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Key Commercial Trends in Football Through the Lens of the Champions League Final

5/18/2022
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As the sun sets on another exhilarating year of European football, there are opportunities and challenges facing the continent’s top teams. Through the lens of the Champions League final, the following summarises some of the key questions that have emerged during this football season, from where to find future sponsors, how to leverage digital footprint for wider reach and deeper relationships with global audiences to how the women’s game is evolving as the sports industry recovers from the global pandemic.

The evolving sponsorship landscape

As of the beginning of the 2021-22 football season, the Finance and Insurance industry was the leader among front-of-shirt sponsorship deals present across the top five European football leagues by value. In total, over USD230 million annually was paid by the industry, although the high number of deals makes the average deal value paid by the industry worth USD11.5 million. Approximately one third of those deals were made with crypto companies, with average annual deal value being worth USD8 million (according to Euromonitor International’s Sponsorship Valuation Model). The dynamism of the crypto market means that there are lucrative opportunities continuously emerging. The benefits to sports properties from signing off crypto deals revolve around the unlocking of an untapped revenue source, creating a catalyst for digital transformation and the possibility to innovate fan engagement. Despite the recent increase in crypto deals, several top-flight properties in Europe remain ripe for partnership as they are yet to sign a deal with a crypto player, including UEFA Champions League (UCL) finalists Real Madrid and Liverpool. Yet with this opportunity comes an abundance of volatility, which may see teams continue to focus on forging partnerships with more traditional industries as rated below.

Top 10 Front-of-Shirt Sponsor Industries by Total Sponsorship Value in Top Five European Football Leagues, 2022

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Source: Euromonitor International

Both UCL finalists are gearing up for new front-of-shirt sponsorship deals. The current Real Madrid deal with Emirates and Liverpool’s deal with Standard Chartered are nearing their end dates. Real Madrid’s reported annual deal value is almost twice that of Liverpool’s and is worth nearly USD79 million annually. Nevertheless, this may change depending on the outcome of the UCL final. Both teams have also seen success within their respective domestic leagues. Real Madrid won its 35th La Liga title in April 2022, while Liverpool is still in the running to win another Premier League title, although Manchester City remain current favourites. Strong competitive offerings, both domestically and internationally, will no doubt place teams in a solid negotiating position as they look to renew existing/secure new front-of-shirt sponsors.

Growth of digital footprint as a strong driver of sponsorship value 

Teams at the top of the football pyramid do not solely rely on success on the pitch to drive sponsorship revenues. Both UCL finalists, Real Madrid and Liverpool, are among the top 10 most followed sports clubs on social media globally. Liverpool managed to increase its following by 13% over the course of a year to March 2022, reaching over 115 million followers across main social media platforms. At the same time, Real Madrid’s social media footprint registered a 9% increase, although the club remains a social media juggernaut with over 314 million followers. Massive digital reach is a strong contributor to both teams appearing among the top 10 most commercially attractive clubs in Euromonitor International’s Club Index each year.

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 Source: Euromonitor International

Social media equals global reach. While monetisation of social media followers remains a challenge, the global reach and attention a sports club is able to attract with, for example, short-form video on TikTok, creates an enticing offer for commercial partners eager to drive brand exposure in key markets. Beyond social media, however, teams are increasingly exploring non-fungible tokens (NFTs) and other blockchain-based technologies to better drive monetisation of global fans to a degree unattainable on traditional social media platforms.

Unlocking the true value of women’s teams

The pandemic tempered the surging growth of women’s football that followed the 2019 FIFA Women’s World Cup. However, this is changing and in 2022 there is greater commercial value to be unlocked in the women’s game. Barcelona women’s team is gearing up to compete for its second consecutive UEFA Women’s Champions League (UWCL) title against Olympique Lyon, a record holder of seven UWCL titles. While only one team will be crowned as champions of UWCL, the real winner here is women’s football in general. Soaring viewership and record live crowds were recorded during the 2021-22 UWCL season. A new 16-team group stage was introduced, raising competitiveness and interest in the matches while centralised media coverage provided better visibility. Despite COVID-19 restrictions persisting in certain countries, the average attendance for group stage games nearly doubled when compared to pre-pandemic figures, according to UEFA. Moreover, the knockout stages produced matches with some of the biggest crowds in the competition’s history.

Record Crowds in UEFA Women’s Champions League, 2022

imagerzj4.pngSource: UEFA

Local rivalries, such as El Clásico, attracted huge live audiences, giving hope that fan interest will filter down into domestic leagues to ensure that growth is more sustainable. The real challenge will continue to be the concerted effort to bridge the commercial divide from high level tournaments to domestic leagues and clubs.

Upcoming UEFA Women’s EURO 2022 and FIFA World Cup 2022 are expected to cement football’s comeback and to demonstrate its commercial value after difficult years during the pandemic. These international events will position the game on the global stage, attracting international audiences and providing opportunities for stakeholders to maximise their full commercial potential.

 

For further insight read our briefing Blockchain and Crytpocurrency Sponsorships Emergence and Impact in Sports.

 

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