#28. The Business of Wimbledon: Of Course It’s More Than Just Tennis

The 147th edition of The Wimbledon Tennis Championships concluded over the weekend on June 14th. The old guard changed hands as Novak graciously passed the baton to another 21-year-old. I clearly remember when the Djoker was 21 and was looking for his first Wimbledon championship as the 3rd seed in the tournament. It didn't seem like he would get past Federer's streak on grass. But alas, how life changes for the better!

For context, Wimbledon is held each summer at the All England Lawn Tennis and Croquet Club in London, England. It is one of my all-time favorite sporting events.

What fascinates me even more than the on-court action is the business behind tennis's most famous tournament. Wimbledon leaves no stone un-turned to ensure everything is perfect, from the meticulously maintained grass courts to the stringent security measures that once mistakenly denied entry to Roger Federer in 2022.

Let's dive into the financials and explore how this club makes money. Interestingly, they leave more than $100 million on the table because they don't want to go overboard with sponsors.

Here’s How The Numbers Look Like:

Wimbledon is unique because, unlike most major sporting events which are shrouded in secrecy, the All England Lawn Tennis and Croquet Club publishes a 30+ page annual report detailing all of the finances behind its two-week-long marquee event.

Here’s Wimbledon’s Annual Financial report for 2023 & Annual Financial Report for 2022

For Example, the club reported that in 2023, the Wimbledon Tennis Championships generated $407.9 million in revenue and ran with estimated operational profit of $95 million, operating at about 23% profit.

Here’s a rough breakdown of their revenue based on reports:

• Ticket Sales: $75.6 million (18.5%)
• Broadcasting: $181.9 million (44.6%)
• Sponsorship: $80.3 million (19.7%)
• Catering & Food: $40.2 million (9.8%)
• Merchandising: $17.3 million (4.3%)
• Other: $12.3 million (3.1%)

Broadcasting Rights

Like many other large-scale sporting events, Wimbledon makes most of its money selling global broadcasting rights, which brought in an estimated $181 million in 2023.

That’s close to 45% of the total revenue comes from selling broadcasting rights. Interestingly, ESPN pays $75 million annually for the US Open but only $42 million for Wimbledon.

This discrepancy is largely because the US Open is a domestic tournament for ESPN, whereas Wimbledon is international.

Nonetheless, Wimbledon commands a high price for international rights, with the BBC paying two to three times what ESPN does annually.

Ticket Sales

Ticket sales are Wimbledon's second-largest revenue driver. However, it's also one of the areas where they leave a ton of money on the table.

In 2022, Wimbledon set a record with over 515,000 attendees in just two weeks, generating roughly $70 million in revenue.

However, Wimbledon has refused to expand its stadium seating over the years. As a result, it attracts 115,000 fewer fans than the 2023 French Open, 325,000 fewer fans than the 2023 Australian Open, and 373,000 fewer fans than the 2022 US Open.

Wimbledon's Center Court is significantly smaller than some other center courts, like Arthur Ashe Stadium has a capacity of 23,000 spectators compared to Wimbledon's at only 15,000 spectators.

The club could also significantly increase revenue by raising ticket prices but opts to keep them low to maintain tradition.

Sponsorships

Sponsorships represent another area where Wimbledon leaves a lot of money on the table. The tournament works with only 10 to 15 sponsors annually, keeping brand logos subtle and barely visible. Despite this, brands like Rolex, IBM, and Ralph Lauren pay seven figures annually to be official partners. Wimbledon prioritizes long-term relationships over short-term cash, adhering to a "clean court" philosophy that emphasizes the event's iconic status.

Here, look at the number of sponsors on the US Open Center Court versus the Wimbledon Center Court.

Food and Merchandise

Food and merchandise may only account for 16% of revenue, but they still bring in over $60 million annually. Wimbledon merchandise, available online, includes items like shirts, sweatshirts, and jackets priced between $50 and $250. The club processes about 155,000 merchandise transactions over two weeks, selling items like baseball caps, championship towels, and t-shirts. Additionally, around 190,000 servings of the famous strawberries and cream are sold annually at less than $3 per serving.

Preserving Legacy Over Profit: The Unique Business Strategy of Wimbledon

Similar to The Masters golf tournament, Wimbledon is willing to forgo tens of millions in additional profit each year to preserve its legacy and iconic status. This meticulous attention to detail and commitment to tradition is what makes Wimbledon so special.

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