Controversial sponsorship deals continuing to increase in football

Betting organisations and money-lending companies are becoming more common

Wolves have a sponsorship deal with The Money Shop which charges up to 729 per cent APR. Photo: Getty Images

Wolves have a sponsorship deal with The Money Shop which charges up to 729 per cent APR. Photo: Getty Images

 

It was easy enough to understand Antonio Conte’s somewhat world weary reluctance to get into the circumstances of the mishap that ruled goalkeeper Thibaut Courtois out of Sunday’s defeat at Manchester United.

The fact that his injury appears to have been sustained while playing basketball as part of a club promo for the NBA seems a little comical but, as the Italian knows at this stage, commercial activities give rather more than they taketh away.

If the reports since Sunday are correct then Conte might actually have gotten off lightly for both of his goalkeepers were involved in the session which was intended to promote basketball in England as, it seems, part of a reciprocal deal under which the London club is helped to achieve a higher profile in the United States. The arrangement has been in place for several years.

The sense of urgency around Stamford Bridge about cracking America might have been heightened by the last round of financial results for Europe’s biggest clubs with Chelsea holding on to sixth place but losing ground to some of its leading rivals, most obviously Manchester United, who regained top spot after a year in which their commercial revenues soared.

More than half (53 per cent) of United’s €689 million in income last year came through commercial activities compared to just 36 per cent at Chelsea where a much smaller capacity also limits matchday revenues and so leaves the club disproportionately dependent on money from broadcast rights which, of course, everyone gets.

The club is, after several false starts, addressing the matchday issue by building a bigger stadium while a radical overhaul of its biggest sponsorship deals has been in progress for a couple of years.

Thibaut Courtois missed the clash against Manchester United after injuring himself while filming a commercial. Photo: Mike Hewitt/Getty Images
Thibaut Courtois missed the clash against Manchester United after injuring himself while filming a commercial. Photo: Mike Hewitt/Getty Images

Yokohama Tyres has taken over as shirt sponsors in a five year deal worth just over €47 million a year and another key element will be put in place during the summer when Nike replaces Adidas as the club’s kit manufacturer, doubling the value of the deal in the process from some €35 million per annum to twice that – a little more than €1 billion over the course of the 15 year deal. Although Chelsea have reportedly had to pay the German firm nearly €50 million to end their association early.

Even those deals fall short of United’s with the Old Trafford club taking in a reported €62.5 million each year from Chevrolet and €88 million from Adidas who, it is worth noting, pay significantly more again (€125 million) to Real Madrid each year.

Liverpool, Arsenal, Manchester City and Spurs also reap considerable benefits from similar deals with what might be considered blue chip firms with values, it seems, continuing to rise.

Where United leave everyone else behind is in the number of deals they do, with 27 firms listed as global partners (there are mattress and pillow partners, noodle partners, wine partners and lubricant partners to name just a few).

There are so many, in fact, that the club now employs an army of ex-players as ambassadors – who can reportedly earn low to mid range six figure sums annually as long as they retain an ability to hold up a shirt and stay on message about both the club and the sponsoring company, because current players simply cannot be required to do all the promotional appearances required.

Manchester United take in €62.5 million a year from their deal with Chevrolet. Photo: AMA/Corbis via Getty Images
Manchester United take in €62.5 million a year from their deal with Chevrolet. Photo: AMA/Corbis via Getty Images

Others clearly struggle by comparison and the growing reliance on the gambling industry for revenue suggests a reluctance by mainstream brands to be closely identified with any but the very biggest teams given the cost involved.

Half of the Premier League’s 20 clubs have the names of bookmakers or related businesses on their shirts this season with several of the firms involved seeing the association as a way of growing businesses not so much in the UK but as in areas of Asia, Africa or other parts of the world.

