Liverpool and Western Union: why is Premier League sleeve sponsorship a big deal?

The Premier League made its highly awaited return at the weekend, and it wasn’t just a collection of expensive new players making their debut. With sleeve sponsors appearing for the first time, SportsPro delves into the detail of Liverpool’s deal with The Western Union Company to learn why cashing in is a no-brainer for top-flight English soccer teams and global brands alike.

Liverpool and Western Union: why is Premier League sleeve sponsorship a big deal?

After ten months of all-encompassing competition, the end of the Premier League soccer season is viewed as a chance for teams to rebuild, fans to recuperate and owners to recruit. For baying brands, however, the two-month off-season lull is their cue to clamour for a share in the world’s wealthiest league.

That matter became even more pressing when the curtain dropped on the 2016/17 campaign, following the Premier League’s announcement earlier this year confirming that shirt-sleeve sponsorship would be made available to its teams for the first time in 2017/18.

As English soccer’s top flight returned at the weekend, 11 of its 20 participants were showcasing new sleeve sponsors in the opening round of fixtures. The new inventory has attracted a host of global brands, but has also been met with mixed reviews from fans fearing that their team’s shirts are shedding their historic value to be leveraged as an advertising space for companies to cash in on.

But, as Neymar’s recent UK£199.8 million (US$259.2 million) move from Barcelona to Paris Saint-Germain demonstrates, there is seemingly no limit to the financial ceiling that soccer can smash. With player transfer fees and salaries now routinely transcending the cusp of nonsensical, new sources of revenue are always likely to be greeted with some enthusiasm.

SportsPro goes inside Liverpool’s deal with financial services firm The Western Union Company to find out why sleeve sponsorship seems a logical necessity for teams wanting to keep pace in the Premier League, and also presents the ideal platform for brands looking to position themselves in front of a global audience.

 

Where does the branding appear, and what is it worth?

The shirt-sleeve branding in the Premier League can be a maximum size of 100cm2 and is available on the left sleeve only. The league’s world-renowned lion and crown logo will continue to adorn the right sleeve of every side’s playing tops, while any team that fails to sell the inventory to a brand, or upsell it to one of their existing partners, will have the Premier League emblem displayed on both sleeves.

While it might seem odd that some clubs have yet to take advantage, sleeve sponsorship is not immediately available to a handful of clubs tied into deals with sponsors which maintain exclusivity over the whole shirt, meaning they will either have to wait until renewal, buy their way out of the clause in their current contract, or renegotiate their existing agreement.

The advertising space has been valued at around 20 per cent of the value derived from a club’s main shirt sponsorship deal, which could create a gulf between the league’s elite and its less established teams. This means the likes of Manchester United - who were recently linked, albeit loosely, to a sleeve deal with dating app Tinder - could earn around UK£10 million (US$13 million) each year based on the annual UK£47 million (US$61.4 million) they receive from front-of-shirt sponsor Chevrolet, while a comparatively lesser side like Burnley could only expect to get UK£500,000 (US$650,000) per season in accordance with the yearly UK£2.5 million (US$3.3 million) commitment reportedly made by Dafabet.  

    

What does it offer Premier League clubs?

The concept of sleeve branding is nothing new to European soccer. A number of clubs in France’s Ligue 1 and Spain’s La Liga are already reaping the financial benefits of sleeve sponsors, while Germany’s Bundesliga confirmed in 2015 that its clubs would also be able to sell the space individually ahead of the 2017/18 season as a league-wide deal with logistics brand Hermes ended.   

When it comes to shirt innovation in the UK, however, Liverpool are pioneers. The Merseyside-based outfit was the first English top-flight club to include a sponsor’s logo on the front of their jerseys in 1979 after agreeing to a deal with Hitachi, and also the first to put player names above their numbers on the back of shirts in 1981.

It seems fitting, then, that the Reds are one of the Premier League teams to have secured a suitor for the new inventory. Liverpool’s recent sleeve sponsorship deal with Western Union is reportedly worth UK£25 million (US$32.5 million) over a five-year period, but even as commercial opportunities open up, it still remains important for teams to ensure they are endorsing brands with the right fit.     

“There were two key criteria when we assessed potential sleeve sponsors,” says Olly Dale, Liverpool’s commercial director. “One was history, and the other was the global appeal of both brands. We’re a club with 125 years of rich tradition which is very passionately supported around the world, while Western Union also has 160 years of history and is a recognised company across the globe, so it was important for us to have a partner that mirrors us in that sense.”

Liverpool announced Western Union as their new sleeve sponsor last week. 

The key, then, is forming a mutually beneficial partnership which enables both parties to grow. Premier League clubs have increasingly been trying to expand their international presence in recent years, with an abundance of pre-season tours to Asia, Australia and the US becoming a regular feature of July and August. The opportunity to offer a new space on the shirt, therefore, provides the chance for clubs to attract brands from their target markets and be engaged with a different fanbase all year round, as opposed to in only one week each year.         

“We’re always looking to help grow our fanbase around the world, and that’s something that all of our partners help us do,” adds Dale. “Western Union is headquartered in the US which is a very important market for us in terms of developing the fanbase and growing Liverpool’s profile. The company is also a really well recognised brand across Asia, and those are the two marketplaces in the world that are of the greatest interest to us in terms of how we develop as a football club, so we believe we are positioned incredibly well by Western Union’s presence in those markets.”

The Premier League has also garnered a reputation for some overzealous spending on player recruitment, which has surpassed the UK£1 billion (US$1.3 billion) mark in each of the last three summer transfer windows. Finding additional revenue streams, then, seems a necessary step if clubs are to continue attracting the global stars that make the league one of sport’s most valuable properties.

