Sponsorship revenue falls due to economic crisis

In the study carried out by Sport+Markt, it was found that for the first time in a decade, since the firm has been undertaking such studies, revenue from sponsorship agreements was on the decrease. The undisputed cause is the current economic recession which it was said that is the worst one since the 1930s. The study covers the 6 biggest leagues in Europe: Premiership, Bundesliga, Serie A, La Liga, Ligue 1 and Eredivisie. The English league was also effected by a weaker Sterling.

The revenue dropped from approximately 405 million to 393.2 million Euros, a decrease of 3%. Teams like West Brom, in England, and Deportivo, in Spain, failed to replace their shirt sponsors. The Bundesliga (Germany) overtook the English league as the league with the biggest revenue from kit deals. Finance and insurance firms occupy the largest market share in the shirt sponsorship industry, with 80.7 million Euros. One such firm is AIG (American International Group) which, despite falling a victim of the credit crunch, continued to sponsor the shirts of the European and English Champions, with 19 million pounds annually. This report shows that the shirt sponsorship industry has also suffered the effects of the state of the economy, and this has impacted the revenue of the clubs in the Big-6 European leagues. Although when coming to think of it, most clubs can absorb this loss, others may have more serious problems when the companies actually go bankrupt, as happened for example with West Ham’s XL Holidays.

Official Source