Soccer is, without a doubt, one of the most important sports today and in history in general, either because of its media presence, its millionaire events that take place annually or the money generated from betting, which They are made in the best bookmakers. So the question arises: is football relevant and necessary for the economy? Today we will discuss this.
Teams and national teams continue to arouse feelings, although in a different way than before. They can be classified as another form of national icon. However, the importance of the financial and media dimensions in recent years has largely supplanted any other cultural significance it might have.
The parallels between economics, finance and football are obvious. As a financial institution, the economy of the game has also been affected by the global economic situation, especially the middle class and the long-standing clubs.
As a result of the global recession, football was also forced to sell assets, take pay cuts and rely on sales abroad. We all know that ticket sales, corporate sponsorships and TV rights are sources of income, but it’s not always easy to figure out why they matter or what they represent.
football around the world
Year after year, the English Premier League and the German Bundesliga remain in the top positions in terms of attendance, even ahead of the Spanish and French leagues. The Italian Serie A occupies the fifth place, with 60%.
Despite increased public demand, German clubs have not raised ticket prices and continue to offer low rates. Member-owned clubs follow German law that requires them to retain a controlling stake in their brand, preventing billionaire investors from buying them.
The Premier League, which has a more equal distribution of television rights, generates a more balanced competition that attracts greater interest from fans and, consequently, greater attendance at the stadiums.
Sponsors and their economic impact
The economy of football is changing. The impact of nations is supplanting the big commercial brands, but their investments are different. Paul Kagame, President of Rwanda, has given 30 million euros to Arsenal as part of his country’s sponsorship deal. Chad, which ranks 122nd in GDP according to the IMF, signed a collaboration agreement with the French team in Metz. These are two examples of governments that use the development of tourism and the football sector as a method to boost their economies.
In the Middle East, diversifying the economy from oil (United Arab Emirates) or gas (Qatar) to tourism and leisure goes hand in hand with other goals. In 2011, the Qatar Foundation, Barcelona’s previous sponsor, donated €150 million to the team. Tamin bin Hamad Al-Thani, Emir of Qatar, bought Paris Saint-Germain in 2011.
According to experts, the objective of these strategies is to weave commercial networks in the West in the face of a modern post-oil economy.
On the other hand, Manchester City owner and member of the Abu Dhabi United Group, Sheikh Mansour bin Zayed Al Nahyan, endorses all the teams his organization sponsors, including New York City. Fly Emirates is the brand with the most sponsored clubs in the European top 50, followed by Etihad and Qatar Airways, which have backed European football giants (Real Madrid, Milan, Roma, Arsenal).
In 2015, Chinese viewers accounted for 38% of the 2.7 billion people who watched the Premier League, a figure comparable to other European countries. The commercial companies are aware of this and, like Chevrolet with Manchester United, they are no longer looking to increase sales in their own nations, but rather to attract consumers from all over Asia, Africa and the Middle East.
Football and the television and streaming industry
In addition to the money it generates in sports betting houses or merchandise, soccer is a powerhouse for the television industry. The 2014 World Cup, for example, was watched by more than 3.6 billion viewers on television. Fox Sports paid more than $400 million for the rights, even at the risk of eliminating the national team. China took similar steps for Qatar 2022, hoping to be the host nation, although it lost to Canada, the United States and Mexico.
In addition, the countries are investing a lot of money to adapt their infrastructures to the competitions. For example, despite sensitive controversies surrounding the event, multiple stadiums were built from scratch for Qatar 2022, creating millions of job opportunities.
There is no doubt that the world of football has had a significant impact on the world economy, whether it is as a generator of jobs, for the television and streaming industry or the large amount of money it generates in sports betting houses, causing this particular sport is undoubtedly influential for the world economy.