The deal was worth £564m for 2019-2022, equating to £9.4m per Premier League team per year. The impact of losing this on the total Brand Value of the Premier League’s 20 clubs would be a loss of £248m, or 7.2%, through the broadcasting revenue alone.
This will also have a knock-on effect for clubs’ merchandising and sponsorship revenue streams, which are more crucial than ever while matchday revenue is impacted by COVID-19. Ten of last season’s Premier League had Chinese sponsors front of shirt, bringing in over £100m in commercial revenue. Chinese secondary sponsors and partners will also be affected, and other international sponsors will be negatively influenced by a lack of Chinese market exposure too. The brand value impact of this lost revenue stream would be over £250m.
Brand Finance’s Global Brand Equity Monitor research from late 2019 showed 46% of Chinese respondents follow football to some degree, and Brand Finance’s 2020 Football Fan Research had the Premier League as the preferred competition of 15.1% of Chinese football fans. Furthermore, a further 26.5% of Chinese respondents follow the Premier League as a secondary league. Based on a population of 1.4 billion of which 610m are an engageable audience covered by our online research, this suggests at least 117m Chinese fans are following the league to some degree, with 42m indicating it is their preferred league. This market is essential for future growth for Premier League clubs, as foreign commercial deals and merchandising are the most actionable strategic options for football club brand managers.
Furthermore, of the top 10 most popular clubs in China, both Manchester United and Liverpool featured from the Premier League. Through the termination of the deal, these clubs may lose share of preference within the market due to lack of accessibility for fans. With the Onset of Covid, major European teams are not able to conduct their usual pre-season tours of Asia causing further disruption.
The Premier League was also perceived to be the best club football league/competition in the world by 18% of Chinese football fans, which was higher than any other competition. The UEFA Champions League ranked 2nd (15%) and the Bundesliga ranked 3rd (13%). For the Premier League to maintain pole position, it may be crucial for the league to find an alternative entry point into the Chinese market for the 2020/21 season.
Extrapolating the effects of losing the Chinese market on the broadcasting, sponsorship and commercial revenues indicates a potential £2.5bn loss to the business values of the Premier Leagues’ clubs.
Note to Editors
Every year, the world’s leading independent brand valuation consultancy Brand Finance values 5,000 of the world’s biggest brands. The latest ranking of the 50 most valuable football club brands is included in the Brand Finance Football Annual 2020.
The 150-page long second edition of the Brand Finance Football Annual features detailed club profiles and provides in-depth analysis on football club brand values, brand strength, enterprise values, sponsorship effectiveness, league reputation, stadia performance, and the role of esports. It includes special contributions by LaLiga, PSG, and ABSA, among others. The Annual builds on the findings of the Brand Finance Football 50 study on the world’s most valuable and strongest football club brands, and includes the methodology and results of the Buro Happold Venue Performance Rating framework.