The World Cup, the most widely followed sport event, ended only a few weeks ago with France winning the trophy for the second time since 1998. The World Cup is indeed a unique opportunity not just for sport fans but also for sport organizers. Large scale events such as the World Cup pose significant management challenges for event holders – one mishap in scheduling or managing tickets can result in disastrous results for the entire event; however, the rewards for solving such challenges are also significant. FIFA is reported to earn over $6 billion for hosting the World Cup, which is approximately 20% higher than its revenue from the last World Cup. The World Cup is only the tip of the iceberg for this highly dynamic and lucrative niche – sport venue management, an often experienced but rarely discussed aspect of sports. At Fast Forward Advisors, we have conducted further research into this market and discovered how innovators are changing how sport management works, especially in Europe, a continent rich in sports history. This article summarizes our findings in three main sections: the overall European sports market, the European sport venue management market, and innovative companies in this market.
Sports market in Europe
Europe is estimated to have generated $8.6 billion in 2016 in sports revenue and $13.2 billion in 2022, a 6.5% compound annual growth rate. Another metric to assess the sports market is number of sports participants – Europe was estimated to have 76 million sports participants in 2016 and 100 million in 2022, a 5% compound annual growth rate. The age group that comprises the largest portion of sports participants is 25-55, which makes up 75% of the entire sports group and is equally distributed among 3 small age groups: 25-34, 35-44, and 45-55. In terms of income demographics, 45% of all sports participants are high income earners and 30% are medium income earners. These figures indicate two implications: the sports market in Europe has not experienced enough innovation, leaving many potential opportunities for sports startups, and there is undeniably consistent growth despite wide fluctuation in the overall economy and political landscape.
The European Commission conducted a recent research and found that Europeans in general prefer parks and outdoors to sports centers, Central/Eastern Europeans have more dynamic options between outdoors, at home or on the way to home or school. Polish in particular prefer to engage in sports activities at sport clubs, schools or universities. Total spending by Polish sports participants is estimated to have a 8% compound annual growth rate from 2013 to 2017.
Sports venue management market and its trends
In the digital era, sport venues, arena and stadiums need to keep up with the pace of change of advanced technology as well as appeal to customer demand and a shift in fan preferences. At the heart of the business is the hospitality experience they bring to fan and athletes. The hospitality concept, as blogger George Heinlein recognized, is the experience fans have purchasing tickets online; the ease with which they find their seat, get a beer or find a restroom; the quality of seating, retail and concessions. Hospitality also presents in the communication that occurs after a game; the pre, during and post-event organisation of sport teams; the interaction between fan and players. Hospitality should be at the core of the business so as to attract more people coming to the events, increase traffic and hence maximize revenue.
Hospitality-driven designs of sport venues and stadium has become more comprehensive thanks to the evolution of technological infrastructure and the widespread of IoT. There are three main trends that drive innovation in the sport venue management market: inclusiveness, experience recording and the rise of marketplace businesses.
- Inclusiveness to increase sport engagement
An innovative approach to generating stable future revenue streams is to include opportunities for the community to feel connected to the venue in more ways than just as fans of a sports team. Mixed-use developments in downtown areas surrounding arenas and stadiums are growing, all revolving around the arena or stadium. For instance, in Los Angeles, the new Rams stadium which is scheduled to open in 2019 will have an indoor/outdoor atmosphere with a curved, transparent roof that will catch the California breeze and allow for year-round usability but still give the fans in the crowd some shade. The venue is designed for fans to be fully-immersed in media with advanced Wi-Fi networks and video board viewing from every seat.
Traditional stadiums used to last decades, but the model shift, along with differing consumer behavior, has brought an introduction to premium seating with in-seat charging, in-stadium e-commerce, etc., that cater to the high-end buyer. The multi-functional Point-of-Sale and cashless payment solution for food and beverage and fan merchandising management is an example where technology advancement can help improve convenience catering for pre-booked food dining options and activities before and after the main event in order to encourage fans to arrive earlier and leave later.
Giving club seats, VIP bars and suite spaces views of a portion of the locker room or player tunnel, for example, makes athletes more accessible and connected to fans. For athletes, health and wellness also has become an important part of sports facility design, as future sports training facilities will be integrated with health, sports medicine and research components, enabling teams to better understand the bodies of high-level athletes while engaging fans with a behind-the-scenes look into their training.
- Live/online experience will be about awe-inspiring story writing and memory-making
It is essential for fans in stadiums and arenas to live an unforgettable experience while they’re watching live sport matches. So that fans can enjoy the best and they can enhance their memories, some stadiums, centers and arenas have worked to design and install :
- Digital scoreboards
- Accessible LED monitors throughout the stadium
- Digital signage at concession stands
- Access control technology for clubs, suites, and restricted areas
- Global WiFi installation
- Security cameras and video management technology
- Alarm systems and life safety measures.
