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How Real Madrid changed the transfer strategy and balanced the books

Until the signing of Jude Bellingham, Los Blancos have maintained a positive balance in the transfer market over recent years while still winning.

Fran García, Bellingham y Joselu, en sus presentaciones como jugadores del Real Madrid.
Imágenes: Realmadrid.com

The signing of English midfielder Jude Bellingham has returned Real Madrid to a prominent position in the transfer market, after the club has maintained a relatively low profile in recent years. The emergence of state-owned clubs and the economic power of the Premier League -- not to mention the new stadium creation -- have compelled the Spanish giants to redefine its transfer strategy. Madrid has primarily focused on two types of players: young talents with significant potential before their value reaches exorbitant levels (such as Vinicius, Rodrygo, Militao, Camavinga, Tchouameni...) and experienced players available on free transfers (Alaba and Rüdiger) or nearing the end of their contracts to reduce costs (like Courtois).

Real Madrid transfer balance compared

This adaptation to market conditions has resulted in an unusual situation for Madrid prior to Bellingham’s arrival: a positive balance in their overall transfer activities over the past six seasons (from 2017-18 to 2022-23). According to Transfermarkt data, during this period, the club has generated more money from player sales (€679.75 million) than it has spent on transfers (€671.75 million). This amounts to a surplus, albeit a modest one, of €8 million.

Among the 25 teams that have spent the most on transfers in this six-year period, only Madrid, Monaco, and Dortmund have managed to maintain a positive net position. Meanwhile, clubs like Chelsea and Manchester United have accumulated negative balances exceeding €750 million. Barcelona, with the highest deficit in LaLiga, has a shortfall of nearly €363 million.

And just consider the relative silverware collected in that period.

Note: €1=$1.09

Expenditure on transfers between the 2017-18 and 2022-23 seasons

Transfers in (€ million)Transfers out (€ million)Net (€ million)
4Manchester City1,026539.92-485.79
5Manchester Utd986.98221.08-765.9
8Atlético Madrid712.15604.5-107.65
9AC Milan685255.49-429.5
11Real Madrid671.75679.75+8
Source: Transfermarkt

Bellingham investment a return to Galáctico levels

A few days after the official opening of the transfer market, Real Madrid took the lead in international spending, with €108.5 million, surpassing Al-Hilal from Saudi Arabia (€78 million) and Tottenham (€75 million). Los Blancos’ expenditure included the fixed amount of €103 million for the signing of Bellingham, €5 million paid to Rayo Vallecano to reclaim 50% of Fran García’s rights, previously owned by them, and half a million euros paid to Espanyol for Joselu’s transfer. This provisional leadership came amidst a market that is currently experiencing some turbulence.

Last summer, 12 clubs exceeded €108.5 million in transfers, with nine of them belonging to the Premier League. However, this year, at least so far, the Premier League has only invested a relatively modest €326 million collectively.

There was a time when Real Madrid dominated the transfer market. The white club led transfer spending in six seasons: 2000-01, 2006-07, 2007-08, 2009-10, 2013-14, and 2019-20. In the summer of 2019-20, which was the last one before the pandemic, the club invested €321 million to acquire players like Hazard, Jovic (two signings that didn’t live up to expectations), Militao, Mendy, and Rodrygo. In that single summer, Madrid concentrated almost half (47%) of its total investment over those six years.

This stood as an exception in a market that underwent a significant transformation in 2017. It was the first summer when the Premier League exceeded €2 billion in transfer spending. The English clubs gained financial strength from lucrative television contracts (the EPL had just secured a new and profitable broadcasting deal in 2016-17), and the influx of foreign investors to numerous teams further bolstered England’s influence in the market.

Neymar y Mbappé celebran un gol en su primera temporada en el PSG.
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Kerching | Neymar and Mbappé celebrate for PSG.BENOIT TESSIERREUTERS

That summer witnessed not only one shocking transfer but several.

Paris Saint-Germain made unprecedented moves by splurging on Neymar and securing the services of Kylian Mbappé (although the agreement with Monaco was initially a loan with a purchase obligation the following year, which was subject to negotiations regarding UEFA’s financial fair play regulations). These two signings remain the most expensive in football history, costing over €400 million combined.

Meanwhile, Manchester City, with slightly less fanfare, made their biggest-ever investment by spending €317.5 million on players like Laporte, Mendy, Walker, Bernardo Silva, and Ederson, among others. State-owned clubs, with seemingly limitless resources, laid all their cards on the table that summer.

Rodrygo, Militao y Vinicius, tres exponentes de la política de fichajes del Real Madrid, con el último Mundial de Clubes.
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Investments | Rodrygo, Militao and Vinicius winning the Club World Cup.JESUS ALVAREZ ORIHUELADIARIO AS

Confronted with this situation, Madrid found it necessary to reinvent itself. The club shifted its focus towards strategic signings with a long-term vision. Since 2017, the capital club has paid transfer fees for only three players aged 25 or above: Courtois, Mariano (who was just 25 when recalled from Lyon), and Hazard.

Instead, the club has prioritised the recruitment of promising young talents, such as Güler (18 years old), Bellingham (20), Tchouameni (22), the future prospect Endrick (18), as well as players like Militao (21), Vinicius, Rodrygo, and Camavinga (all 18 years old upon their arrival), who have already made their mark for the team. Madrid now approach the market with a fresh perspective, emphasising the potential and future prospects of players.