Pay checks, participation and partnerships

Inspire a generation. It was at the heart of the London 2012 Olympic bid presented to the IOC in Singapore in 2005. The promise of a fitter, healthier nation, inspire the younger generation to participate in sport and transform their lives. In 2015 the British media were already critical of the £9.3 billion investment for the Games and regeneration in the east of London. And, figures for sports participation post-Games did not appear to support the pay-off either.

The Olympic Games, World Championships and certain elite professional sports operate in a different stratosphere. According to latest figures, the 2020 Australian Open Grand Slam tennis tournament attracted 812,174 visitors. And yet there are persistent reports some players argue the prize money is not a fair compensation in comparison to the total revenue generated. At the 2019 US Open the USTA reported just over $370 million of which $57 million or 15.4% was paid in prize money. The issue is not how much the top 10 or 20 players earn but the ability of the players outside the top 100 on the official ranking to earn a living.

For the vast majority who work in the sport business these figures are irrelevant. Take an ATP 500 tournament such as the ABN Amro World Tennis Tournament at AHOY in Rotterdam this week. This tournament was first staged in 1974 and is now in its 47th year. I have been a regular visitor over the last 20 years and witnessed some world class tennis from Federer, Murray, Wawrinka, Hewitt and last year’s winner, Monfils. With more than 100,000 visitors each year supported by numerous fan experiences and business events, it is an admired tournament on the ATP Tour.

But, here is the rub. Such a tournament has negligible to zero impact on tennis participation or membership of the 1,650 tennis clubs in the Netherlands. It is now 24 years since Richard Krajicek won Wimbledon and he joined the ABN Amro World Tennis tournament as Tournament Director in 2004, since which there has been a steady stream of top players and rising stars. So, to get back to the original point about inspiring a generation, it’s not happening. It is sad to see matches in the early rounds and day sessions with half-empty seats, especially in a venue that has invested heavily to create a great on court atmosphere. The latter stages of the tournament are well attended as there is generally a star player who reaches the final.

A recent report captured the challenge faced by most live events, sport, music, culture or the arts. Global spend on mobile games was $86 billion in 2019 and is predicted to reach $100 billion in 2020. And, games account for 72% of all spending in the app store according to App Annie. In the report, State of Mobile, mobile gaming witnessed 25% more spending than all other games combined. Spending on apps has exceeded $120 billion and total worldwide downloads reached 204 billion in 2019. Advertisers are expected to invest $240 billion on mobile in 2020. Enough said although it would be unfair to attribute all of sport’s challenges to mobile gaming.

Depending on which source you believe global sponsorship spend was $65 billion in 2019. And this investment is mainly from brands who wish to increase awareness and engage with sports fans, followers, business partners and players. Some sports events or leagues enjoy media revenue, distribution and viewership worldwide. More are moving to subscription models and OTT services. At a certain point, the connection between professional sport and fans, viewers and participants dilutes and disappears. And if the next generation, GenZ are no longer inspired to join sports clubs or consume as much sport, what happens to the appeal for sponsors to maintain their investment?

Time is ticking, not just with new arrivals like TikTok who witnessed a 210% increase in time spent on the video-sharing platform last year but also for the longer term development of professional and grassroots sport. UEFA’s recent announcement to partner with Disney and the Playmakers program targeting 5 to 8 year old girls using Pixar’s box office hit, Incredibles 2 and various characters such as Elastagirl or Dash to bring the program to life is different. But, if sport does not explore new formats and partnerships that drive participation, where will we be in 10 years time? The lost generation……