Having been announced as the latest financially dominant club in the world of football, perhaps shockingly in many people’s eyes, by economic study group Deloitte on Thursday – it appears Manchester United are back on the unrealistically high pedestal on which they belong – if not on the pitch, then at least in the wildly fluctuating stock market that is major-league football. Overtaking both Spanish giants FC Barcelona and Real Madrid in the space of just 12 months, the Red Devils, or rather their Chief Financial Officers, Commercial Directors, Executive Vice Chairmen and Chairmen themselves, have made up hefty openings of a reported €31.3 million on the Catalans, and a further €57.5 million on Los Blancos, no mean feat when you analyse the competitive results on the pitch of Zinedine Zidane’s side against any other.
How have the Mancunians done it? Well, I think we all realise how, from their unparalleled, vastly extortionate commercial partnerships, not least from the Premier League and its global televisual income of around £10.4 billion – of which roughly £51 million goes to each club every season – but also from kit providers Adidas, from whom £75 million is parachuted in every season and kit sponsors Chevrolet, who pump £47 million into the club annually. That’s without mentioning the numerous other rather obscure global corporations, Abengoa, Casillero del Diablo, Mlily and personal favourites Nissin Foods Group, for example, as the ‘Official Sustainable Technology’, ‘Official Wine’, ‘Official Global Mattress and Pillow’ and ‘Official Global Noodle’ partners respectively, who certainly played their parts in contributing towards the club’s reported revenue of €689 million in the 2015/16 season.
But the overall question is not how the club have managed to pull off such an unexpected toppling, the first of Real Madrid - who fell to third, by a deficit of €0.1 to their national rivals - on the list for 11 years, despite the Red Devils’ lack of recent sporting achievement. Rather, it should be; how does this skyrocketing of financial performance, in the wake of painfully obvious footballing nonfulfillment, reveal the brutally elitist, heartbreakingly unjust, self-rewarding reality of top-echelon football in the current socioeconomic era of the sport?
There is an increasingly common phrase across all borders of sport these days. ‘Success breeds success’, apparently. Having been utilised to its fullest potential during the Rio Olympics last year by many BBC journalists, to describe first Adam Peaty’s world record-breaking win in the pool – the first of many British Golds at the Games – then by the man himself after Max Whitlock’s unbelievable double Gymnastics triumph – and finally as a convenient round-up to the complete performance of Team GB, a record-defying one at that, we all started to believe the adage. It became the mantra of personal trainers, sporting chiefs, sub-standard journalists and cringeworthily self-confident athletes everywhere – even having inspired University research on the topic, as well as a number of click-bait articles from sleazy news sites.
Perhaps this theory works on an introspective psychological level, or on the overall form of a sporting club on the pitch – though in any sporting pantheon, most runs of form are unlikely to last, unless you compete in as unchallenging a league as the likes of Celtic or The New Saints (whose ground is actually situated in England despite being the Welsh champions for five consecutive seasons) – but in the field of economic readings in football, it seems not to quite add up. How can a club, who have made their way through four managers since May 2013, while winning only one major trophy (excluding two Community Shields) and qualifying for the Champions League just once in that same period, be top of the global footballing revenue charts, in the wake of the second and third sides in that list winning two league titles, two domestic cups, a Champions League, a UEFA Super Cup and a FIFA Club World Cup (Barcelona) and a domestic cup and double Champions League-UEFA Super Cup-FIFA Club World Cup treble (Real) respectively? In short, how can Manchester United, despite their general lack of vitality following the retirement of Sir Alex Ferguson, be more financially successful than the two most successful clubs in not only Spain, not only Europe, but the world, in the same period?
