Building business beyond Brexit
Sports business opportunities around the world:
On the strength of our close working relationship, MEI was recently invited to attend the DIT Sports Economy Conference at Twickenham.
Here's a rough and ready synopsis of the day:
Presentation 1
Manuel Vial, Representing the Chile Minister of Sports
The Ministry of Sports is a new institution, created in 2013- supported by a strong legal, financial (there are a number of schemes that are funding Chilean sport) and operational infrastructure that will support growth, such as National Institute of Sports (which works with all National Governing Bodies). ‘Team Chile’ leads Elite Sports.
The creation of a National Policy to 2025 is designed to:
- Increased participation
- Promote the benefits of practice
- Drive a National System of physical activity co-ordinating public and private organisations
- Raise profile within the International community – driving elite sports
Part of the strategy (inspired by the historic work of Carlos Dittborn) is the hosting of major sporting events. Past e.g’s: WRC (May2019), FormulaE, CopaLibertadores, Dakar Rally
‘Bravery’ and a ‘Can do attitude’ defines the Chilean mindset and spirit.
Chile’s claim to be part of the world’s sports stage based on:
- Chile now one of the richest countries in S.America.
- Solid economic foundations
- Proactively seeking world engagement
- Entrepreneurial environment
- High level of intellectual talent
- Strong internet reach (88%)
- 11% growth from international travel
- Exported Alexi Sanchez!
Very strong football heritage and infrastructure- now working hard to bring cycling events to Chile.
Encouraged a connection with suppliers (email address listed above)- but I would suggest not sending a credentials deck or a sales pitch, but instead, an offer of help, support or guidance in your area of expertise.
Panel discussion:
All stressed the importance of a local partner.
Robert Datnow, The Sports Consultancy
Specialises in Middle East and the ‘Stans (e.g Kazakstan)
Dubai following a High Performance strategy which will end in an eventual Olympic bid- underpinned by cultural events such as World Expo 2020/21
Oman wanting to put itself on the map. Focuses more on sports tourism (e.g Cyclo Tourism)- Festivals of Running
Saudi provides opportunities in supporting high performance sport which is being seen as a way to ignite participation- more cultural change than hosting major sporting events
Eloy Mazon, 4Global
Specialises in US/S. America
Opportunities in US with 2026 FIFA World Cup- LA 2018 Olympics. US Sporting expertise is very specific and lacks an holistic view- so opportunities for companies with multi-sports events experience. Lack of language barrier makes life easier.
South of the border there is a growth in regional events such as Central American Games. Peru will look to build on their Pan American Games hosting. Chile becoming very proactive and focussed.
Stuart Senior, Gleeds
Specialises in India but with Global reach
Key to breaking India is finding the right local partner to gain a foothold. Taxation is a big challenge. It’s about perseverance and having the right connections; “it’s a slow burn- it took us 10 years to really see a serious return”. Opportunity for new sporting facilities especially- drive to increase sports participation and also to succeed at an elite level. Football is the next opportunity after Cricket. “My advice would be to focus on the private sector and ignore the public sector”
Peter Griffin, KPMG
Specialises in HK, Macau and China
Key drivers are changing consumer (digital consumption); moving towards Western Sports such as Cycling, American Football and Tennis; Major Sports events are central to the strategy- and the subsequent knock on affect for sports infrastructure. Slow burn- nothing will happen overnight- need patience.
Presentations
All stressed the importance of a local partner.
DIT India
- Aiming to become a $10billion industry by 2025- so smaller opportunity than China, but competition is less intense too.
- Now gearing up to improve participation and elite sports success
- Opportunities
- Consultancy; fundraising; fan engagement; broadcast; coaching; grassroots development; sports tech
- Market is not developed, therefore need to come in at partner and development level
- Don’t under-estimate the Indian talent pool
- Useful to form group collaboration/ consortia approach- reach out to other MEI Members?
- SGSA can help you break in
- Strong tie up with Premier League, so could be a ‘back door’ entry point
DIT China
Largest DIT thrust with 6 offices
- Disposable income has doubled in the last 10 years, and slowing down of economy has meant Chinese Govt. spending more money internally. 59% sports fans.
- Golden era of UK opportunity (US less so)
- China want to be a leader, not just a player, in the sports economy marketplace- to double the size of the industry by 2025
- Massive focus on Winter Sports- move from 62million to 300 million participating by 2022!
- FIFA World Cup hosting is an ambition- significant infrastructure and expertise opportunity
- Sports Science a particular opportunity
- Don’t think about ‘breaking China’ think about a specific region and how you might
- Understanding WeChat is essential!
- Barriers to overcome:
- Market access and policy
- IP and protection
- No quick wins
“we can only help you if we know about you”- open invitation to get closer to DIT
DIT France
Main future events: 2023 RWC & 2024 Paris Olympics/ ParaOlympics
- Part of a larger political strategy so bidding and hosting is likely to continue…The Games is a catalyst for ‘Grand Paris’ initiative- research.
