Mexican Football: An exciting perspective

Most people who have a working knowledge of the football industry in Latin America will agree that the landscape in the region is colourful, varied, and at times wild. Gaining a clear insight into the local landscape can require patience, an exceptional network of personal contacts alongside a strong understanding of local culture. Given the size of its market, Mexico catches the attention of all the big players in the sports industry, yet it remains an intriguing, and in some cases, frustrating market for business.   

Gaining a clear insight into the local landscape can require patience, an exceptional network of personal contacts alongside a strong understanding of local culture

We were recently asked by a UK-based football consultancy where we thought Mexico sits in the global football pyramid. The short answer is that Mexico has a complex relationship with football on a global level. The national team, currently ranked in the top ten nations in the world, consistently performs strongly at international tournaments; particularly at youth level, where the Under 17s have won The World Cup twice with the Under 23s winning the Toulon tournament in 2012 alongside gold at the London Olympics. However, given the depth of quality that Mexico displays on the international stage, it would appear that Mexican players are substantially under-represented at club level in the top 5 European leagues.   

The international appeal of the Mexican league 

Considering its vast geographic size and population of over 130 million, it can be argued that Mexico is somewhat insular when it comes to football. Unlike the vast majority of Latin American professional footballers, few Mexicans have traditionally sought footballing opportunities abroad. Why is this? Firstly, it is important to note that the Mexican league, Liga MX, is the largest, most attractive and best paid league in The Americas with average gross annual salaries ranging from USD$350,000 to USD$400,000. Secondly, these salaries entice talented players from across the region, which means the standard of football in Liga MX is substantially higher than leagues in South America. Thirdly, with 73% of the urban population considered interested or very interested in football, the league has a vast following domestically and internationally. Millions of Mexicans in the US regularly tune into Liga MX games, meaning the pulling power of Mexican football currently dwarfs that of the MLS (Major League Soccer), which has an average of just 300,000 viewers per game. To put that into context, last year’s Liga MX Apertura Final featuring C.F. America against Monterrey recorded 3.3m TV viewers on US channel Univision. 

This makes the Mexican league an attractive combination for players who want a platform to a fulfilling career whilst gaining financial security, all without having to uproot their family and enter the unknown in European leagues. Furthermore, until recently, those who did head to the MLS and or Europe, found the nurturing arms of the Liga MX which they had left, were perhaps not as welcoming when they returned. 

Consolidating these influencing factors, Mexican players have always had a fantastic opportunity at home. In contrast, football players from other Latin American countries have typically had to seek similar opportunities outside of their respective domestic leagues. Arguably, this has often generated an inherent hunger and desire on the pitch subsequently translating into better chances of successful careers for them in Europe. 

Player valuations, data analytics and its effect on the region 

Pre COVID, Liga MX clubs were able to entice the best Latin American talent from regional clubs via very attractive transfer fees and salaries, Rodolfo Pizarro’s move from Pachuca to Chivas Guadalajara in 2017 being a case in point. We understand that despite various offers from European clubs, the winning package from Chivas blew the competition out of the water. Moreover, his recent move to Inter Miami as a designated player was again able to fend off competing offers from Europe. 

*Please note Christian Cuerva signed for Yeni Malatyspor in August 2020

Until recently, overseas clubs looking for value for money in Latin America would often turn to Argentina, traditionally regarded as the hotbed of talent. Nevertheless, as European and North American clubs embrace data analytics in player valuation, recruitment and acquisition, we are seeing many clubs turning their attention to other Latin countries, potentially now feeling Argentina has become an overvalued market. More here on this from an excellent NY Times article.

Below: A notable decline in Argentinian Football Players in both Serie A and La Liga

It can be further suggested that a growing sophistication in player valuation from international buying clubs is frequently not acknowledged by the selling clubs in the region. We are seeing more and more buying clubs considering walking away from deals in the region because the parties involved are unable to reach an agreement on valuation, deal structure and/or sell on-clauses. Concurrently, across The Atlantic, clear pathways are being created to bring top African talent to Europe, which has perhaps further chipped away at Latin America’s traditional recruitment appeal. 

 We are seeing more and more buying clubs considering walking away from deals in the region because the parties involved are unable to reach an agreement on valuation, deal structure and/or sell on- clauses.

