Mishcon de Reya page structure
Site header
Main content section

The Growing Importance of Football Brands

Posted on 13 July 2022

football-goal

In light of the new UEFA Financial Sustainability Regulations and potential regulatory changes across all levels of football governance, clubs must now look to bolster their commercial revenue more than ever before. For many, this will mean extracting as much value as possible from the 'brand' and other intellectual property (IP) rights associated with the club.

David Haigh, CEO of brand valuation consultancy Brand Finance, recently remarked in the World Trademark Review that a number of the biggest football clubs now have 'brand strength' comparable to that of Coca-Cola or Google. The statement was made following publication of Brand Finance's Football 50 2022 Report, which ranked Real Madrid as the world's strongest and most valuable football brand at approximately €1.5 billion (marking a year-on-year growth of 19%).

Growth in brand value is particularly important for English clubs, which now dominate the majority of high-end brand value and marketability tables. From 2021 to 2022, Manchester City recorded the highest revenue in world football and saw a 59% increase in the size of its registered trade mark portfolio – contributing to the club's position as the second most valuable football brand according to the report.

Trade mark protection

A number of clubs have recognised the potential value to be found in trade marks, with all Premier League clubs from the 21/22 season either maintaining or increasing the number of registered trade marks in their portfolio over the last 12 months. In addition, clubs such as Tottenham Hotspur have taken a comprehensive approach to brand protection. Nearly 100 trade marks, including nicknames, logos, fan programmes, mottos and stadium amenities have all been registered by the club in the UK.

A number of clubs have also taken a progressively active stance in protecting and enforcing their registered trade marks. In 2020, Manchester United sued Sega and Sports Interactive alleging that the developer and publisher had infringed one of the club's trade marks within its video game Football Manager. Manchester United further argued that it had not been afforded the opportunity to profit from licensing its own IP. Although the parties later reached a settlement outside the Court proceedings, this instance clearly demonstrated a willingness from the club to take action to protect and enforce its IP.

The Premier League is watched around the world. With that level of recognition, top flight clubs are a constant target for counterfeiters who use the clubs' trade marks on unapproved products. Ensuring that the club crest and name are adequately protected as registered trade marks in all relevant jurisdictions is therefore vital. Other IP rights may apply, such as copyright. However, proving ownership and subsistence of copyright creates an added burden and can present its own challenges. Indeed, one of the main reasons that Arsenal FC replaced its crest to the current version in 2002 was because it was finding it difficult to prove ownership of a crest that had been created over half a century ago and been embellished numerous times over the years. 

Players are also increasingly aware of the value of their own personal brand. Lionel Messi and Cristiano Ronaldo rank as the two players with the most registered trade marks, owning 138 and 89 trade marks respectively around the world. It is no coincidence that these two players also benefit from two of the strongest 'personal brands' in football and bring in the highest individual commercial revenues according to a 2022 report by Forbes. However, there are still a number of players who appear not to have yet taken advantage of their marketability in this space. Liverpool's Mohammed Salah and Manchester City's new £50 million pound signing Erling Haaland in particular reportedly currently own no registered trade marks associated with their name or personal brand.

Looking forward

The immense value embedded within football brands was recently highlighted, with Chelsea being acquired by a Clearlake Capital-led consortium for a reported total of £4.25 billion – making it the most expensive sports team in history. This figure, coming from a hotly contested auction process, is a clear indicator of the future value that many investors see in football clubs and their IP. Much of this derives from the scarcity value involved in owning an elite football club and the IP associated with it. In fact, of the top ten clubs listed in the 2022 Deloitte Money League, only Chelsea have now changed ownership in the previous ten years. As elite clubs continue to become more difficult to acquire, due to the long-term nature of ownership, investing in smaller clubs and building up their brand may become a more attractive proposition.

With the development of new technologies and growth of strategic branding opportunities like fan tokens and esports, football clubs will offer potential investors with new and increasingly innovative ways to commercialise their IP and strengthen fan relationships. Clubs such as Paris Saint-Germain have been at the forefront of this, with year-on-year e-commerce growth of 300% following the launch of its fan token and partnerships with fashion brands such as Dior and Air Jordan. This may be of particular interest to private equity firms in the United States, who are restricted from becoming majority stakeholders in most US-based sports franchises – including teams in the National Basketball Association (NBA), Major League Baseball (MLB) and National Football League (NFL).

As football clubs become more reliant on their own commercial revenue due to new financial regulation, the importance of effectively commercialising their IP increases. Through trade mark protection and licensing, and other strategic opportunities, clubs, players and investors alike can effectively leverage the 'brand' that exists in a sport whose audience continues to rapidly expand.

How can we help you?
Help

How can we help you?

Subscribe: I'd like to keep in touch

If your enquiry is urgent please call +44 20 3321 7000

I'm a client

I'm looking for advice

Something else