THE FUTURE WFS SPECIAL REPORT THE VISION FOR 2022 - World Football Summit

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THE FUTURE WFS SPECIAL REPORT THE VISION FOR 2022 - World Football Summit
WHERE THE FOOTBALL INDUSTRY MEETS

THE FUTURE
WFS SPECIAL REPORT      THE VISION FOR 2022

                APRIL 2019
THE FUTURE WFS SPECIAL REPORT THE VISION FOR 2022 - World Football Summit
WFS   2   WFS SPECIAL REPORT   EDITORIAL                          3   THE FUTURE OF FOOTBALL INDUSTRY

                               World Football Summit (WFS) is the International event of the
                               football industry, gathering the most influential professionals in
                               order to discuss the most relevant topics. One of such subjects is
                               how these professionals are envisioning the future of the football
                               industry and with this objective in mind, WFS has undertaken a
                               survey with the participation of WFS Advisory Board members
                               and collaborators. WFS would like to thank the members of the
                               Advisory Board.

                               This report delves into key industry trends such as the digital
                               transformation and the use of technology and innovative ele-
                               ments in football which can enhance the fan experience (espe-
                               cially for younger audiences). Besides, it provides insights into
                               the appearance of new media channels that are changing the
                               sports viewership by broadcasting, livestreaming and posting
                               sport content; i.e “social media” players.

                               Lastly the changing landscape of revenue streams of the football
                               industry, how experts envision its future and which new oppor-
                               tunities bring for stakeholders.

                               All of that give us a positive outlook for football in the coming
                               years.
2
THE FUTURE WFS SPECIAL REPORT THE VISION FOR 2022 - World Football Summit
ADVISORY BOARD                               4   WFS SPECIAL REPORT     ADVISORY BOARD                             5   THE FUTURE OF FOOTBALL INDUSTRY

                 ANDY STALMAN                    CARLOS CANTO                            EBRU KÖKSAL                               IRIS CÓRDOBA
                 Expert in Branding.             CEO                                     Senior Advisor                            General Manager
                 “Mr. Branding”.

                 JAVIER GÓMEZ                    JAVIER SOBRINO                          JULIO SENN                                JUN ZHAO
                 Corporate General Manager       Strategy & Knowledge                    Managing Partner                          CEO
                                                 Director

                 JURGEN GRIESBECK                LUIS VICENTE                            MOUNIR ZOK                                PABLO DANA
                 Founder and CEO                 Chief Digital                           Co-founder                                CEO
                                                 Transformation                          and Managing Director
                                                 & Innovation Officer

                                                                                           N3XT
                                                                                         SPORTS

                 PATRICIA RODRÍGUEZ              RAYDE LUIS BÁEZ                         RICK PARRY                                SAM LI
                 Member of the                   Founder                                 Chairman                                  Head of Content
                 Advisory Board                                                                                                    Acquisition and Strategic
                                                                                                                                   Partnership

                                                                                         Bramley Corporation Ltd
THE FUTURE WFS SPECIAL REPORT THE VISION FOR 2022 - World Football Summit
METHOD                       6                WFS SPECIAL REPORT     INDEX                              7    THE FUTURE OF FOOTBALL INDUSTRY

SURVEY METHODOLOGY                                                   CONTENTS
Respondents were asked to rank in a scale of 1 - totally
                                                                     01 GENERAL AND OWNERSHIP
disagree - to 10 - fully agree - several statements about
                                                                             Survey Results
the future of the industry in three main areas:
                                                                             Economic and social importance of football
                                                                             Ownership

01.      GENERAL AND OWNERSHIP                                       02 INCOMES
                                                                             Survey Results Key Areas

02.      INCOMES                                                             Distributor disruption: new global media ecosystem
                                                                             Commercial and venues
03.      USE OF TECHNOLOGY IN THE FOOTBALL INDUSTRY                          Transfers and prizes

                                                                     03 USE OF TECHNOLOGY IN FOOTBALL
                                                                             Survey Results
                                                                             eSports and fantasy sports revolution
                                                                             Using technology to improve football stadiums
0        1     2   3   4     5     6      7       8     9       10

Totally disagree                                      Fully agree            REFERENCES
THE FUTURE WFS SPECIAL REPORT THE VISION FOR 2022 - World Football Summit
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01   8   WFS SPECIAL REPORT   01.GENERAL AND OWNERSHIP                          9         THE FUTURE OF FOOTBALL INDUSTRY

                              SURVEY RESULTS
                              The football industry in 2022: Envisioning its future

