One of the most well-known soccer teams in the world is the Spanish team Real Madrid. It is mostly famous for being able to afford the best players worldwide – Beckham, Di Stefano, and Zidane in the past and Kaka and Ronaldo in the near future. Recently it offered a world record amount (over $100 million) to Manchester United for their most recognized player – Cristiano Ronaldo. A few months ago some European teams were faced with the possibility of bankruptcy but this has never been the case with Real Madrid. Many wonder where Real is getting all this money from when the world is in a recession?
The answer is superb business management shown by the construction magnate and returning club manager Florentino Perez. His signing and advertising strategies have proven to be excellent and much can be learned from him. In the past few years Real Madrid has more than doubled its revenues by using world famous stars such as David Beckham in advertising campaigns across the world. What the club is aiming for is massive TV deals overseas. Analysts believe these sort of deals are not only possible, but extremely likely. With each new player Real Madrid signs, new markets emerge for the club. For example, after the purchase of David Beckham in 2003, Real Madrid cleverly projected their brand into East Asia by using the player in advertising campaigns. There is competition among soccer clubs to be the first one to gain a strong following in emerging markets. Therefore, a good strategy employed by Real Madrid has been targeting the world’s best players who are also the world’s most marketable players. The club’s business success is beneficial to companies such as Coca-Cola, Adidas, Audi which are high profile sponsor partners with Real Madrid.