West Ham have £60m off-pitch plan to blow Newcastle out of the water - Kieran Maguire

07/08/2024 12:30 PM

Financially, few clubs in the Premier League are as stable as West Ham, so why are the board opening themselves up to accusations of pricing out their bedrock supporters?

The East London club have enjoyed some forgettable seasons in recent years, with the apex being the Europa Conference League triumph in 2022-23.

But there is still, to put it charitably, a disconnect between the fans and the club’s top brass, namely chairman David Sullivan and second-in-command Karren Brady.

What’s more, it does not appear that there will be a transition of power any time soon given that Daniel Kretinsky does not want to up his 27 per cent stake in the club.

Part of the initial draw for Kretinsky when he first invested in West Ham back in 2021 was its London geography and its ability to monetise a huge stadium, for which they pay a paltry annual sum in rent.

At £41m, their matchday income last term was the highest in the Premier League outside the so-called Big Six.

However, the GSB regime’s latest pricing structure initiative would suggest that they are still not happy with the amount of cash they are extracting from fans.

As well as raising the price of season tickets across the boar, West Ham have now made concessions tickets (OAPs and juniors) available only in the highest and least accessible areas of the London Stadium.

Many older supporters simply cannot access these areas, meaning they face having to stump up the extra cash for a non-concession ticket or forfeit their ticket entirely if they cannot afford it.

It is believed that West Ham can make an extra £600,000 per season maximum from this move, less than two per cent of the cash they generated through the turnstiles last season.

Speaking exclusively to TBR, Price of Football author/podcaster and University of Liverpool football finance lecturer Kieran Maguire explained why West Ham are taking this controversial approach.

West Ham taking incremental approach to price rises

When they moved to the London Stadium in 2016, the board promised there would be more ambition in the transfer market and that West Ham fans would not be priced out.

The club’s net spend has been among the highest in the Premier League over the past five seasons, but fans are still frustrated by both the atmosphere and prices at the former Olympic venue.

The concession pricing structure, which has prompted one fan group to launch a petition in opposition to the move, is the latest in a litany of flash points between GSB and supporters.

Analysing the situation from a financial point of view, Maguire suggests the board are trying to gradually move away from a season ticket holder model towards a more lucrative, single-game ticket system.

“It’s the David Sullivan show at present, and the optics are really bad,” he said.

“One of the issues at West Ham is that, in order to smooth the transition from Upton Park, they had to justify it to fans.

“Season ticket prices were actually pretty modest. They originally had a huge number, I think around 51,000 season tickets.

“What they have been doing ever since then is gradually decreasing the number of season tickets available when people have not been renewing.

“They’ve realised there is a generational issue, in the sense that people are getting older.

“if people are going from paying a not particularly expensive season ticket price by London standards to paying a senior season ticket price that’s even cheaper, that’s an issue – for the owners’, at least.“

How does West Ham’s matchday income compare to other Premier League clubs?

West Ham generate more cash through the turnstiles than any other top flight besides the two Manchester clubs, Liverpool, Tottenham, Chelsea and Arsenal.

However, their income per fan is lower than many of their peers and their headline total is at risk of being overtaken by the likes of Everton when they move into their new stadium.

At present, West Ham’s closest matchday income challengers are Newcastle, who earned £38m at the last count.

And Maguire claims that the latest pricing developments are all part of a long-term plan to maintain their lead over the likes of Newcastle and bridge the £60m gap between themselves and the Big Six.

“For the last few seasons, matchday income has been around £41m. That includes the benefit of European football as well.

“Man United are on £136m, Spurs are £100m, Arsenal are on £100m. I don’t think West Ham pit themselves against those types of clubs, but they think they should be pulling away from the rest of the table.

“How do you do that? Well, there are three element. First, there is the capacity of the stadium, which they have managed to bump up a bit since moving in.

“Then, there are the number of matches played, which is out of the hands of senior management.

“Then, there’s price, and that is the area they are targeting. West Ham fans are a vocal bunch and they are voicing their concerns. I have a lot of respect for that.“

The London Stadium’s impact on commercial income

At £48m, West Ham’s commercial income is also among the highest in the Premier League for a non-Big Six club.

However, their front-of-shirt and kit deals with Betway (£10m) and Umbro (£7m) respectively are lower than the likes of Everton and Aston Villa, who are now commanding close to £20m for each category.

This has led to suggestions that rather than squeezing fans, West Ham should be looking to the commercial department for marginal financial gains.

What’s more, the club have so far failed to secure a naming rights deal for the London Stadium, which analysts have suggested could be worth up to £12m per season.

Granted, that is ultimately the responsibility of their landlords LLDC, who would be entitled to the first £4m plus 50 per cent of any additional annual revenue from a naming rights deal.

Maguire expanded on West Ham’s commercial position, offering that the rental agreement makes it harder to monetise the London Stadium than it is for other clubs to push the envelope in this area.

“West Ham have the benefit of the stadium being state-subsidised,” he said.

“But the downside is that because they are only tenants for 30 days per year, they can’t monetise the stadium for the rest of the year in terms of conferencing and other activities.

“Their commercial income is decent. It’s in line with Leeds on £48m, Newcastle on £48m, Villa on £46m and Leicester on £44m.They are doing pretty well to be getting as high as that.

“They have the benefit of the London premium and being able to monetise the stadium on matchdays on a commercial basis, which to a certain extent offsets the lack of commercial benefits on non-matchdays.”

• READ MORE WEST HAM FINANCE NEWS: News from US could shape West Ham takeover as billionaire speaks out on £795m deal

Could West Ham buy the London Stadium?

In theory, West Ham could buy their home ground from LLDC, which would give them the freedom to expand the ground and monetise it on a commercial basis.

It has been reported elsewhere that the club are not ruling out buying the London Stadium, but Maguire is having none of it.

“I have read some reports saying they could buy the stadium. As far as I’m concerned, they are nonsense.”

“Why would you do that when the rental agreement is £3m per year and the maintenance costs are £15m per year? That is before you take into consideration the issues with LLDC.”