The Six Nations 2023 has grown by 30% over two years since CVC Capital Partners paid £365m for a seventh stake. This growth can be accredited to new broadcast rights, marketing assets and ticketing.
We wanted to take the time to analyse the revenue growth of the Six Nations 2023 as we know rugby below international level is struggling to find revenue to support them. Let’s dive into this and see if we can understand the growth of rugby and how it can be applied to lower divisions.
The most obvious financial benefit to the Six Nations is the increase in fees for broadcasting rights. With the capital investment agreement, current contracts with the top six broadcasters in the host countries have increased to over €700 million, with an additional €100 million for global distribution to countries including Australia, New Zealand, South Africa and the USA.
In Ireland, the broadcasting co-rights is valued at €28 million over four years, bought by RTÉ and Virgin Media. UK broadcasting blows this number out with water with a €520m contract to broadcast matches until 2025. France invested €100m to get coverage by France Télévisions. Bringing the total to over €800m.
The participating teams are battling it out for the chance to win €6.8 million. With the total prize fund being €19 million, it is important to note that there is a huge difference in reward between finishing positions. Although there is a lot at stake for the teams if they don’t perform on the pitch, the six participating teams will receive the largest revenue from Fund VII, broadcast rights, matchday revenues and marketing activations.
The Fund VII will see the six teams receive investment of €100- €120m across a four-year payment structure until 2025. The positive of this fund is each Union chooses how to use the CVC funds and does not receive any strategic guidance from Six Nations Rugby regarding where it should invest.
The difficulty with applying these first two points to lower division teams is the lack of investment to begin with. It would be ideal if each league could receive a massive broadcasting fee but it’s just not feasible with the small investment they have.
A sold out Six Nations would total €100- €120m for just tickets. On top of that, the 1,069,000 fans entering the stadiums will spend an average of €7 while watching the match. Across the six venues, this would total an additional €7m.
The issue among lower leagues is the lack of fans attending matches, but fans aren’t splashing the cash as much as they used to. The cost-of-living crisis has had a huge impact on sport and rugby is starting to feel the burden.
Marketing impacts revenue
The growth of the Six Nations could be accredited to the top content platforms in the world, TikTok and Netflix, and their partnership with the Six Nations. Half a dozen Netflix teams are currently infiltrated in the six squad camps filming material for an eagerly-awaited Six Nations docuseries that will air before the championships the following year.
The TikTok agreement will be comparable in that access to each other’s brand and audience is extremely valuable to both parties. Although it would be easy to suggest such marketing agreements are priceless, their actual worth may reach €400 million following the Rugby World Cup.
The commercial partners of Six Nations Rugby are purposefully limited, and they have to make significant financial expenditures to be included as one of four premium brands affiliated.
Guinness, the Six Nations Championship’s headline sponsor since 2019, is joined by lead associates Breitling, TikTok, and Sage, who collectively paid an estimated €50 million for the right to some of the sport’s most high-end visibility.
In our recent poll, sports organisations voted their best revenue stream is sponsorship and this is no different for rugby. Rugby teams should work on segmenting their audiences on social media platforms in order to provide niche, highly engaged audiences – something incredibly valuable to sponsors.
It’s amazing to see the Six Nations perform so well, at Nifty we would love to see some lower division teams earn well-deserved revenue. Find out how much money you’re leaving on the table and how sports organisation can utilise social media streaming.