Those 10 deals have a combined value of around €40 million – a fraction of the estimated €265 million value of the 20 – and so clearly the motor or tyre manufacturers, insurance companies and airlines will reach deeper into their pockets when they want to. West Ham and Sunderland are some sort of exceptions, earning around €7 million each per season out of their gambling related deals.

As an industry, though, the betting companies look to be getting a real bargain with online betting on football in Britain alone said to be worth €450 million. The global figure, meanwhile, is put at anything up to €700 billion; a significant portion of it relating to top flight English football.

SportPesa are an example of the Premier League appealing to remote markets with the three year-old Kenyan firm paying Hull City around €3.5 million per year to have their names on the club’s shirts, despite the fact that they have almost no presence at all in the English market. They also have regional deals with Southampton and Arsenal.

When Hull played Stoke on Saturday, both teams’ shirts were sponsored by betting firms. Photo: Carl Recine/Reuters
When Hull played Stoke on Saturday, both teams’ shirts were sponsored by betting firms. Photo: Carl Recine/Reuters

Back at home they are title sponsors of the Kenyan league and the company is reported to attract one million users a day plus another 300,000 who visit the site for the lottery it is licensed to run.

But the Kenyan press report that it enjoys huge spikes in business while English games are in progress and the firm, like so many others, benefits from the number of punters who bet impulsively on games in progress, a scenario in which having your name on screen tends to generate an immediate return.

On their website, there is much talk but little hard evidence of Sportpesa’s “integrity”, “transparency” and “social responsibility” although the company’s owners, a mix of Kenyan and Bulgarian businessmen many of whom had, it seems, previous experience of running failed lotteries in their respective countries, declined to discuss revenues when asked about them by the local media. We can only assume that the people running Premier League clubs would, as in all of their other instances, have done a proper due diligence before taking their money.

To be fair, every single Premier League outfit has commercial links to at least one betting firm, although the nature of those companies varies widely. William Hill, which continues to have a major high street presence in England, re-entered the club market last year by signing deals with Chelsea, Tottenham and Everton while Manchester United lists, amongst so many others, a firm called Donaco as its Official Casino Partner in, amongst so many other places, Myanmar.

It is open to debate whether a club having an association with a firm whose fixed odds machines in shops have been shown to impact disproportionately on Britain’s poorest areas or one overseas whose casinos contribute to altogether more dramatic social problems is worse. That both create employment would clearly be the counter argument made by those involved.

The same might be said of those clubs that still retain links with payday lenders but can anyone really believe that? Betting is regarded as a leisure time activity with roughly half the British population participating and while the figure for England of 0.5 per cent of people identifying themselves as “problem gamblers” probably underestimates the problem, it is clear that most of those who put money on the outcome of games do so without serious issues.

Borrowing money at astronomical interest rates, on the other hand, is never fun, and Newcastle have received so much bad publicity over their deal with Wonga that both sides have made it clear it will not be renewed next summer.

Wolves, though, are still less than midway through their shirt sponsorship deal with The Money Shop, a firm that charges up to 729 per cent APR. That deal is reckoned to be worth just €460,000 a year, prompting the question asked by many of their own fans: Did they really have to do it?

Sunderland, meanwhile, whose shirt sponsor is Filipino firm Dafabet (they also sponsor Burnley, Celtic and Blackburn Rovers) have ties to Satsuma Loans – a trading name of Provident Personal Credit which also operates in Ireland.

On the Sunderland website you can link to the club’s charitable foundation, which, like the one at Newcastle and many other clubs, clearly does hugely valuable work in the areas of education, health and personal development, much though not all of it with kids and young people.

You can check out Satsuma who, like SportPesa, talk a lot about how socially responsible they are before providing an example of their loans that carries an APR of 991 per cent (borrowing €400 over six months and you would repay €746.40) and stating that their maximum rate is 1,575 per cent.

Obviously Sunderland need the money more than Chelsea or Manchester United and whatever they are getting clearly hasn’t been enough to save them this season. But really, can deals like these really have any part to play in a club “connecting” its community?

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