10th May 2021
Manchester United’s commercial dominance no longer guaranteed following loss of £200m deal, says GlobalData
Following the news that The Hut Group is ending its sponsorship of Manchester United’s training kit before it has even begun;
Conrad Wiacek, Head of Sport Analysis at GlobalData, a leading data and analytics company, offers his view on the commercial prospects of the world’s biggest soccer team:
“The question now is how much damage the commercial model can sustain before the owners begin to question the value of their investment? With Real Madrid, Barcelona and Juventus still clinging on to the Super League dream - and as a result, severe sanctions likely to come from UEFA - the threat of further commercial disruption is very real. With fellow English side Liverpool already losing a commercial partner, this is likely just the start of the disruption.
“The Glazer’s business model, when it comes to owning and running Manchester United, has long been focused on driving commercial revenue through partnerships and maximizing the ‘brand value’ that has been built up in Manchester United to increase the overall value of the club. This is a strategy that for 16 years has been quantifiably successful, with the club generating more from commercial partnerships than any other club: as evidenced by THG willing to pay the club £20m per season over the next ten years.
“In light of fan protests against the owners, and THG walking away from a partnership before it has even begun, the commercial model that allowed brands to sell to over 1bn fans or followers worldwide is now is serious jeopardy. With other brands said to be unhappy with the actions of the club attempting to join a European Super League, and the new deal with THG due to start in July, the club now has a significant financial shortfall to make up. The hope will be that other brands do not decide to join THG in walking away, but with fans group already promising to target partners such as adidas and Cadbury, it is likely that this is just the first sign of the upcoming war between fans of the club and the owners.”
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