Coronavirus has now infected even the value of top clubs

The most valuable football brand today is 13-time Champions League winner Real Madrid, with the royal club's value reaching €1.419 billion. However, world football as a whole is heading into an exceptionally difficult period.

Not even football’s elite teams remain immune to the consequences of the coronavirus. After years of continuous growth and an ever-increasing spiral of spending, sports clubs are now undoubtedly entering a period of belt-tightening. This is clearly reflected in the Brand Finance Football Annual 2020 report. It is the first ranking in the football business to partially reflect the impact of the ongoing pandemic.

The report's author, Richard Haigh, selected the 50 most valuable professional football club brands based on various parameters, with a combined total loss of €751 million—representing a 3.7 percent decline. The last time clubs saw a year-on-year drop was in 2014. This time, however, it doesn’t appear to be just a one-off dip in an upward trend.

A major existential threat
"Professional football is facing its greatest existential threat since World War II. Revenue loss, amplified by health risks tied to mass events, has raised major questions about the future of the industry and the financial resilience of clubs at all levels," wrote Richard Haigh in his commentary. (...)

Could the pandemic leave permanent marks on football and dramatically transform the sports business? "The threat is real, but it’s also important to consider which sectors we’re comparing. Football is still in better shape than the airline or tourism industries. I believe it will stabilize over time and return to normal," said sports analyst and football agent Jozef Tokos.

However, Tokos warned that next year’s ranking could see an even steeper decline. "The 2020 ranking couldn’t yet capture the full duration of the pandemic. That’s why another drop is likely. Before the pandemic, the football industry was growing at about eight percent annually," he added.

Zero matchday income
The biggest losses for clubs are due to the absence of spectators in stadiums. And again, clubs from smaller leagues or regions have been hit harder by the loss of so-called matchday revenue. "Most leagues resumed behind closed doors after the forced break. Revenues from the remaining 501 league matches in the top five leagues dropped to zero," noted Richard Haigh.

In Scotland, such income accounts for as much as 43 percent of total revenue, while in neighboring England it’s only 13 percent. That’s one reason why Scottish champions Celtic Glasgow dropped 11 spots in the rankings compared to last year. In 2019, Celtic was ranked 37th; this year, they fell to 48th place. As a result, clubs like Burnley FC and AFC Bournemouth—teams Celtic would likely beat on the pitch—overtook the Glaswegians in brand value. (...)