By Paul Nicholson
October 2 – Clubs looking for financial relief for their coronavirus hit income streams should look harder at the revenue that can be generated from selling the naming rights to their stadia, according to a new report from the KPMG Football Benchmark team.
“Income through stadium naming rights deals is considered to be the third most lucrative source of revenue for clubs in the field of commercials, behind shirt sponsorships and kit supplier deals. Monetizing stadium names has been a rising trend globally in the past decades, as it promises to bring extra revenue to clubs. However, the market in European football is still underdeveloped,” says the report.
KPMG say the stadium naming rights market is far less developed in the European top football flights, with the exception of the Germany’s Bundesliga where 78% of stadia are sponsored.
Looking at the 98 clubs in European football’s top five leagues, only 30% of them have stadium naming rights partners.
“Only a fifth of the stadia are sponsored in the English Premier League, Italy’s Serie A and France’s Ligue 1 (all at 20%), followed by the Spanish La Liga (at 15%). Interestingly, Turkey’s Süper Lig and England’s second tier, the Championship have more venues with a naming sponsor than those bigger leagues,” says the report.
The money can be big. UAE’s Etihad Airways has the largest individual deal but German insurance giant has been the most aggressive in the naming rights market, sponsoring eight venues on four continents, including six football clubs, paying a total of around €30 million annually for those rights.
In terms of who is sponsoring, the financial sector leads the way with 28% of the German deals with financial firms, followed by 21% with car manufacturers. This mix “is quite similar to that of US stadiums’ naming rights market, where financial services and automotive firms lead the pack”, says the report.
The analysis concludes that in a generally challenged sponsorship market clubs that have been reticent to sell stadium naming rights for traditional or legacy reasons, will likely start to consider the opportunity.
“However, the uncertainty around the pandemic makes it hard to estimate the fair value of new stadia sponsorships, putting all the excitement at the negotiation table regarding deal value,” concludes the report.
See the full analysis at https://footballbenchmark.com/library/stadium_sponsorship_an_unexploited_field_of_play
Contact the writer of this story at email@example.com