The sports industry is undergoing a significant shift, with data and artificial intelligence playing a crucial role in determining the future value of sports. According to Peter Gacheru, CEO of IMG marketing company, the biggest change happening in global sport right now is not a new league or investor, but data and its impact on the value of sports properties. This change was a key topic at the SportsBiz Africa Forum held in Kigali, which brought together various voices from across the business of sports.
For decades, sports business has been built on sponsorship, with companies sponsoring clubs, athletes, or events in return for branding, visibility, and media exposure. However, these metrics are no longer sufficient, as sports rights are increasingly being viewed as investment assets, not just marketing opportunities. Private equity, family offices, and sovereign wealth funds are moving into the sports industry, with firms like Arctos building portfolios across major US sports.
The Asian-Pacific sports M&A market reportedly hit $3.69 billion by July, 12 times the prior year, highlighting the growing interest in sports as an asset class. However, valuing sports properties requires a deep understanding of their audiences, including demographics, behavior, and purchasing power. This is where data comes in, enabling sponsors and investors to move beyond simple metrics like audience size and towards a more nuanced understanding of audience quality.
Global leaders in audience measurement, data, and analytics, such as Nielsen, have already made this shift, combining exposure data with demographics, brand health, and sales impact. One study of 100 sponsorships found a 10 percent average lift in purchase intent among exposed fans. The Australian Football League uses consumer research on fan behavior to build sharper, more targeted partnership deals, demonstrating the potential for data to discover new value in sports properties.
Africa has extraordinary sports stories, including Kenyan distance running, Nigerian football culture, and South Africa's sophisticated market. However, African sports properties remain significantly under-monetised, not due to a lack of audience, but a lack of commercially structured information about that audience. By developing a more detailed understanding of their audiences, African sports properties can increase their value and attract more investment.
The NBA Africa illustrates what this looks like in practice, building an ecosystem of media, partnerships, grassroots programs, and retail. In 2023/24, over 140 live telecasts drove a 41 percent year-on-year rise in viewership and nearly six million watch hours; local social accounts generated almost 90 million video views; NBA Store sales in South Africa rose almost 150 percent. This approach has attracted investors, including Tunde Folawiyo and Helios Fairfax Partners, who backed the ecosystem around the audience, not just a sponsorship line.
Imagine a Kenyan Sports Audience Index combining media, demographic, behavioral, fan, engagement, commercial, geographic, and economic data across various sports. This could identify running tourists, marathon participants, sportswear consumers, and destination travelers, turning a marathon from a broadcast asset into a tourism and investment asset. The next generation of sports commercialization in Kenya and across the continent must be built on a simple principle: measuring not just how many people watch, but who they are, what they do, what they're worth, and what economic value their attention can create.
Key points
- African sports properties remain under-monetised due to a lack of commercially structured information about audiences.
- Data is becoming increasingly important in determining the value of sports properties.
- The next generation of sports commercialization in Africa must be built on measuring the quality of audiences, not just their size.