For Liverpool, though, the timing is ideal. They finished fourth in the Premier League in 2016/17, securing qualification to the Uefa Champions League, European club soccer’s premier competition, for only the second time in the last eight years. For the Reds to maintain their position among the continent’s elite, securing significant added income from new principal partners will contribute towards building a more competitive playing squad.     

“First and foremost, from a commercial perspective, we’re always looking to generate revenues that can support our performance on the pitch, so having an additional principal property to market has obviously been beneficial to us,” says Dale.

“We’re always looking out for new partners that can add value to the club, so having the sleeve sponsorship open up has given us an opportunity that we haven’t had before, and enables us to talk to brands all around the world about being able to partner with us on that front.

“The sleeve sponsorship brings new value to Liverpool FC, and helps us with the overall financial wellbeing of the club. So there are many positives for us in that light, and we expect that to become the norm for Premier League clubs in the future.”

 

Where does the value lie for brands?

Since its inception in 1992, the Premier League has represented something of a commercial mecca for brands seeking to associate themselves with the world’s most popular sport. Indeed, English soccer’s top flight remains uniquely well followed at home and abroad, which is reflected by a UK£5.1billion (US$6.6 billion) domestic TV rights deal worth more than the Bundesliga and La Liga broadcast agreements combined, and billions more coming in from media partners around the world.

For potential sponsors, this provides a cost-effective media buy which guarantees exposure across more than 200 territories in front of a cumulative TV audience that stretches into the billions. Put simply, sleeve sponsorship affords a global advertising platform, and Elizabeth Chambers, Western Union’s chief strategy, product and marketing officer, points out that this coupled, with the chance to partner with one of the UK’s most prestigious clubs, made purchasing Liverpool’s sleeve inventory an opportunity that was too good to pass up.

“Soccer is a very accessible sport for people from all walks of life, and it’s not a property that is going to run out of road in terms of the way in which we can develop it over time,” Chambers explains.

“I wouldn’t characterise Western Union as a serial sponsor of many different sports, like some other brands might be, but we quickly narrowed down to the Premier League because it ticks the boxes across many fronts in terms of scope, scale and target audience.

“Pretty early in our dialogue with Premier League clubs we latched on to Liverpool as a team that had a great fit with us in terms of a brand heritage, an iconic history and a global fanbase that transcends territories in many ways. So in the end, it was a pretty clear choice.”

Aligning values aside, the collaboration makes sense for sponsors from a financial perspective, too. Clubs prosper from the added investment but, in return, brands benefit from the ability to use player imagery in marketing campaigns to the same extent that a front-of-shirt sponsor would, but at a fraction of the cost.

Western Union's association with Liverpool will give the company access to players from all over the world.

This advantage is further enhanced at a club like Liverpool, where manager Jurgen Klopp is German, winger Sadio Mané comes from Senegal and forward Roberto Firmino is Brazilian. Such cultural diversity allows companies to strengthen in less explored markets, where the passion for soccer is equally as rife as it is in the UK, and it is in this space that brand association can have a truly enduring effect - particularly for a company that operates as Western Union does.

“We decided that what was going to be really important for us was an association with the athletes themselves,” explains Chambers, “because those athletes are the manifestation of what we’re trying to put across, which is people who move, seek opportunity and strive, like our customers.

“If you think about the places that the Liverpool players are all from, they all represent someone who has gone to another country and succeeded while still maintaining a relationship with their fans, family and friends back home. That is fundamentally our target customer, so it’s easy for us to wrap a story around that.

“The stuff on social media will be trying to draw on the idea that these athletes are from lots of different countries where we do business, and they have followings that represent that, and you can tell really powerful stories around the individual people.”

Of real value, then, is not only the company’s ability to drive digital engagement through access to players for content creation, but even more so is the exposure the brand will benefit from having its logo publicised on the kit across the club’s digital and social channels.

“If you think about the places that the Liverpool players are all from, they all represent someone who has gone to another country and succeeded while still maintaining a relationship with their fans, family and friends back home.That is fundamentally our target customer, so it’s easy for us to wrap a story around that"

To put this into perspective, Western Union’s Twitter account currently has 650,000 followers, while its Instagram page has just under 200,000. In contrast, eight million fans follow Liverpool’s official Twitter account, in addition to the club’s four and a half million Instagram admirers. That’s also before considering that the majority of Liverpool’s players’ personal accounts have more followers than Western Union across both platforms.    

“It was really important for us to find a sponsorship platform that could be activated digitally,” Chambers says. “Specifically for us, we want to focus on a younger audience that’s digitally savvy and on the go.

“Soccer clubs have done an amazing job - almost head and shoulders above other leagues and sports - in developing social media properties and their ability to reach fans, so that was really appealing to us too because that’s also what we’re good at.

“We will have a lot of extensive access to the digital properties of the club, whether those are social channels or websites or LED boards or indeed the sleeves themselves. That’s going to give us the platform to communicate about our digital offerings, new products and the capabilities that we have within our business. It allows us to tell our story quickly on an LED board, or in the long-form through the unique content and promotions that we’ll create.”

 

Current sleeve sponsor deals

Chelsea - Alliance Tyres

Crystal Palace - Dongqiudi

Huddersfield Town - PURE Legal

Leicester City - Siam Commercial Bank

Liverpool - The Western Union Company

Manchester City - Nexen Tire

Southampton - Virgin Media

Stoke City - Top Eleven

Swansea City - Barracuda Networks

Watford - 138 Bet

West Brom - 12Bet