In recent time, sports organizations are making consistent efforts in term of technology in their equipment and also the security of their customers. The first aim of these organizations is to retain their customers through different sensory approaches like a warm environment between fans, visual comfort with screens of high quality for the spectators, wifi available for everyone etc.. These solutions are essentials and allow for customers to build their own memories through this unique sensory experience. The fans must feel at home, as if they were watching at the house with an exceptional comfort and the atmosphere and sensations that go with it.
Apart from all its, there is also the security that we mustn’t forget. Safety plays a vital role during sporting events, especially during major events such as finals. Many people are agitated and others are no longer controlled due to alcohol. That’s why security cameras and video management technology are here for their security during sporting events. These security cameras will continuously film the spectators to ensure their safety and verify that no anomaly occurs.
3. Marketplace as a solution for efficiency and sustainability in managing sport venues and stadiums
Venue booking management & payments, event organization and promotion, can be now done by web and mobile applications. Many marketplace businesses incorporate a comprehensive operation package that allow venue owners to analyses and manage customer transactions, and promote traffic. The system of E-Ticketing, for example, permits sales using all available channels (Desk with operator, Web for Print@home, Mobile etc…), incorporates the planning process of organization with interface on Google Calendar, thereby helps management and sale of products and merchandising.
Platforms allow venue operators to collect data about their customers, such as purchasing behavior and preferences, and then use this data and combine it with their other sources to run hyper-targeted campaigns on any channel to upgrade customer experience, engagement, increase ticket sales and improve customer services. Understanding fans’ preferences and choices also help venue owners to targets those who are interested in their services, to identify and grow their fan base. These help win the hearts and wallets of millennials.
Fans can enjoy the sports pre-event, during-event, and post-event through immersive experiences, socializing with friends near or far and accessing all match content and stats on their mobile devices, providing them with instant access information they need, while maintaining data security, with logged and trackable activities. They can also earn reward from venue operators, such as digital currency for purchasing tickets, resale tickets, discounts, pre-book VIP seats, or even organizing their own sport events.
Companies disrupting the sport venue management industry in Europe
Perfect Gym Solutions is a Polish startup that offers management solutions to sports clubs. The product offers access control, advanced reports (club statistics, client activity), CRM database, newsletter/SMS module, invoice generation, calendar module for trainers, self-service Kiosk and many more. The venture has proven to be quite appealing as it has attracted over 6 million USD funding in 5 rounds, most recently with 3TS Capital Partners.
Glofox is a Irish startups that offers a complete gym & fitness studio management software. With Glofox’s product, one can manage membership sign-ups/periods, schedule classes, facilitate payments, offer self service check-in, and review key business metrics. Accompanying the software are the branded Web App and Mobile App that allow easier access for customers. Glofox has raised close to 3 million Euros in fundraising, most recently from Partech.
Sportly is an Austrian software company that offers management solutions to fitness professionals. The product is a self-service platform for organizing and promoting sport classes and workouts as well as facilitating communications and payments. Sportly is still a relatively small and young company – founded in 2015 and currently with below 10 employees. Nevertheless, Sportly has shown some signs of traction as the company has raised over 100,000 Euros from ABC Accelerator
Fitmanager is a Dutch software company that also offers management solutions but focuses on small/boutique fitness clubs, gyms, and personal training studios. Fitmanager’s cloud-based software handles all membership administration and payment matters, automating processes such as reservation reminders, subscription, etc. Fitmanager was previously funded by Leapfunder for an undisclosed amount.
eGym is a German startup that offers cloud technology to manage gym hardware (training stations, equipment, etc.) and store user workout data to improve user experience. eGym’s cloud technology can connect to all hardware on training floor (supplier independent) and trainers as well as members can access their workout data through the mobile apps. eGym’s model has proven to be quite attractive as it has attracted close to 90 million USD in funding in 3 rounds, most recently from HPE Growth Capital.
Modern sport venues and stadium equipped by technology stack like Wifi access, networked hardware / beacon technology, in-stadium functions like operations / facilities, retail point of sale, customer service, ticketing, and social media, systems integration solutions to integrate with surroundings environment, etc., are developed surrounding the core business – hospitality. From obtaining event information, booking tickets, finding seats, to online connection with social media, sharing moments and in-seat beverage and entertainment, a new dominant model of venue business is emerging that shapes and directs in-stadium sport experience. Venue operators, who embrace the hospitality at the heart of their business and carry their stadium design, construction and operation with computing power and mobile and cloud computing, will be on the vanguard of offering their fans the best experience in the stadium of the future.
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