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The business of Sports: Manchester United


Some of the legendary football players - right from Cristiano Ronaldo, Ryan Giggs, David Beckham to Wayne Rooney (and many others) all played for the same club “Manchester United”. This football club started in 1878 has a long story of success, many might know about this but hardly people know about it as a company. Yes, Manchester United is a listed company on the NYSE. This means that you can become a part-owner of the company.


But how do you evaluate a sports business and understand the key metrics? To know about continue reading the article.

MANU a brand: An internet-based survey was conducted during 2019 that included respondents across 39 countries. The survey indicated that MANU has 1.1 billion fans and followers worldwide, thus making it a global brand. The majority of the accounts from Asia Pacific, followed by Europe, the middle east, Africa, and America.

Business Model and Revenue Drivers


The greatest asset a football club has is its players, coaches, managers, scouting agents, and other staff. Therefore, this business is highly dependent upon the ability to retain key personnel and the brand value of the first team players.


For example, Today if MANU signs in a very famous player say “Lionel Messi” the value of the company will go up as Messi has billions of fans and followers on an individual level.


Also, the performance of the key team can affect the streams of revenue like ~


· Sponsorship revenue through sponsorship relationships;

· Retail, merchandising, apparel & product licensing revenue through product sales;

· Broadcasting revenue through the frequency of appearances, the performance-based share of league broadcasting revenue, Champions League/Europe League distributions MUTV distribution through linear and digital platforms; and

· Matchday revenue through ticket sales.


The company generates revenue through three principal sectors – Commercials, Broadcasting and Matchday


Commercial: Within the Commercial revenue sector, they monetize their global brand via two revenue streams: sponsorship and retail, merchandising, apparel & product licensing.

Sponsorship: This is typically the sponsorship relationship with leading global companies by monetizing the value of the global brand. Sponsorship revenue was £182.7 million, £173.0 million, and £173.0 million, for each of the years, ended 30 June 2020, 2019, and 2018, respectively.


Retail, Merchandising, Apparel & Product Licensing: MANU markets and sell sports apparel, training, and leisurewear, and other clothing featuring the Manchester United brand on a global basis. In addition, they also sell other licensed products, from coffee mugs to bedspreads, featuring the Manchester United brand and trademarks. These products are distributed through Manchester United branded retail centers and e-commerce platforms, as well as their partners’ wholesale distribution channels. Their retail, merchandising, apparel & product licensing revenue was £96.3 million, £102.1 million, and £102.8 million for each of the years ended 30 June 2020, 2019, and 2018, respectively. Revenue for the year ended 30 June 2020 was impacted by COVID-19 and the closure of the Old Trafford Megastore from mid-March 2020 to mid-June 2020.

Commercial revenue was £279.0 million, £275.1 million, and £275.8 million for each of the years ended 30 June 2020, 2019, and 2018, respectively.


Broadcasting: The company benefits from the distribution of live football content directly from the revenue they receive and indirectly through increased global exposure for their commercial partners. Their broadcasting revenue was £140.2 million, £241.2 million and £204.2 million for each of the years ended 30 June 2020, 2019, and 2018, respectively.


Matchday revenue from the supporters is a significant portion of the overall revenue: A significant revenue is derived from ticket sales and other match day revenue and share of gate receipts from domestic cup matches. During the season, the MANU played a total of 24 matches and the matchday revenue accounted for GBP 89.8 Mn for the year ended 30 June 2020. The collections were hit due to the ongoing pandemic as there were restrictions on ticket sales.

Future of clubs and live sports


Football’s growth and increasing popularity is primarily a product of consumer demand for and interest in live sports, whether viewed in person at the venue or through television and digital media. The sport’s revenue growth has been driven by the appetite among consumers, advertisers, and media distributors for access to and association with these live sports events, in particular, those featuring globally recognized teams.


As television and digital media such as broadband internet and mobile extend their reach globally, the availability of and access to live games and other content of the leading European leagues has increased and live games are now viewed worldwide. In addition, advances in new technology continue to both improve the television and digital media user experience and the effectiveness of sponsorships and advertising on these platforms.


These trends further strengthen the commercial benefit of associating with football for media distributors and advertisers and increase the global opportunities for the sport.


Moreover, in the era of digitalization and digital connectivity, people have lost real connections. We believe sports could be the best way to connect, chill, and enjoy with friends. Thus, there lies a great future for live sports and football clubs to capitalize on the opportunity of reconnecting the world in a much meaningful way.


This article is for information purposes only, and not to be considered as investment advice.

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