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How can the sports business in Asia respond to a de-globalised world?

How will global sports industries adapt to the likely prospect of a more inward looking world? And can cancelled events easily win back the hearts of fans in Asia? SportBusiness asks three experts on the region for their thoughts.

SINGAPORE, SINGAPORE - JULY 21: Juventus team entrance during the International Champions Cup match between Juventus and Tottenham Hotspur at the Singapore National Stadium on July 21, 2019 in Singapore. (Photo by Daniele Badolato - Juventus FC/Juventus FC via Getty Images)

Although not a new construct, globalisation has created the current world economic order. But with the rise of the Covid-19 virus, are we about to see a global reordering?

Most Asian countries have flourished on the integration of trade and the burgeoning middle class in the region is evidence of that.

But what will any decoupling mean for the business of sport in Asia. Will broadcasters, sponsors, globally-recognised sports individuals and teams need to recalibrate their commercial activity to counter the potential change?

SportBusiness asked three industry experts for their views.

PROFESSOR SIMON CHADWICK director of Eurasian Sport at Emlyon Business School in Paris

Professor Simon Chadwick

The question pre-supposes that globalisation is actually ending, which seems to be a prevailing Western view. Whilst Europeans and North Americans might take a pessimistic view of the future, especially as their economies struggle and trade barriers go up, the view in Asia is different. I question whether, in fact, Asia and the Pacific will notice or be perturbed by the ‘de-globalisation’ story.

If one looks at the pandemic lockdown period, Asia-Pacific nations have in some notable cases coped well with the virus, and have not been as badly affected as countries elsewhere in the world. China has remained bullish, its stadium development ambitions remaining on-track.

Vietnam has been a beacon, not only in terms of its successes at controlling Covid-19 but also in attracting inward investment to its burgeoning economy. India is fast-developing as a sport, entertainment and tech hub – the case of Reliance Jio is an illustration of this. During the pandemic, Jio has attracted billions of dollars in new investment. Meanwhile, Saudi Arabia and Abu Dhabi have acquired global sports assets across the first seven months of this year.

I do not think we should be asking, ‘Is this the end of globalisation?’. Rather, we should be asking ‘Are we seeing a new form of globalisation emerge, and which countries are driving it?’. It seems that there are some inconvenient truths ahead that the West will need to confront.

Adrian Staiti

ADRIAN STAITI, APAC president, Sportfive

In the short term, I believe that we will see a strong trend towards the localisation of sponsorships, as brands will be more inclined to look for assets that are focused on their home market following the impact of the Covid-19 pandemic.

At the same time, we can expect that, once the pandemic subsides, consumer attitudes and behaviors will change, and brands will have to rethink and reevaluate their marketing strategies in terms of expectations and involvement.

I believe that consumers will – and already are – expecting brands to show a greater sense of social responsibility and, in turn, brands will start looking for more cause-based opportunities to support their countries and communities.

These shifts will obviously have an impact on the various players in the sports industry. For rights-holders who have benefitted from internationalisation before, they will now have to uncover new ways to provide value in the home markets of the brands. Given the current restrictions on events held in Asia, the challenge is how sports IP can fully activate sponsors’ rights, especially onsite when there are no fans.

Similarly, sponsors will have to be innovative in their direct-to-consumer activations, especially during periods of limited live engagement. To interact with fans and create that long-term relationship, digital investment is for sure going to be much higher as brands look to digital and social media campaigns, or geo-focused brand content, to keep fans engaged.

For broadcasters, many have been scrambling to fill the void with quality content in order not to lose their audience during this time. While some may turn to ancillary programming and third-party programming, this is also the time for them to be creative. For example, broadcasters can look at replacing live sports with archive matches and content, and generate social media engagement around that. They should also think about broadcasting alternative content or original self-produced content, even if they are not able to monetise it at the moment. This will help them to maintain engagement with their audiences.

Even though events are down for the time being, I am optimistic about the sports industry once markets come out of the pandemic. Beyond 2020, Asia has a big runway of events that will positively impact the region, and I am sure there will be opportunities to take advantage of a busy sporting calendar next year, with events like the Euros, Olympics and the Copa America happening. In 2022, we will also see the Asian Games and Beijing Winter Olympics take place and, in 2023, the Fifa Women’s World Cup will be coming to APAC for the first time.

As nations move beyond the Covid-19 pandemic and begin opening their borders, I am confident that globalisation will once again return. Governments will be focused on kickstarting their economies and attracting tourism receipts, while the business world counts on the efficiencies and rapid growth that have come from a globalised marketplace.

The sports industry will enjoy the tailwinds of this trend as markets open up and as governments look to invest in events for both social and economic benefits. Asian economies, especially, have benefitted much from the globalisation of both business and sport, so I believe that when we are ready to return to a better normal, we will see the continued boom of the sports industry across the Asian territory.

Joanne Warnes

JOANNE WARNES, agency director, Octagon Singapore

There is the potential for de-globalisation, but I believe that technology, social media and digital media will override this and ensure sport remains globally connected.

Among rights-holders, venues, and brands involved with sport, focus and attention globally and across APAC is turning to increased digitisation of experiences, drilling down into building better and more highly-engaged consumer experiences that make the fan feel even more connected to the sport that they follow and love. The role talent is playing is key, but also rights-holders in how they pivot to unleash new opportunities for brands to be part of the growing conversation.

We’ve seen this evolution during Covid-19, with everyone from LeBron James, to Neymar, to sports federations like the International Table Tennis Federation seeking ways to remain connected with their fans in the at-home environment.

We’re all waiting with bated breath to see the NBA restart and how they have learnt from the likes of the Bundesliga and the EPL, and if they can take fan engagement to the next level. All these experiences will be heavily reviewed, monitored and learnt from.

So the adaptation that needs to take place is looking to the opportunities to build experiences across channels to continue to reach broader audiences – AR, VR, concurrent streaming, social interaction, choice of commentary, the fan’s voice, and interplay. Learnings can be sought from esports, that was non-reliant on broadcast, and how quickly it scaled during Covid-19 in terms of viewership, participation and investment numbers, particularly in the mobile gaming space, which saw an increase of 50 to 75 per cent in playing time over the pandemic period in Southeast Asia, providing significant opportunities for brand engagement.

I do believe APAC remains a continued opportunity for growth. There is government support bringing the likes of the Women’s Fifa World Cup to New Zealand and Australia, and the Beijing 2022 Winter Olympics and the AFC Asian Cup 2023 to China. These events will keep consumers engaged, drive international tourism, enhance national pride, and put sport back on the map globally after Covid-19 – not that it really went away, it only just paused!

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