Sports consumption primed to bounce back strongly in 2021, reckon experts
Citing a consumption rebound on the horizon, business insiders remain bullish on the post-pandemic revival of China’s sports industry as the country aims to build the sector into an economic pillar by 2035.
With COVID-19 still casting a cloud over the global sports scene, officials, scholars and business leaders concurred during an online symposium on Tuesday that the industry can expect a robust recovery in China this year.
Although hit hard by the pandemic in areas such as sports marketing, ticketing, offline fitness training and sports tourism, industry experts still see a silver lining.
“Looking at the pandemic’s impact from a positive perspective, I am confident for the future as the crisis has actually opened up new business opportunities for the sports sector,” Bao Mingxiao, a professor in sports economy with Beijing Sport University, said during the 2020 Sportsmoney Annual Summit on Tuesday.
“People have grown more aware of the importance of a healthy lifestyle after the pandemic, which will result in more sports participation and consumption,” said Bao, who is also director of the sports social research center of the China Institute of Sport Science.
The use of 5G network, virtual-reality technology and online training programs will help the industry explore new frontiers as a supplement to its traditional offline business, Bao added.
With an increasing number of Chinese embracing exercise as a daily necessity during the first half of 2020, the sector’s online spending boom, especially for training gear, has impressed insiders.
“The sales of sports training equipment for individual home use witnessed a strong increase over the past year, giving manufacturers a break during the tough period and providing more evidence that they should adjust their sales and service systems toward the online mode,” said Luo Jie, secretary-general of China Sporting Goods Federation.
With more potential yet to be tapped, China’s sports sector is expected to return to the strong growth it experienced prior to the pandemic, according to the central sports governing body.
The General Administration of Sport of China (GASC) and the National Bureau of Statistics jointly announced last week that sports-related businesses generated around 1.12 trillion yuan (about $173 billion) in revenue in 2019－up 11.6 percent from 2018－contributing to a total industry scale of over 2.94 trillion yuan. The total output was 10.9 percent higher than in 2018.
The report, which has been published annually since 2013, is the country’s most recent assessment of the size and growth of its sports industry, with the data covering 11 categories of business, including the manufacture of sporting goods, fitness and leisure, sports entertainment, sports venue operation and construction.
Sports services dominated the industry with a 67.7 percent share in total added value, up 2.9 percentage points year on year, according to the statistics.
The sector’s booming performance, which outpaced overall GDP growth, can be attributed to rising public awareness of healthy living, which has accelerated due to the pandemic, said officials.
“We can see it from the bustling scenes at ski resorts entering the winter season and the hot demand for marathon events, which have resumed in some cities. The recovery is on the way and it’s almost inevitable,” said Liu Fumin, director of the GASC’s sports economy department during the online meeting.
Liu’s assertion is supported by the skyrocketing number of marathon races held in the country as well as the growing number of winter sports participants in the build-up to the Beijing 2022 Olympics.
However, industry experts have stressed that the impressive numbers should be put in perspective.
“The manufacturing-centered consumption pattern of sports in our country reflects an immature industry structure, where the potential of the sports service sector is not yet developed,” said Bao.
Compared with the United States, sports still play a less important role for Chinese people for entertainment and social purposes, leaving untapped potential in the service sector, Bao added.
According to the statistics, manufacturing, sales and rental of sporting goods still contributed a 54.7 percent share of industry revenue in 2019, as opposed to revenues generated by consumption of non-equipment products and services, such as fitness training, event ticketing, broadcasting and merchandising.
“The structure of our country’s sports industry needs to be and will be further diversified as sports consumption nowadays involves more than just buying sneakers and clothing,” said Jiang Chongmin, a senior researcher at the China Institute of Sport Science.
The postponement of the Tokyo Olympics and the Euro 2020 soccer tournament means those major events have been added to a 2021 sports calendar that already featured China’s National Games and the Summer Universiad in Chengdu, Sichuan province.
“2021 has turned out to be an unexpectedly big sports year,” said Zhang Qing, founder of Beijing-based sports marketing consultancy Key-Solution.
“Players in the field of sports marketing should be ready to reallocate their budget and adjust their strategies to take advantage of these opportunities.” (Source: ChinaDaily.com.cn)