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A global audience of hundreds of millions watched Real Madrid forward Kylian Mbappé spring past FC Barcelona’s defence and sweep the ball into the corner to open the scoring in last month’s El Clásico.
But any Madridistas inspired to mark Mbappé’s blistering start to the season by purchasing a replica shirt could be in for a bout of sticker shock.
A replica of the French forward’s Adidas-branded shirt, with his name on the back, retails for as much as £185 — or £200 for one with long sleeves and Champions League badges.
The advent of the £200 shirt is seen by some industry executives as a byproduct of prevailing trends reshaping football finance.
Merchandise is an increasingly important growth driver for clubs, as the media rights market slows significantly — and with onerous new regulations linking transfer spending limits with revenues, generating growth off the pitch is crucial to stay competitive on it.
Revenues at the retail and licensing division of FC Barcelona — which charges fans £320 for a shirt with teenage star Lamine Yamal’s name in a limited edition font on the back — rose 55 per cent to €170mn last year.
Manchester United’s retail sales grew 16 per cent to £145mn last year, despite flat revenue overall. Meanwhile, Liverpool FC has built a retail network across Asia and the Middle East, opening its 22nd store last week in China’s Shenzhen.
Alongside the income from selling replica jerseys and other apparel and merchandise, top clubs can also earn tens of millions of pounds a year in sponsorship fees from the sportswear brands that produce their teams’ kits.
Those fees mean brands such as Nike and Adidas often lose money supplying the shirts, they reap the benefits of exposure gained by having their logo on a club’s kit.
“The reason you sponsor a club is to make money selling something else,” explains Gianluca Pavanello, chief executive of Italian sportswear brand Macron, which produces kits for teams including Premier League side Crystal Palace.
Pavanello said the cost of kit deals had soared over the past decade. Earlier this year Puma agreed a new 10-year deal to supply Manchester City kits worth about £100mn annually, up from £65mn previously.
When a new season rolls around most fans do not splurge on high-end replicas, choosing instead to buy so-called stadium edition replica shirts, which are made with more basic materials.
The average price of these shirts for Premier League clubs is £75, with children’s shirts ranging from £45 to £65.
Tom Beahon, co-founder of sportswear brand Castore, said a recent influx of investment into football clubs — including from institutional investors — had focused executives on “monetisation”.
“Kit deals are a part of this wider trend,” he said.
Sportswear executives say that fierce competition between kit makers is enabling top teams to drive up the value of their shirt deals, which results in brands raising prices for fans.
A shirt that retails for £70 will typically cost about £15-20 to manufacture, and be supplied to retailers at a wholesale price of £35, according to industry executives.
While clubs rake in royalties on shirts sold by third-party retailers, the margins for the sportswear brands are thin — typically between zero and 10 per cent, the executives added. Club executives stress their own retail businesses operate on tight margins too.
Adolfo Bara, head of football at sports marketing agency IMG, said only a small group of clubs had the global appeal to command high fees from brands. “The top clubs get a lot of money. The mid-tier get a little, and the lower tier get nothing,” he said.
Premium replica shirts cost more to produce but come with higher margins. The average price of a premium Premier League club shirt, with a player’s name printed on the back, is £132, according to data collected by the Financial Times. Bayern Munich, Paris Saint-Germain, Inter Milan and Manchester United all sell replica shirts priced at or more than £150.
The ability to sell deluxe shirts at higher prices is in part a reflection of an increasingly global fan base, especially for the English Premier League, which earns more from international broadcast rights than it does domestically.
Demand for shirts has also been boosted by football’s growing appeal in the world of fashion.
“We have something in this football business which we have never seen before — that football articles have become fashion,” said Adidas chief executive Bjørn Gulden at a recent industry conference. “People are starting to wear soccer shoes on the street — even with studs — which is kind of crazy.”
Clubs are trying to ride that wave. AC Milan released limited edition kits this year designed by Off-White, the fashion brand founded by the late Virgil Abloh, while Arsenal has previously produced collaborations with designer Stella McCartney.
Gulden said “the forecast for the next 12 months for soccer-inspired products is almost twice what it’s been”, adding that a lot of investment was being directed towards “selling football as a much bigger thing than only for the fan”.
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