On a molecular level, it comes down to the established global fan base of the club. The ultimate trendsetters in the now imperative concept of overseas pre-season tours, jetting off to such various regions as Malta, Ireland, the Netherlands, Bahrain, Bermuda, Scandinavia, Thailand, Japan, Austria, Portugal, South Africa, Malaysia and, err, Torquay, in the decade from 1986 to 1996, United were able to expose tens of millions of potential fans to their image. Reaching not only those watching the games, but also those awakened by the hype surrounding the visit of what was at the time the prime British club, whom will likely forever be the most reputable in the UK, these tours garnered, and strengthened, serious support for the club moving into an increasingly commercially-reliant future, as fans meant money, through ticket and merchandise sales, as well as, more prominently as time passed, televisual income. The pre-season tour is a firm United tradition, recently reaching the likes of the USA, South Africa, Australia, Japan, China; all of which you may notice being well-renowned emerging nations for football, proving the credibility of United’s directorship in sniffing out such unprecedented opportunities, pouncing on the chance to beat the competition to market in which the door is being creaked ajar.
In exploiting such newfound fandom in each and every corner of the earth, no matter whether a tour has been taken there by players, such clubs, with the Red Devils as a perfect case study, are able to forge invaluable links with business in such regions, with the examples for United including Nissin and Kansai Paint (Japanese), Chevrolet, 20th Century Fox, EA Sports and Gulf Oil (America) and Mlily (China). Increasing their presence in each region through this practice, while also aiding the corporations no end by allowing them to plaster their brash logos and straplines across Old Trafford, in this case, the Glazers, and before them long-term Chairman Martin Edwards – who largely represented a number of different shareholders, much unlike the Glazers, who now own 75% of the club – had the foresight to realise how football was moving, always remaining one step ahead of the competition. Their business intuition, along with the strengths of the many instrumental advisors on their boards, allowed them to remain über-competitive even in somewhat of an off year, thriving off their past glories at some stages, as they arguably are, more than any stage in their history, today.
It is this business plan which has consistently allowed United to steer clear of UEFA’s Financial Fair Play sanctions, such as those encountered in recent years by the fifth and sixth sides in this year’s Deloitte Football Money League; Manchester City and Paris St Germain. In fact, with a hugely contrasting approach to both the Citizens and Les Parisiens – in that the Red Devils are a club in constant debt, with the Glazer’s empire built on innumerable tactical business loans, secured on the club’s assets and eventually repaid by competitive success and, since 2012, the sale of shares on the New York Stock Exchange – and the vast majority of the funds used in transfers stemming from actual revenue, rather the owners’ pockets. With Sheikh Mansour and Nasser El-Khelaifi, who both largely made their billions – aside from inheritance – from chairing investment corporations, pumping ‘their’ clubs with necessary funding by their own means, which far outstripped comparative club revenue, they were always likely to incur such fines and restrictions as Man City and PSG similarly experienced in 2014. Coming through the other side unharmed, however, these clubs, whom I doubt will challenge the top three clubs in Deloitte’s league in the foreseeable future - a result of their comparatively laughable match day attendances and corporate deals – will be nipping at the heels in a decade or so if their current progress transfers into continental triumph before too long.
Taking this logic into account, how, without any continental achievement to speak of since the 2010-11 season (in which they reached the Champions League final, before falling to a rampant FC Barcelona), other than arguably a CL quarter-final under David Moyes, can Manchester United sustain their financial prominence in the sport? Well, I guess there is the case of supporter (or, in the businessmen’s eyes, customer) loyalty, an oddity in this day and age, with Premier League fans, especially those from outside the parish or nation of their chosen club – of which the Red Devils famously have many - often mocked for their fickleness and infidelity, which the Glazers can be extremely grateful for. It is not an image that many can rid themselves of – becoming a United fan – as the glamour and coveted nature of the club draw many an outsider in, to never let them go. In fact, this fever has said to have infected almost 700 million people globally, of which around half are based in South East Asia.
