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To the Victor, the Spoils - Leicester City Adds US$135 million to Brand Value

06 June 2016
This article is more than 7 years old.

· Leicester’s brand value is up 132%, making it the fastest growing football club brand

· Manchester United remains the most valuable football brand, worth £1.17bn, despite failing to qualify for the Champions League

· Real Madrid, fresh from Champions League victory and with a lucrative new kit deal, is just US$22m behind United

Every year, brand valuation and strategy consultancy Brand Finance conducts a unique study, calculating the brand strength and value of the world’s leading football club brands. The results are published in the Brand Finance Football 50.

Manchester United tops the table again with a brand value of US$1.17bn (£793 million). A relatively weak, fifth place league finish meant failure to qualify for the Champions League and saw Louis Van Gaal sacked. However a first FA Cup triumph in over a decade and forecasts of continuing revenue growth softened the blow. The new Premier League broadcasting deal saw the rights to the next three seasons’ games divided between Sky and BT Sport for over £5.1 billion, a 71% increase on the previous period, boosting the brand values of all premier leagues clubs and keeping United just ahead of a resurgent Real Madrid.

United may be number one, but Leicester have even more to celebrate. The Foxes’ remarkable on-pitch performance has translated into a commercial fairy tale too. In just one year, the club’s brand strength score has increased by 13 points, while brand value is up 132%. Its brand value of US$237 million (£160 million) puts Leicester 16th globally, up from 42nd in 2015. At the beginning of the decade Leicester languished in the third tier of English football. As recently as 2012, sponsorship revenue stood at just £5.2 million. Revenues were £32 million in 2013/14 and £104 million in 2014/15, reflecting the cachet of Leicester’s newfound Premier League status. This year’s unprecedented title win, it is estimated, will see Leicester receive an additional £150 million.

A club’s brand value is calculated by combining brand strength with revenue data across three major streams; commercial, broadcasting and matchday. With a capacity of 32,000, Leicester’s King Power stadium is one of the Premier League’s smallest, so matchday revenues are likely to grow only slightly. The same can be said for commercial revenues from merchandise as, despite Leicester’s Thai ownership and success this year, clubs such as Liverpool, Manchester United and Chelsea still hold sway in Thailand and wider Asia. In the short term, Leicester newfound riches will flow from sponsors thronging to the club to capitalise on the club’s global visibility and heroic story as well as vast broadcasting revenues from the Premier League and Champions League, which will deliver a minimum of £20 million and likely significantly more.

Brand Finance Chief Executive David Haigh comments, “Leicester’s success is something their existing sponsors will only have dreamed of and their return on investment has been spectacular. Armed with a thorough understanding of what its brand is really worth to potential sponsors, Leicester will now need to carefully manage the flood of offers and opportunities it receives to both maximise revenue and create partnerships that will reinforce the club’s brand as well as its bottom line.”

Real Madrid’s brand value is also in the ascendant after the club claimed yet another Champions League title, “La Undécima”. In his short tenure, Zinedine Zidane has delivered on-pitch success, but just as significantly, is a fan favourite whose presence reinforces Real’s image as the natural home of football’s biggest stars. Though no longer a player, he is undoubtedly a Galactico. The forthcoming renegotiation of La Liga’s TV rights, a massive €140m / year kit deal with Adidas and an AAA+ brand whose strength continues to grow, mean that Real’s brand value is up £251 million to US$1.15 billion (€1.06 billion).


Note to Editors

For more information on the performance of the world’s most valuable football club brands, including versions of the full table in GBP and EUR, please see the Brand Finance Football 50 report. If you have more detailed questions then please get in touch.

Brand values are calculated as at 1/6/2016. Percentage changes vary depending on the currency in which brand values are presented, reflecting the change of exchange rates over the course of the year.


Media Contacts

Penny Erricker
Communications Executive
Brand Finance

About Brand Finance

Brand Finance is the world’s leading brand valuation consultancy. Bridging the gap between marketing and finance for more than 25 years, Brand Finance evaluates the strength of brands and quantifies their financial value to help organizations 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 over 100 reports which rank brands across all sectors and countries.

Brand Finance also operates the Global Brand Equity Monitor, conducting original market research annually on over 5,000 brands, surveying more than 150,000 respondents across 38 countries and 31 industry sectors. Combining perceptual data from the Global Brand Equity Monitor with data from its valuation database enables Brand Finance to arm brand leaders with the data and analytics they need to enhance brand and business value.

Brand Finance is a regulated accountancy firm, leading the standardization 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.

Definition of Brand

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

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 Valuation Approach

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.

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