- Olympic Village and Aquatic Centre opportunity
- Temporary structure opportunities
- Security requirements (UK is far better than the French at this)
- More ‘upgrading’ than building from new
- Complicated eco-system with SOLDEO and COJO as the foundations
- Ambitious plans which throw up lots of problems- and therefore opportunities for partnerships
- Buttons to press
- Legacy: business and infrastructure
- Environmental Sustainability
- Inclusivity (opportunities for para support particularly)
- Creativity
- Pedigree
- Only French companies seem to be winning procurement opportunities at the moment, so worth considering partnerships
DIT Japan
2021 World Masters in Osaka as well as RWC2019 and Olympics2020
UK Sales target- ￡100m- DIT want to secure business for UK businesses, not just knowledge share.
- Main barriers to entry:
- Language (procurement opportunities are only in Japanese- and response is required in Japanese)
- Short-lead times
- Local representation required
- Current focus is now sponsorship engagement (currently 60 local sponsors for Tokyo 2020)
- Sports Development strategy stretches to 2025 (target is that sports economy will be tripled by this date) so Tokyo 2020 is only the start of a journey
- Health Ageing is a major thrust
- Also, renovation of stadia and arena
- “Take advantage of any Trade Missions available to you to help you understand the market”
- Need to raise your profile amongst key decision makers with case studies and knowledge sharing (to position you as a thought leader)
Panel Discussion
Working on UK events clearly a tremendous stepping stone to working on International events via developing relationship with the International Governing Body.
Stephen Brown, CEO, Rugby League World Cup 2021
Mens, Womens and Wheelchair; 21 venues; 17 host cities- wants to position themselves as an ‘entertainment event’
Target is double 2013 ticket sales
Innovation is one of the strategic pillars.
“Bold and Brave”- so prepared to take a risk on new ideas if the return is likely to be right.
Looking to find out more about suppliers’ pedigree, values and capabilities- interested in learning from the experiences of others
To win business: understand the sport, our vision, our objectives and our targets- do your due diligence
Supplier opportunities will be outlined via x2 May workshops- need to sign up on the website under ‘Get involved’
Steve Elworthy, Cricket World Cup 2019
10 team tournament- 11 venues- 1.5 billion viewership- 800,000 tickets to be sold
Innovation in the area of data analysis which has led to structural change of the game; looking to engage youth/ young people from a legacy perspective; use of DRS and broadcast innovation very successful.
Not risking the foundations of the event, but prepared to in terms of added value and fan engagement. Would like the CWC to be the first for some things.
Suppliers need to be partners rather than simply having a transactional/ arms length relationship e.g Red Sky at Night and Ticketmaster- have people in the office full time. Need to be fully engaged and ‘on the inside of the tent’
Process is fraught with conflict therefore suppliers should feel part of the team right from the start of things.
Often suppliers are similar in terms of deliverables, so what tips the balance is the belief that ‘we can work with you’ (culture and values important to gain connection). “Capacity critical for us in 2019 as the calendar is so full”
Biggest frustration with suppliers is over-promising and under-delivering
Lindsay Impett, Event Director, Vitality Netball World Cup, Liverpool, 2019
10 day event; 16 teams; single venue- first since 1995.
England Netball is the host but did not guarantee that the suppliers would stay the same- wanted points of difference and innovation.
Innovation in the area of communication with member nations- now working with Sport80 to provide an information hub/ payment taking/ signoff; embracing black-out lighting
Looking to improve fan engagement.
Expects suppliers to share some of the risk- happy to work with suppliers who buy into a shared ethos.
Suppliers treated as part of the team, but cannot have representatives in the office.
“Needs to understand our 4 pillars- a great example being our relationship with CSM”
Smaller event, therefore open to developing relationship with smaller suppliers
Biggest frustration with suppliers is not pitching a bespoke proposal showing an understanding of the sport
Fireside Chat
Jonathan Dowell, UK Export Finance (based in the Treasury)
Supporting with financial and insurance solutions- Govt. backed
Target is to maximise UK exports.
Provide:
- Helps facilitate working capital (providing a guarantee to banks which supports loans and might improve loan terms)
- Credit Insurance- up to 95% of contract
- Financial Guarantees/ under-writing
- Govt. leverage
Jeff Burke, ES Global
Delivered ￡40m Velodrome in Jakarta- but only thanks to UK Export Finance (which even leveraged Ambassadorial support)
Panel session: Sports Technology and innovation
Opportunities to reach out and engage based on needs?
George Vaughan, Head of Technology, Ascot
Difficult to introduce new tech to a very traditional environment- but is trying!
Mindful of the expectations of a new generation of horse racing fans (is it more about being at a social event?)
Looking for things that will deliver something different for a transient fan base to enhance their experience- or that will make the operations more efficient.
Keen to engage with VR and AR ideas.
Michael Cole, CTO, PGA European Tour
Business systems and general procurement
Golf prides itself on tech innovation- wants technology to lead the transformation of the sport
Objective is to broaden audience and levels of engagement-“ technology needs to lead us on this journey e.g app to speed up the game”
Is not interested in innovation for innovation’s sake- has to ‘make the boat go faster’ or provide cost efficiencies
Always looking for overlay innovation
Alex Zurita, London Sport
Funded by Sport England to make London the most active city in the country
Interested in Sport Tech that will help participation- better health and societal outcomes
Gold standard is ‘Park Run’- how can we replicate this initiative?