Major investment is coming from Asia and many major events are heading to Asia. The continent’s growing importance in global sport is clear, but within Asia there are many diverse markets – each with their own distinct sporting landscapes. Even within South East Asia, a region of, at a rough estimate, some 650 million, significant differences between countries can be identified. “Unlike more heterogeneous markets, the challenge is what’s happening in Singapore isn’t at all in line with what’s happening in very near neighbour Malaysia or China,” confirms Claude Ringuet, who heads up Repucom’s South East Asia division from its headquarters in Singapore.
“But I think there’s an increasing thirst in this part of the world for engagement with sport,” Ringuet continues.
“If you look at a developed market like Singapore, its focus is on academic excellence of the population but since the creation of the Sports Hub and the new national stadium there’s been a noticeable increase in the general population’s interest in sport and entertainment, and an increase in the government’s engagement in sport at a macro level. Major events like the success of the F1 race have also contributed to this shift.
“In developed South East Asian countries – football in general has always had massive interest and popular engagement, in particular European football and the Premier League. While they’ve had difficulties with their local leagues and their development and commercialisation, fans have remained very passionate about the top European clubs and leagues. This has in part driven a desire for countries in South East Asia to identify new products to satisfy local fans and local talent.”
League creation: a major opportunity
The development of new leagues is an area where Ringuet sees significant potential across the region. Repucom is already working closely with the Pakistan Cricket Board, notably to develop and execute the first edition of the Pakistan Super League, the country’s new franchise-based Twenty20 cricket competition. The first edition launched on the 4th of February in the United Arab Emirates and features five franchises – Islamabad United, Karachi Kings, Lahore Qalanders, Peshawar Zalmi and Quetta Gladiators – and concludes on 23rd February.
“It’s about bringing the league to life,” Ringuet says of Repucom’s role, “and that is the big opportunity in this market: league creation.”
Other start-up leagues in the region are taking shape, including the oft talked about ASEAN Super League, a new club football tournament slated for launch in 2017 or 2018 which has been designed around participation from countries across the region, and a potential new football league in the Philippines. “There’s increasing affluence,” Ringuet points out when asked what’s driving this spate of new properties. “In all the markets, without fail, there’s been an increase in the middle income population groups, particularly in markets like Indonesia where you’ve got this significant increase in disposable income of the urban middle class and upper class. There’s greater disposable income to spend on enjoying sport and entertainment. This applies to interest in ownership of local clubs and in some cases significant global franchises”
Among the next steps will be persuading the many Asian brands already engaged in global sponsorships of the merits of these new, closer-to-home leagues. “Brands are certainly taking a bit of a wait and see approach in terms of the evolution of sports and entertainment in Asia,” suggests Ringuet.
“I think there’s still a propensity to throw money at the mature, developed leagues as they exist overseas. Although there has been interest in the expansion into Asia of leagues like the NBA in China and PGA Tour I don’t think there’s necessarily been a massive leap of faith by brands into those plays yet, but there’s obviously interest and enthusiasm. It’s still very much money going out into the mature market leagues like the Premier League or La Liga from the sponsors here trying to grow their brand awareness and equity in markets in Europe and the US. But in talking to many brands and stakeholders in Asia that we’ve engaged with in the past, they are very interested in what is going to be the next league or viable global product that’s going to launch in this part of the world.”
Singapore: setting the standard
Having staged a Formula One race on its streets since 2008 and hosted last year’s Southeast Asian Games, Singapore is well-versed in how to stage major events. The opening of the Sports Hub, the city-state’s new multi-purpose sports and entertainment facility, in 2014 led to a number of major event wins including concerts – Madonna, for example – and appearances from top national football teams, as well as building a 2016 calendar that includes a round of the HSBC Sevens World Series, year one of a five-year agreement, and three Super Rugby games featuring the new Japan Sunwolves team.
