Fashion, lifestyle and Leao – Milan’s €100m merchandising plan explained

AC Milan’s commercial revenues have grown a substantial amount since the arrival of American ownership, but there are plans to increase them even further and find more of a balance in certain areas.

This morning’s edition of La Gazzetta dello Sport talks about the different areas of Milan’s merchandising. There is of course the historic shirt with the iconic sponsor, on the other hand the new Rafael Leao surfing waves sweatshirt, and fashion shirts with a baseball-esque font.

Every item that Milan release has its own reason within a strategy that aims to broaden the customer base, capture new fans – or even more casual supporters – and satisfy their tastes.

There is no order of priority: the 50-year-old who is nostalgic and faithful to tradition is ‘worth’ as much as the kid who can’t keep his eyes glued to the screen for the 90 minutes of the match. But it is clear that the future is there, and Milan are one of the top clubs most oriented towards the future.

In Gerry Cardinale’s project, competitiveness must go hand in hand with sustainability, and sustainability at higher levels (i.e. the ability to generate more cash than today and, therefore, to be able to afford more stars) cannot ignore an increase in revenues.

With TV rights brokered by UEFA and the League and the stadium project obstructed by political vetoes, it is the commercial segment where the club can have greater control. A sector that has already seen a growth in turnover up to €127m in 2022-23.

With that there is the merchandising/licensing area, in short, the sale of products. There were €6m in proceeds in 2017-18, at the time of Yonghong Li and his amazing commercial plans to conquer Asia. That became €30m in 2022-23 and it is growing by double digits this season.

The challenge is ambitious: Cardinale aims to exceed €90m in five years. At Casa Milan, where they think American-style given the origin of ownership, the number of $100m is circulating.

A start-up with 17 people

For almost five years, Valerio Rocchetti (Milan’s Retail, Licensing and E-commerce Director) has been at the head of the sector.

First with Elliott, then with RedBird, this branch of the company developed as if it were a start-up: from 3 to 17 people, average age 27 years and experience acquired mostly outside football, from fashion to large-scale retail trade.

It is the fresh, innovative point of view, a little outside the old patterns of the company structure. A crucial step in 2022 was the internalisation of e-commerce which in the first month of activity generated a turnover of €2m, as many as it had done in the previous 12 months.

“Today Milan manages the main part of the value chain by outsourcing the low added value phases and this allows us to be flexible and take the best possible care of the fan-consumer,” Rocchetti explains.

“Habits have now changed: 50% of customers who order in the province of Milan choose to purchase online and collect the goods in the store. We must be able to satisfy all needs.”