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Daniel Levy wants to completely overhaul Tottenham with £228m masterplan
From a financial perspective, Tottenham are often considered the best run club in the Premier League.
When their commercial aptitude and long-term fiscal responsibility will yield a trophy is a matter for debate, but their business smarts are not in question.
Spurs are enjoying long-term commercial partnerships with AIA and Nike worth a combined total of £70m per season, with the latter locked in until 2033.
The security this provides will be invaluable in chairman and co-owner Daniel Levy’s search for investors, which was revealed earlier this year in the club’s accounts.
Talk of a full or partial takeover has naturally sparked speculation about what kind of club Spurs, who have undergone a remarkable transformation in the last decade, might become in the long-term.
To get the answers, TBR spoke exclusively to Liverpool University football finance lecturer and the Price of Football author Kieran Maguire, who explored Levy‘s masterplan for the North London club.
Tottenham to tap into overseas markets
Thanks to the Son Heung-Min factor, Spurs have a huge following in South Korea and East Asia. And they will tour Japan this pre-season.
Their popularity in the United States is growing meanwhile and they are believed to be considering to the country for pre-season for the first time since 2017.
However, of all the so-called Big Six clubs, their brand is the least recognisable outside the UK.
One area that experts such as CLV Group have suggested could drive huge commercial growth and brand awareness in foreign markets is Web3 and crypto.
Spurs are arguably little late to the party in this regard, with several other Premier League sides signing their first commercial deals in this space several years ago.
They would argue that this is because they have exercised caution in aligning themselves with the right brands, of course.
But in any case, they have now made their first steps into the space with their new shirt sleeve sponsor deal with Kraken.
Maguire, however, is sceptical that the new deal is the golden ticket in terms of monetising Spurs’ overseas following.
“Football clubs in the last 15-20 years, due to the global success of the Premier League, have been trying to open pandora’s box in terms of converting interest into hard cash.
“Therefore, potentially using some form of blockchain or Web3 arrangement is appealing to clubs.
“Additionally, these companies tend to have a lot of start-up capital from the initial people who buy into them. That is attractive.
“However, WhaleFin at Chelsea was a mess. DigitalBits and Inter Milan was too. These organisations don’t always end up paying.
“The value of the deal can be good. The benefits of being sold and hyped by the crypto company seem good.
“But at the same time, they tend to use very vague language in terms of ‘integration with the fanbase’ and ‘bringing parties together’.
“The tangible benefits actually seem to be very light. As those crystalise and fans realise they aren’t getting very much, the relationship can sour.
“Blockchain itself is great. A digital receipt book is a positive for anyone working in the artistic sector, for example, so there are positives.
“But when it comes to the club, how you convert a vague interest into a customer who is willing to pay, say, once a month for a digital relationship with the likes of Spurs is still proving a hard nut to crack.
Spurs keen to dodge repeat of commercial mess
Another sponsorship deal Spurs recently signed was with online bookmaker BetMGM, who have replaced Spurs as their training kit partner.
Getir were forced to end their deal with the club early after the UK arm of their business collapsed, with some reports suggesting the Turkish company still owed Spurs several million pounds.
Similar issues have been seen within football since the proliferation of crypto deals in the last three years.
Maguire believes Spurs will likely have learned their lesson from the Getir saga, however.
“It will be interesting to see whether or not Daniel Levy has been blinded by the cheque,” he said.
“Spurs are notoriously difficult to negotiate with. You would think they will have done appropriate due diligence.
“You’d think they will have had a substantial down payment following their own issued with Getir but also what we’ve seen with other digital companies.
“In that situation, at least you have a cash inflow as opposed to what we have seen with WhaleFin and so on.”
Levy wants to turn Spurs into entertainment brand
Much has been made of Spurs’ new stadium as both a football and entertainment venue.
As well as hosting football matches every fortnight, the space-age 62,000-seater arena has stage myriad pop concerts and non-football sporting events.
That has contributed to Spurs’ staggering commercial income which, at £228m, is the fourth-highest in the Premier League and has almost doubled since the move to the new stadium.
Matchday income has also rise, partially as a straightforward result of expansion but also because of soaring ticket prices at Spurs.
The pricing structure implemented by Levy, coupled with the club’s broader commercial approach, is part of a masterplan to reposition Spurs as a media institution rather than a sports team, claims Maguire.
“There seems to be a breakdown in the relationship between Spurs and the fanbases when it comes to ticket prices.
“When they moved to the new ground, it was sold as a way of becoming more competitive on the pitch. The launch prices were very high. We’re talking six per cent on what was already a very high figure.
“I’m not excusing what we have seen at Nottingham Forest or Wolves, but they were coming from a lower base.
“We’re seeing a substantial increase as far as wages are concerned. They have gone up from £181m in 2020 to £251m in 2023.
“The club will argue that the continued investment in talent has to correlate with increases in revenues as well.
“Like it or not, Spurs have a monopoly on supplying Spurs. The club has a waiting list of seasons tickets and they are fully aware that if season tickets don’t attend matches, there are plenty of supporters who will.
“And while the prices seem very high, because they are, the club will benchmark against Beyonce tickets, other concert tickets etc.
“I was due to go to Spurs to see Pearl Jam, and that was over £100.
“What we are seeing from owners is a repositioning of football clubs away from being sporting organisations towards being part of the entertainment industry.
“They say if you go to a West End, you would pay that, so why would it be any different for Spurs?”
Tottenham to squeeze every penny from matchday income
To fund the investment in talent outlined by Maguire, Spurs are constantly searching for efficiencies and revenue opportunities.
That has extended to a scheme whereby season ticket holders can sell their passes back to the club for a pro-rata price, with the club then selling it on as a single matchday ticket for a profit.
“If you don’t put your tickets up for sale on the exchange for a few matches, they reserve the right to not allow you to renew your season tickets,” said Maguire, offering his view on the initiative.
“Sometimes life gets in the way. There could be a work or family issue that stops going to a game. If it’s a few games per season, fine. If it’s any more than that, you can understand the club’s point of view.
“From a fans’ point of view, it’s costing them a fortune in the first place, so you would likely want to get that money back.
“What tends to be the case is that, say you’re normally paying £60 per match as part of your season ticket, you can sell them back to Spurs for £60, and then they can sell them for £120.”