Artwork by Millenia Kitikul

The EFL Championship: A House of Cards

With its highly competitive system of promotion and relegation, English football has long attracted global attention. The English Premier League (EPL) is the highest tier English football league and most valuable national league in the world, boasting an audience of 3.2 billion and annual revenues of £5.16 billion ($8.86 billion CAD). It is home to notable teams like Manchester United F.C. and Liverpool F.C. The EPL is followed by the EFL Championship League, featuring teams such as Swansea City A.F.C. and Norwich City F.C. It is the second highest tier in the English football league system with revenues of £785 million ($1.35 billion CAD), signifying its powerful position despite being a lower-tier league.

Football clubs have three main revenue drivers: broadcasting, commercial, and matchday.  Matchday revenues have traditionally been clubs’ steady revenue foundation, attracting large ancillary broadcasting and commercial revenues. However, they have declined as a result of government imposed bans on stadium game attendance due to COVID-19. Similarly, while broadcasting and commercial revenues have historically surged, these streams took a hit when games were cancelled during the COVID-19 lockdown between March and June 2020. Most broadcasters have been offered rebates by clubs—the EFL recently returned £7 million ($12 million CAD) to Sky Sports—and commercial entities have reduced contract values and deferred payments into the next year. 

However, clubs’ financial positions were already strained before the pandemic hit. Many EFL teams notoriously burn cash on player wage expenses in hopes of meeting the performance requirements to be promoted to the EPL, which rewards teams with substantial additional revenue. Consequently, the excessive spending has led to many EFL teams recording operating losses for the last four seasons.

Thus, the impact of COVID-19 on revenue streams has only exacerbated the poor financial health of EFL Championship clubs. Many are on the verge of administration (bankruptcy protection), with Wigan Athletic F.C. being the first on the chopping block. A financial bailout from the EPL or “phoenixing'' (fans resurrecting a liquidated club) are potential solutions. However, the most effective tactic to stabilize league spending and ensure the long run financial health of clubs would be the implementation of Deloitte’s suggested annual wage cap of £18 million. Regardless, there remains the need to recover from the impacts of COVID-19 by diversifying revenue streams and adapting to changing fan preferences. EFL Championship clubs should therefore enhance the at-home fan experience through monetized official team apps and a digital fan club ambassador program.

The Online Stadium Experience

A monetized official team app would serve as a club’s roadmap to extending the beloved stadium experience, both during the ‘new normal’ of COVID-19 and after, to fans at home. EFL Championship League clubs should have a monetized official team app for two reasons. Firstly, it would be an additional source of income. Second, it also provides data points on fan behaviour that can be leveraged to strengthen and inform fan engagement campaigns.

The app would serve as a revenue source by operating on a freemium model: a free app with additional fees to engage in certain activities. It would hold tiered offerings available through purchases that bring fans closer to the club and provide a deeper behind-the-scenes experience. Thus, each new app feature would be a distinct sales opportunity for the club. 

While many clubs do not have apps, some such as Swansea City A.F.C. and Watford F.C. have modest existing apps that have demonstrated strong user engagement. Their apps have leveraged common features such as live audio for all matches, push notifications for score and team updates, and exclusive interviews with players. Both clubs with existing apps and those that would look to develop one should push beyond these features and employ more favoured live matchday components digitally. This would make the app a more intimate and experiential offering. 

For example, a memorable aspect of live stadium games is matchday food. The clubs should therefore integrate partnerships with food delivery apps such as UberEats that could deliver stadium-like snacks to fans, ideally with a discount via the partnership. Other features would include paid opportunities to have player meet-and-greets over Zoom, merchandise advertisements linked to player biographies, and content and advertisements from club sponsors.

App Appeal: Building Superfans

For EFL Championship League fans, who are predominantly domestic English supporters, showing their loyalty through team merchandise and travelling to away matches is an integral part of their social lives. This revere fans feel for certain clubs is often driven out of family or close social connections. Their passion can be seen in their digital consumption to keep up with teams outside of live games: 83% of fans use official club websites and 66% use social media channels to access timely information about favoured teams. Creating an official team app would blend many of the benefits of social media and an official website into a ‘one stop shop’ for fans, which is likely to boost adoption. 

