Barcelona go for renaming the Camp Nou

SPOTIFY are in the process of agreeing a € 280 million deal with Barcelona that will include shirt sponsorship and the renaming of the iconic Camp Nou. The transaction, undoubtedly just what Barca need in their current situation, may not prove to be a popular one with the fans, at least not in the short term. If there is a stadium indelibly linked to a club, it is surely the Camp Nou.

Spotify, who recently announced they generated € 9.7 billion of revenues in 2021, have over 400 million users worldwide. They have a strong profile that is instantly recognisable and after some bad publicity, they arguably needed some good news. The marriage of Spotify and Barcelona may be a compelling mix for the modern age, but will Spotify’s deal prove beneficial for the company? Is it realistic to expect people to start calling the vast bowl the Camp Nou Spotify?

This is a case of caveat emptor because there are four main cultural pillars in the football club story: the name; the logo/badge; the stadium; and the colours. Tamper with these elements and you risk alienating your audience. However, there are rich pickings to be had in naming rights and not many clubs outside of Germany have really exploited their potential.

With so many clubs suffering from the pandemic in terms of reduced revenues and rising debts, there may be a more flexible sentiment around selling naming rights. It is certainly easier when a club builds a new stadium as the legacy has already been disrupted, hence when Arsenal moved into a new arena, adding the name Emirates wasn’t seen as a heinous crime. It would have been a different tale if their former ground, the much-loved Highbury, had been renamed.

Similarly, Manchester City’s adoption of Etihad was seen as part of their takeover by Abu Dhabi. It would seem unlikely that Liverpool and Manchester United would ever rename Anfield and Old Trafford respectively. United’s board has said in the past that it would not sell its name, but cynics might argue that if a deal came along, everything has its price in football.

Everton, when they move to their new dockside venue, will have an opportunity that would have been difficult to even suggest at Goodison Park. Tottenham have yet to sell rights for their new ground, but having incurred big losses, the moment cannot be too far away.

Barcelona’s proposed deal will yield € 93 million annually for three years and is aimed at replacing Rakuten as the main sponsor, whose agreement expires at the end of this season. Rakuten will depart after paying the club € 55 million per year for the past five years, but they were reported to be less than satisfied with the sponsorship deal, claiming their objectives were not fulfilled.

Since Barca have been embroiled in talks with Spotify, the club’s CEO, Ferran Reverter, has resigned, “for personal and family reasons”. Reverter had been with the club less than a year and was a pivotal figure in the financial recalibration of Barcelona. Doubtless, some will link the Spotify talks with his departure.

Another major club, Argentina’s River Plate, have also announced plans to sell naming rights to their El Monumental ground, the venue of the 1978 World Cup final. They are also expanding the capacity to 81,000. As the club doesn’t currently have the financial resources, the rights, which should generate around US$ 20 million, will fund the project. Favourites to agree a deal are the supermarket chain Chango Más.

Of the top 30 clubs in Europe (source: Deloitte), 11 have sponsors as part of their stadium name, including Bayern Munich, Manchester City, Juventus, Borussia Dortmund and Atlético Madrid. 

Some companies have developed a taste for buying-up rights, such as German insurers Allianz. The Munich-based company has what it calls a “family of stadiums” and has its name on football arenas in Munich (Bayern), Turin (Juventus), Sydney, Minnesota, Nice, São Paulo (Palmeiras) and Vienna (SK Rapid Wien). The Allianz in Munich is one of the great football sites in the world and is the most visited tourist destination in Bavaria as well as Bayern Munich’s home. The Aliianz family seems to have one thing in common, they all seem to be state-of-the-art constructions. They also have an impressive appearance.

Germany has embraced the concept of stadium sponsorship more than almost any other country – only a handful of current Bundesliga clubs do not have deals in place. And in typical German corporate fashion, backing comes from some of Deutschland AG’s big names, such as Volkswagen, Mercedes-Benz, Deutsche Bank and Bayer.

Some sponsorships do work very well, the Allianz Arena, for example, rolls of the tongue and nobody blinks an eyelid when you mention Emirates and Arsenal. This is the challenge for Tottenham, and indeed for Barcelona, to secure a sponsor that becomes seamlessly linked to the brand of the football club. In Barca’s case, the Camp Nou is such a significant brand of its own that grafting any other name to it will be hard work. There should be no shortage of takers for big club rights, for the mass appeal and media coverage of the game should benefit modern, multi-faceted companies. 

The biggest corporate brands in the world are predominantly tech-orientated, such as Apple, Amazon, Google and Microsoft. We’ve yet to see much activity around football club sponsorship, although partnerships have been established, such as Apple and Bayern Munich and Microsoft and the England team. 

The key to any deal, or indeed anything that threatens the integrity of a club’s brand, is sensitivity and recognition of the cultural aspects of the game. Clubs like Barcelona, Real Madrid, Manchester United and Liverpool will be only too aware of the problems that can emerge from a badly-handled deal that devalues the brand in any way. Right now, with clubs feeling the impact of the pandemic, the need to come up with elegant solutions is arguably more important than ever before, so we can probably expect more to leverage the power of their historic and modern football landmarks.