“Singapore stands quite independent from other South East Asian markets,”Ringuet says. “It’s the most progressive of the markets and there’s been significant investment. The biggest challenge for the Singapore government and the owners of the Sports Hub is really how they utilise the asset and what marquee events they are able to bring into the stadium – they don’t have a league that regularly uses the facility. I think there’ll be an increased focus on attracting major events and working out ways to drive fan engagement and attendance in stadia. Singapore itself is a country of five million people, it’s never going to be a massive hub of ongoing domestic sport but it will be an importer of major sporting and general entertainment events given the affluence of the local community.
“The other thing that’s really picking up in Singapore,” Ringuet adds, “is mass participation events. We’ve gone from very little, the Standard Chartered Marathon and the JP Morgan run, to now having pretty much every major mass participation event in Singapore, whether it’s the Spartan Race, Men’s Health Urbanathlon, Ironman or Colour Run. All of these have now come to Singapore, as a result of demand from big corporate clients and a population keen on less competitive traditional timed races and sports events.”
Single-sport domination and attracting events
In other markets in the region – Thailand, Malaysia, Indonesia and most other small South East Asian nations – a single sport dominates: football. The Philippines, where basketball is dominant, remains an exception. “In all those cases there’s a major gap between the top sport and the number two,” Ringuet notes. “There is a focus in those nations around the ongoing development of football; they’ve all been impacted to an extent from internal governance challenges in recent times and they are all trying to find alternative revenue streams and ways to monetise their domestic leagues. We’re therefore seeing the development of these new leagues, where the league models are evolving to lead to more professionally run and managed events that are able to attract top local talent and more renowned marquee foreign players.
“Malaysia are definitely looking to bid for a FIFA World Cup at some distant future date – they are exploring that now, in addition to hosting the next edition of the Southeast Asian Games [in 2017]. Malaysia has done a fair job in terms of their ministry engaging with the corporate community to attract and leverage those events – and obviously since 1999 they’ve staged the Formula One race in Kuala Lumpur.”
In other markets, however, Ringuet believes that bidding for and attracting international events is a much longer-term play. “Thailand has a strong domestic football scene and is the regional benchmark but struggled to drive interest and growth beyond football and Muay Thai. Like the Philippines, although it did bid for the 2019 FIBA World Cup [it lost out to China] last year, and Indonesia, finance and infrastructure are big challenges. It’s currently extraordinarily difficult for these countries, given their current infrastructure, to pick up anything of a marquee nature.
“In Asia as a general rule, everyone still looks up to the Premier League from a commercial and a marketing perspective,” Ringuet continues. “Regardless of whether the clubs make money or not in the Premier League, it’s still looked at as the aspiration for Asian countries. It’s still obviously the league that the fans here engage with the most. You walk around Singapore, Jakarta or Manilla and the number of people you see walking round in a Manchester United or Liverpool shirt, in particular, is incredible. There’s still a massive affinity for the EPL and a large gulf between that and the Bundesliga, La Liga and everything else. It’s still the aspiration.”
Longer-term plays: the markets to watch
Offering a longer-term perspective, Ringuet has identified the first glimpses of potential from Vietnam and Myanmar. “They are very long-term players but they are just starting to gather momentum,” he says. “Everyone thought Vietnam was opening up probably quicker than it really did, but there’s significant multinational brand presence there now investing in manufacturing and distribution. With the interest in football, they’ll definitely be an up and coming market in the long-term.
“Myanmar is the same. The Myanmar Football Association has received considerable support from key individuals and corporates in the past to invest in opening up the country and sport, and they are making the right noises now. The populations in both of those countries are very large and there’s definitely intent to grow a sporting mindset. They are the potentials: other markets like Laos and Cambodia are just too far away in terms of development at the moment.
“The biggest opportunity is the creation of new leagues and deeper engagement with fans in the region,” Ringuet concludes. “It’s an extremely difficult market to engage but I think people recognise that there’s a massive opportunity – and a challenge. If faced correctly the results for stakeholders in these emerging markets can be very material.”