Any football club has to be led like a company these days. From an economical point of view, it’s not just about the teams or players, but very much about the brand. And new findings show that success on the pitch is not always neccesary in order to be accounted for the most valuable brands in football, as Man Utd and Real Madrid show. They do of course have the luxury of being able to rely on their titles and star players. But it’s also their branding that makes them flourish financially.
Real Madrid become the most valuable football brand
Brand Finance publishes the Football 50 report annually and lists the most successful brands in the ecosystem. Real Madrid have this year overtaken Manchester United to become 2019’s most valuable brand in football, with an estimated worth of 1,646 billion Euro. Bryn Anderson, director at Brand Finance, explains:
Real Madrid have shown this year who truly reigns supreme in the world of football. They triumph not only as the most valuable and strongest brand but their enterprise value and stadium are also ranked second to none. The most successful club in the history of European football is finally reaping the benefits of decades of spectacular on- and off-pitch performance.
The Spanish giants are actually still the reigning Champions League winners – until 1 June. But their recent season has been quite terrible for their standards, being knocked out of every competition bar the Club World Cup and having had no real chance for the La Liga title. While the Spanish champions FC Barcelona sit third in Brand Finance’s rankings, Manchester United are still second, with an estimated worth of 1,472 billion Euro.
But their recent failings on the pitch have not only made them fall off top spot, but also lose worth. They haven’t gone on to win anything, since Mourinho gave them the Europa League success in 2017 – and their last league title came in 2013 under Sir Alex Ferguson and is a distant memory now. Their latest campaign has been rather miserable, apart from the women’s success.
United also slipped to fourth in the strongest brands ranking behind Bayern Munich. Despite their poor form on the pitch and the costs of sacking José Mourinho in December, the club still announced earnings of nearly 500 million pounds for the financial year ended 31 March. The brand is so poweful that both commercial and broadcasting revenue brought in more than 200 million pounds in that period. The third quarter 2019 alone saw them earn just over 150 million pounds. Such sucess is strengthened by lucrative new partnerships, for instance with Marriott or Maui Jim.
United executive vice chairman, Ed Woodward, says that the club will help the new manager in restoring success on the pitch as well:
After a turbulent season, everyone at Manchester United is focussed on building towards the success that this great club expects and our fans deserve. Preparations for the new season are underway and the underlying strength of our business will allow us to support the Manager and his team as we look to the future.
Premier League dominates brand value rankings
England’s first tier, the Premier League, accounts for 43 per cent of total brand value. The league has 17 entrants in Brand Finance’s top 50. Even the promoted Wolverhampton Wanderers have jumped ahead of Ajax Amsterdam, Celtic Glasgow or the FC Sevilla in terms of brand value. Six of the ten strongest brands and most valuable brands are from England: the Premier League’s traditional top six.
The biggest winners in brand value change in total numbers are Real Madrid (+349 million Euro), FC Liverpool (+199 million Euro), PSG (+161 million Euro) and Manchester City (+158 million Euro). Still, the biggest growth can be attributed to the FC Sevilla, a club that grew brand value by 49,1 per cent. Other clubs in that listing are SSC Napoli (36,3 per cent) or even the FC Southampton (32,4 per cent).
While the report from Brand Finance gives a comprehensive overview regarding the brand value of football clubs, it also shows that England does have the highest value, but second-placed Spain is only slightly ahead of Germany.
Next in line are Italy and France, but the value of all the countries behind that accounts for only a fraction of the leading contenders.
A lot of other factors are presented in the report, explaining that Borussia Dortmund are number one for the Matchday Experience, while Bayern Munich are best in the category broadcaster and partner appeal. Fan perceptions are also quoted, showing that some people like Barcelona for their “cool branding“, whereas others favour PSG for having their favourite player in their ranks. The Brand Finance report elucidates how money talks in football these days – even if you’re not successful on the pitch for some time. However, the enormous amounts of money that the biggest club brands generate will probably give the not so unreasonable impression that there will be an ever growing imbalance in the financial powers of football leagues and clubs. Yet, it’s nice to reckon that clubs like the 1.FC Nuremberg, AS Saint-Étienne or Newcastle United are mentioned in the same breath as Manchester United, Real Madrid or Bayern Munich, when it comes to history and heritage.
Values, which shouldn’t be forgotten whilst growing the club revenue. For a brand, success is everything. For a football club, though, there is more.