Maintaining select free features not only attracts more customer traffic, but allows fans to derive some value without spending. This is likely to increase the time they spend on the app, which creates a greater opportunity to influence them to purchase offerings or spend more on average to support their teams. These free offerings should be kept minimal, but could include trivia games where fans can predict scores or starting lineups with the chance to win prizes. 

Additionally, achieving a critical mass of users through free offerings would allow for more data points to be generated through the app. It would allow clubs to control the fan journey the same way they do in a live setting, but in an even more targeted and efficient manner. The data points on what and where fans direct their attention would enhance understanding of fan behaviours and preferences. This can inform future app offerings, strengthening the app’s ability to generate revenue. Further, it can inspire future fan engagement campaigns or marketing strategies. Most importantly, the data can be used to assess fans’ willingness to pay to ensure offerings are priced effectively. Using the data to inform pricing decisions is critical to drive higher average spending per fan. It would also mitigate fan criticism, such as that expressed when the EPL decided to charge £14.95 ($25 CAD) to watch certain matches.

Finally, these valuable data points and unique new sales opportunities can be achieved at low cost. After the initial development and fixed cost of the app, the successive variable costs will be very minimal. As clubs look to add more value to the app through more behind-the-scenes and other unique opportunities, the digital nature of this development keeps costs very low. 

Who’s the Real MVP? The Twelfth Player.

Akin to how an app can help digitize the live matchday events, fan club ambassadors can serve as the same fan engagement tools as traditional matchday hosts do. Surprisingly, fan ambassadors are absent from all EFL club rosters—as such, an ambassador program of club fans is a cost-efficient way to build advocacy for the club and reach new audiences to ultimately boost revenues. In short, this form of ambassadorship has an inherent advantage: clubs leverage the existing brand loyalty of their fans to produce engaging and passionate advocates. This is in contrast to conventional digital marketing ambassadorship, which often hires solely off of social media followings. 

Pre-pandemic, football clubs around the world had employed ambassadors to varying effects. The most powerful EPL teams used ambassadors to meet-and-greet fans at live games and as customer service agents, while several smaller teams worldwide have hired ambassadors to convert sales leads, organize community programs, and promote special events. Regardless, the use of ambassadors not only as a push-marketing tool but rather as an engagement catalyst is ubiquitous. For EFL clubs, season ticket holders or regular game attendees can be onboarded as ambassadors, and activate key COVID-era engagement activities such as online viewing parties for games, community fantasy tournaments, charity fundraisers, and FIFA or Football Manager video game streams. Paid over three-to-six month contracts, these ambassadors can be powerful forces of community-building for clubs—rallying and solidifying fan bases. Naturally, this excitement translates into app revenues as fans reignite their love for their home club.

In addition, these ambassadors do not require substantial social media followings to hugely impact an EFL club. Official social media accounts can present opportunities for ‘fan takeovers,’ maintaining a tight-knit community of fans that can ultimately drive greater broadcast viewership. At the end of the day, the motivations of a fan who wants to buy game tickets and a fan who wants to become an ambassador are similar: they want to interact with people who are just as invested in the ups-and-downs of the beloved club as they are. This has two consequences: (a) that there is massive feasibility in finding potential ambassadors among the existing fan base, and (b) that reinforcing a community of engagement through an ambassador program can realize greater broadcast viewership in addition to increased app revenues from riled-up fans. By adapting the role of a club ambassador to a solely digital world, EFL clubs stand to solidify their fan bases—with online and delocalized ambassadors paving the way for potential international audiences in the future.

The Away Game: Fan Engagement to Outlast a Pandemic

The business of football is football - the bottom line is to give the fans a club they can be proud of and an experience they can treasure. What better way than offering opportunities to stay engaged with their favourite players, moments, and communities? By bringing the matchday experience online, clubs stand to gain substantial revenues and strengthened fan bases—placing them in pole position for a post-COVID world. With thoughtful implementation, club apps and fan ambassadors can serve as robust supplements to revenue streams long into the future. Potentially, these tactical recommendations might herald advancements for the EFL Championship League’s fan presence as a whole—perhaps one day rivaling the EPL for its top spot.