Sporting giants cashing in as sponsorship deals grow for stadia

COMMERCIAL income for Europe’s top 20 richest football clubs has increased to €3bn from €1.8bn in the five years ending with the 2016/17 season.

This is according to Deloitte’s ‘Money League’ report.

After broadcasting rights, income from commercial deals now represents the second-biggest stream of revenue for football clubs.

In recent years, the manner in which clubs have sourced commercial revenue has changed considerably, a report from credit ratings company DBRS Ratings has found.

As football has grown in popularity, international corporations including AIA Insurance and Emirates Airlines have become increasingly visible in their partnerships with teams.

Today, the average football club generates commercial income from three main revenue streams; sponsorships, retail – including merchandising and clothing – and mobile and content.

Clubs are also beginning to sell the naming rights of their stadiums to interested corporations.

This is something that is already considered mainstream in North America, where 24 of the 31 stadia in the National Football League in the US are named after commercial partners.

In Ireland, Aviva Insurance currently holds the naming rights to what was previously the Lansdowne Road stadium, something it pays €4m a year for. Ulster Rugby play in Kingspan Stadium in Belfast, while Irish Independent Park (formerly Musgrave Park) is home to Munster Rugby in Cork.

In addition, a number of Gaelic Games grounds have partnerships with businesses, including Elverys McHale Park in Mayo and Kingspan Breffni Park in Cavan. However, clubs in the League of Ireland have not yet engaged in the practice of selling the naming rights of their grounds.

According to DBRS, stadium naming rights deals are a potential way for clubs to further diversify revenue, while securing another stable income stream.

In England, a minority of football clubs – seven out of 20 – have taken advantage of the revenue on offer from stadium naming rights. Arsenal sold their stadium naming rights to Emirates airline, for example.

Manchester United, the most commercially successful club in the UK, have publicly stated that they currently have no plans to rename their Old Trafford stadium, a stance that is estimated to cost upwards of €28m a season, according to the DBRS report.

In mainland Europe, four of the top 20 clubs in France have deals in respect of stadium naming rights, while in Italy as few as three of biggest clubs have sold theirs.

In Europe, clubs may be hindered by country-specific considerations. French, Spanish and Italian stadia, for instance, are often owned by municipalities rather than clubs, therefore restricting teams in the commercial opportunities they can pursue.

It costs Man United more than €28m a season tokeep their Old Trafford stadium name