Footy fever kickstarts a business boom

With the winter's elite football competitions underway business information analysts at IBISWorld are anticipating a strong season for industry players too with AFL, rugby league and rugby union expected to generate revenue of $646.6 million.

The codes are also expected to boost consumer spending by $2.6 billion to the benefit of pubs and bars, sports betting, sporting clubs and ticket retailers.

IBISWorld sees the AFL as the biggest winter sports earner (including ticket sales, sponsorships, TV rights and merchandise).

In 2012, the AFL generated $425 million, more than triple that of the NRL's estimated $135.5 million and six times that of the rugby union's $70.1 million in earnings. The NRL's earnings are expected to be significantly boosted in 2013, as it is the first year of a five-year, $1.025 billion TV rights deal with the Nine and Fox Sports networks. TV rights are also a significant aspect of the AFL's total revenue.

The AFL will also outperform popular summer sports with Cricket Australia, Tennis Australia and the A-League generating $205.6 million, $185.7 million and $95.2 million, respectively, in 2012-13.

IBISWorld General Manager (Australia), Karen Dobie explained "With over six million spectators attending matches each year 2.8 million of which were unique attendees in 2012 the AFL is Australia's most highly attended sport, so it attracts some of the highest yielding corporate sponsorships and the biggest TV rights of any sport played in Australia. In comparison, the NRL clocked up just over 3.1 million spectators in 2012."

Counting the coinage
In terms of consumer spending, IBISWorld tipped the start of the footy season to result in a $2.63 billion boon for pubs and bars, sports betting, sports club memberships and ticket sales.

Pubs and bars - $1.5 billion, rising by 2.1% from 2011/12
Sports betting - $325 million, rising by 3.2% from 2011/12
Sporting club memberships/subscription fees - $440 million, rising by 0.6% from 2011/12
Ticket sales - $281 million, rising by 0.2% from 2011/12

IBISWorld anticipates the biggest spending category - pubs and bars - to grow moderately this footy season to reach over $1.58 billion. 

Here Dobie adds "growth will be spurred on by the large share of AFL games broadcast on Foxtel, and the Aussie culture of hitting the local to watch the game."

Sports betting – the fastest-growing segment of spending on all sports - is expected to grow 3.2% from last year's winter betting to reach $325.64 million. This will be driven by increased marketing by providers, diverse betting options and the ease of internet and mobile device accessibility.

However, Dobie said ticket sales are expected to remain relatively flat - mainly due to sporting bodies keeping membership and ticket prices on hold to attract members and spectators.

In the grandstands 
Dobie added "in the past 12 months, 44% of Australians over the age of 15 have attended at least one sporting event."

On the whole, IBISWorld revealed winter sports receive a stronger attendance than summer sports - resulting in higher overall revenues for winter codes.

"Despite the general upward trend in unique spectators, spectator growth has begun to plateau over the past five years, largely due to the increasing volume and quality of TV and online coverage, as well as smartphone applications allowing and encouraging fans to tune in from home and when on the run.

"In the past two years, total AFL attendance figures for all matches fell from 6.5 million (2011) to 6.2 million (2012), despite the higher number of games played. The total attendance at NRL games rose only slightly, from 3.12 million to 3.15 million between 2011 and 2012." 

Tactics being employed to woo fans back to the grandstands include ticket price freezes, inclusions of public transport in tickets, a greater focus on half-time and pre-match entertainment and the continued marketing of live games towards the family market.

For more information on these, or any of Australia's 500 industries, go to www.ibisworld.com.au 

Image: AFL Grand Final day at the MCG.

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