To prosper over the next 25 years, rugby union needs more countries playing the 15-a-side game at the top level and challenging for trophies, and it needs to broaden its appeal in its core countries by age, region and social class
Mark OliverMark Oliver is the chairman and founder of Oliver & Ohlbaum Associates, leading the firm’s advice on media, entertainment and sports investments to both investors and target companies/organisations, covering over £20 billion of deals since 1995.
Rugby union has come a long way since it turned professional almost 25 years ago in 1995. It might have to travel even further in the next 25 years if it is to prosper as a leading global sport, as the second wave of disruption hits the sports sector.
Changing demographics and tastes, a shift in the global centre of gravity of all sports and the need to adapt to an age of 24-hour connectivity will all test the game’s existing structure, calendar and power base.
The rugby authorities have had many successes over the past two and a half decades. Most notably, they established the Rugby World Cup as a significant four-yearly global event generating almost $300 million in combined media, sponsor and attendance/hospitality revenue by 2015, and broadcast across more than 200 countries.
The Six Nations tournament is still an important annual event that remains attractive to audiences and competitive up to the final match weekend. Women’s rugby has become a serious game worthy of TV schedule time and sponsor interest. And Rugby sevens became an Olympic Sport in Rio, with a great ‘David versus Goliath’ finale as the extraordinary Fijians beat Great Britain.
Rugby union remains a sport with only partial global support, a scale down in commercial terms from tennis and golf and falling behind that other great Commonwealth team sport, cricket
But rugby union remains a sport with only partial global support, a scale down in commercial terms from tennis and golf and falling behind that other great Commonwealth team sport - cricket - with its massive appeal in high-growth India.
Rugby union’s appeal to the young in its core markets is static at best and participation among the young is challenged by a more sensitive health and safety environment. It has failed to nurture enough new countries into the top tier of the 15-a-side game, or to consolidate its early gains - after the game turned professional- versus rugby league in England and Australia, where it had traditionally been seen as a middle-class, privately-educated, southern game or a New South Wales/Queensland game, respectively.
Rule changes, which at first led to a more flowing and attractive game, seem to now result in more breaks and hold-ups and wholesale team substitutions that can destroy the personal head-to-head narratives of the game.
Global annualised revenues now totalling $1.8 billion a year are growing at about 2 to 3 per cent a year, only half the rate of the sports industry average
As a result, global annualised revenues now totalling $1.8 billion a year are growing at about 2 to 3 per cent a year, only half the rate of the sports industry average. Rugby sevens helps bring in new fans and new countries but is seen as very separate to the 15-a-side game. Low-contact versions of the game help encourage initial youth participation, but tough physical contact is still part of the game’s appeal, and the recent fortunes of MMA formats suggests there is no diminished appetite for such hard physical spectacle.
To prosper over the next 25 years, rugby union needs more countries playing the 15-a-side game at the top level and challenging for trophies, and it needs to broaden its appeal in its core countries by age, region and social class.
A potential route to all these ends could be a radical redesigning of the top club game which currently accounts for about 50 per cent of total sport revenues but still plays second fiddle to the national team tournaments in terms of profile and focus. O&O’s own research also suggests that top club rugby tends to have proportionately more appeal to the young, and its strong city/regional affiliation might help overcome class and regional bias against the game.
The focal point of any restructuring would probably be a proper World Club Championship, initially biennially. But this could be reinforced by a new two-conference Global League structure - one combining Europe with USA and Canada, and the other combining SANZAAR with Japan. Each conference would have the aim of expanding its geographic coverage over time, with Conference A bringing in city-based teams from central, southern and eastern Europe, and Conference B bringing in cities from the Far East and South East Asia.
If rugby union doesn’t change, it could be forever consigned to the second tier of global sports and see its audiences migrate away to soccer, NFL, rugby league and eSports
Over time, an expanded network of club franchises should increase the quality of the national sides from new nations, and support for them, making the Rugby World Cup live up to the middle word in its name. Current national club leagues could sit side by side with these hemisphere conferences or be subsumed into them over time.
If rugby union doesn’t change, it could be forever consigned to the second tier of global sports and see its audiences migrate away to soccer, NFL, rugby league and eSports.
And if those in charge of rugby union don’t evolve the proposition, investors with a global view and a focused strategy might start to take parts of the game away from them. Rugby clubs are not hugely profitable enterprises and rugby players are not that well rewarded - they could be easily enticed by a more lucrative and high-impact future.
This is the second part of a series of opinion articles by Mark Oliver on disruption of sports in the digital age.