What we are also noticing, cognizant of the Covid context, is that the use of data in the valuation of players has in some cases highlighted a historic habit of optimistic valuation by Latin American clubs when dealing with foreign buyers. A US-based agent who handles a stable of young talented Ecuadorian players mentioned that this issue has typically meant he’s finding it harder to support the development his clients’ potential overseas due to club owners expecting excessive transfer fees for promising but untested local talent. Sebastian Saucedo, the talented Pumas and US Under-23 international winger, referred to a similar situation recently in an interview with ESPN. 

Whereas most scouting work, valuations and decisions were previously made on the ground with player valuations being set by selling clubs, the nascent availability of online footage and in-depth data analytics for players means these steps are now being made remotely by the buying clubs who are also guided by more reliable player valuations. In the long-term, if Latin American clubs fail to adapt to the rapid growth of data driven decision-making, we are likely to see the gap in quality widen between Europe and Latin America as the export of talent in the region decreases and buying clubs find more amenable counter-parties elsewhere.

An exciting, shifting landscape in Mexican football 

Mexican football has been progressing for over a decade and remains currently in flux, mainly due to some significant changes in the past couple of years. Of note, in 2018, MLS and Liga MX entered into an exciting long- term partnership which aimed to unify cross-border soccer, being initially demonstrated by three new inter-league competitions, namely; The Campeones Cup, Leagues Cup and an All-Star game.

"Major League Soccer is proud to come together with Liga MX for this unprecedented partnership"

Don Garber, MLS Commissioner

This historic alliance between the two countries also coincided with the end of Liga MX Club owners’ informal “pacto de caballeros” (gentleman’s agreement), which perhaps previously stifled movement of players domestically when player contracts expired. This fundamental change effectively created a free agency which has (in some cases indirectly) helped facilitate some eye catching transfers to the MLS over the past 18 months. We have seen Alan Pulido join Sporting Kansas City, the Mexican-German Jurgen Damm move to Atlanta FC, and as mentioned, Rodolfo Pizarro permanently relocating to Inter Miami. 

Adios to promotion and relegation 

Along with the revamping of the Liga MX knock-out phase, a democratic decision was recently taken to suspend promotion and relegation in Liga MX, replaced with fines decided by position and previous 3 season average points. The Mexican second tier has effectively now become a youth development league similar to the top tier USL division in the USA. This significant change caused controversy, although objectively speaking, it was a change that was required to rescue the previously named Liga de Ascenso from the self-destruct button. 

Liga de Balompie 

This controversy was directly reflected earlier this year with the launch of an alternative football league in Mexico, Liga de Balompie (LBP). Some disenfranchised clubs, players and staff from Liga MX and previously structured Liga de Ascenso made the move into the unknown. LBP is currently not recognised by FMF (Mexican Football Federation) nor FIFA, but there are discussions with both CONIFA, FIFA and CONMEBOL. However since its announcement in April, LBP has seemingly slowly imploded, with players, clubs, broadcaster and apparently league President, backing away from the enterprise. The jury is still out (although rapidly summing up) as to whether this embryonic league will be successful in the long-term, whilst it remains an interesting development to keep tabs on. 

Torneo de Guard1anes 2020 

In the meantime, the reborn, attractive Liga MX format currently competes across two 6-month tournaments per calendar year. These tournaments are aptly named Apertura (Opening) and Clausura (Closing) and run from January to June, July to December respectively each year. League winners are decided for each tournament via a combination of final league position and end of season play-off tournament. The new format this year for the Apertura tournament 2020, following suspension of play due to COVID, allows the top 4 placed teams to automatically qualify for the play-offs. Joining them are 4 of the teams who finish 5th to 12th in the league. These 8 teams initially play a single knockout game amongst themselves to decide which 4 teams will make up the 8 quarter final entrants for the end of season play-offs.

Whilst alongside the suspension of relegation, this new format develops excitement and new commercial opportunities, it also generates more of a cup format. In short this means a Liga MX club can essentially finish 12th out of 18 clubs in the league and still be crowned the season champion by winning their following 4 play-off games. 

Creation of UPSL MX 

Perhaps as a prelude to a more permanent cross-border collaboration was the exciting announcement by the USA’s United Premier Soccer League (UPSL) of a partnership with Mexican clubs evolving in Liga Premier (3rd tier) and Liga TDP (4th tier) to create the international UPSL MX. Kick-off is scheduled for March 2021 with roughly 30 cross border teams expected to participate. In our view, this is a precursor and a ‘testing of the waters’ for the much-anticipated integration of the MLS, CPL and Liga MX in some shape or form in the not-so-distant future. 

