When you think of large amounts of money, the first thing that springs to mind could well be, be the payouts from the video pokies at River Belle Casino. We’re the first to acknowledge how generous these rewards are, but even the biggest jackpots pale in comparison to the value of the world’s top soccer teams.
Aggregate Value Contributors
In the science of how much a team is worth, bean counters have identified 4 contributing factors: Matchday, Broadcasting, Commercial and Brand Value. Matchday Value refers to corporate hospitality and gate receipt earnings, Broadcasting Value to how much the teams got for distribution and Commercial Value to sponsorship and merchandising revenue.
Brand Value is the enigmatic pulling power that a side’s name has; how much they can boost a product’s popularity and sales simply by attaching their name to it. When these 4 factors are added together and taxes are deducted, we can put a dollar amount to a sports side.
The Beautiful Profits
These days, big sports mean big business, and some of the biggest business of all is tied to soccer. Huge games and matches are watched by millions of people around the world. That makes the space – in the commercial breaks and on the shirts of the athletes – some of the most profitable and expensive advertising real estate in the world.
To give some idea of the money that’s changing hands, Real Madrid recently sold sponsorship rights for the next four years to Providence Equity for a $224 million upfront payment. Their rival Barcelona started a $246 million sponsorship deal with Rakuten, a Japanese eCommerce group, last year. The Spaniards are also at the beginning of a decade-long kit agreement with Nike that will be worth at least $174 million every year, and the recently inked kit extension deal between Adidas and Juventus will pay $457 million over the next 8 years.
Media rights are also becoming more expensive. Turner and Univision bought the United States rights for the Champions League in a three-year deal starting with the 2018-2019 season back in 2017. They’re paying almost $100 million annually, which is almost twice the bill their Fox predecessor was footing. The international and domestic broadcast rights for the Premier League’s next 3-year cycle will be up a total of 8%. Experts say streaming deals with Amazon and Facebook are also worth millions, and ESPN is reported to have agreed to a $165 million three-year package including FA Cup and Series A rights back in 2018.
Advertisers, sponsors and club owners are always looking for new ways to generate income, and stadium-naming rights seem to be the next big money-spinner. A recent Duff and Phelps study reported that six English Premier League teams – Arsenal, Bournemouth, Brighton and Hove Albion, Leicester City, Huddersfield Town and Manchester City – signed a stadium naming rights deal worth a combined $57 million last season.
Which Teams are Worth The Most?
All those profits that are being raked in depend on the star power of players and teams. The enormous numbers of soccer fans across the world essentially constitute one huge target market, and it’s one that likes to spend a lot. Top-tier players are the superstars of the modern age – lowly mortals like to gather and watch them in action, and to buy merchandise that makes them feel like they’re part of the magic.
But it’s not just soccer that’s a money-spinner. Globally, the 5 sports sides with the largest net worth are, from highest to lowest, the Dallas Cowboys (American Football), the New York Yankees (Baseball), Real Madrid Football Club, FC Barcelona and the New York Knicks (Basketball). Barça and the Knicks are tied in fourth place and are worth $4 billion, while the Cowboys, the Yankees and Real Madrid have values of $5 billion, $4.6 billion and 4.2 billion respectively.
The only sport mentioned more than once in the top 5 is, of course, the Beautiful Game. Current estimates are that half the world’s population consider themselves Soccer fans and it’s safe to say that the game generates more profits than other sports both inside and outside of Europe – except in the United States, according to the data.
After Real Madrid and Barcelona, Manchester United is next on the list of Soccer teams with the highest net worth, at $3.8 billion. Bayern Munich and Manchester City hold fourth and fifth places, at $3 billion and $2.69 billion respectively. That means 2 Spanish, 2 English and 1 German team occupy the top 5 positions.
Real Madrid, Barça and the Red Devils are the only 3 teams to come in the top 5 on all 4 Value measures mentioned above. As Soccer’s popularity continues to soar, its profits are expected to do the same, and the top teams will simply become even more valuable than ever.