Premier League – losing the attendance battle?

16 Mar

Recently Í wrote an article on Premier League attendances for the When Saturday Comes website. My argument involved pointing out the irony that just as the Premier League had concluded yet another record breaking deal, when it came to actual live spectators its record has been less good – in fact for over a decade, since the early noughties, the average attendance figure has been virtually static. I also argued that I felt not enough of the TV money coming into the league is being set aside for stadia development. It is these issues which I turn to in more detail.

The 90’s stadia boom

Looking through my old Premier League 95 sticker album one of the most striking things is the number of pictures of half-built stadia; The Taylor report, new sources of finance, and the impetus provided by Euro ’96 – the tournament which was billed as rehabilitating England’s worldwide footballing reputation – all combined to turn back years of under investment (A sign of just how acute this underinvestment had been is the fact that when Scunthorpe United moved to Glanford Park in 1988 it was the football league’s first new purpose built ground since 1955).

Unsurprisingly this building-boom went hand-in-hand with an increase in attendances. By the late 1980s there had already been some tentative growth following a several decades-long slide which dated back to the 1950s, but it was in the 1990s that attendance really surged ahead and by the end of the decade the average attendance was around 10,000 higher than it had been at the beginning, a growth of around 50%

Noughties stagnation

By the early noughties however, this growth had begun to level off. This was not through any shortage of demand though as the Premier League, attracting the best players in the world with a winning combination of high wages and low taxes, continued to draw fans back to live football. Rather it was a stretching of supply. As the Premier League’s own figures highlight the stadium occupancy rate had rocketed from 69.6% in its first season in 1992/93 to 91.8% by 1997/98.  In the last full season it was 95.9% in 2013/14. One inevitable consequence of demand catching up with, and in many cases overtaking, supply was sharp rises in ticket prices as clubs sought to take advantage of the law of supply and demand to maximise their matchday revenues.

PL BL att chart2

Meanwhile in Germany Bundesliga attendances, which had also experienced growth in the 90s, continued to increase. As the 2006 World Cup approached a new generation of German Stadia was emerging which were, on the whole, bigger than their English counterparts. For the tournament almost $2bn was spent on the construction of four new stadia, including the Allianz Arena in Munich with a capacity of 69,901 and a cost of $473 million.

Building for the future?

The position today is that the Premier League, for all its TV money and worldwide adulation, has an average attendance rate some 7,000 spectators per game adrift of its rival. As this is a supply, rather than demand, issue the only solution is to increase capacity. There is some evidence that after something of a a lull in activity this is beginning to happen; In the next few seasons West Ham will move to the Olympic Stadium with a capacity of around 54,000, Anfield will be expanded from 45,000 to 59,000 at a reported cost of £100 million while Tottenham are finally advancing with plans for a 56,000 capacity ground.

Of these projects one involves a ready-built stadia which has been built with a large amount of public money, whilst all have experienced numerous delays and set-backs typical with such large-scale projects. And even with these completed the impact on the league averages will not be enough to fully close the gap on the Bundesliga – taking the 2013/14 season data and assuming the three grounds will be at capacity gives a very rough projection of 37,500.

Challenges ahead

Taking a wider view the clear lesson is that left to their own devices, and without a major tournament on the horizon, individual clubs fail to invest enough in their bricks and mortar. One issue is that for mid and lower ranking clubs despite the rapid growth of broadcasting revenue the risks of diverting money away from playing budgets is particularly high especially if relegation occurs. This makes it more attractive as a short term strategy to use the money instead on player wages in order to realise a higher share of broadcasting revenue.

In the meantime the rest of Europe is not standing still. In Germany Frieburg, one of the Bundesliga clubs with a more modest average attendance, around 26,000, are on course to construct a new 35, 000 seat stadium whilst in France clubs have benefitted from a reported 1.6 billion Euro investment in stadia ahead of the 2016 European championships. Finally in Italy there have been moves to upgrade stadia which have aged since the last building bonanza ahead of Italia 90.

The challenge facing English clubs now is to the need to invest a greater proportion of their new revenue into stadia to meet the demand for watching live football. Failure to do so may represent a missed opportunity which one day the league as a whole could well rue.

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