Corporates still line-up for football

FRANCE’s top division will have a new name for the 2020-21 season, the Uber Eats Ligue 1,  after the US online food ordering and delivery service agreed to sponsor the league until 2021-22.

This naming rights deal, making Ligue 1 sound a little like an English non-league competition, will yield € 32 million for the French league, a significant increase on the previous deal with Conforma. The announcement has, predictably, sparked a wave of mockery from fans, notably around the plan to have the matchball for every Ligue 1 game delivered by an Uber Eats driver.

The French deal comes just a few weeks after the Football Association announced that BT will provide £ 50 million of sponsorship over a five-year period. The corporate world continues to find football attractive. Each summer, clubs announce major new deals with the business fraternity, most of whom have identified the potential of the world’s most popular sport. And as well as using major competitions like the FIFA World Cup and the UEFA Champions League, corporates are constantly gravitating towards football’s big names.

According to CSM Sports & Entertainment, Manchester United are the leading European club for sponsorship, receiving around € 269 million, just ahead of Barcelona (€ 261 million). CSM estimated that the market across the top five European leagues (England, France, Germany, Italy and Spain) is worth around € 4 billion, with the Premier the top competition with € 1.2 billion.

Shirt sponsors in some leagues are now sharing their space with the recently-added area of sleeve advertising. For example, Arsenal’s shirt sponsor is Emirates, while its sleeve sponsor is Rwanda. 

Football sponsorship brings multiple benefits to companies eager to break into new markets. This may result in some corporates being very generous in order to accelerate their expansion programmes. AIA, who describe themselves as a “pan-Asian insurance group”, paid a considerable sum – £ 100 million over five years – to sponsor Tottenham Hotspur, but market observers assumed this was in order to take the AIA name to the UK.

There is little doubt, however, that a blanket approach to sponsorship can quickly raise awareness of the corporate name. One very obvious example is Gazprom, the Russian energy company that has not only entered into the shirt sponsorship market, but their association with the UEFA Champions League – notably their graphic and somewhat sinister TV advertising – has made them something of a household name across Europe.

Some see Gazprom’s blanket approach to football sponsorship as an expression of Russian passive aggression, although the company itself is clearly using the game to soften its image. When Gazprom sponsored Schalke 04 it coincided with the construction of the NordStream 1 international pipeline, a deal that was supposed to signal heightened cooperation between Germany and Russia. Gazprom is now one of the leading backers of football and includes Zenit St. Petersburg, Schalke 04 and Red Star Belgrade among its shirt sponsorship contracts.

Similarly, Emirates, the world’s fourth largest airline, has entered into a number of sponsorships, including shirts and stadium rights in a bid to become closely linked with the world’s leading football clubs. Emirates have some big names in their shirt sponsorship portfolio, including Real Madrid (€ 70m per season), Arsenal (€ 31m), Paris Saint-Germain (€ 25m) and AC Milan
(€ 18.5m)

Barcelona surprised many people with their shirt sponsorship deal with Japan’s Rakuten, but the agreement, totalling €55 million per season, was one of the most lucrative in football and has the potential to raise public awareness of a relatively unknown company. Rakuten have said that their involvement in sport has proved to be beneficial for revenue generation.

Chevrolet is far from unknown, but its long-standing relationship withManchester United, with a € 71 million per year shirt sponsorship agreement, has undoubtedly made their name more visible in the UK and Europe.

Etihad, the sponsor of United’s neighbours, Manchester City, has a number of touch points that obviously assist recognition. Etihad is the shirt sponsor (€ 45.9m), but also has the stadium naming rights. In addition, the complex that includes the stadium has a dedicated tram stop, Etihad Campus, that also takes the name to the Manchester public.

The football industry’s appeal has certainly caught the imagination of gambling brands, particularly in the English Premier League where almost half of all shirt sponsors are betting entities, casinos or other forms of gambling. Gambling and football have long been related although there is a school of thought that the sport is over-saturated with link-ups with the sector.  Gambling is an area that is very liquid, appeals to the football demographic and has expanded considerably due to the growth of online offerings and new technologies. However, there is something of a moral dilemma here that contradicts many of football’s social responsibility activities. Gambling is a growing problem, often classed as an addiction or a form of illness. Is this an industry that is appropriate for a pastime that attracts huge numbers of children and young people?

Financial services account for 20% of shirt sponsors in the Premier League and across the top five European leagues, have spent more than € 300 million. Airlines and Automotives contribute 10% apiece to the Premier. Interestingly, Germany’s Bundesliga has not followed the same path and has a broad range of shirt sponsors.

With match attendances high in the leading football leagues, particularly the Premier League and Bundesliga, and broadcast coverage at an all-time high, sponsors will undoubtedly continue to seek to exploit football as a market opportunity. Indeed, clubs themselves are constantly seeking new ways to monetise the broad appeal of the game. While some sceptics see football as a classic bubble waiting to burst, there is no apparent sign the appetite is waning. If there is a word of caution, it should be that the global economy is due for a downturn. With football increasingly reliant on income streams that represent discretionary spending, the effect of another financial downturn cannot be underestimated.

At the moment, though football, due to the mass appeal of the game and its ever-expanding global footprint, remains a magnet for big business. For how long, you might ask?