FC Barcelona, Real Madrid – business models and transfer deals

“In the age of Beckham and Rooney, Ronaldo and Zidane, the attempt to commercially control both images and information around football has never been so great. For those players at the pinnacle of the sport the rewards of playing the professional game and the commercial trappings that accompany it are viewed as recognition that their worth is not purely born of how they play the game but also by their market value as a brand. As any economist will tell you, brands are notoriously difficult things to evaluate and are prone to fluctuations in the potency of their symbolic and capital worth (Thurlow & Jaworski, 2006). Nevertheless, the elite of the worldʼs footballers, the superstars of the game, are now traded on this intangible value with the capture of their so-called ʻimage rightsʼ central to any contractual negotiations between player, agents, club and national federation.” (Haynes, 2007, p. 361)

When investigating Real Madrid’s and FC Barcelona’s business models and the way in which these clubs have increased their revenue streams over the years[1], it shines through that part of the strategy behind this development is associated with investing in players with massive media appeal and hence media value. Especially players like Christiano Ronaldo, Gareth Bale from Real Madrid and players like Lionel Messi and Neymar from FC Barcelona underline the fact that investing in star players are some of the vital building blocks of top football clubs’ business models in pursuit of ROIs. Though, the four players, who are mentioned above, seem to be in a league of their own in terms of value[2]. The rivalry between FC Barcelona and Real Madrid takes place on and off the pitch and both clubs are competing for national and international titles while competing for brand status and global fan appeal and revenue streams off the pitch. In that sense, it is interesting to look at some of the two clubs’ latest signings of marquee players and to consider how each club acts on the transfer market to close the gap to the rival or to position itself in a better position.

Looking at the latest signings, my conclusion is that both Gareth Bale and Neymar are marquee players. Both of them possess excellent football skills but I consider Neymar to be ‘by far the best deal’. First of all, Neymar was cheaper than Gareth Bale (measured on transfer amount). Second, his performances during ‘Confederations Cup’ in Brazil was second to none and showed that FC Barcelona made a good deal because the club had signed the deal at a time before Neymar performed at that level in consecutive international competitions. ‘Confederations Cup’ illustrated how Neymar could take his team to a title against the best international competition, e.g. Uruguay, Italy, and Spain. Neymar is not Pelé, Maradona, Zidane or Messi but he has the potential to become the best player in the world in his time.

At the same time, Neymar’s marketability and approach to modern marketing techniques is very competent. British footballer Joey Barton once stated that Neymar is football’s Justin Bieber and in that regard, I must recognize Neymar’s perfect ability to blend superior ‘on-pitch performances’ with interesting and cognitive commercial decisions. This is in fine alignment with the notion of Haynes (2007, p. 361) that “image rights, broadly defined as the commercial appropriation of someone’s personality, including indices of their image, voice, name and signature, have become increasingly important in the political economy of media sport.” Moreover, SportsPro Media ranked Neymar as the most marketable athlete in the world. Their editor David Cushnan mentioned in that regard that “Neymar is very much the perfect storm: young, gifted and with an Olympics and a home World Cup on the horizon. He is already a superstar in Brazil, one of the world’s most robust economies and a vast market to boot.
If you were a brand looking to make an impact in Brazil, he would certainly be the athlete you’d pick. Neymar is Brazil’s poster boy for its sporting decade.” I am very interested in following Neymar’s performances in FC Barcelona where he will suit up with Lionel Messi and if those two find the right chemistry FC Barcelona will probably be extremely hard to stop in the club’s pursuit for the UEFA Champions League title.

Sources:

Haynes, R. (2007). Footballers’ Image Rights in the New Media Age. European Sport Management Quarterly, 7(4), 361-374.