After a match at Old Trafford, 70,000 supporters disperse and make their way home or maybe to a bar, pub or restaurant. The chances are, they will come across products that have been touched by the Manchester United franchise. They may drive a car that has some connection to the MUFC partnership programme, they may get some cash from a bank that has links with the club. They may have a drink or two that has come from United’s official spirits partner. Whether it is consumer products, gambling, clothing or coffee, United have a commercial tie-up. This is very much 21st century big-time football at its most opportunistic, a global business that generates cash as fast as it spends it.
Manchester United are not enjoying their most successful periodn on the pitch, but the club’s commercial appeal shows no sign of waning. Indeed, the brand appears to be getting stronger and stronger.
United’s worldwide support base is said to be 659 million, but these figures, which are open to debate, are based on research that is six years old. Nevertheless, the statistics do underline that the club is no longer a UK-centric football institution.vOne glance at Facebook’s top 6 United countries emphasises where the club’s growing fanbase is – and also explains why Premier clubs fly to emerging markets to spread the message:
The UK accounts for just 2.1 million Facebook followers, the US 2.5 million.
United’s dilemma is that its global reach can only produce so much direct revenue. True, when Asian fans visit the club, they spend more money than the average supporter from the UK, a reflection of the desire to buy into the brand and strengthen personal links with the club. But followers on social media can only be leveraged so much and the relationship is as tenuous as the Facebook user who accumulates and acquires friends in a frantic bid to generate fake “popularity”.
When Ed Woodward was appointed as executive vice-chairman of the club in 2012, the development of the Manchester United brand was a priority. Woodward is a former investment banker who worked with JP Morgan, Robert Fleming and PwC. He also advised the Glazer family on the takeover of Manchester United.
Since Ferguson left, there is little doubt that the brand has grown in value. Manchester United’s financial position has grown annually and that includes broadcasting, matchday and commercial revenues. United feature highly in every form of measurement in the market:
But as United’s commercial prowess has been highlighted by impressive rankings, their performance on the field has been impacted by stalling momentum and the rise of clubs with greater financial clout, such as Manchester City.
In 2012-13, United’s revenues totalled £ 363 million, with commercial income amounting to £152.5 million. In 2017-18, the club’s total revenues were £590 million with £280 coming from commercial activity. But over the past two years, the club’s lack of on-pitch success has slowed the rate of growth. In 2017-18, total and commercial revenues showed a negligible increase, hardly surprising given that the past four years have seen little success in the UEFA Champions League.
United’s global presence is boosted by its network of commercial partnerships. The rationale is to indirectly connect with the local population in the name of Manchester United through the arrangements made with locally-established companies. With that in mind, there is a strong emphasis on the emerging markets, both in the regional network as well as the cluster of financial partners. For example, in the financial sector.
To some fans, a list of “official partners” is a source of amusement and embarassment. As an international business, Manchester United is very successful and is constantly broadening its influence and web of partnerships. But a lack of football success draws criticism that the club has become a form of multinational company rather than a football institution. Some of the partnerships would appear to have little in common with a football club from the north of England – United’s latest partnership is with Remington, who have become United’s first “official electrical styling partner”. Such corporate speak means little to the average fan in the stand.
With other companies from fields that would naturally appeal to United’s audience – music, video games, watches and betting – the partnership business establishes multiple touchpoints that include products likely to be on the shopping list of supporters. United even have an official pillow partner in Mlily. And in the case of Asia Pacific, where United’s growth markets are located, there is a rising middle class that has disposable income to spend. Buy with United’s partners and, indirectly, the club benefits. Through this approach, United have found a way to monetise segments of their global fanbase that does not directly contribute to the club’s income.