Why? One reason and one reason only: the EPL has mastered the art of sponsorship deals - both amongst the league as a whole, as well as individual teams and clubs.
Breaking Down The Numbers:
Although from 2010-2012, the NFL remained steadily ahead of the EPL in commercial revenue, it is evident in both charts above that the Premier League has taken a firm lead. According to Dan Jones, a partner at Deloitte, this lead is attributable to the global appeal of the Premier League.
Nonetheless, the EPL's commercial revenue dominance is heavily linked to a clubs on-field performance - an aspect that is exceptionally different between the two leagues. For example, 82% of the EPL's commercial revenue was distributed amongst the league's top 6 teams: Arsenal, Liverpool, Manchester City, Manchester United and Tottenham. With exception of Tottenham, each of the above teams were prospected to have a "real" shot at winning the league during the 2012-13. On the other hand, the 2012-13 Superbowl Champions, the Seattle Seahawks, earned less than average revenue during the 2012-13. Thus, commercial revenue is not linked to performance in the NFL.
So, it's clear that the NFL could learn a thing or two about signing sponsorship deals, while the EPL should pay a little more attention to fair distribution of revenue...
Correct me if I am wrong, but doesn't the EPL have fewer teams than the NFL? Also, is the average the of earnings for the EPL skewed by any top team? The EPL major teams have been known to stand far beyond the rest financially. The NFL, however, has a more even distribution among the teams in the league. Therefore, there are not as many NFL teams worried aobut falling into debt that could dismiss them from the league. I believe the NFL handles the finances better with not having certain teams so far beyond the rest.
ReplyDeleteYes, there are fewer teams in the EPL. To my knowledge, though, the number of teams in each respective league plays no role in the average distribution of wealth. However, I could be rightfully misinformed. Even so, I agree with you that the NFL, without question, handles finances in a much better manner than the EPL. That's mainly the point I intended to reach at the conclusion of my post!
DeleteIt makes sense that the EPL has taken the lead in commercial revenues because of their larger global appearance. Since the NFL has a more narrow focus, the US, it is not as beneficial for global sponsors to support the individual teams as it would be to support the individual teams in the ELP. It also makes sense for the sponsors to concentrate their support on the top 6 teams because the teams that are winning are the teams that people want to watch. In turn, more viewers means more publicity for the sponsors.
ReplyDeleteI definitely agree! Because the EPL is so concentrated on their top clubs, it without question makes more sense (at least from a financial standpoint) to sponsor said clubs.
DeleteMany companies are interested in sponsoring large European futbol teams because of their large presence in almost every country in the world. Futbol is known as the most popular sport except for in the United States, so it would only make sense for companies to target the largest global audience.
ReplyDeleteI completely agree. Football clearly has the most widely global presence of all sports, so it naturally makes sense for companies to want to sponsor them and have their brands present throughout the world. Going off of that, though, do you think it would be possible for teams in the NFL to follow such a sponsorship process? Obviously these team's don't have as large of a presence, but in my opinion there is still a lot a major corporation could gain from becoming a primary sponsor for an NFL team.
DeleteI have to agree with Stephen. It is much more profitable for Nissan to sponsor an EPL team because of the desire to extend their brand to the european market and to other sectors of the world. The attractiveness of sponsoring an EPL team comes from the ability to expand the brand to all parts of the world especially if you are a top 6 team in the league as you mentioned before.
ReplyDeleteWe all seem to have very similar viewpoints as to why it is so profitable for larger corporations to sponsor a club in the EPL. What this conversation has really gotten me thinking, is if it is at all possible for the NFL to mimic such a concept at all in the future.
DeleteIn my opinion, if NFL wants to mimic this model, they have to figure out a feasible way to expand its market out of US. As Stephen mentioned, football is still seen as the most popular sport in the world. American football cannot get enough attention out of US so that NFL cannot get enough exposure in the world. And I think this is the most important thing that the sponsor cares.
DeleteWithout question, global recognition is the most important aspect for a sponsor. While American football may not have the potential to expand outside the United States, I do think, though, that there are American companies that could benefit greatly from sponsorship of individual teams.
DeleteCompanies focus on sponsoring large European futbol teams because of how much they can impact and affect the dynamic of things in almost every country in the world. Futbol is so well-known that is makes sense they want to target these large companies. "Go big or go home" if you will.
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