                              0        1         2         3         4          5         6         7               8       9             10

                              The economic importance of football will increase by 2022
                                                                                                                                        9,57

                              The social importance of football will increase by 2022
                                                                                                                                 9,07

                              Clubs will be managed in a more profesionalized way by 2022
                                                                                                                          8,71

                              By 2022, football will still be sport #1 among Millenials and Native Digital
                                                                                                                   7,86

                              By 2022, a super European league will become a reality
                                                                                                                  7,71

                              Investment funds will acquire more clubs by 2022
                                                                                                           7,43

                              Clubs listed in the stock exchange market will increase by 2022
                                                                                                           7,36

GENERAL AND
                              By 2022, the “franchise” business model will become a reality in football
                                                                                                    6,93

                              Clubs owned by “members” will increase in number by 2022
                                                                                         5,79

OWNERSHIP
                              KEY TAKEAWAYS
                              The economic and social importance of football will increase in the next decade.
                              Investment funds will acquire more clubs by 2022.
                              Clubs will be managed in a more professionalized way.
THE FUTURE WFS SPECIAL REPORT THE VISION FOR 2022 - World Football Summit
01                                      10                    WFS SPECIAL REPORT     01.GENERAL AND OWNERSHIP                            11      THE FUTURE OF FOOTBALL INDUSTRY

ECONOMIC AND SOCIAL IMPORTANCE                                                       Another important aspect is that respondents consider that by 2022, football
                                                                                     will still be among the favorite sports for Millennials and Natives Digitals as it
OF FOOTBALL                                                                          has a huge potential in appealing to these generations. For instance, clubs will
Football is of significant importance worldwide; in the WFS survey, when             be able to offer extremely valuable content to them by improving their viewing
asked to rank their perception of the football industry’s growth in the future,      experience through POV videos and AR offerings (e.g with player statistics) or
respondents pointed that both its economic and social importance will in-                                                                 supplying them with new experiences
                                     crease by 2022 (with an average grade of                                                             (e.g apps that allow fans to compare
                                     9.57 and 9.07 out of ten respectively).                                                              their performance with those of their
THE ECONOMIC AND
                                                                                                                                          favorite players and learn from them).
SOCIAL IMPORTANCE                    As football keeps gaining popularity, we
OF FOOTBALL WILL                     expect an increase of its significant eco-                                                           In fact, the diagram below shows that
INCREASE BY 2020                     nomic impact not only with its direct con-                                                           football tops the chart in terms of peo-
                                     tribution to the city/country where com-                                                             ple’s interest in sports (data comes
                                     petitions take place (stimulation of the                                                             from a Nielsen’s survey carried out in
tourism sector: job creation, tax receipts, investment in facilities, hospitali-                                                          18 markets) and is expected to contin-
ty, etc.) but through indirect support to growing industries; tech (e.g sports       ue to dominate the global sports market. What’s more, the football fan-base
start-ups, gaming), gambling and media industries.                                   is growing and becoming more international with USA, Mexico, Russia, China
                                                                                     and India representing some of the most interesting growth markets.
Besides, football with such huge reach around the world is aiming at improv-
ing the society around it through increasing participation in the sport. In the      This may be also related to the fact that by 2025, a super European League
next decades, we will see an increase in community programs – investment             might become a reality (respondents ranked it with an average score of 7.71
in facilities/refurbishments, teaching of skills/values inherent to the sport and    out of 10).
investing in education/training–.
                                                                                     PERCENTAGE “INTERESTED” OR “VERY INTERESTED” IN MAJOR SPORTS
                                                                                     Nielsen Sports: World Football Report 2018
                                                                                                                                                                          Football

                                                                                     40%

OWNERSHIP                                                                                                                                                                 Basketball

In terms of management and ownership, respondents believe that clubs ac-             40%                                                                                  Track & Field Athletics
                                                                                                                                                                          Tennis
quired by investment funds will increase by 2022 and that there is growth po-                                                                                             Motorsport
                                                                                                                                                                          Cycling

tential for them to be managed in a more professionalized way. Therefore, it         20%                                                                                  MMA
                                                                                                                                                                          Baseball
is expected clubs to be transitioning from just a football club to a business-ori-                                                                                        Cricket

ented organizational structure focused on the leisure and entertainment in-                                                                                               Golf

