Feyenoord's commercial income exceeds that of many sub-top European clubs: 'A large amount of TV revenue relieves the pressure from commercial activity'
7 April 2021
An Off The Pitch analysis highlights how Dutch clubs outperform much bigger European clubs on commercial income.
Feyenoord's commercial income is greater than that of many clubs like Sevilla, AS Roma and Southampton, all playing in leagues with more exposure than the Dutch.
Lower income from TV deals forces clubs to focus on other, more controllable revenue streams, explains Feyenoord's commercial director.
An extensive KPI-model along with database utilisation are the focal points of their strategy.
More than 50 per cent of Feyenoord's turnover stems from commercial revenue while the figure is less than one fifth for many other clubs.
In traditional thinking, the more exposure you have, the more you should be able to attract high-value sponsorship deals. And that's usually the case when you look at some of the elite European clubs who are in a league of their own when it comes to commercial revenue.
But below the so-called super clubs a wholly different picture is painted, reveals an Off The Pitch analysis. Here, simply playing in one of the major leagues doesn't equal having the ability to capitalise on broad, global viewership. Take a look at clubs such as Sevilla, AS Roma and Southampton.
Their commercial revenue stands at €17.9 million, €30 million, and €19.6 million, respectively. Besides being much lower than their respective leagues' top clubs, their commercial revenue is lower, by a substantial amount, than clubs such as Feyenoord, Ajax, and PSV – all clubs playing in a lower-ranked Dutch league, whose TV deals and global viewership are significantly less pronounced.
We also have a perspective that is keep the best and improve the rest
So, why is that? According to the commercial director of Feyenoord, Joris van Dijk, the lack of broadcasting income is precisely the reason why a club such as theirs are doing so well when it comes to business ticketing, exposure sales and partnerships.
"We have to invest our time, money and energy in building commercial income because, on the other hand, if you receive a large amount of TV money at the start of the season, it relieves the pressure from commercial activity," he says.
The majority of Feyenoord's commercial income, which stood at €40.4 million last season, stems from B2B sales through corporate partnerships and seating.
Top partners include global brands like EuroParcs, Adidas, BMW, Heineken and Disney, who is producing an all-access documentary on the club – the first in Europe - set to be released on its Disney+ streaming platform.
Van Dijk, a boyhood fan who joined Feyenoord in July last year from a position as director of miniature park Madurodam, explains the club have adopted a unique KPI-model (key performance indicator) based on tv media valuation, market research and database matching to provide partners with insights in exposure, brand performance and conversion.
This helps sell the case that partnering with Feyenoord gives companies access to a valuable consumer segment through which significant commercial results can be achieved.
"People count on us to deliver 365 days a year, and that's something we cherish, but we also have a perspective that is keep the best and improve the rest," van Dijk says.
Manhattan on the border of the Maas
Now, the club are working on growing the B2C side, with van Dijk leading the creation of a compelling brand strategy and vision, taking basis in stakeholder interviews to better understand the values of Feyenoord's supporters.
"I'm looking for insight, what is really happening on supporter level, about how they look at the club, and what their expectations and values are," he says.
With their 112-year-old history, much of what embellish Feyenoord stems from a time period long gone, but as with Rotterdam, the Netherlands' second-largest city in which they are based, you can't always depend on the past for future growth.
"Rotterdam – which is often referred to as 'Manhattan on the border of the Maas' – is known for its port which still is an important economic engine for the Netherlands. But this dynamic place is increasingly known as a trendy nightlife, shopping and a hip artistic city. Above all, Rotterdam is the architecture city of the Netherlands," van Dijk explains.
Accordingly, the city's 180 different nationalities, 33 per cent of them under the age of 26, have different lifestyles and priorities than those who supported Feyenoord when they lifted the European Cup in 1970.
"When we won the title in 2017, after an 18-year wait, young fans had never experienced that before. That adds to the experience that being a Feyenoord fan also means suffering a bit," van Dijk says.
From the 2010/11 season to 2018/19, Feyenoord saw an 87 per cent increase in commercial income, highlighting the effectiveness of their work with executing a strategy independently from sporting results.
Performing strong commercially also helps Feyenoord be more resilient to downticks in other revenue streams. The club had the largest commercial-to-revenue ratio among a select group of peers last season at 55 per cent, ahead of FC Porto's 37 per cent and Ajax' 33 per cent.
Leveraging your golden river
Nationally, around 2.5 million people support Feyenoord, while the club have one million fans in their database - of which 100,000 are paying members.
"The fans are our golden river – what we live from. How can we even more than we do now transform them into people who are engaging within our database, how can we entice people to become members, and how can we further engage them," he explains, is what's central to the club's B2C growth strategy.
Utilising data, in particular, to be able to target supporters with increasingly relevant campaigns is what will support that process and deliver objectively measured ROI (return on investment) for Feyenoord's partners.
"You have to use your insight studies, in combination with your brand insight, to service your products to the right people, at the right moment, via the right media," van Dijk says.
Ultimately, that goes hand in hand with the club's B2B strategy as growing fan- and databases drives greater relevance for corporate partners who are able to leverage their partnership with Feyenoord for marketing purposes by using football as a medium to tell consumers a compelling brand story.