Chelsea’s cut-price of £25m for a new shirt sponsor is not low enough

Chelsea have this week revealed their home kit for the 2023-24 season without a front-of-shirt sponsor. The photoshoot took place after repeated failings to secure partnership deals with Paramount+ and Stake.com. While Chelsea’s valuation of prospective shirt sponsorships is down significantly, we look at why it is still not low enough as the club looks to overcome the on and off pitch turmoil of last season. 

At the end of last season, the club chose not to extend the three-year partnership with telecommunications company, Three. The Premier League then blocked a deal with streaming service Paramount+, due to concerns about conflicts with its broadcast rights holders. Following that rejection, the London club then opted out of a shirt sponsorship agreement with online gambling company, Stake.com.

Yesterday, it was reported that the club had instructed an agency to secure a shirt ahead of the new season, commencing in under a month. Chelsea’s valuation for the shirt sponsor opportunity was £25 million ($32 million). Although the figure has fallen by a dramatic 37.5%, down from the £40m potential deal with Stake, the valuation is still too high. 

According to The Sponsor's fair market value of every Premier League club's sponsorship, Chelsea’s memorably poor 2022/23 season has left their value at a lowly £16.9m. The team’s failure to secure any form of European football next season now simply means that far fewer eyes will be on Chelsea’s shirt. The available brand awareness will be confined to the English cups and league, also meaning that international brands without a strong audience in the UK could be put off significant investment. 

As the club continues to rest on its existing brand reputation, particularly in the areas of cultural relevance, innovation, and history, it will have to understand its own negotiating position, or else face Liverpool in one month’s time with a plain, blue shirt.

To read more about qualitative vs quantitative Premier League sponsorships, click here.