Qualifying for the Champions League would not just be a game-changer for Newcastle United on the field. It would also open up new doors off it, too, if Eddie Howe’s side manage to get over the line in the coming weeks.
It is certainly a lot easier to justify a big-money sponsorship deal is of fair market value if you are a Champions League club and it is Newcastle’s kit partners who really stand to benefit if the Magpies return to Europe’s top table for the first time in 20 years. UEFA’s sponsors are centralised, which means the same brands are promoted inside each of the stadiums in the competition, but the clubs still have full autonomy over who is their front of shirt sponsor, sleeve sponsor and training kit sponsor for European fixtures.
This, in turn, gives these brands increased visibility in foreign markets they would not ordinarily have, which will have been a factor in any talks Newcastle will have held with potential partners of late, including those battling it out for an eight-figure-a-year front of shirt contract. As lucrative as this deal will be – the biggest in the club’s history – it is unlikely to be the last.
Take the club’s training kit, for instance. Rather than tying this in with the overall front of shirt deal, as the club previously did with Fun88, Newcastle could yet sell this space to another brand as Man City (OKX), Manchester United (Tezos), Liverpool (AXA), Spurs (Getir) and Chelsea (Trivago) all have to further boost revenues. Manchester United’s current arrangement with Tezos is worth around £20m-a-year and given where Newcastle hope to go, this looks an obvious area for the club to target. Few know that better than Daniel Haddad, the head of commercial strategy at Octagon, who advises brands such as Mastercard, Budweiser, Standard Chartered and Expedia on their sports marketing asset investments.
“Training kit is an asset that historically a lot of clubs of Newcastle’s level would have probably grouped in with the front of shirt deal to make sure the front of shirt deal delivers premium value,” he told ChronicleLive. “The stakes of the club now and where they are going means they now have the opportunity to sell that outside of the shirt deal. It’s a brand new revenue stream for the club so anything they make on that deal is going to have a purely incremental benefit to the club.
“The majority of the value of those deals comes through social media because it’s a very digital asset. A lot of a club’s content in the lead up to matches is done around the training ground so if a club starts growing audiences digitally, developing a lot more content and getting a lot more engagement on social media, that’s where the training kit asset should start delivering higher value over time.”
There is also the small matter of a sleeve partner. Newcastle’s current arrangement with Noon, which the club specified was for this season, initially, is understood to put the black-and-whites well ahead of Brighton, Aston Villa, Brentford et al.
However, Newcastle’s challenge is to eventually close the gap on those teams at the very top of the commercial field with Manchester United, for example, banking £20m-a-year with sleeve partner DXC. Is that realistic for Newcastle in the years to come?
“The sleeve marketplace has not moved as quickly as the front of shirt marketplace in terms of how values have grown,” Haddad added. “A bit of that is due to COVID and the couple of years there where those values were hit a little bit.
“That asset is going to benefit from the Premier League’s ban on gambling on front of shirt over time. The natural progression for betting companies in the Premier League who have got big budgets, who have been doing shirt deals, would be to trade down to a sleeve deal. That will probably help the value of those deals anyway.
“The sleeve value is one over the next two or three years where you will see quite a bit of growth for everyone underneath the ‘big six’. All the clubs there have got a good growth opportunity on that asset.
“It’s one of those where the difference between those top clubs and the rest has been even more marked on the front of shirt area because it has proven quite difficult for lower end Premier League clubs to sell that asset on more than a one-year deal and really generate top revenues for it. Newcastle will definitely benefit from a good value and because clubs have not pushed the value of those deals to the same extent as front of shirt, they might actually end up being a bit closer to a Spurs or an Arsenal and even closer than they would be on the front of shirt.”
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