When it comes to creating value, no one in football beats Florentino Perez and Real Madrid C.F.
Winning trophies is 60% of the work, but here is how the $6 billion enterprise has done it wearing their suits and ties:
1. Matchday revenue
2. Commercial partnerships
3. Media rights
4. Merchandising
5. Player transfers
1. Maximizing matchday revenue
Santiago Bernabeu is a revenue powerhouse. In the 2019/2020 season, Real Madrid earned over $150 million in matchday revenue, including ticket sales, hospitality, and concessions. Matchday revenues is expected to grow now that the stadium renovation is complete.
2. Securing commercial partnerships
Real Madrid has one of the most lucrative kit sponsorship deals in football history. Their partnership with Adidas was signed in 2019 for $1.2 billion over 10 years.
3. Searching for more eyeballs through media deals
The Merengues benefit from lucrative broadcasting deals, including agreements with Movistar (Telefónica Hispam) and ESPN. In the 2022/2023 season, Real Madrid earned over $330 million from broadcasting rights.
4. Creating demand for your merchandise
The iconic white home kit is a best-seller year after year and one of the highest selling jerseys globally. The club's retail stores at Santiago Bernabeu Stadium and online platforms offer a wide range of branded merchandise, including apparel, accessories, and collectibles. Revenue from merchandise sales surpasses $100 million annually.
5. Buying players who are marketable
Real Madrid's transfers make headlines, with high-profile signings commanding substantial transfer fees. The club acquired Eden Hazard from Chelsea Football Club for a reported fee of $100 million in 2019. Player signings, like Hazard's, drive merchandise sales, with fans eager to purchase jerseys and memorabilia featuring their favorite players.
Everyone wants to be seen with a winner.
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