The crisis puts Real Madrid sponsors in check

first_img“If there is no soccer, the sponsors may be looking for a refund of part of the money from their contracts or to make adjustments” David Hopkinson, Global Director of Real Madrid Sponsorships The great flow of money towards the accounts of Real Madrid is not the sales of soccer players, the tickets and the subscriptions for the Bernabéu, not even the television rights … it is the advertising and the marketing. An area that was going to generate this season € 371M for the club (45% of income according to the 2019-20 budget) and that it also lives gripped by the coronavirus. Without football, the sponsors do not shine and they are already, also, with the water around their necks. If they collapse, Madrid will not be immune to that tsunami … Closed factories, suffocated sectors …They are not the only sponsors harassed by the coronavirus. The Volkswagen group (owner of Audi, the brand associated with Madrid) also faces severe adjustments (only in Spain is expected a 25% drop in production), while the Korean tire multinational Hankook and the Mexican brewery Tecate (regional sponsor) have had to temporarily close several of its factories. Other white sponsors operate in strangled sectors. Not get rid Sanitas, the activity of private healthcare has fallen 80%, nor the hotel Palladium Group, the great sponsor of Madrid basketball (contributes € 7M). The World Tourism Organization has drawn a apocalyptic setting, with a 30% drop in tourists …A scenario that Madrid attends worried. “If there is no football soon, the sponsors may be looking for a refund of part of the money from their contracts or to make adjustments”, admitted last month David Hopkinson, Global Director of Sponsorships of the Madrid club. If the sponsors continue to be in check, Madrid will tremble. Almost no sponsor escapes the Covid-19 crisis. The entity has signed contracts with fourteen companies, but only Adidas and Fly emirates they have the rank of main sponsors. They are the ones that provide the bulk of the income. The new contract (until 2028) with the brand of the three bands signed in May 2019 means 100 million with bonus which can amount to € 50M more, while the Emirates airline contributes another € 70M.As well, Adidas has had to ask for a loan to the German Government of 2,400 million and there is talk of loans from private banks for another € 600M in the midst of a severe adjustment plan to be able to receive Merkel’s life jacket. Less transparent, but just as real, it has been the UAE’s rescue of its airline, Emirates, the sponsor who pays to appear exclusively on the Madrid shirt. The airline sector is in a “critical moment” according to him Financial Times and foresees losses of € 289bn this year. Emirates is no exception. Almost all of its fleet is on land And it has cut the salary of its 105,000 employees in half.last_img read more