· Guangzhou Evergrande and Manchester United: the two most popular teams in China
· 56% of all Chinese fans follow a Premier League club, exceeding other major European leagues
· Streaming football games is more popular than TV-viewing for younger, more avid fans
· 85% of all fans actively follow other clubs other than their absolute favourite
Valuation and strategy consultancy Brand Finance has conducted a bespoke market research study of 2,800 respondents in 10 major cities in China in order to understand the country’s rapidly growing football fan-base. A survey was created covering 16 different leagues and 314 individual clubs worldwide to unpick Chinese fans’ depth of knowledge, interest and attachment to the major leagues and clubs around the world. The study uncovers how football is consumed in China, the demographics most interested in football and how consumption differs across the different demographics. This report is the first of its kind to examine what drives loyalty amongst fans, the level of loyalty towards fans’ favourite clubs and the nature of support for both domestic and foreign football clubs.
Premier League clubs are by far the best supported of all foreign leagues. 56% of all Chinese fans follow a Premier League team while 34% follow a Bundesliga club, the next best performing European league. Manchester United’s viewership of 42% significantly outperforms its European competitors AC Milan and FC Bayern, which garnered a slightly lower 33%. Cristiano Ronaldo is China’s most popular player while his club boss, Zinedine Zidane, is the country’s most popular manager.
Manchester United’s popularity in China can be partly attributed to the enduring halo effect from the club’s remarkable success during Alex Ferguson’s reign. It must also be recognized however that United has successfully used its strong on-pitch performance to market the club globally in order to maximise financial return, and this has certainly been the case in China. In 2016 for example, Manchester United signed a ‘multi-year’ deal with Sina Sports to make MUTV, the club’s official TV channel, available to 108 million fans in China. Strong social media campaigns have also seen tangible gains as the Red Devils rank second on all platforms except QQ behind only Guangzhou Evergrade, China’s favourite club.
Online streaming is the most popular method of following football amongst the younger, more avid fan base and clubs must capitalise on the opportunity to increase broadcasting and commercial revenue in China through striking lucrative media deals. In addition, there is growing social media usage and engagement amongst Chinese football fans as 32% of all fans followed a league/club/player on social media in the past month. This number increases to 37% amongst the lowest age category (18-27) which highlights the opportunity for clubs and sponsors to engage with fans and increase their following across arguably the most important growth market.
The nature of Chinese football fan-ship means that fans are far less likely to be absolutely loyal to one club as the culture of supporting a club in China differs from the traditional European approach. Clubs are therefore able to benefit commercially from a wider pool of fans than in their own markets with Chinese fans often follow at least 4 or 5 different teams.
Buying merchandise and products from brands associated with fans’ favourite teams is very popular in China. Indeed, 88% of the most avid fans bought merchandise from a club and 42% bought brands that sponsor their favourite club. Capitalising on this commercial potential, Real Madrid struck a deal with Chinese platform Alibaba to sell club merchandise online, increasing their reach to a potential additional 600 million consumers. In order to best exploit a wide pool of fans with a high propensity to spend, clubs must focus their attention on increasing awareness and familiarity amongst the Chinese fan base.
Andy Moore, Brand Finance’s Insights Director, commented: “The importance of the Chinese market for football is growing and the trend is reflected in the differences in brand value between those clubs that do well in China and those that are only starting to realise the country’s potential. European clubs need to be more aware of the needs of their Chinese fans and make an extra effort to communicate with them in Chinese, as the research shows 88% of respondents would like to see websites and content in their native language.”
Brand Finance is the world’s leading brand valuation consultancy. Bridging the gap between marketing and finance, Brand Finance evaluates the strength of brands and quantifies their financial value to help organisations of all kinds make strategic decisions.
Headquartered in London, Brand Finance has offices in over 20 countries, offering services on all continents. Every year, Brand Finance conducts more than 5,000 brand valuations, supported by original market research, and publishes nearly 100 reports which rank brands across all sectors and countries.
Brand Finance is a regulated accountancy firm, leading the standardisation of the brand valuation industry. Brand Finance was the first to be certified by independent auditors as compliant with both ISO 10668 and ISO 20671, and has received the official endorsement of the Marketing Accountability Standards Board (MASB) in the United States.
Brand is defined as a marketing-related intangible asset including, but not limited to, names, terms, signs, symbols, logos, and designs, intended to identify goods, services, or entities, creating distinctive images and associations in the minds of stakeholders, thereby generating economic benefits.
Brand strength is the efficacy of a brand’s performance on intangible measures relative to its competitors. Brand Finance evaluates brand strength in a process compliant with ISO 20671, looking at Marketing Investment, Stakeholder Equity, and the impact of those on Business Performance. The data used is derived from Brand Finance’s proprietary market research programme and from publicly available sources.
Each brand is assigned a Brand Strength Index (BSI) score out of 100, which feeds into the brand value calculation. Based on the score, each brand is assigned a corresponding Brand Rating up to AAA+ in a format similar to a credit rating.
Brand Finance calculates the values of brands in its rankings using the Royalty Relief approach – a brand valuation method compliant with the industry standards set in ISO 10668. It involves estimating the likely future revenues that are attributable to a brand by calculating a royalty rate that would be charged for its use, to arrive at a ‘brand value’ understood as a net economic benefit that a brand owner would achieve by licensing the brand in the open market.
The steps in this process are as follows:
1 Calculate brand strength using a balanced scorecard of metrics assessing Marketing Investment, Stakeholder Equity, and Business Performance. Brand strength is expressed as a Brand Strength Index (BSI) score on a scale of 0 to 100.
2 Determine royalty range for each industry, reflecting the importance of brand to purchasing decisions. In luxury, the maximum percentage is high, while in extractive industry, where goods are often commoditised, it is lower. This is done by reviewing comparable licensing agreements sourced from Brand Finance’s extensive database.
3 Calculate royalty rate. The BSI score is applied to the royalty range to arrive at a royalty rate. For example, if the royalty range in a sector is 0-5% and a brand has a BSI score of 80 out of 100, then an appropriate royalty rate for the use of this brand in the given sector will be 4%.
4 Determine brand-specific revenues by estimating a proportion of parent company revenues attributable to a brand.
5 Determine forecast revenues using a function of historic revenues, equity analyst forecasts, and economic growth rates.
6 Apply the royalty rate to the forecast revenues to derive brand revenues.
7 Discount post-tax brand revenues to a net present value which equals the brand value.
Brand Finance has produced this study with an independent and unbiased analysis. The values derived and opinions presented in this study are based on publicly available information and certain assumptions that Brand Finance used where such data was deficient or unclear. Brand Finance accepts no responsibility and will not be liable in the event that the publicly available information relied upon is subsequently found to be inaccurate. The opinions and financial analysis expressed in the study are not to be construed as providing investment or business advice. Brand Finance does not intend the study to be relied upon for any reason and excludes all liability to any body, government, or organisation.
The data presented in this study form part of Brand Finance's proprietary database, are provided for the benefit of the media, and are not to be used in part or in full for any commercial or technical purpose without written permission from Brand Finance.