Esports team competing in a professional tournament; viewership and participation will grow to … [+]
While you might look at the sports industry and feel like it’s been around forever, its changing rapidly right now. In college sports, power is shifting from the colleges to the athletes. For professional sports team, they are examining better ways to drive revenue and connect with their fan base. Sports like Pickleball, not necessarily new, have exploded recently due to a variety of factors. And online, esports is exponentially growing. Deloitte’s Annual Sports Industry Outlook explores how these trends could create new opportunities and challenges for both organizations in sports and those entrepreneurs looking to enter this marketplace.
In addition to the growing sports segments, technology will play a very large role in the future of sports. And it’s not just all the tracking of athletes as they perform and big data. What is the next best thing to being at a soccer match in Europe when you can’t physically be there? Being there via augmented reality (AR) or virtual reality (VR) as several teams are now experimenting with this technology. For instance, an NBA game between the Sacramento Kings and San Antonio Spurs was broadcasted in VR. Ask yourself, how many fans can attend a Lakers game in AR? Millions?
According to Research and Markets, the global sports market is expected to grow from $354 billion in 2021 to $501 billion in 2022 at a compound annual growth rate (CAGR) of 41.3%. The growth is mainly due to the companies recovering from the impact of COVID-19, which had earlier led to restrictive containment measures involving social distancing, remote working, and the closure of sports arenas and stadiums. The market is expected to reach $707 billion in 2026 at a CAGR of 9%. That is some amazing annual growth.
The sports marketplace is segmented by type into participatory sports and spectator sports. Let’s review the fastest growing participatory sports as opportunities where existing and future entrepreneurs can play a role.
Off road gravel bicycle racing.
Esports. The short history of eSports has been an amazing story as it has seen a stratospheric rise in popularity in the last decade. Fueled by the COVID-19 pandemic, sports fans were looking for something to fill the void and eSports has stepped into the breach helping it turn into a billion dollar a year industry. Goldman Sachs expects that eSports will have roughly the same viewership levels by 2022 as the NFL.
Rugby. The sport has grown exponentially in fanbase and the 2019 Rugby World Cup (RWC) really spurred this on. The RWC saw an increase of 18% from 344 million in 2018 to 405 million in 2019. This is an incredible growth of over 60 million fans from one year to another. The USA now have top tier rugby competition called Major League Rugby which is expanding fast helping to drive the sport to new levels in North America.
Pickleball. This sport has been around for years but is now gaining traction fast. In February 2022, pickleball was named the country’s fastest-growing sport for the second year in a row by the Sports and Fitness Industry Association. Pickleball has 4.8 million players nationwide, an increase of nearly 40% over two years ago. There are now an estimated 35,000 courts in the U.S., more than double the number from five years ago. Equipment sales, lessons and tournaments will fuel the future growth of this industry.
Standup Paddle Boarding. While it may come as a shock to many, stand up paddle boarding (SUP) is still one of the fastest-growing sports in the world. Over the past several years, paddle boarding has experienced a surge in popularity as individuals from all over the world are being exposed to the sport for the very first time. The Global Stand Up Paddleboard Market research report indicates the size of the industry was estimated at $336 million in 2021, and is projected to grow at a Compound Annual Growth Rate (CAGR) of 8.55% to reach $551.47 million by 2027.
Drone Racing. Pricewaterhouse Coopers forecast that the world drone market was worth $0.61B in 2021 and that overall revenue is anticipated to rise at a rate of 22.10 % from 2022 to 2029, reaching almost $ 3.01B in 2029. Whether it’s selling drone racing gear or organizing events, this market will continue to grow.
Adventure Bicycle Racing. Ever go on a Belgian Waffle Ride? It does involve Belgian pancakes but they come at the end of an off road bicycle race designed by an emerging company, Monuments of Cycling in the bicycle adventure racing industry. They are helping lead the charge in off road or ‘gravel racing’ which is growing quickly across the USA and Europe. Equipment, training, social events and coordinating races are driving the growth along with $50,000 top prize packages.
