Sports Business: SSC Napoli

Written by Umberto Pelà (02.03.2023)

“Rollercoaster of emotions”. I think this short phrase sums up the experience of being an SSC Napoli fan these days. From bankruptcy in 2004 to going inches away from a historic Scudetto in 2018, Napoli fans have really experienced it all recently.

A historic club and a city with unbreakable ties to football, Napoli, today, is close to ecstasy. League leaders by 18 points at the time of writing, the Scudetto seems like it may be heading back to Naples for the first time since 1990. On top of this, club philosophy, roster, and overall excitement around the club is enviable.

However, as aforementioned, things weren’t always like this.

Season 2004/2005. SSC Napoli find themselves battling for the Serie C1 playoffs against local rivals Avellino. In front of 21763 spectators, Edi Reja and a humble Napoli side fight to snatch a win after the first leg had ended 0-0. Despite being favorites to win and a tenacious performance, two goals from Biancolino and Moretti for Avellino doomed Napoli to another season in the third tier of Italian football.

Yet things weren’t as dark as you may imagine them to be. In other words, this wasn’t about to be the most classic of ‘almost’ stories – and largely thanks to one man: Aurelio De Laurentiis.

De Laurentiis, renowned film director, didn’t – and to this day, doesn’t – take “almost” stories. Like when on set, he imagines a scene and does everything in his power to make that reality – regardless of how unorthodox that path may be.

His way, or no other way.

De Laurentiis did much more than just relieve the club from bankruptcy.

He revived and brought back the love for football to Napoli. A city that, largely thanks to Diego Armando Maradona, worships and lives off football. Whilst his years at the head of the club haven’t always been sunshine and rainbows (to say the least), De Laurentiis has helped Napoli in ways that the average fan fails to consider.

The following season, Napoli earned promotion to the top flight of Italian football, led by Italian ‘bomber’ (slang term for goalscorer) Edoardo Calaiò, who found the net 16 times that season. Along with them, Juventus and Genoa were promoted, in what would be a fresh start for all three clubs in the division which they belong in.

Stubbornness

Since then, Napoli have had a lot of success.

Actually, let me rephrase.

Napoli have done really well for a club promoted back to Serie A less than 17 years ago – but I can’t refrain from mentioning that I felt like they’ve underperformed.

Over the past decade or so, Napoli has built a huge success story and remarkable teams. The Partenopei have boosted their trophy cabinet extensively. Testimony to the first, the Azzurri have added 3 Coppa Italia’s and 1 Supercoppa Italiana: impressive. Yet if we consider the caliber of players that have played for the club over the years, you can’t help but feel that they could have arguably done better. Edinson Cavani, Gonzalo Higuaín, Jorginho, Kalidou Koulibaly, Lorenzo Insigne, Dries Mertens, Pepe Reina, Josè Callejòn, Marek Hamšík and so many more. The level of these players, in any other team, would have perhaps led to a Scudetto.

But with Napoli, it didn’t. “Why?” I hear you ask.

This is where we touch on De Laurentiis’ bad side. His stubborn side.

Over the years, especially the 2017/2018 season, Napoli had an incredible team. However, because of De Laurentiis’ stubbornness with investments and finances, it felt like there were just a few pieces missing. He would never go for that “extra” signing. The type of signing which makes good teams great teams.

During that season, Napoli, in my opinion, simply lacked a great Centre-back to pair with Kalidou Koulibaly. Raùl Albiol, 31 at the time, was past his prime. If you compare it with Juventus’ Bonucci, Barzagli, and Chiellini, you can see the slightest of margins which ultimately handed the team from Turin the Scudetto. Albiol, in my opinion, would have been an invaluable resource as a 3rd, rotational center-back for other domestic and international competitions. In front of him in a center-back hierarchy, Napoli should have put a young(er) center-back of the highest of qualities. That would have come with a bigger financial burden – and De Laurentiis wasn’t (and still really isn’t) a fan of that philosophy.

But Umberto, how come Napoli are doing so well now?

Good, actually, great question.

De Laurentiis-Giuntoli Strategy

De Laurentiis’ stubbornness, today, has (finally) paid off. Whilst I wasn’t a fond believer in not investing heavily into the club as that gave off an aura of high financial conservatism, the strategy eventually paid off. Even though De Laurentiis, in fairness, did loosen his grip on finances ever so slightly (which was inevitable seeing how crazy football markets have become in recent years), he has refrained from repeated high-value investments.

