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Sport's short-term investments have long-term implications

Ben Howard with Tonga Netball Association
Copyrights: Tonga Netball Association (Photo)

Sport's short-term investments have long-term implications

Who would you invest in? This question will be key to the future of sport, as will the role sport for development plays in it.

For better or worse, sport and the entire landscape in which it operates have changed due to COVID-19. Sporting organisations have been brought to their knees in a short space of time, highlighting not only how unprepared most were, but also how vulnerable they are as business models.

In Australia, the shutdown of sport at both elite and community level has affected nearly every sport, from the bigger codes that derive most of their funding from broadcast rights and sponsorship, down to the smaller sports that are largely funded through a subscription-participation model, and everything in between.

Before COVID-19, Australia’s major sports were enjoying record revenue thanks to unprecedented broadcast rights deals and record non-broadcast income streams. The sports themselves were investing, particularly in women’s sport, where a number of professional competitions have been established (e.g. AFLW and NRL Women’s) and were beginning to flourish. Many sports have also invested heavily in para-sport, a range of socially responsible community programs in Australia, and are now working with regional and in-country partners, particularly in the Asia-Pacific region, to implement or support highly successful sport for development programs.

There is no doubt that sports will have to cut costs and devise new cost structures moving forward. Part of this will include re-evaluating their entire investment strategy, which could place question marks against the funding of items such as women’s sport, including their professional competitions, along with para sport, community programs in Australia and sport for development programs at home and abroad. It will be these short-term decisions and investments that will have long-term implications for these sports. The decisions they make will highlight what each sport stands for.

Even before COVID-19, sport’s funding spectrum was beginning to change due to the disruption of the media and broadcast landscape that pointed to a flattening, or even a decline, in previously ever-increasing rights deals for major sports. Further to this, in a post-COVID-19 world where nearly every business and aspect of life has been affected, there will be even bigger competition for the diminished funding of all areas of sport. This competition for funding will range from the parents who choose which sports their children play or consume, to the corporate sponsors operating with reduced revenues in a declining market, to cost-squeezed NGOs and charities, up to the government departments with reduced budgets.  The social fabric of what each individual sport stands for will become exposed and highly evident during these times.

Circumstances of extreme pressure often offer a good test of character in how people stand up, respond, and prioritise during tough times. Sport is no different, and coming out of COVID, we will start to build a picture of what each sport really stands for, cares about, and what it deems as its lowest priorities. There will be sports that decide to focus on ‘core business’ and areas that generate income over those they see as an expense. While these sports may enjoy short-term financial gain, they risk losing goodwill by abandoning activities focused on social gain (e.g. Women’s sport, para-sport and socially responsible programming in Australia, and sport for development in the Asia/Pacific region) wasting their previous investment in these areas, and potentially ending up with a more negative perception than before they started.

Put yourself, for a moment, in the position of a future investor in sport, be that a parent deciding which sport their children will play and watch, a sponsor looking to invest commercially, an NGO or charity looking to partner with a sport for mutually beneficial development outcomes, or a government official deciding which sports to invest in. For most, a major part of that decision will be: ‘what does this sport stand for, and does it align with what our family or organisation stands for?’ It is inevitable that individuals and organisations will choose to invest in a sport that: promotes diversity; has a women’s professional competition and para-sport structures that creates both pathways and role models; invests back into the community; creates participation opportunities for the most vulnerable in society; and invests in sport for development programs overseas. Indeed, we could see a flow of investors, supporters and, ultimately, participants from sports that abandoned these types of activities (due to their perceived expense) to those who held strong.

Who would you invest in? This question will be key to the future of sport, as will the role sport for development plays in it.

Ben Howard is an experienced sport for development practitioner from Australia who has been actively involved in the sport sector for over 20 years. For the past 15 years, he has specialised in sport for development and has spent the last 10 of those managing international sport for development programs across the Asia-Pacific region. Ben is a current Steering Board Member of the International Platform on Sport and Development.

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Tuesday, May 19, 2020 - 15:31