What’s next for Europe’s top clubs?

BACKGROUND

UEFA have been the governing body of European football since 1954 and are the organisers of the Champions League, the world’s most prestigious club football competition. UEFA have successfully cultivated this competition into Europe’s top prize and have displayed effective business continuity by improving the format and structure often.

The financial benefit of playing in this competition is incomprehensible. As time has passed, the traditional structure of quality has started to shift in Europe’s top leagues. For example, Arsenal placed outside of a European spot in the 2020/2021 Premier League season, the first time they have done so in 25 years. This has ramifications for their revenue streams as they operate on the scale of a club that is consistently qualifying for Europe’s premier competition.

For exactly this reason, the owners of Europe’s top clubs agreed to form their own league, where this crisis scenario is avoided, and their revenue streams are maintained by eliminating the threat of relegation.

FORMATION

The Super League materialised from doubts about UEFA’s capacity to take the competition, and therefore its most contributory clubs, to greater heights.

Firstly, the rebelling clubs felt that UEFA’s position was now obsolete. The ESL would have followed a governing format like the NFL, where the owners of the teams form the board of the competition, meaning they can act in the interests of each other and strengthen their business continuity.

Secondly, the owners of Europe’s top clubs felt that UEFA did not do enough to protect the future of its greatest assets. The capacity for future losses, made possible through football’s pursuit of fair competition, meant that clubs could suddenly find themselves unable to maintain the business costs at which they operate. This was compounded by the COVID-19 pandemic, as the sudden and devastating damage to their revenue exposed their lack of a response plan and led to them forming a breakaway league.

DOWNFALL

The Super League materialised from doubts about UEFA’s capacity to take the competition, and therefore its most contributory clubs, to greater heights.

Firstly, the rebelling clubs felt that UEFA’s position was now obsolete. The ESL would have followed a governing format like the NFL, where the owners of the teams form the board of the competition, meaning they can act in the interests of each other and strengthen their business continuity.

Secondly, the owners of Europe’s top clubs felt that UEFA did not do enough to protect the future of its greatest assets. The capacity for future losses, made possible through football’s pursuit of fair competition, meant that clubs could suddenly find themselves unable to maintain the business costs at which they operate. This was compounded by the COVID-19 pandemic, as the sudden and devastating damage to their revenue exposed their lack of a response plan and led to them forming a breakaway league.

AFTERMATH

The fallout from the ESL has been massive. Not only have most of the domestic governing bodies vowed to sanction the clubs involved, but the corporate reputation of these clubs, and their decision-makers, has been damaged, perhaps irreparably. This is just a further symptom of the PR disaster which is crippling the clubs both socially and economically.

This links to another result of the catastrophe; a maintenance of their financial struggle. A strong reason why the clubs initiated the ESL in the first place is because some, especially Real Madrid and Barcelona, were reliant on the cash injection to cover the massive running costs the clubs have incurred in the pandemic. The downfall of the project has maintained the crisis scenario and leaves them financially vulnerable for the foreseeable future, demonstrating the necessity of a crisis communication plan to protect the brand’s reputation, and therefore profits.

Overall, the questions surrounding this issue seem to arise when the role of sports in society is brought into question.
On the one hand, football has undoubtedly become a business. Therefore, at the end of the day, the owners of these super-clubs are entrepreneurs and are acting in the best interest of their profits – it is effectively all they understand. The future of football is therefore tricky, as billionaire owners look to develop the commercial success of these clubs and turn them into global corporations, supported by the Glazers taking Manchester United public in 2012.

However, what they must start to understand is that the heart and soul of a football club is its fans. Accordingly, they cannot again make decisions based on their wallet and cannot possibly look to make major decisions without consulting the fans. What results otherwise is what we witnessed; an unmitigated PR disaster, a failure to secure business continuity by proposing changes that are detrimental to the rest of the football pyramid, and an entire continent’s fan base doing what ever they can to ruin the corporate reputation of the so-called ‘Dirty Dozen’.