In fact, Sporting Director Cristiano Giuntoli and De Laurentiis have done an exceptional job at mixing their strategy. They’ve put together a remarkable mix of cheaper finds and amalgamated them with more expensive, proven players. The likes of Khvicha Kvaratskhelia (€15M), Giovanni Di Lorenzo (€8M), Zambo Anguissa (€16M), and Kim Min-Jae (€18M) were all signed for less than €18 000 000 respectively – absurd if you think about today’s transfer fees. In contrast, they then added the final touch to their masterpiece by adding in the proven, high-caliber players like Victor Osimhen for the price of €75 000 000 from LOSC Lille.

*Player*	*Cost*	*Value Today*
Khvicha Kvaratskhelia	€15 000 000	€60 000 000
Giovanni Di Lorenzo	€8 000 000	€25 000 000
Zambo Anguissa	€16 000 000	€38 000 000
Kim Min-Jae	€18 000 000	€35 000 000
Stanislav Lobotka	€21 000 000	€30 000 000

*Values provided by Transfermarkt

**Values Today – (02/03/2023)

This investment strategy, in today’s footballing market, has undoubtedly paid off. Its low-risk (Napoli could hypothetically easily cut losses on low-value investments like Anguissa by selling the player to a smaller % of their value to other teams – which would be happy to take a player from a club like Napoli) factor makes it a special strategy which requires a lot of patience – but when it works, it will do wonders.

On top of this, their club philosophy, in which no player is bigger than the club, was designed similarly to AC Milan’s which we talked about in the previous episode. Club captain and true Napoletano Lorenzo Insigne knows something about it, and so does Gonzalo Higuain. Both of these forwards were denied lucrative contracts, and went searching for them elsewhere. Whilst the two may have then had the first laugh – obtaining desired amounts of money and footballing success respectively – it is now Napoli that laughs last. Their strategy has paid off, and their future looks as prosperous as it has ever done. Whilst this strategy may result in the loss of high-value players, the board has done a remarkable job at dealing with contracts in similar fashion as aforementioned. Testimony to this is the total market value of the team, which has increased from €471M to €543M in only one season: impressive.

Furthermore, we must also recognize Giuntoli and De Laurentiis’ dues because of the scrutiny their strategy received. Many tifosi of the azzurri and around Italy questioned the stubbornness. Other tifosi da bar (fans who chat about football as if they were experts at cafès) acted as Sporting Directors criticizing the cheaper investments and questioning whether these cheaper bets were ever going to pay off. They couldn’t believe that players from uncommon nations (Mexico, Georgia, South Korea, North Macedonia, Uruguay, Norway to name a few) would adapt rapidly to Italy’s system.

Yet here we are today.

Napoli’s Ship Soaring through the Mediterranean Sea

On the field, the Captain is Giovanni Di Lorenzo. However, I’ve already written in greater depth about how great he is and how criminally underrated his performances are.

On another note, off the field, the real mastermind is another man: Luciano Spalletti. Fresh off a new record, most Serie A Wins (276) in history, Spalletti has sat on the sidelines for various clubs around Italy. Udinese, AS Roma, Inter Milan and now SSC Napoli. Wherever he’s gone, Spalletti has brought some form of success to the city. In Udine, it was a first historic qualification to the UEFA Champions League. In Rome, it was two Coppa Italia trophies. In Milan, it was a remarkable UEFA Champions League qualification which put end to a 6-year-drought for the Nerazzurri.

Now, in Napoli, he’s about to rewrite history. Luciano Spalletti’s team is demolishing opposing teams as they currently find themselves at the head of the Serie A table with an 18 point gap from 2nd place Inter Milan. In fact, many question what their path will look like in the Champions League, as they show no sign of slowing down.

What makes everything even more exciting, is how perfectly well the pieces of the puzzle have come together in Naples. Spalletti’s game – aggressive and intense off the ball, exciting and offensive on the ball – suits its players perfectly.

The back-line is comfortable on the ball and extremely solid when facing opposition. Napoli have only conceded 15 goals so far this season. That is 0.63 goals per game – a significant improvement on last season’s 0.82 goals conceded per game. Offensive construction is also aided by one of Serie A’s great Center Defensive Midfielders, Stanislav Lobotka, who often slides in between the two center-backs and sets up plays. Midfielders Zambo Anguissa and Piotr Zielinski offer great balance and are able to find their forwards efficiently – as mentioned in Underrated Episode 1. Up top, Khvicha Kvaratskhelia, Victor Osimhen, and Hirving Lozano have played in a league of their own – this is especially the case for the first two. Khvicha Kvaratskhelia and Victor Osimhen have produced a combined 31 goals and 12 assists, with the first on top of the Assist leaderboard (9 assists) and the Nigerian striker on top of the Goals scored leaderboard (19). Flabbergasting.

Today, watching Napoli play is daunting. Daunting because you wish your club played like they did.

And whilst their likely first Scudetto in over 30 years may be a massive sign of success, it is the future that shines even brighter for la Città del Vesuvio. Off the field Napoli and De Laurentiis’ unorthodox strategies have yielded great success.

