The Deloitte Money League is out today, and as we reported today, there’s a piece on how Newcastle were promoted in 2017 by basically continuing to operate as a Premier League club in the Championship.
It was a bold move by the Newcastle hierarchy and thankfully paid off with immediate promotion back to the Premier League.
Another interesting piece and something that Newcastle have been lagging behind in is commercial revenue.
Mike Ashley – hasn’t been able to increase commercial revenues much at all
The three areas of revenue for Premier League clubs are broadcast, matchday, and commercial.
Broadcast are the huge TV right payments we get every season, matchday revenues are the gate receipts, and commercial revenues are where Newcastle are engaged with other companies (partners) like the sponsors of the strips and other such deals.
If we finish in the top ten in the Premier League, then broadcast revenues will be good, and we seem to be a popular side and are on live TV frequently – probably due to Rafa being the manager.
And matchday revenues will be good with St. James’ Park now sold out for every PL game.
Here’s a piece from Deloitte on commercial revenue and the fact that the advantage currently is with the commercial partners of clubs:
“As a key source of revenue under a club’s control, commercial revenue is the area where clubs have the greatest opportunity to differentiate themselves from their competitors.”
“The development and exploitation of commercial opportunities over the next ten years is therefore the key growth opportunity for clubs.”
“Whilst for broadcasting rights, clubs act collectively, they are in a fiercely competitive market for commercial deals.”
“As a result, this market has become increasingly crowded, with clubs at all levels offering commercial partners multiple entry opportunities at a wide variety of price points.”
“The result is a lack of clarity and an advantageous position for the commercial partner, who can play any potential suitors off against each other in order to drive the price down.”
Newcastle should do better as we move up Premier League table and become a more recognizable brand worldwide.
That will allow Newcastle to increase the revenue we get from shirt sponsors and have other partners wanting to be associated with the Newcastle United brand.
In football doing well is really about having the team do well – and everything else – including increased revenues – naturally follows on from that.
If only Mike Ashley would realize that.