A major new survey of stadium naming rights has identified the Irish market as “very underdeveloped and nascent” and suggests there is a “huge opportunity for stadiums in Ireland to explore stronger commercial agreements.”
The survey by Duff and Phelps is a refresh on one they did four years ago and shows that the overall value of naming rights in the English Premier League has climbed from €84 Million in 2013 to €152.7 Million in 2017.
The study indicates that if Manchester United were to offer seasonal naming rights to its 75,643-seater Old Trafford stadium, this could generate €29.5m per season, €7.9m more than that of neighbouring Manchester City who play in the Etihad Stadium.
The top six clubs who regularly play in European competitions account for over 77% of the €152.7m potentially attributable to seasonal Premier League naming rights.
The two Manchester Clubs alone generate over 33% and the five London clubs over 40% of the total.
Chelsea FC is in third place with over €20m per season potentially available, and Tottenham Hotspur FC, looking to move into a new stadium next season, might generate over €16m per year.
Despite West Ham sitting mid-table in the Premier League, its new 66,000-capacity Olympic Stadium provides the club with an opportunity to maximise its potential market worth.
With its 52,405 capacity at St James’ Park and dedicated fanbase, Newcastle United ranks in the top half of the table. Leicester City FC, 2016 Premier League winners, have already secured a naming rights deal, with Thai travel and retail business King Power and come in at mid-table in the naming rights league with an estimated annual value of €2.7 Million on the rights.
“This research also showcases the commercial opportunity for sporting organisations in Ireland,” said Niall Cribben, Director, Valuation Advisory with Duff & Phelps in Ireland.
“With a few notable exceptions such as the Aviva Stadium, Cork’s Irish Independent Park and Kingspan Breffni in Cavan, the naming rights for Irish stadiums is a very underdeveloped and nascent market.”
“There is a huge opportunity for stadiums in Ireland to explore stronger commercial agreements with top brands. This will be good for the brands, good for the stadiums and the teams that fill them and ultimately good for fans as stadium experiences will undoubtedly improve.”
Aviva recently signed a five-year extension to the naming rights for the Aviva Stadium in a deal which would put it outside the top six in the Premier League but in the top half of the table.
Suggestions of Croke Park having naming rights sold have continually been pushed back and while the value of those would likely be higher again in a pure market it is difficult to see a change in that in the foreseeable future.
Sport for Business wrote in June 2015 that an agreement in principle had been reached between the RDS and Laya Healthcare over naming rights to a redeveloped RDS Arena. Slower than anticipated progress on that development means no deal has been signed yet but when it does it will give a boost to the concept of stadium naming rights and their value here.
We also understand that a new naming rights deal has already been signed between a major Irish brand and a significant stadium that has not previously had naming rights and that this could be unveiled as early as this month.
As ever Sport for Business will endeavour to keep you ahead of the game when it comes to the commercial world of Irish sport.
“Sponsorship demand for the content rights of the top clubs in the Premier League shows no sign of abating,” said Trevor Birch, formerly the Chief Executive of Chelsea FC and now Managing Director and Head of UK and Ireland Sports at Duff & Phelps.
“We have seen enormous increases in rights values of the elite clubs over the last couple of years, especially regarding shirt branding and product endorsement.”
“Although the UK hasn’t embraced Stadium naming rights as enthusiastically as the United States, its potential to become an important revenue stream is highlighted by these figures.”
“Clubs are continually looking at ways to generate extra value and given the gilt-edged international demand for the Premier League TV rights, we may be entering a period where we start to see clubs monetising their stadium rights.”
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