(WFI) A globally renowned sports business expert tells World Football Insider that the European Champions League’s position has been “reinforced” by the global economic downturn.
Speaking ahead of new research published Friday that shows the huge rewards earned by Champions League clubs that qualify for the competition’s knock out stage, Professor Simon Chadwick says that the downturn has seen sponsors turn to the competition as they seek a “safe haven” in the midst of recession.
“This time last year people were saying [revenue] has maxed out: there’s a downturn coming, there’s big problems,” Chadwick told WFI.
“But if you look at UEFA’s prize pool for this year, it has actually increased in spite of the downturn.”
Professor Chadwick, who is director of Coventry University’s Centre for the International Business of Sport, says that the recession has affected sponsors’ mindsets in a “number” of ways.
“I think commercial partners were looking for value for money, for a return on investment, for a safe haven,” he said. “They found that in the Champions League because they know people watch, they’re interested, they’re able to recall the brand names and so on.
“The downturn has really reinforced the Champions League’s position as one of the premium global sporting properties.
“Possibly one of the unintended consequences of the economic downturn is that the Champions League will actually become even bigger and stronger over the next five years. And that the kind of revenues that UEFA are able to generate and the kind of revenues clubs participating in the Champions League are able to generate, they’re both going to increase — and will continue to increase.”
Champions League qualifiers reap vast benefits
The 16 clubs in today’s Champions League first knockout stage draw in Nyon will each earn an average €50 million ($72 million) from the competition, according to Professor Chadwick’s latest research.
Chadwick revealed that 2009 European Champions Barcelona earned €110 million from their participation, while runners up Manchester United pocketed €65 million.
But arguably the real story is the vast riches earned by clubs who may not progress even as far as the quarter finals and that prize money only forms a small component of a team’s revenue.
The report, commissioned by MasterCard, shows that the €50 million revenue comes in five main trenches: prize money worth around €14 million; UEFA commercial revenues, paid as a market pool payment, estimated at €12 million; ticket sales are worth €10 million; club’s additional commercial revenue estimated at €8 million; while increased squad value amounts to approximately €6million.
Chadwick said that the overall economic benefit of the Champions League, which he describes as “arguably the biggest annual domestic team competition in the world”, is now so great that it is now comparable to the World Cup finals.
“Over a calendar year, our research suggests that the UEFA Champions League is worth as much as €6 billion to the European economy, with England, Italy and Spain enjoying the greatest economic boost in the last 12 months,” he said.
“That means that the annual UEFA Champions League ‘economy’ is comparable to the last FIFA World Cup finals in Germany.
“As well as being a thrilling event for football fans around the globe, this makes it both a premium sponsorship property and an important contributor to the economic and commercial health of Europe.”
Written by James Corbett.
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