Twelve years after Real Madrid’s galacticos-fuelled takeover of the Deloitte Football Money League, Manchester United have, once again, regained the top spot in football’s rich list.
The Red Devils recorded a staggering revenue of €689m (Rs 49.97 crore approx) for the 2015-16 season.
Despite their earnings increasing every year, United finished behind the Madrid giants in the annual ranking of club revenue for eleven consecutive seasons. While Louis Van Gaal’s final season at Old Trafford was considered a footballing failure by the administration – despite his protests and an FA Cup – unrivalled commercial revenue growth saw the club rake in the money in record numbers.
Real Madrid also posted record revenues (Rs 44.97 crore approx), but lost out to United, and, for the first time, their La Liga rivals FC Barcelona (Rs 44.98 crore approx).
Madrid’s Champions League success in 2016 should provide some comfort, and they will hope to regain their position next year – with the help of Brexit’s effect on the pound and the Red Devils’ absence from the Champions League this season.
Are Commercial Deals the Secret?
For United, the results are a vindication of their exhaustive commercial strategy. In recent years, United have renegotiated multiple major sponsorship deals which have led to a significant hike in commercial revenue.
United has also entered into an unprecedented slew of commercial partnerships, including signing HCL as the official digital transformation partner.
Hilarity may have ensued when they unveiled more baffling deals like Nissin as the team’s official global noodle partner, but commercial revenue grew by £ 71m (Rs 5.94 crore approx) to £ 272.1m (Rs 22.76 crore approx), putting them well ahead of every other club.
An increase in commercial revenue also helped Barca leapfrog Real. The success of the strategy is bound to tempt other clubs into adopting the same approach.
The transition will probably upset traditional fans, who are already unhappy with the increased commercialisation of the sport, as it will devalue matchday revenue.
The power of clever commercial exploitation is clearly evident in Deloitte’s rankings, where eight of the top twenty earning teams come from the exceedingly savvy Barclays Premier League.
While usual suspects Manchester City, Arsenal and Chelsea maintain positions in the top 10, last season’s surprise champions, Leicester City, bagged the 20th spot, despite their low matchday revenue and lack of global footprint.
United, of course, are hoping for a return to footballing success under Jose Mourinho; but the new Premier League TV deal and their veritable horde of partnerships will ensure some serious cash inflow.
Indian Firms, Are You Listening?
One of the fascinating aspects of United’s commercial strategy is their penchant to form regional partnerships – aimed at leveraging their fanbase in specific countries or regions. This has seen them enter into partnerships with companies in China, Korea, Vietnam, Nigeria, Laos, Cambodia, Thailand, Myanmar, Japan and even Taiwan, in diverse fields like snacks to casinos, and mineral water to motorcycles.
The Red Devils do not have a regional partner in India, despite the club’s 35 million-strong fan base in the country.
These figures (from a survey conducted for the club by market research club Kantar four years ago) makes India the biggest United fanbase in Asia after China and Indonesia.
The time, therefore, is ripe for Indian companies to partner with one of the most valuable brands in the world.
The Deloitte Football Money League annual reports are a unique way for bored accountants and obsessive football fans to find something to talk about. The full report, along with Deloitte’s insightful infographics, can be accessed here.
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