                                                                                     10%                                                                                  Rugby
dustry. On the contrary, respondents don’t expect clubs owned by members
to increase in the next decade.
                                                                                           2013               2014                2015             2016            2017
THE FUTURE WFS SPECIAL REPORT THE VISION FOR 2022 - World Football Summit
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02   12   WFS SPECIAL REPORT   02.INCOMES                                      13           THE FUTURE OF FOOTBALL INDUSTRY

                               SURVEY RESULTS KEY AREAS
                               0        1        2        3           4        5           6       7                 8                  9     10

                               PRIZES
                                                                                                                     7,88

                               — International Competitions (Clubs)
                                                                                                                                       8,79

                               — International Competitions (National teams)
                                                                                                                    7,86

                               — Domestic Competitions
                                                                                                    7

                               TRANSFERS
                                                                                                                  7,64

                               — Players
                                                                                                                             8,14

                               — Coaches
                                                                                                        7,14

                               AUDIOVISUAL
                                                                                                           7,31

                               — “Social Media” players
                                                                                                                                8,36

                               — OTT NON-Football industry properties
                                                                                                                             8,14

                               — Influencers
                                                                                                                         8,07

                               — OTT Football industry properties
                                                                                                                         8

                               — PPV
                                                                                           5,86

                               — TV
                                                                                    5,43

INCOMES
                               COMMERCIAL
                                                                                                        7,31

                               — Retail space (online)
                                                                                                                                8,36

                               — Sponsorship
                                                                                                                  7,71
THE FUTURE WFS SPECIAL REPORT THE VISION FOR 2022 - World Football Summit
02                                                                               WFS SPECIAL REPORT    02.INCOMES                                          THE FUTURE OF FOOTBALL INDUSTRY

                                                                                                       DISTRIBUTOR DISRUPTION:
0        1        2        3       4     5       6             7                     8    9       10   NEW GLOBAL MEDIA ECOSYSTEM
                                                                                                       OFF THE BOX | Time spent watching traditional TV*
— Licesing
                                                                              7,36

— Merchandising
                                                                 7

— Friendly matches
                                                                6,93

— Football academies
                                                         6,64

— Catering and F&B (outside the venue)
                                                        6,57

— Retail space outside the venue
                                                                6,93

VENUES
                                                          6,70

— Hospitality
                                                                       7,14

— Retail (in the main venue)
                                                                   7

— Catering – F&B (in the main venue)
                                                                   7

— Games ticketing – members
                                                         6,64

— Games ticketing – visitors
                                                        6,57

— Museums Tours
                                                 5,86

KEY TAKEAWAYS
New platforms (OTT, social media, etc.) will increasingly the media ecosystem
and enable the creation of new content.

Exploring monetization opportunities will still be a top priority.
                                                                                                       GREATER FUSION
Sponsorship is one of the revenue streams expected to grow the most and will
find new opportunities (through digital marketing and monetization of data).
                                                                                                       OF SPORTS AND
                                                                                                       ENTERTAINMENT
Prizes and transfers are likely to increase in the future.
THE FUTURE WFS SPECIAL REPORT THE VISION FOR 2022 - World Football Summit
02                                       16                     WFS SPECIAL REPORT     02.INCOMES                               17       THE FUTURE OF FOOTBALL INDUSTRY

                                                                                       TRANSFERS AND PRIZES
                                                                                       According to respondents, the transfer market is an important part of the foot-
                                                                                       ball industry and in the future, player transfer fees will continue to climb and re-
                                                                                       main as a key revenue stream. PwC has predicted they could exceed £100m by
                                                                                       2024/25 as spending continues to follow the escalating growth of club revenues.
COMMERCIAL AND VENUES                                                                  Besides, digitalization is allowing the football fan-base to grow outside historical
WFS’s Advisory Board members believe that the decreasing efficiency of mea-            geographies and become more international. Therefore, we will also see a rise in
sured media (traditional advertising) and new advances in technology will con-         the prizes revenue stream (specially in clubs in international competitions).
tribute to an exponential sponsorship’s growth. In fact, innovation and data
gathering will optimize sponsorship by providing sponsors with a better un-
                                              derstanding of fans bases, the abil-
GROWING SPONSORSHIP                           ity to anticipate to their needs and
                                              offer tailored content (e.g with rel-
REVENUES OPPORTUNITIES
                                              evant promotions) and new mon-
GENERATED BY DIGITAL
                                              etization possibilities. Furthermore,
MARKETING                                     we will see:

  INCREASE OF GLOBAL SPONSORS                INCREASE OF PRICES PAID BY
   INVESTMENT                                 SPONSORS
  ESPECIALLY WITH TIER                        AS FOOTBALL BENEFITS FROM A
  1 PROPERTIES                                GROWING GLOBAL VISIBILITY

