Newcastle United have teamed up with one of the biggest brands in the world as they aim to increase their revenue.
Since selling players is so difficult, it is vitally important that Newcastle United increase their revenue with new sponsorship deals.
And the club have done just that, having announced that Red Bull is the Magpies’ new official energy drink partner. The club have agreed a multi-year deal with the Austrian company, and their logo was already being advertised at St James’ Park on Sunday during Newcastle’s 2-1 win against Tottenham.
Newcastle’s sponsorship with Red Bull comes at the same time that Leeds United are also sponsored by them.
The Red Bull logo is on the front of the Leeds shirts this season, as Daniel Farke’s side aim to win promotion from the Championship to the Premier League. Not only that, but the Red Bull group have also bought a minority stake in the Yorkshire club.
And TBR Football‘s finance expert Adam Williams has suggested that Red Bull’s association with Leeds could have an impact on their Newcastle deal if the Whites are promoted.
Newcastle United and Leeds United are both sponsored by Red Bull
“This is an interesting deal on a number of levels,” he said.
“For one, I think this is only the second ever deal that Red Bull have done in English football.
“The energy drinks market is actually pretty saturated. Lucozade, Carabao, Monster – all have associations with football clubs and competitions.
“Red Bull are obviously the biggest player with by far the biggest market share, but perhaps their existing relationship with clubs in their ownership group has led them away from getting into bed with English clubs.
“Events in recent months indicate that they are breaking from this strategy.
“Earlier this summer, Red Bull struck a significant minority investment deal with Leeds United. They are also paying the club a Championship-record fee to be their front-of-shirt sponsor.
“I suspect that, if Leeds were to be promoted, there might be some sort of break clause that would see the deal with Newcastle terminated.
“That’s speculation, but it’s possible. I can’t think of any other examples where an owner of one Premier League club also sponsors another.”
How much Newcastle could make from Red Bull deal as PIF strike second partnership
Williams notes that this is the second deal that Red Bull have recently agreed with a PIF club, and has suggested that this sponsorship could be worth double what the Magpies were getting from their previous agreement with Monster.
“From the Newcastle angle, it’s interesting to not that, just a few weeks ago, Red Bull struck a sponsorship deal with Al-Hilal, who are owned by PIF,” he said.
“Clearly, there has been some backchannelling between the two organisations. PIF are now one of the biggest benefactors in sport, as are Red Bull, so it’s fascinating to see them partner up indirectly in two different deals.
“In terms of the value of the deal, I know Newcastle’s previous deal with Monster Energy was worth around £1million. I don’t know the finances of this deal, but I suspect it will be worth a fair bit more in relative terms – maybe £2-3million.”
With Newcastle getting a bigger deal with a more lucrative energy drink company, it is another step in the right direction in terms of increasing the club’s revenue.
That will help Newcastle’s PSR situation, on the back of a summer transfer window that saw the club struggle to splash the cash.
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