Newcastle needs to explore more revenue options

Newcastle United are falling behind most Premier League clubs when it comes to properly utilizing commercial revenue and social media.

Media is taking over, society consumes it, businesses depend on it, and the ability to connect the entire world on one website, one post,  and one click is more valuable than ever before. The Premier League, along with most clubs competing in the top flight, have recognised the terrific opportunity to grow their brand, except, of course, for Newcastle United.

The never-ending, short-sighted approach by Mike Ashley and his staff doesn’t just translate to the quality of the team on the pitch. That stubbornness is also hindering the club in commercial revenue, fan engagement and fan recruitment.

Show Me the Money

Let’s start off with some financial statistics. In the 2018-19 season, the Premier League made approximately £5.3B in revenue, nearly doubling the Bundesliga and La Liga, respectively. Television revenue has been substantial, domestically from Sky Sports, BT Sport, Amazon Prime and BBC, the league made £5B. International broadcasting deals, which scan across 26 different countries brought in a total of £4.35B.

What’s interesting about these numbers is that after the “power-six” clubs, Arsenal, Manchester City, Liverpool, Manchester United, Spurs and Chelsea, 13th-placed Newcastle United are next in television revenue at £22,330,000. Through all of the dysfunction and turmoil people are still tuning in to watch the club known as the sleeping giant.

Expand Social Media

If Newcastle United isn’t going to open up the pocket books for resources on the pitch, what’s the harm in getting fans more connected through that money? A quick scan through the club’s social media pages shows an abundance of simplistic content. The power-six clubs provide fans with a full week experience, from training ground videos, behind the scenes at training, personable player interactions, pre match video teases and tunnel cams.

It’s not a new model of social media strategy. Professional leagues and teams around the world have capitalised on the incredible opportunity to connect and grow the fan base. It’s a simple ripple effect; more engaging content means more eyes on the page and this creates a natural intrigue for both new and long-time fans that goes beyond the 90 minutes on match day. This could lead to more commercial revenue that Mike Ashley has been craving for, so why wouldn’t the club take advantage of a “Newcastle United tunnel cam brought to you by Fun88” concept?” Why not take advantage of more media related revenue opportunities?

Commercial Revenue

Commercial Revenue and sponsorship bring in, on average, £70M per season for Premier League clubs. Newcastle United only profits are roughly £28M, which is only £14M higher than their total in 2012. A clear issue here is that Mike Ashley is using the club to market his own company, Sports Direct, which brings in no outside sponsorship revenue, but rather a personal marketing platform.

Newcastle United are in an interesting position due to their kit deal with Puma and kit sponsor Funn88 expiring at the end of this season. However, with their current relegation battle, is it realistic to gain big commercial deals? Companies will have a hard time paying big dollars to sponsor teams that are in the Championship. Leicester City, West Ham and Everton have all raised their commercial revenue by 20% due to removing themselves from the relegation zone in recent years.

If Newcastle can manage to stay in the best league in the world, it would be a fantastic opportunity to restructure themselves in media and commercially to generate more profits and maybe, just maybe, use it to strengthen the club.