According to WFS experts, non-broadcasting revenues will still be extremely
important for the whole sector such as commercial (including merchandising
and licensing) and match day (including catering, retail on-site and corporate
hospitality sales). Ticket sales, museum tours and retail spaces outside the
main venue will go down the list of growing revenue streams while innovation
will bring new opportunities in e-commerce and online sales (e.g hyper-target-
ing platforms that are able to intelligently adapt and offer customized access to
fans according to their interests). Indeed, retail space online is identified as the
first growth driver for the future of incomes (average grade of 8.36 out of ten).
THE FUTURE WFS SPECIAL REPORT THE VISION FOR 2022 - World Football Summit
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03    18   WFS SPECIAL REPORT   03.USE OF TECHNOLOGY IN FOOTBALL             19   THE FUTURE OF FOOTBALL INDUSTRY

                                SURVEY RESULTS
                                Innovative elements in the Football Industry
                                0           1        2     3        4        5    6      7      8                9               10

                                Artificial intelligence
                                                                                                                          9,29

                                Augmented reality
                                                                                                                         9,14

                                Big Data – analysis of teams-game strategy
                                                                                                                     9

                                Video Assistance Replay (VAR)
                                                                                                                8,86

                                eSports
                                                                                                                8,86

                                Cashless
                                                                                                                8,79

USE OF
                                Blockchain
                                                                                                               8,71

                                Virtual Reality
                                                                                                               8,71

                                Big Data – physical performance

TECHNOLOGY
                                                                                                               8,71

                                Wearables – performance
                                                                                                         8,43

                                eTextiles
                                                                                                         8,43

IN FOOTBALL
                                Big Data – for transfers
                                                                                                        8,29

                                Gamification
                                                                                                    8,21

                                Chatbots
                                                                                                 7,93
03                                            20                     WFS SPECIAL REPORT     03.USE OF TECHNOLOGY IN FOOTBALL        21      THE FUTURE OF FOOTBALL INDUSTRY

                                                                                            To start with, the use of technology in sports is increasing rapidly and new
                                                                                            elements are appearing to improve performance aspects for both the play-
                                                                                            ers and referees on the pitch. Respondents identify artificial intelligence and
0        1         2         3         4      5    6      7                 8      9   10   augmented reality as the first growth driver for football technology (average
                                                                                            grade of 9.29 and 9.14 out of ten respectively).
Facial recognition (security in the stadia)
                                                                            7,93
                                                                                            THE PROVISION                         We can already see it through a first
                                                                                                                                  wave of activity data with the inclusion
Fantasy Sports                                                                              AND PROCESSING
                                                                            7,93                                                  of technologies such as the Video Assis-
                                                                                            OF MATCH DATA WILL
                                                                                                                                  tant Referee, leading to new possibilities
Geolocalization
                                                                       7,71
                                                                                            ENHANCE PLAYERS’                      for the future like sensors in the fabrics
                                                                                            PERFORMANCE                           of players’ kits. Thanks to new Augment-
Daily Fantasy Sports
                                                                      7,64                                                        ed Reality tools referees will get to see
                                                                                                                                  the action from any angle in real time
Drones
                                                                     7,50
                                                                                            and avoid game-changing situations (dubitative goals, penalty, red card inci-
                                                                                            dents, etc.).
On-body cameras (referees)
                                                              7,14
                                                                                            According to WFS’s experts this is only the beginning; textile or wearable and
On-body cameras (players)                                                                   sensor technology will come into play to complete a technical ecosystem
                                                       6,64
                                                                                            and get a better insight into football players’ and team performance. During
On-body cameras (staff and coaches)                                                         matches, this kind of electronic performance and tracking systems (EPTS)
                                                       6,57
                                                                                            will provide more accurate positioning and biomedical data that will facilitate
                                                                                            decision-making (e.g. transfers, game strategy, recovery, injury prevention).