One-of-a-Kind Business

First of all, an important mention must be made for Napoli’s Kit Sponsorship deal, and how much of a pioneer it truly is. To me, De Laurentiis really hit the spot with this one. On July 27th 2022, Napoli unveiled their new home and away kits, thus confirming their continued collaboration with EA7, Emporio Armani’s Sportswear line. This was another one of De Laurentiis’ mad moves, where he literally said “f**k it, I’ll produce them myself – that’s what you have to do at one point if you want to create change”, as he criticized Puma, Adidas, and Nike, who “create their kits 18 months prior to their release”. Whilst the 18 months is perhaps a hyperbole, there is some great truth and genius to his actions. In fact, not only does the partnership bring €9 000 000 to Napoli’s finances, but it also allows them to create designs and produce them with little turnover. In other words, thanks to its terms with EA7 (who don’t have other involvement in football’s markets) Napoli is truly independent when it comes down to kits. This means creating and displaying as many kits as they desire, whenever they want.

These conditions allow Napoli to release special edition kits and advertise them accordingly. In turn, not only does this create more opportunity to generate revenue, but also to commemorate special events – which is very much in De Laurentiis’ style. For example, one year after the death of club and city legend Diego Armando Maradona, Napoli released 4 different kits with a design that pictures him in a Napoli jersey. Similarly, Napoli’s Halloween Jersey was explicitly said to be “an idea of the President” (Aurelio De Laurentiis). On top of this, Napoli also managed to sign a deal with Amazon worth over €2 000 000 – impressive for a sleeve sponsorship deal.

What makes this idea work so well – and Napoli a special place to play in – are the fans. Whilst the relationship between the players and fans has historically been rocky in Naples, you cannot deny the intensity of their passion. Their love radiates to the players, and this season, finally, the players are giving all of that back. The engagement towards the club overall – including social media – has been notable. Over the past year and a half, Napoli’s Instagram account has seen an increase in followers by more than 700K followers, as they currently sit on 3M followers.

In terms of finances, Napoli has closed the 2022 financial year with a loss, but an improvement on the previous fiscal year. Its loss of €51 951 202 was a slight improvement on the previous year’s €58 941 765 loss. This is an important factor to keep in mind considering the size of the club and the direction it has gone in with its investment strategy.

Throughout these previous two transfer windows, Napoli has done some good, great business, ending with a net positive of €4 900 000. Players like Fabian Ruiz and Kalidou Koulibaly seemed to be irreplaceable – but again, the current season and the board’s strategy showed us exactly why this isn’t the case.

Urgently Needed: Modernization

Napoli fans, De Laurentiis, Giuntoli, the players, and everyone else at SSC Napoli have been patient enough. They are finally collecting the results of their hard work over the years – but we must question: what could be improved?

Not everything in Naples is great. Starting from the Stadium. The ‘Diego Armando Maradona’ Stadium needs a lot of work. To allow the stadium to compete with other stadiums in Europe, engineers have said that “a new exterior facade, the structure of the stands, and the roof would need complete redevelopment”. Whilst the stadium has received works worth around €23 000 000 in 2019, it is still in sub-par conditions and owned by the city of Naples. Pieces of concrete from the Curva have been seen tearing and falling to the ground – in what is also a safety hazard. What perhaps is even more frustrating, is the idea that the venue is in a one-of-its-own location, on the gulf of Naples. Renovations would allow the (home average) 38 000 spectators to enjoy their games even more. Whilst Naples carries the stereotype of being an old-fashioned city, far from the technological development present in cities like Milan and Turin, I still strongly believe that a Stadium – of property of SSC Napoli and not the town – would open up immense pathways for the club.

As previously mentioned in AC Milan’s SB article, a model like Tottenham Hotspur’s is the one to follow. To add to this, the english club just recently announced a partnership with F1 – another brand who has done a one-of-a-kind job of promoting itself on digital platforms over the years – to have car-racing events held within the stadium.

Finally, I also believe that the club should capitalize on this season – and increase their social media content creation. A first historic scudetto in 30 years not only should be documented crisply, but shared with all the fans around the world which will inevitably hear about the Azzurri’s story. This idea is emphasized even further if the Parteneopei end up encountering success in the UEFA Champions League – Europe’s most prestigious competition.

Future Steps

Overall, things are not looking half bad in Napoli. With the city in ecstasy, it is curious to see if the board will adopt a change in strategy to ride the wave of enthusiasm and create a dynasty for the years to come. However, that may have to come with more important capital investments, which now, regardless of end of season income and prizes from competition wins, seems unlikely. I am most curious to see how Napoli close out the season – which I hope sees them go far in Europe and carry the Italian – and Serie A’s – flag high and proud.