Thread by @CashNSport

The Economics Of The @rugbyworldcup

The 1995 World Cup in South Africa generated R197 million (£30.3 million) in revenues. World Cup revenues have spiked over the years, peaking at £381.4 million in 2019.

This is the money behind the Rugby World Cup

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The IRB runs a four year business revenue cycle and relies on the World Cup for 80% of its revenue during that period.

The 1995 World Cup in South Africa generated R197 million (£30.3 million )in total revenue which increased by 131% to £70 million in 1999 when Wales hosted.

Revenues peaked at £381.4 million when Japan hosted the 2019 World Cup with nearly £4.3billion generated in economic output according to The Economic Impact of Rugby World Cup 2019 report published by EY.

A large part of the revenues is generated by charging host nations a Tournament Fee which forms part of a package that the host nation submits in their bid.

Nations now have to to make a minimal financial guarantee of £120m

In 2017, South Africa was the prefered candidate to host the 2023 World Cup ahead of France and Ireland. In a very dramatic and controversial move the World Rugby Council voted for France, who received 24 votes compared to South Africa’s 15 in the second round of voting

South Africa’s total guarantee was about £220m which consisted of the £120m fee, an additional tournament pledge of £40m, a commercial offer of £35m for hospitality, travel and private catering rights and expense savings of £25m due to the weaker South African rand

The France package was worth in the region of €500m. Their total guarantee to World Rugby was £150m alongside offering to buy the hospitality programme and marketing rights from World Rugby for a combined €112m and pledging €236m to cover tournament expenses.

Hosting another World Cup would have been challenging considering the state of the economy hence South Africa dropped the bid for the 2023 hosting rights but SA Rugby projected that hosting the event would bring in R27 billion in direct and indirect economic impact.

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It was estimated that R5.75 billion of the estimated R27 billion that would have flown into the country would have directly impacted low-income groups and created 38 600 permanent and temporary jobs, generating revenue to the tune of R1.4 billion.

Japan was wildly successful. 850 million people watched around the world through 28 broadcasters that had acquired rights to the tournament.

World Rugby revealed a record 99.3 per cent attendance across the tournament and the final saw a record attendance of 70,103.

With the success of the Japanese World Cup and looking ahead to the showpiece in America, it’s no wonder that the IRB has set their sites on the Americas.

The USA has pledged $500 million towards hosting the men’s and woman’s tournaments with organisers optimistic of generating $1 billion in revenue from ticket sales alone with the U.S bid also aiming for an average of 55,000 spectators per game in the men’s tournament.

Rugby is growing quickly in the USA and participation in the game has risen by 350% since 2004. College Rugby is the fastest growing team sport in the U.S and it's reported that over 33 million people either play or are interested in rugby

There are now more than 115,000 registered players with USA Rugby, including 32,000 college students and approximately 29,000 females. With 25% of the participation coming from women, this places the U.S. with the highest percentage of female participation from any nation.

Sadly, South Africa is unlikely to see another World Cup for many more years as World Rugby looks to other markets with more favourable currencies and bigger appetites to host.

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