KEY TAKEAWAYS                                                                               Moreover, WFS members agree that data collection will be key for transfers
Electronic performance and tracking systems will unleash their full potential.              analysis and for increasing fan engagement by allowing fans to view in-depth
                                                                                            player statistics as matches are broadcasted (using augmented reality apps
Match-data and statistics will improve team performance and fan engagement.                 linked to live in-game data). Not only that but fans will have more flexibility in

eSports is on to become established as one of the leading sports globally.                  terms of football matches’ consumption.
                                                                                            For instance, they will have the means for enjoying immersion experiences
Venues of the future will become smart connected stadiums that enhance                      thanks to Virtual Reality tools that will teleport themselves onto the sideline of
fan experience.                                                                             the game and seat wherever they want (e.g use of 3D simulation to do a vir-
                                                                                            tual stadium visit). VR and AR will also bring value to sponsors for activations
Technology is the key lever to the revenues increase. (specially in clubs in
                                                                                            and teams for training purposes.
international competitions).
03                                                  22                               WFS SPECIAL REPORT   03.USE OF TECHNOLOGY IN FOOTBALL         23        THE FUTURE OF FOOTBALL INDUSTRY

Likewise, “drones” or mini cameras will possibly appear to follow players                                 According to Newzoo, a provider of eSports market intelligence, the global eS-
around and cover absolutely every move. Similarly, fans will be able to see the                           ports revenues are expected to reach $1,650 million in 2021 (with a sustained
action from the players’ point of view (POV devices).                                                     growth from 2018) with media rights being the fastest-growing revenue stream
                                                                                                          (2016-2021: CAGR of +49.v8%).

ESPORTS AND FANTASY SPORTS                                                                                Respondents believe that football properties will respond fast and link to this sec-
                                                                                                          tor with such growth potential with video games to connect millions of fans (FIFA
REVOLUTION                                                                                                game is already booming interest with new competitions: FIFA eWorld Cup). Ac-
When talking about new consumer phenomenon, gaming is emerging as a com-                                  cording to Radiant Insights, fantasy sports market is also anticipated to witness
petitor for the football fans’ attention but at the same time, appearing as an op-                        impressive growth and will post a staggering CAGR of more than 11% by 2025.
portunity. Esports viewership and popularity has grown drastically (thanks to the
growth of online streaming gaming channels and the link with Virtual Reality) and
according to WFS survey’s respondents it is on course to become established as
one of the leading global sports (average grade of 8.86 out of ten)                                       USING TECHNOLOGY TO IMPROVE
                                                                                                          FOOTBALL STADIUMS
                                                                                                          First of all, we are already seeing increased attempts to raise venue security and
eSports REVENUE GOWTH
                                                                                                          WFS members expect that digital solutions will come to maximize fan safety (e.g
Font: 2018. 2018 Global eSports market report. Newzoo.
                                                                                                          facial recognition, electronic fingerprints or video analytics).
  Brand investment     Media rights, advertising,   Total   Media rights, advertising,
                       sponsorship                          sponsorship, merchandise and
                                                            tickets, game publisher fees
                                                                                                          Besides, it is known that digital native fans have much higher expectations in all
                                                                                                          the different occasions they interact with their favorite club. Then, these smart
                                                                                                          stadiums will have models to manage fan behavior and technology will contin-
                                                                                                                                                  ue to evolve in order to change the game
                                                                                           +27,4,%                                                experience through new tools such as
                                                                                                          TECHNOLOGY WILL                         geolocation (e.g remote ordering of food
                                                      +38,2%
                             +33%                                                                         ALSO COME TO                            or guidance to the toilet with the short-
                                                                                                          FOOTBALL STADIUMS                       est queue) and other innovations like 3D
                                                                                                                                                  holographic projection (e.g to watch away
                                                                                                          OVER THE NEXT
                                                                                                                                                  matches in the stadium) or smart seats
     $493                    $655                     $906                                 $1650          DECADE
                                                                                                                                                  (with touchscreens and entertainment
     $350                    $468                     $694                                 $1385                                                  features. i.e. replays).

                                                                                                          Finally, respondents are positive about changes in the payment systems with a
     2016                    2017                     2018                                 2021           growing number of stadiums providing cashless experiences to customers (by
03                                        24                WFS SPECIAL REPORT    03.USE OF TECHNOLOGY IN FOOTBALL   25   THE FUTURE OF FOOTBALL INDUSTRY

having one app for many purchases) and see also blockchain taking hold in foot-
ball (e.g bringing benefits in advertising measurement impact and transparency
for ticket selling, betting and transfers).

              Ticketing
              & Accreditation

              Fan content
              Player statistics,
              goal replays, etc.

              Merchandising

              Seat location and
              geolocation services
              Food & drinks, toilet queues
              scanning, etc.
01
REFERENCES                                          26           THE FUTURE OFWFS
                                                                               FOOTBALL
                                                                                  SPECIAL
                                                                                        INDUSTRY
                                                                                          REPORT

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