EVENTS
EVENTS
FOOTBALL’S HOME IMPROVEMENTS
Europe’s top football clubs have become expert at raising millions through
sponsorship, TV rights and ticket sales. But many are way behind the pace
when it comes to maximising match day revenues. Alex Miller reports.
A casual glance at the finances of Europe’s
leading football clubs suggests they are achieving
impressive levels of match days revenues.
According to Deloitte’s 2010 Football
Money League, Manchester United turned
over €127.7 million on match days from a
€327 million turnover (39 per cent), Arsenal
€117.5 million from €263m (44 per cent) and
Real Madrid €101.4 million from €401 million
(25 per cent) during the 2008-09 season.
However, a more thorough look at the issue
reveals a number of elite clubs are second-
division when it comes to match day revenues
and, almost just as importantly now, stadia-
related income on non-match days.
With UEFA, European football’s governing
body, revealing the intricacies of its ‘Financial
Fair Play’ framework this January, maximising
revenues or ‘sweating the assets’ is the major
aim of all major clubs and sports.
There are a plethora of factors involved in
match day revenues. Ground size is a key factor;
it is widely accepted that unless you have a
26 SportBusiness International • No.164 • 01.11
60,000-plus capacity stadium, competing at
Champions League level going forward is going
to be extremely difficult.
Arsenal’s match day revenues from hospitality
and corporate clients alone at its Emirates
Stadium are bigger than the entire match day
income from former ground Highbury.
Size does matter
Ground size is an issue that top clubs, including
Chelsea and Liverpool, understand greatly.
They both reside in 45,000-seater stadiums
and understand they have to expand or move to
remain competitive.
But while size is important, a smart approach
and the clever management of match day revenues
will prove to be a solid base to build from.
“There is only so much time for fans to
spend at half-time and so many shirts they
will buy,” notes Burnley chief executive Paul
Fletcher. While that is fact, a smart management
approach can produce greater match day
revenues before, during and after the game.
David Pullan recently swapped life as
Manchester City’s chief marketing officer to
become interim commercial director at Surrey
County Cricket Club. While at Eastlands, he
witnessed a radical shift of attitude towards the
match day experience of fans at the club under
the ownership of Sheik Mansour.
Pullan believes club directors need to begin
by installing a manager who is ultimately
responsible for match day revenues.
“Football clubs in general are still struggling
to understand how to maximise revenue per
head on match days, in part because it cuts
across the organisation’s boundaries,” Pullan
told SportBusiness International. “All those
employees with a role to play sit in different
departments not talking to each other enough.”
By installing a manager to look at the whole
match day picture, departments will become
joined-up and better-equipped to generate
revenues. “Not many clubs appear to be looking at
the complete fan experience,” adds Pullan.
“Manchester City dispatched staff to
benchmark some of the best non-sporting
venues such as Euro Disney and the O2 Arena
to learn from them. The club also asked fans
what really mattered to them on match days.
Simple issues such as adequate access to food
and drink rated highly.
“Manchester City realised it needed to
improve the match day experience on many
levels, such as ensuring transport to the ground
was top class (direct links to a new Metrolink
station are due to open in 2012), providing clear
signposting to the stadium and club employees
greeting fans correctly.”
Lingerers spend more
Increasing the ‘linger time’ of fans at the
ground before and after games is another area
the majority of clubs have yet to fully come to
terms with.
Manchester City has made inroads by
installing ‘City Square’, a pre-match weather-
proof fan zone at the back of the stadium,
complete with bar, café and family entertainment.
From a purely financial point of view, it is
debatable whether City Square will pay back the
multi-million pound investment. Although City
Square can also be used on non-match days, the
unfavourable location of the stadia means it will
be harder to attract revenues. Nonetheless, it is a
positive move and maybe one indicator as to the
future use of stadia.
Smarter management of match day staff
is also an issue that is becoming increasingly
looked at and understood.
Acua, the commercial arm of Coventry
University, is currently finalising a consultancy
deal with a London-based Premier League club
called ‘Talent Academy’. The programme focuses
on improving the loyalty of match day staff -
EVENTS
Bold initiatives being taken at Old Trafford to boost match day revenues - Getty Images Sport
particularly hospitality and catering staff and
stewards - and identifies opportunities for greater
revenue and fan satisfaction on match days.
“The initial aim is to provide added value
around the cost of a match day ticket and
build up loyalty to the club,” explains Michael
Costello, Business Consultant and Chartered
Occupational Psychologist at Acua.
“This was initially focused on the catering
area. Fans are not coming to the club for the best
burger - but a bad burger, cold cup of tea or even
good food delivered in a poor manner may be a
catalyst for a fan to consider not renewing their
season ticket the following season.
“Clubs can make better use of match day
staff to up-sell and cross-sell. We are aiming to
improve areas such as crowd management, so
that club employees are trained to guide fans to
less busy kiosks, and so on.”
“It is a win-win situation,” adds Coventry
University’s Professor Simon Chadwick. “Match
day staff receive training, development and a
management qualification. The club enjoys
better-trained and motivated staff workers who
are familiar with the club - while recruiting time
and costs are reduced.”
Ticket prices are an important and sensitive
issue, particularly during a recession. Clubs
want to maximise revenues without alienating
the hardcore followers.
Manchester United took a bold and
inventive step in this area by reducing the
number of ‘ordinary’ match day tickets it
issues, in favour of new ‘sports-bar packages’
that guarantee purchasers drinks, snacks and a
premium seat.
United hope the drive to widen the mix of
match day ‘experiences’ on offer will help offset
a decline in traditional corporate hospitality
revenues brought about by the recession (official
documents suggest corporate hospitality sales
at the club are 16 per cent below capacity this
season). This kind of ticketing initiative looks
set to be increasingly replicated.
Directors may also like to look at German
Bundesliga club Schalke, which has transformed
stadium revenues by advancing its ground
towards becoming a sports ‘venue’, which hosts
handball and basketball games, as well as track-
and-field events.
The club has gained leverage from the other
sports so that the stadium is full for more than
just 20 to 30 games a year. Arena revenues have
increased and also the opening of retail outlets,
bars and restaurants have become more viable.
Despite the global nature of major sports,
directors need to look closer to home to dig out
every nugget of commercial value from their
club - starting with smart management and a
closer look at their stadium.
If leveraging other sports or events, or
integrating retail outlets, residential properties
and hotels into stadia or venues is necessary
to ensure the competitiveness of a sports club;
then the legacy of Financial Fair Play may well
be staring us straight in the face.
SportBusiness International • No.164 • 01.11 27