There seems to be not much to contend for when it comes to the fact that soccer is the most popular sports in the world. The game has evolved over the years since its 19th-century invention on the shores of England. Not only has it gained more prominence in terms of popularity, but several soccer players have also been ranked among the world wealthiest people. The individual players are not the only evidence of the prosperity that has perched on the game, club sides across different continents have proven the soccer world is a strong magnetic pull for the economy.
Although soccer originated from England in the mid-19th century, the fame and fate of football have spread all over Europe, so much so that the world has not been left behind in this sports appreciation. Perhaps, the most significant advantage of the game of soccer is the global influence it has on all people beyond the walls of religion, politics, geography, gender, culture, and even socio-economic class. The impact of football is not limited to first or second world countries but far-reaching to all third world countries.
Soccer as entertainment sports and already has a dimension of providing a needed service to the people. However, the parallel events that take place away from the pitch have surprising ways of influencing the game on the pitch. Such circumstances might include the negotiation of players’ transfer or other regular board decisions of the men-in-suits. Imagine a world where over 240 million professionally registered players exist; there has to be business involved.
In Europe, for example, where soccer has carved an indomitable market for itself, professional soccer in the 2016/2017 season had a market value estimate of 25.5 billion USD. In a broader sense, the European governing body, UEFA raked in a total revenue above 2 billion Euros in the same season from the UEFA Champions League alone. It is now hard in an average family for you not to find a soccer fan, with bold undeniable evidence of the love for the game all over our streets and other public places.
Passion versus Profit in Soccer
Football started with enthusiasm, as much as every business startup. However, as it expanded, there came a need to set up structures and organize governing bodies. The overall governing body in the world is FIFA while the other agencies include UEFA, CONCACAF, CAF, AFC, CONMEBOL, and OFC, basically for each continent. This growth of soccer has opened the door for several investors who ordinarily did not begin with football, to capitalize heavily in soccer-related investments. Even small businesses have survived this fast-growing venture. However, what is the significant aspects of the sports that have made the highest profits in the past years?
Club and Nations’ revenue system
With an ever-increasing audience, countries have developed a unique fan base for weekly league matches for club-side football. By current statistics, FIFA comprises of about 205 member associations which span across over 300,000 different clubs that accommodate diverse footballers all over the globe. These population of soccer players is not limited to male players alone; women football is daily gaining more reputation in the world. The worth of the wealthiest club in the world, Real Madrid, according to the latest ranking, is about 750.9 million USD. This growth in financial stature is a direct offshoot of their revenue from winning the Champions League for the third time in the 2018/2019. There is also an excellent business opportunity for you as a ticket sales representative company.
Between two of the wealthiest clubs in the world, Manchester United and Real Madrid, the former sold Cristiano Ronaldo to the latter for a then whopping sum of 132 million USD which was a record transfer. However, as if that was not enough, Juventus announced their snap up of the famous player for a sum believed to be between 117 and 131 million USD to play in the Italian league. The worth of the player was inarguable after scoring 451 goals for the Spanish giants over a period of 9 years. What more shall we say of Neymar, Mbappe, Coutinho, Dembele, Pogb, and Bale, to mention a few; all of whose transfers were not less than 100 million USD. It should be noted, however, that the worth of a transfer is not the exact wealth of a club as some clubs still have outstanding debts. It has a direct relationship in building stature and other off-pitch transactions.
Media and Advertising
In the year 2012 alone, the English Premier League as a top tier league signed a contract worth a record of 4.7 billion USD for three years for an only television deal. In the same year, the German Bundesliga, another top tier signed close to 3.2 billion USD deal for a period of 4 years. When compared with the initial deals for both clubs, there were about 72% and 52% increase respectively.
Several companies have partnered with different leagues and tournaments of the world to promote their brand as well as invest in the competitions. Interestingly, the kinds of company that can invest in soccer are not limited to only a sector. You will find tire companies, car brands, insurance companies, airlines, mobile phone, and IT companies optimizing their chances.
Have you ever wondered why football clubs pay so much as 222 million USD for a single player? One notable answer is the worth of that player’s shirt sponsorship deal. For example, from shirt sponsorship deal alone by Chevrolet for Manchester United, the club receives about 80 million USD per season. Similar clubs who earn lump sums from sponsorships include Barcelona, Arsenal, Liverpool and Manchester City FC.
As an entrepreneur, it is time you started thinking of how to invest in the football business. A simple way to begin football investments is by buying shares into the club’s financial status and worth at the next opportunity. Similarly, if as a brand manager, you create a sellable idea that promotes the club, you are definitely in for the big game.
In recent times as well, soccer business has diversified into sports betting with irresistible stakes. Investing in sports betting also comes with its business aspect with the knowledge of permutation to take a good chance that eventually pays off. However, the right side of soccer has not been devoid of its silver linings, such as clubs running into unpredicted debts but as a professional investor, a good knowledge of your economics at both macro and micro levels can give you an edge. Soccer continues to rise in success for those who will be bold and strong enough to consider it a viable and profitable venture.