Rugby Union – A Numbers Game?

Autumn is here! Fresh from a pulsating Lions series in New Zealand and last weekend’s enthralling climax to the Women’s World Cup in Ireland, our local heroes return to the domestic scene.

With the first games kicking off tonight, we look ahead to rugby union’s new season. And for all the passion and excitement that comes with following the sport, we assess the less glamorous factor that plays a pivotal role in shaping the modern game – the numbers.

The Fans – The most important Number

People often talk about a sport being nothing without its fans. It’s a matter of pride to “be in that number”. However, it’s arguable that not enough is made about the ecosystem they exist in and how various sides contribute so vitally to the game we love.

Fans want to see the best players wear their favourite shirt but the truth is, for this to happen, the commercial side needs to be healthy. And what is the key to commercial success? It’s back to the fans, as it’s they who drive the brand value of the club in the eyes of the broadcasters and sponsors.

Broadcast

At a broad level, club rugby represented a huge slice of TV’s sports pie last season. On average, we saw 75 hours of rugby shown in the UK & Ireland each week, pulling in audiences regularly in the six figures. These are strong numbers as far as TV goes, and a great platform for those with an interest in the game.

Going deeper, it shouldn’t be ignored how broadcasters are influenced by fans, with the clubs with the biggest followings most likely to get preference on who is covered live – and when. It’s understandable, with one eye on ensuring they generate high viewing figures regularly. We saw this last season in the Aviva Premiership, with some clubs having eight home matches broadcast live during the regular season, whilst others would only feature as few as three times at home.

Finding the perfect balance for a club is tricky – but important. Does an abundance of TV coverage impact ticket sales? Should clubs be lobbying broadcasters for more coverage? In a sport like rugby where thousands of pounds make a big difference, it’s important to be on the pulse of the economics.

The newly-formed PRO14 has spoken publicly about the search for the perfect balance as they consider whether it’s in the best commercial interests of their clubs to have more coverage aired by satellite broadcasters. The more lucrative fees they traditionally offer may well seem attractive on first glance, but it needs establishing whether the number on the cheque impacts the numbers to be made elsewhere.

It’s a challenge that affects leagues, clubs, broadcasters, sponsors and fans, and in the work we’ve done in this space we know that no two scenarios are the same.

Sponsorship

A bigger TV audience not only appeases the execs who shell out the rights fees for TV, but positively impacts advertising sales, with brands wanting as much bang for their buck as possible when it comes to the number of people they’ll be seen by.

Such a simplistic approach also underpins why a brand might sponsor a club. However, as both rights holders and brands evolve, there are an increasingly complex set of factors that might cross either party’s mind before any partnership is signed.

Engaging, influencing and converting the fan goes way beyond the logo, and the ready-made fan-base that any rights holder offers allows brands a rich plethora of options in which to do this.

The crudest detail behind all of this though is how much money might the brand make from any partnership. Our analysis of the actual retail spend of the fan de-risks this point, as we uncover what sectors, brands and products are selling amongst very specific sets of fans.

We’ve picked out just three areas that caught our eye:

  • For all the connotations between rugby fans and beer, it’s surprising that note that fans in the UK spend £1.4bn on wine and champagne in the supermarkets each year vs just £660m on beer. Yet wine labels sponsoring the sport in a major way are few and far between.
  • Toiletries is another sector that generates huge consumer spend each year, and rugby fans are worth £1.1bn to that industry. Will we see the likes of Gillette and Dove Men commit more to the club scene in the future, expanding on their partnerships?
  • Would it be a surprise to see brands like Pedigree Chum involved in rugby? Our data suggests not, with nearly 60% of Rugby households purchasing pet products. This strongly outperforms sports like football (+7%) and perhaps represents an untapped opportunity.

Feedback tells us that taking a revenue-centric approach not only ensures a partnership is struck, but that it’s struck more swiftly than others might have taken. After all, a quicker way to a brand CFO’s heart is to get him excited about his balance sheet rather than tickets to the weekend’s game.