There’s just something about devoting your entire footballing life to a single cause for just a moment that you can never release, and United, despite riding their luck in recent years through the inept tragedy of Moyes’ reign, the hilarious, yet tiresome, obscurity of Louis van Gaal’s stint and the constant fear of Marouane Fellaini’s impending disastrous urge, have played their cards well throughout. By offering supporters what, with the benefit of hindsight, may have been false hope in the signings of Juan Mata, Radamel Falcao, Ángel Di María, the distinguishable deals with Adidas and Chevrolet, and the dismissals of both Moyes and van Gaal after the fans’ demands became incessant – the likes of Ed Woodward and Group Managing Director Richard Arnold (both former accountants with sound business expertise) have performed admirably in such a tricky period for the club. Without the loss of too significant a number of customers during this period, the club have maintained, if not increased, season ticket and merchandise sales, while also expanding their array of corporate partnerships, significantly increasing their revenue, alongside bloated televisual sums, as Red Football Shareholder Limited (A.K.A. the Glazers) have convinced a heavy figure of individuals to believe in the United dream.
Whether that dream is to be fulfilled on the pitch this season is yet to be determined, but as a frustrating Premier League campaign under new boss and self-proclaimed managerial Messiah Jose Mourinho currently sees them lying in sixth, with FA Cup, Europa League and EFL Cup success still on the cards – but most likely in the latter – United seemingly aren’t living up to such lofty expectations naturally created when being the richest club in the world. All this while runners-up Barça are two points off top spot in La Liga and well-placed in both the Copa del Rey quarter-finals and Champions League RO16, third-placed Real are top in La Liga after a 40 match unbeaten run, also in the Copa QF’s and CL last sixteen, and Bayern Munich, fourth in the list, retain their familiar stranglehold over the Bundesliga, complete with a continental RO16 spot, then it appears England’s telecommunications income separates the sides a little more. It surely can’t be match-day revenue; both Barça and Real’s stadiums are fully packed out at higher capacities than Old Trafford, with the Allianz Arena only a matter of hundred seats behind the Mancunian Theatre of Dreams, sponsorship is evidently out of the equation as, according to a Forbes investigation in May 2016, Real’s trio of deals for kit providers, kit sponsors and ground sponsors totalled $220 million annually, a sneaky $11 million more than United’s similar treble.
In this case, it comes back to the fans again – through the means of those paying subscribers to Sky Sports and BT Sport – to propel MUFC to the top of the economic charts. Or at least you’d think, especially when factoring in the news in April last year that La Liga’s £1.8 billion broadcasting deal in Spain was to be shared vastly more equally, in a blow to both Real and Barça. But it’s important to consider that such a decree only came into action this season, while Deloitte’s test was based upon the 2015/16 season. Earning £51 million, the figure earlier noted, in league televisual income, in addition to an extra £89.6 million (enough, conveniently, to break the transfer record by re-signing Paul Pogba) in ulterior broadcasting income according to Deloitte’s findings, United appear to dominate such standings. In actual fact, from Deloitte’s investigation, it was the two Spanish giants who continued to bat off any English pressure in broadcasting stakes, with Real, for their global exploits, earning £170.3 million, while Barça garnered £151.6 million worth of TV attention. In fact, due to United’s short tenure in both European cup competitions, they even ranked behind their cross-city rivals, as well as Arsenal, Chelsea and 10th-placed Juventus in the broadcasting stakes, with the 27% of their overall revenue created by televisual income only lowered by three of the top 20 clubs in the list; Bayern Munich, PSG and 17th-placed Zenit Saint Petersburg. This was in stark contrast to 20th finishers Leicester City, who saw a staggering 74% of their £128.7 million seasonal revenue stem from broadcasters.
As United’s commercial income percentage of total revenue came to 53%, perhaps it was no surprise then that this was only bettered by the same three sides as aforementioned – the German and French champions, and the Gazprom-backed four-time Russian titleholders. No side could boast such a commercial record, and, come the time of reckoning for all club Chairmen, Executive Vice Chairmen and Presidents at the biggest global clubs on Thursday – as Deloitte unveiled their findings – it turned out this was the area in which United had out-fought their rivals, seeing them to a return to the top spot for the first time since the 2003/04 season’s conclusion. Also topping the standings for match-day revenue, surprisingly enough, despite lagging some 24,000 or so seats behind their second-placed Catalan rivals – down to their lowest season ticket price of £532 comparing to that at Barcelona of £113.93, and a match-day ticket costing at least £36 at Old Trafford, compared to £28.48 at Camp Nou. Factor in the extortionate costs of refreshment, light reading and grub at British grounds – in the form of teas, programmes and pies, then even more can be torn from the pockets of fans at Old Trafford than in sunny Catalonia.
