Big football clubs have a reputation for being money-making juggernauts. Since the introduction of the Premier League, there has been a huge focus on money. Manchester United has perhaps been the main example of a team that is a commercial success. The brand is known over the world and there are many millions of pounds generated each year with things like shirt sales.
Anyone who is in any doubt about the power of football commercially should pay close attention to what happened when Cristiano Ronaldo snubbed Coca-Cola. The share price dropped by billions.
How Football Clubs Are Making Money
The revenue that has been brought into football is quite impressive. The Premier League is worth billions already and television deals drive a lot of cash into the game. There are reasons why clubs are paying players tens of millions of pounds every single year.
Football clubs also explore a lot of other revenue sources. In recent years we have seen a lot of clubs entering the world of esports. Some esports events take place in the football niche (EA Sports FC is the main football esports title) but there are a lot of teams expanding into the other esports.
Some of the biggest global esports events are in other niches and football clubs know this. PSG have led the way and as well as the fact that they compete in EA Sports FC, they also have teams for games including Dota 2. These have the potential to be profitable and bring another source of revenue into the clubs. People watch these sports and put money into them and there are many who bet on esports matches which generate money in the same way that the sportsbooks covering the Premier League do. Manchester City is an English club that has followed the esports route for revenue growth.
Global expansion is another way that clubs try to build revenue. Every fan of a club tends to bring money into the club whether that is through buying a shirt or watching a game. Even watching televised games brings a huge amount of revenue as the rights are sold for huge amounts. The total TV deals for the Premier League’s revenue have now exceeded £6 billion. Even fans who don’t buy tickets to games can contribute to the revenue by watching on their televisions.
Merchandise is also huge for the biggest clubs in the world. Manchester United has a megastore on its premises at the ground! But what impact does all of this have on the pitch?
Does More Revenue Mean Better Results?
Premier League teams spend a lot of money on players but they can’t all be successful. Chelsea and Manchester United have not won as many trophies in recent years but they have spent a fortune on players. Poor recruitment is one of the many contributing factors.
While wealth certainly offers an advantage for teams and allows them to build squad depth to handle the wear and tear of the season, success in the UEFA Champions League or other top tournaments remains elusive for some wealthy clubs. PSG has yet to win a Champions League trophy and they have spent a fortune in the attempts to do so.
On the flip side of the coin is Manchester City. Since being acquired by Sheikh Mansour in 2008 they have become one of the wealthiest clubs globally. They still have not spent as much in recent years as some competitors. Their financial resources have allowed them to sign players like Kevin De Bruyne and generational goalscoring talent Erling Haaland. This impressive squad collectively helped City secure multiple Premier League titles and finally win the UEFA Champions League in 2023.
The general trend is that the clubs with more money tend to rise to the top of the tables. The Champions League draw is not troubled by Norwich City or Rotherham. There are a lot of examples of clubs spending a lot of money and not getting success though. It proves it is one part of the equation but not the only contributing factor.
Cinderella Stories
Even in modern football, there is a role for the Cinderella story. Leicester City’s Premier League win in 2015-16 is the ultimate example and proved that great scouting and a great system implemented by management can overcome wealth disparities. Leicester’s triumph reminded fans that while money matters, it isn’t the only factor at play. Atletico Madrid in Spain has competed with giants like Real Madrid and Barcelona even though they have unbelievable wealth. In recent years we have also seen some underdog teams manage to qualify for the biggest tournaments and even challenge for titles.
Financial Fair Play (FFP) rules were introduced to address the growing financial gap between wealthy clubs and smaller ones. They aim to prevent clubs from spending beyond their means. Clubs do tend to find ways around this.
Footballing minnows rarely have long and sustained periods of success. Money is important to be at the very top level. We do see teams like Brighton who consistently do well in spite of not spending a fortune, but at the elite level, money is definitely a crucial factor.