Saracens Rugby’s new chief executive Mark Thompson discusses TV broadcast deals, the club’s path away from their recent £5m loss and the state of rugby union and its future.
Being a rugby bigwig cannot be far from the most stressful job in sporting governance; the English game is a borderline failure and clubs are churning loss after loss.
But Mark Thompson, formerly of sports marketing agency Two Circles and then-Premier League football team Burnley, is taking on the challenge as the newest chief executive in Premiership Rugby.
The Saracens CEO is a new breed of data-driven boss and met City A.M. to discuss the club’s financial situation following a £5m loss, the broadcast landscape and the new Premiership season, which begins this week at Gloucester.
Saracens chasing the black?
“My job, like anyone running any business, is to reduce the obligation on shareholders, for them to believe we actually can generate that pathway towards profitability,” he says.
“But at the same point we’ve taken a strategic decision. While some other clubs might shy away from spending the full salary cap, we want to be competitive and expect to be competitive domestically and in Europe.
“That does mean we’re not going to be breaking even in the next two or three years, and there’s a certain amount of our cost base that will not go down, which does mean profitability becomes impossible in the short term.
“Selling out every game is not going to materially change our profit and loss. The sponsorship revenue last year was shy of £5m so you can grow that by 50 per cent and the reality is that it is still £1m here, £2m there. It’s not £20m.
“The reality is the women’s game is not going to be profitable in the short term. But it’s important for us, not just because we believe it’s the right thing to do, but we believe there will be growth. We also believe in what our women’s team brings to the broader club story that we’re trying to build commercially.”
Fixing rugby through TV?
Clubs have not only had to deal with England’s top flight going from 13 teams to 10 – after Worcester Warriors, Wasps and London Irish collapsed – but the broadcast deals domestically from TNT Sports and continentally with Premier Sports have not seen an increase in money in the bank for the clubs.
Thompson admits Saracens’ cut is “slightly smaller” than before, stating: “There are challenges with rugby. I think we’re going to face a difficult 12-24 months. The next broadcast cycle [going out to tender in the next 12 months] will be key.”
When asked about whether the TV rights for the Champions Cup being shipped off to Premier Sports, a streaming service not widely used in England, was disappointing Thompson says that it is “very difficult to define disappointment” but the market is “softer” and there’s more onus on being a “premium rights” sport.
“The reality is rugby does not fit into what people’s definition of premium rights are at the moment,” Thompson says.
“I have trust in people at PRL [Premiership Rugby], [chief executive] Simon Massie-Taylor is very good at what he does, and we’ve got the best of what we could have got.”
Saracens saw mass change during the summer. Players left – all except Owen Farrell, Thompson insists, were planned – while the club signed up to a new Professional Game Partnership (PGP) which will shape English rugby for the next eight years.
Chief executive Mark Thompson. Credit: Saracens
Thompson trust
“There’s going to be an element of feeling it out along the way, but we trust the people in the room on that,” he adds.
Saracens are looking forward too, having begun talks with director of rugby Mark McCall about a new deal. Thompson described the Northern Irishman as “pivotal” to their plans but remained tight-lipped on the progress of the discussions.
This year feels like a brand new era for Saracens: a new chief executive, new captain, a raft of new players and a new approach to business. Key partners have stuck around and extended, in the case of main sponsors Stone X.
Thompson’s closing message is to throw his weight behind promotion and relegation and a pathway, however. Saracens themselves needed it after being punished for salary cap breaches five years ago this autumn.
“There’s an element of making sure that the people who invest significant money in loss-making Premiership clubs feel confident about their investment moving forward,” he says.
“Because what rugby doesn’t have right now is a track record of people picking up those investments when people have chosen to discontinue theirs.
“If we lose any more clubs at the top it will become fundamentally quite hard to deliver what the PGP and others are trying to do.
“But whether it’s to reward excellence or to reward additional investment, there has to be a pathway for people to come and add value.”