Friday, November 28, 2008

Bundesliga Beats Premier League: Avoids Recession

The news that the total value of shirt sponsorship in Germany’s Bundesliga has overtaken that of England’s Premier League did not come as a surprise, despite the fact that there are 18 Bundesliga clubs compared to the Premier League’s 20. Sport+Markt, which has tracked the value of shirt sponsorship in Europe’s top football leagues for the past three seasons, pointed out that the Bundesliga had only fallen behind the Premier League for the 2007/8 season - it was ahead in 2006/7.

There are many reasons for this, and Sport+Markt point out that Aston Villa started this season with a charity organisation on its shirt (incidentally, West Bromwich Albion is also appearing without a shirt sponsor) and that the value of sterling has fallen against the Euro.

However, my feeling is that the change could signal a fall in the value of shirt sponsorship generally, but that Germany has managed to buck the trend. Germany has a long-established tradition of Friday night football on free-to-air television, which is great exposure for sponsors, and is also available on Setanta, which is also free to subscribers to Virgin Media in the UK (it is also great for Australian National Rugby League, by the way, if you can be bothered to get up at 8am on a Saturday). German companies know that they are getting a great deal of exposure for their Euros, which is something that cannot be guaranteed through screening on pay-TV, as in the UK.

Evidence suggests that we are on the verge of another recession in football. Premier League crowds are down by 920 fans per game this season, according to the results of an investigation by the Daily Telegraph, and it is not unusual to see once-full seats at Premier League grounds now lying empty. Premier League football is a luxury product and whilst I have always found it difficult to relate to footballers paid huge wages, I have noticed that even some of my season-ticket holding friends are starting to agree with me. Whilst they will still consume football, they are getting choosy about how they do it.

I visited a friend - who shall remain unnamed for reasons that will become clear - at the weekend and was not surprised to find him watching the Liverpool vs. Fulham game. What was surprising is that he was watching the game over the internet from a provider streaming coverage from abroad, whereas previously he had subscribed to a pay-TV channel. The Premier League has a dedicated unit designed to shut such broadcasters down, however as new ones appear each day, it faces a mammoth task. Incidentally, my friend was still prepared to check the other scores on his mobile phone.

In these times of financial downturn, combined with digital convergence, sporting bodies need to examine very carefully the way that they leverage media rights and sponsorship in order to avoid a recession – similar to the one that hit English football following the collapse of ITV Digital in 2002.

Andy Brown



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