupted telecast of two halves of 45 minutes) and subsequent replays, reruns and in all print images, all eyes are on the players, whose jerseys bear corporate logos and thus act as walking billboards for the corporate. Global corporate houses see huge marketing potential in the same—paying sums worth hundreds of millions of dollars in mega, multiyear sponsorship deals.
Among the biggest merchandizing deals of its type is the landmark merchandising deal between Manchester United and Nike in 2000, estimated at £303 mn plus royalties over 13 years (approximately $33 mn p.a.) for distribution of Manchester United sports kit and merchandise21. Spanish club Real Madrid’s kit sponsorship and marketing rights were purchased by Adidas for $25 mn p.a. It is clearly a win-win for all involved—the club, the sponsor, and the fans.
English Premier League represent as many as 61 different nationalities across the five continents2 with just 41 percent of the 550 first team players being Englishmen representing the truly global nature of club football today.
The Deloitte Football Money League – 2009/10 revenue
Position (prior year position) | Club | 2009/10 Revenue (£m) | 2009/10 Revenue (€m) (2008/09 Revenue) |
1 (1) | 359.1 | 438.6 (401.4) | |
2 (2) | 325.9 | 398.1 (365.9) | |
3 (3) | 286.4 | 349.8 (327.0) | |
4 (4) | 264.5 | 323.0 (289.5) | |
5 (5) | 224.4 | 274.1 (263.0) | |
6 (6) | 209.5 | 255.9 (242.3) | |
7 (10) | 193.1 | 235.8 (196.5) | |
8 (7) | 184.5 | 225.3 (217.0) | |
9 (9) | 184.1 | 224.8 (196.5) | |
10 (8) | 167.8 | 205.0 (203.2) | |
11 (20) | 125.1 | 152.8 (102.2) | |
12 (15) | 119.8 | 146.3 (132.7) | |
13 (11) | 119.7 | 146.2 (146.7) | |
14 (13) | 119.6 | 146.1 (139.6) | |
15 (14) | 115.5 | 141.1 (133.2) | |
16 (16) | 114.5 | 139.8 (124.5) | |
17 (18) | 101.9 | 124.5 (105.0) | |
18 (12) | 100.5 | 122.7 (146.4) | |
19 (n/a) | 94.0 | 114.8 (99.8) | |
20 (n/a) | 89.6 | 109.4 (99.0) |
Source: Deloitte Football Money League 2011
Jany, Lead Economist
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