What us fans are left to take from these annual results, other than a great sense of shame in the development of football into an intensely competitive industry, however, is that football is no longer the reason football clubs can strike rich. That’s what Manchester United’s financial readings inform us of, at least, as they have little sporting triumph in recent years to predict their economic upsurge and swift overtaking of their Spanish rivals, who have been the dominant forces in global football over at least the past five years, if not the previous decade. If reputation has been proven topically to mean little on the pitch, then it means a hell of a lot off of it, attracting fans in their hundreds of millions, their hard-earned cash and thereby a number of opportunistic, rapidly developing global corporations and businessmen, all into a particular club not in the wake of excessive achievement, but rather when they are compelled by a timely reminder of the club’s stature on the global sporting stage.
For the Red Devils, a consistent pack of forward-thinking, cunning market-leaders have powered their rise to dominance, utilising their many years of business know-how and arsenal of contacts to secure some of the most unfathomably valuable and extortionate sponsorship deals in sporting history. Considering commercial income makes up more than half of their world-leading revenue, there can be no doubt that exploiting their image, one that has been battered since the loss of Sir Alex Ferguson as manager, has been the major practice of United’s new breed of marketing and accounting gurus in their rise to the top of the global footballing economic rankings. This can be sure to press on over the coming years, but if this cycle is to continue in the same manner, if not on a grander scale, maintaining dominance over the Spanish styles, then it will still fall to men like Mourinho, captains like Wayne Rooney, and star signings in the mould of Paul Pogba and Zlatan Ibrahimović, still to fly the club’s flag. Football can become side-tracked by commercial pandering all it likes, as it is across each and every sector of its extensive existence in our era, but eventually, as always, nothing will come as a result unless those eleven players perform for that one manager across 90 minutes against a side hopefully equally as motivated for triumph on the pitch.
At least that’s what I prefer to believe. United’s story doesn’t tell that at this moment in time, but face further embarrassment in comparison to Fergie’s reign, and they will, undoubtedly, slip back down the rungs of relevance in an evolving sporting landscape. United are not a side who settle for League Cup wins and fourth place finishes. Mourinho is not a manager who will settle for such either. Ibrahimović, Pogba, Rooney, De Gea and Mkhitaryan are not players who should ever be content with sub-par performances. Something has to give, and being the world’s richest club, you’d presume it will, but for the signing of someone like the rumoured Antoine Griezmann to turn around the sporting performances of a club with such a complex financial outlook is surely nigh-on impossible. Yes, United’s squad does appear weak compared to those of their title rivals. But will a few big-name signings fix such a painful hole in what is an inwardly rotten club? Can the answer to the Glazers’, and Ed Woodward’s, dilemma, to satisfy the fans, as well as the American clan’s bank accounts, be to buy into Mourinho’s buy-big, win-big, philosophy with serious gusto, or would that spell the beginning of the end of the Glazers’ Mancunian odyssey, leaving them riled in the face of having to sacrifice personal profits on a game of footballing roulette? Surely, having employed their faith in the Portuguese’s skillset less than six months ago, this is the only path they can now follow if they aim to assert their global economic supremacy, with little room to manoeuvre in the matter? Give it another two years, I believe, and we could be in that very situation. As ever, only time will spell the fate of a club so esteemed by the global public, so revered in history and so financially prominent, and I’m sure it will be fascinating to witness unfold.
Author - Will Hugall
Now a BA Journalism student at Nottingham Trent University, I divide my time between my base in Radford and back home in East Sussex while watching as much football as I can!