Premier League Ticket Prices Cause Uproar Amongst Supporters Ahead of 2014-15 Campaign

Today there will be a very different “March to the Match” in London as Premier League fans join together to show their frustration with the Football Association (FA) and its clubs about the rise in ticket prices. The Football Supporter’s Federation (FSF) is leading the march on the FA’s headquarters that will begin from London’s Marble Arch. The group’s chief executive, Kevin Miles, was quoted saying,

There is an assumption that football has become a middle-class pastime, but I don’t necessarily see that. I see traditional supporters stretching themselves, paying prices they think are unreasonable, to do the thing they love. It is such a captive market, clubs can squeeze people in a way other businesses can’t.

Miles and others in the group are calling on the clubs to lower ticket prices using the increase in broadcast and sponsorship revenue that the league and clubs have enjoyed over the last several years. It is definitely true that soccer clubs have seen a very healthy increase in revenue (generally speaking) over the last several years, however, the industry has also seen the introduction of new Financial Fair Play regulations (FFP), as well as a fairly substantial increase in the cost of top talent. The ultimate message the FSF is sending though is one that stresses to league leaders that soon they won’t have many true supporters to fill their stadiums if the trend persists for too long.

If we look at the most expensive season ticket price of the 12 clubs that have remained in the BPL since the 2010-11 season (MUFC, MCFC, CFC, LFC, SCFC, AFC, AVFC, SAFC, NUFC, WBA, THS, EFC) juxtaposed with average weekly wage data in Great Britain from the Office for National Statistics during the same timeframe, the issue the FSF is calling attention to becomes a little more visible.

Ticket price data courtesy the Guardian. Wage data courtesy the office of National Statistics.

Ticket price data courtesy the Guardian. Wage data courtesy the office of National Statistics.

Since the 2010-11 season the average most expensive season ticket price in the BPL (of the 12 consistent clubs) has gone from £828 ($1,382) to £985 ($1,644), which is an increase of approximately 19%. During that same time, the average weekly wage in Great Britain has gone from £450 ($751) per week, or £23,400 ($39,043) per year, to £477 ($796) per week, or £24,804 ($41,386) per year, which represents only a 6% increase in average wages. The top 3 clubs driving this increase are Manchester City, who went from £515 to £850 (67% increase), Tottenham, who went from £1,175 to £1,895 (61% increase), and Sunderland, who went from £545 to £869 (59% increase). The only clubs to increase ticket prices at or below the rate of average wages were West Brom (-8%), Stoke City (2%), Manchester United (2%), Chelsea (3%), and Newcastle (6%).

The FSF’s concern is not necessarily that ticket prices are increasing, but rather that they are increasing at more than 3 times the rate that the average weekly wage is increasing in Great Britain. If supporters were stretched to make a season ticket purchase in 2010-11, the impact relative to their overall income in 2014-15 is much more significant. In 2010-11 the average Great Britain worker could purchase the average most expensive season ticket package for about 1.8 times his or her weekly wages. In 2014-15 it would cost him or her more than 2 weeks in wages (2.1), increasing the ticket price to weekly wage ratio by +0.3 points, a trend Miles and the FSF would say is unacceptable for a club’s loyal supporters.

Over the last 4 seasons the top 20 clubs in the world (AKA Deloitte’s “Football Money League”) increased their combined revenue by about 37%. While this is not necessarily indicative of the 12 BPL clubs whose ticket prices we have analyzed, 5 of those 12 are included in the top 20 earning clubs in the world, so we can use this growth directionally. As we have outlined previously, soccer clubs generate revenue via three main vehicles: commercial sales, sale of broadcasting rights, and matchday sales.

READ: How Do Soccer Clubs Make Money?

By far, the sector contributing the largest portion of that 37% growth in overall revenue for the world’s top 20 earning clubs is commercial sales, with an increase of 78% over the last 4 seasons. Commercial sales is the broadest bucket and includes everything from jersey sales to sponsorship deals, and we are beginning to see some clubs, like Manchester United and Real Madrid, begin to truly tap into a global market with their brand – but it has only just begun. Broadcast revenues and Matchday sales both increased as well, 18% and 15% respectively, over the same time frame, however, the largest increases are coming from commercial development. This trend will only continue following the heightened focus on the sport following the World Cup in Brazil, and we will surely see significant growth yet again.

FFP certainly has thrown a bit of a wrench into the game for clubs and their financial management and strategy, and clubs are under more pressure than ever to generate enough revenue to cover increasing player costs, stadium upgrades, and other overhead to net out within the “allowable” loss window of €45 million ($60 million) over a 3 year monitoring period. While this pressure to generate more revenue is undeniable, and Matchday sales certainly has its part to play in that increase, clubs need to be careful about pricing their main constituents out of their brand. Attendance rates will fall should the prices get too rich for the appetite of the average Joe in Great Britain, and while they most likely are not splurging for the season tickets, rest assured that the cheapest single match ticket prices are following similar, if not more severe, increases as the season ticket packages. It’s a dangerous game to play with supporters, and the FSF are showing up with numbers to let the FA and its clubs know that they have a few words to say about the matter. Perhaps, as a solution for both parties, clubs could begin to focus on looking into ways that they can exploit and maximize the growth potential previously mentioned in the commercial sector, to be able to maintain, or at this point potentially decrease, ticket prices for their faithful fans.

*Currency conversions via Google Finance 8.13.14

 

What do you think about the rise in ticket prices vs average wages in Great Britain over the last 5 years? Let us know in the comments section below, or via Facebook or Twitter.

Reporting on the business side of the world's game.