New Stadium: Huge Commercial Opportunity Arises As Takeover Wait Continues…

Everton are in the process of seeking a naming rights partner for the new stadium at Bramley-Moore Dock

With Everton potentially looking at a brighter future under new ownership, raising revenues will be at the top of the agenda for whoever is in charge.

American billionaire Dan Friedkin is currently in the process of conducting due diligence on Everton after provisionally agreeing on a deal to acquire the club from Farhad Moshiri.

The process could take some time, and no deal is yet done, with the Friedkin Group only progressing if fully satisfied with the financial picture after the period of due diligence is concluded.

The Blues have been financially stricken in recent seasons, with their reliance on external debt rising, and posting heavy losses that saw them fall foul of the Premier League’s profit and sustainability rules (PSR) on two separate occasions. Both incurred points deductions.                                  But Everton have managed to hold on to Premier League status against the odds and the potential for a better financial future goes hand in hand with the move to the new 52,888-seater stadium at Bramley-Moore Dock in time for the start of the 2025/26 season.

The new ground brings the potential for greater commercial revenue opportunities – and that is something that the club has already identified.

Before the Russian invasion of Ukraine back in early 2022, the Blues had in place a deal with former commercial partners USM that would afford the Russian firm first refusal on stadium naming rights. But with the sanctions imposed due to the Ukraine invasion, that deal will never come to fruition and the Blues have been in the market for the last two years for a new partner.

Back in 2022, Everton engaged US firm Elevate Ventures to work alongside the commercial team at the club to try and find a partner for the stadium. Elevate had delivered on finding sponsorship for stadiums in San Jose, for the Earthquakes MLS team, and for the Pittsburgh Steelers NFL team.

There are differences between the UK and US stadium naming rights market, with the value of such marketing inventory far higher in the US due to greater visibility of brands through lack of competition, while big businesses that reside within the states of the team whose stadiums they sponsor has largely been the trend.

In Spain, Barcelona were willing to risk wrath when they sold the naming rights for the Nou Camp to streaming giant Spotify. That deal could have been worth more had it not been for the fact that Barcelona had limited data on their fans, something that Spotify put a great deal of focus on and that damaged the overall value.

There is no doubt that Everton could command a sizeable sum on a multi-year deal from a potential naming rights partner given their status and at a time when the sport is increasingly globalised and reach extends into territories such as the US, which now have a huge interest in the game of ‘soccer’, with the Premier League’s US TV deal making up 20% of all global broadcast revenue for the most recent cycle.

Tottenham Hotspur’s 2019 move to a new purpose-built stadium on the site of their old White Hart Lane ground saw them take residence on one of European football’s most state-of-the-art venues. With a build that cost some £1.2bn plus, with £800m worth of debt still existing on the balance sheet as a result, Spurs looked into stadium naming rights early. Links with potential partners such as Google were mentioned but given chairman Daniel Levy’s notoriety for getting a good deal, Tottenham are understood to be holding firm on what they believe the value of such a sponsorship space should be.

Levy has also previously talked about the potential value of not handing over stadium naming rights to a firm, instead keeping the Tottenham Hotspur Stadium name, something that could be impactful in growing markets, especially given that the stadium hosts NFL regular season games annually.

But the US market is not the UK market and the same kind of success can’t be assumed.

In 2019, financial firm SoFi acquired the naming rights to the home stadium of the Los Angeles Rams as well as the Los Angeles Chargers in a mammoth $600m-plus, 20-year deal. In 2021, Crypto.com paid $700m to take over the naming rights of what was once known as the Staples Center, the home of the Los Angeles Lakers and Los Angeles Kings. In 2024 the Los Angeles Clippers will open a new purpose-built arena in Inglewood, the rights for which have already been sold to Intuit for $500m.

Los Angeles sits in California, a state with a bigger GDP than France, India, Italy and Brazil. It is home to some of the biggest firms in the world, firms that generate billions upon billions of dollars in revenue each year.

There is a trend in the US for major local firms to be the ones to take up the stadium rights. In the absence of front-of-shirt sponsorship opportunities across major North American leagues, although small jersey sponsorship patches are now permitted, and with the in-stadium branding fairly clean in US sport, stadium naming rights have a significant pull.

Speaking to the Bottom Line earlier this year, Daniel Haddad, head of commercial strategy at global sports agency Octagon, explained: “It’s a completely different mark in the US, and I think one of the big mistakes that a lot of European clubs or sports entities make is actually trying to draw a comparison on the value of a stadium naming rights deal in the US and trying to translate it into what that could mean in Europe.

“Essentially, the key difference is that if you look at traditionally how sports teams are able to sell their assets in the US, they don’t have to share, they don’t have the kind of other highly visible points of entry. The market in the US is almost kind of trying to accommodate those with jersey patches, etc. But it’s always been in the US that stadium naming rights is the top-tier asset in terms of brand recognition and exposure.

“There isn’t the same extent of field signage in the US. If you watch an NFL game it is pretty much a clean environment from a stadium branding perspective. Obviously the model there is different and you get a lot of a lot more brands integrated in the broadcast spotlight as in sponsored segments on CBS or ESPN, but the actual playing environment is a lot cleaner.

“Crypto.com is actually one of the exceptions to this, but mostly stadium naming rights are purchased by a massive business located in that state. So, if you look at most of the stadium naming rights deals in the US, the corporation would usually be a US company with its headquarters in that state.

“The economies of these states can be massive. California is bigger than the UK economy, and in every state you have multiple businesses. The signature is billion-dollar revenue businesses that can afford that as a marketing expenditure. So, that’s why it’s a different market.

“The other thing to consider is that it’s always hard to sell a stadium naming rights deal outside of the US when it’s not a multi-purpose, 365-day-a-year venue.