"The clubs in Mexico are well-organized and have been playing at a high level. We are confident that the UPSL MX is going to be a success."

UPSL Founder & President Leonel Lopez

Changing Landscape

Liga MX has been positively and consistently evolving for some time with the suspension of promotion and relegation naturally appealing to foreign investors. In 2017 we saw Atletico Madrid invest in Liga MX club San Luis Potosi whilst Sevilla previously looked at a LBP club.

Across the border, this rapidly developing league is also attracting significant interest from US investors, now able to guarantee stability of investment by ringfencing their assets for at least the next 5 years. This aligns with the much talked about “new order of football investors”, which the outstanding 21st Club referred to recently; a global shift in club ownership and operation over the past ten years which leans towards a North American sensibility and attitude to sports business.  Similar evidence of these changing attitudes was the purchase, rebranding and 750km relocation of Liga MX football club Morelia to Mazatlan this year, a controversial move, which echoes that of the NFL’s Oakland Raiders, eventually becoming Las Vegas Raiders in 2020. 

Across the border this rapidly developing league is attracting significant interest from US investors

Looking ahead, as Mexico prepares for the 2026 World Cup, host cities Mexico City, Monterrey and Guadalajara will be looking to upgrade infrastructure and transport. The predicted alignment of the MLS, CPL and Liga MX in some capacity will also allow for the implementation of an internationally focused framework across Mexican football, whilst closer alignment with the MLS and CONCACAF will likely encourage the ubiquitous use of new technology across Mexican clubs 

Big Data - Citec 

As an indicator of this progressive mindset, Citec (Centro de Innovación Tecnológica) was set up in Mexico last year as a way to bring valuable data to Mexican football clubs. The data generated by Citec covers the top 2 divisions in Mexico, as well as the women’s league, U20, U17 and U15 football. 

The database currently comprises of over 2,625 Mexico-based players and is analysed by Golstats, Wyscout, Wimu and SeeUPlay. These industry leading data analytics providers form the basis of the platform, which we understand is the only one of its kind in the global football industry to join the interests of the league (Liga MX) and the football federation (FMF), with the two organisations sharing operational costs evenly. 

All the information generated by the platform is made available for the clubs to interpret and manipulate as they see fit. The idea is that instead of each club investing separately in software, Citec could negotiate a group price for the clubs involved, which considerably reduces the running costs. Beyond the financial benefits of such a group deal, it also means that data can be pulled at league level, comparing all 18 teams, providing more depth in the numbers. 

Communication breakdown 

Given the collective culture and success of Citec, one has to wonder as to the significant advantages of Liga MX hypothetically being able to tie up a collective TV broadcast deal. Currently each club negotiates independently, negatively affecting the overall broadcast income available and represents an opportunity for improvement. The graphic below offers an estimated comparative breakdown of revenue across the English Premier League (EPL), Major League Soccer (MLS) and Liga MX: 

The distribution of Liga MX revenue varies substantially from club to club (hence the ranges), due to independent TV deals struck by clubs, with match day and commercial revenue being very different. Sales and sponsorship of C.F. America shirts will always surpass those of Necaxa for example. Whilst broadcasting revenue still currently represents a significant portion of Mexican club income, were the clubs to negotiate a group deal, it is reasonable to think that they could leverage their position to close a bigger deal than the sum of current independent ones. 

With Matchday income temporarily on hold, Liga MX clubs have also been hit by the withdrawal of commercial sponsors. It is not uncommon for clubs to strike a commercial deal with a brewery or other F&B supplier for exclusive sale of their product in and around the stadium. The pandemic has naturally seen several clubs lose such deals due to no footfall and empty stadiums. 

What next? 

Income from player transfers has now become more central to the long-term strategy of Mexican and LatAm clubs and it’s important that this is seen as an exciting opportunity to build bridges with international clubs, using the export of players to showcase a club’s culture and DNA, rather than a transfer being viewed as purely transactional.  

"What is happening in the United states and Mexico is probably the most exciting project in world football ahead of the 2026 World Cup."

Christian Seifert CEO, Bundesliga

There is a fantastic opportunity for Mexican football to bridge the gap by aggressively tapping into data analytics, global sports technology, advisory services and collaboration with foreign clubs.

We anticipate that the next 36 months will see an exciting rise in engagement of Liga MX and FMF with both national and international partners in the football industry all supporting increasing alignment with the MLS, continued progress and strong preparation of the World Cup in 2026. 

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