It’s also something that allows a club to protect the value of what is unique to them. As once they’ve been able to demonstrate the revenue uplift their fans offer a brand, that same uplift cannot be assumed elsewhere if that brand wants shop around.

Social Media

Away from the stadium, digital media – particularly social – represents the best way of fans and club maintaining regular contact.

As a means of keeping abreast of the latest club news, behind the scenes action and matchday build-up and analysis, the content opportunities for clubs to jump on are huge. And whilst fans are there to hear about their club, meaning authenticity is paramount when it comes to what is posted, involving brands in this communication can be a big revenue generator.

Numbers are again key here. At what point might a club be deemed to be posting too much content? So long as it’s relevant to the fans, we don’t see any number of posts becoming too much. And the true marker of what’s relevant? The number of engagements that each post generates.

So what’s happening already in this space? One example is Land Rover. As the club’s main partner, their logo is embedded on many of the graphics that Wasps produce, including team line-ups. This goes beyond the passive exposure that they gain from any shirt branding, ensuring an association – an ownership, even – with specific content types.

This leads us to ask what more can be done with other partners? A club might typically have 5 or 6 core partners, so should rugby clubs be looking to involve all of these brands in their social media strategy? Saracens suggests so, as they and Betsafe wasted no time following the launch of their partnership by offering fans the opportunity to join the club and its players for their upcoming league match in Philadelphia.

However, it seems examples of this are all too limited in club rugby just now. It’s easy us commenting on this from the outside, and of course each club is making every effort to attract the highest possible partnership fee it can. It won’t be for the lack of trying, but understanding the value opportunity to both the club and the brand, based on the way they can both connect with their fans, needs fuller articulation. Our experiences of this in multiple sports point to a commercial uplift as a direct result.

It’s a fan’s game

Fans certainly make the game what it is today, and for all the support they offer in the stands and terraces, it’s the help they provide to the deal brokers behind the scenes that perhaps goes unnoticed.

There are 21.2m people interested in rugby in the UK alone today, over half of which could defined as fans. That’s a huge number and, as broadcasters, brands and clubs vie for everyone’s attention, there’s big money to be exchanged that will drive the game on to new heights.

For now though, let’s relish in the fact that Summer is over and the sporting action can begin.

Five exciting developments we’re keeping an eye on

PRO14 – stick or twist?

14’s the new number for the former PRO12, with the addition of two South African teams. Will we see other countries enter the fold though? There’s already much speculation that this is just the start of international expansion and the top dogs have been very open that all cards are on the table.

Commercial heyday nonetheless?

Irrespective of what’s to come, South Africa’s presence in the PRO14 has already resulted in an additional £500,000 for each club. This is through broadcast rights alone, so with many existing and potential new broadcast contracts being discussed right now, clubs will be understandably excited about what’s to come. Add to this the sponsorship element, with Guinness and Gilbert recently renewing their commitment and Macron new to the ranks, we could see a busy few months ahead.

5 on 5

Channel 5 are looking to build on the success that ITV generated through their highlights coverage of the Aviva Premiership, with numbers largely on the up since the 2015 World Cup. But it’s not just highlights – starting this season, Channel 5 will be showing 5 matches per season live, ensuring free-to-air coverage for the masses.

Viva Aviva – but who’s the pretender to their throne?

Aviva continue to sponsor the English Premiership this season, but all eyes are on for how much longer. It’s a welcome surprise to many that they continue to support the game after a prosperous tenure, but it’s no secret that a new title partner is being sought – it’s just a question of when and who.

Monetising Social

As controversial as it might be, our view is that the social media opportunity for rugby clubs is currently under-exploited. Whilst it would be unfair to compare to the success on this front enjoyed at international level (the RFU and the Lions stand out), there’s a lot to be learned from the successes had across different sports when it comes to carving out activation opportunities that brands are willing to pay extra for. Now is as good a time as any to kick on in this space. For more information, it’s worth reading the following recent article:

INFO

Charlie Prichard, Business Development

To contact Charlie directly, email: charles.prichard@nielsen.com