In China, cross-country racing has actually only been going for 8 years. This for any sports event is only in the early stages, there are bound to be many problems. Regulation and approval, race system settings, safety measures, etc. are no standards, we are all figuring out. “May 24, a domestic cross-country event executive unit chief planning Zhang Chang (a pseudonym) told reporters that the biggest problem facing the cross-country event is the cost problem, due to low investment, cross-country events often lack of security.
May 22, Gansu Baiyin Yellow River Stone Forest 100 km off-road race took 21 people’s lives, triggering outside reflections on the marathon industry. “Capital brings bad sports industry”, “to make money Save costs” and other doubts are incessant.
The IT Orange data shows that since 2015, a total of 128 sports event management enterprises have been financed, with a total financing of 6.5 billion yuan. 2019, the national 800 people above the scale of marathon events amounted to 1900, the number of participants is 7.2 million.
Behind the capital carnival, how does the marathon industry chain work? Who is making money in the end?
“Doing cross-country is mostly losing money”
China Athletics Association information shows that the marathon includes full marathon, half marathon, mini marathon, cross-country race, mountain running, etc.. Although in a broad sense belongs to a member of the marathon, but the cross-country race input situation and the narrow sense of the marathon is very different.
A number of practitioners told reporters that the current operating company doing cross-country racing is mostly money-losing. Marathon has a fixed standard, most of them are in the road. But there is no standard cross-country race, different areas of the race is very different, the cost is high. Therefore, compared with the marathon, the cross-country race investment costs are large, less money into the field.
Zhang Chang told reporters, the city marathon audience wide range, low risk factor, sponsors prefer the marathon in large cities. And cross-country race audience is small, mostly located in the edge of the region, the amount of sponsorship received relatively small.
“There is a contradiction, due to the investment of less money, cross-country race basically can not make money, but the cross-country race risk factor is higher, the need to invest more costs to do safety work. If the safety work is not in place, the players do not get full protection. “Zhang Chang revealed that the high cost of cross-country racing, most of the current income to do cross-country racing can not cover the cost, can only rely on long-term management of cross-country racing driven by the cultural tourism industry and sports events to make money.
May 24, a cross-country race practitioners told reporters, alone engaged in cross-country race business less, more than the event company while carrying out cross-country race, city marathon and other event operation work. As the cross-country race needs to be more familiar with the human terrain and climate, the organizers prefer to use the local enterprises, or in the race place has a company based in the enterprise.
The Yellow River Stone Forest 100 km cross-country race implementation unit of Gansu Shengjing Sports Culture Development Co. Shengjing sports in 2018 won the first Yellow River Stone Forest 100 km cross-country race, the winning bid amount of 1.5 million yuan; 2019 Shengjing sports won the first half marathon in Pingchuan, the winning bid amount of 970,000 yuan.
In recent years, the annual registration volume of enterprises related to sports events has been on a growing trend. In 2019, China added more than 23,000 sports event planning-related enterprises, and the annual registration volume reached its peak. As of May 24, China’s new sports event planning-related enterprises this year more than 2,400.
A marathon can earn 5 million yuan
Compared with cross-country events, race companies are more willing to invest in urban marathon events. In 2017, Chi Mei Sports (01661.HK), for example, won the bid for the Qingdao International Marathon operation service project for 21 million yuan; in 2018, Chi Mei Sports won the bid for the Changsha International Marathon project for 12 million yuan.
With tens of millions of dollars of investment at every turn, what do marathon organizing committees rely on to make money?
“The profitability of the city marathon depends on the specific city, the initial operating profit of the ordinary city marathon event is less than 1 million yuan, and the profit of the gold medal event in the first-tier city can be more than 5 million yuan. “May 24, the provincial running team leader, the race company legal person Li Jun (a pseudonym) told reporters that the income source of marathon events mainly consists of three parts: government subsidies, registration fees and sponsorship fees.
Generally speaking, the government subsidy for a full marathon is about 1 million to 2 million yuan, and the maximum subsidy is 3 million yuan if it is an international event. Next, the registration fee for a full marathon earns several million yuan. Depending on the specifications of the event, the titling fee for sponsors varies. The general starting price is 5 million yuan, and some sponsors will spend ten million yuan to gain brand exposure.
According to Ariadne, sponsorship revenue is a major component of marathon revenue. In general, provincial marathon events, sponsorship income can basically cover 50%-60% of the event costs.
At present, the marathon events registered with the China Athletics Association are divided into Class A, Class B and Class C. Class A1 events have the highest specifications and are generally held in municipalities, provincial capitals and economically developed cities.
In addition, there are a large number of commercial events that have been very hot in recent years, but most of these events are hosted by units lacking expertise, and many non-sports professional operation and execution companies enter the field. In order to maintain a basic level of profitability, many event safeguards are difficult to implement in place and there are risks.
“CATA marathon event costs more than 2 million yuan, but micro commercial running, unit running events tens of thousands of yuan to run a. Will the organizing committee earn money to seriously do a good job of protection? I have reservations. “Li Jun said.
An average of 5 races per day
With the promotion of national fitness, the marathon industry has entered a high-speed growth phase.
China Athletics Association data show that in 2019, the country held a total of 1,828 marathon scale events, the average daily marathon events held more than 5. As of 2019, 160 cities above prefecture level have held full marathon events. If there is no epidemic influence factor, the forecasted number of participants of various marathon races in 2020 will exceed 10 million, with an industry scale of 120 billion yuan.
The marathon industry has developed a mature industrial chain in the wave of capitalization.
The core event itself is usually participated by the local government, local cultural and tourism bureau, sponsors, race companies (operating companies) and other organizations. In addition, sports goods sales, media, entertainment, training and gaming, medical care, tourism, etc. also have close economic ties with marathons. A marathon event often leads to consulting, public relations, scientific research, construction, real estate, exhibition and other industries.
Many companies are competing to enter and grab the huge cake of sports economy.
The first stock of domestic marathon, Wimax Sports, entered the Chinese road running market in 2011, and has formed the whole industry chain operation model of event operation, sports marketing, event broadcasting and venue operation. It has formed the whole industry chain operation mode. Up to now, Wisemax Sports has operated more than 200 large city marathons.
Turbo International (01368.HK) has completed its transformation through the marathon industry, and in 2020, Turbo was the brand that sponsored the most international marathons in mainland China.
In its annual report, Turbo said that the blow to marathons in 2020 did not shake its determination to sponsor major marathons and running events, sponsoring a total of 12 offline marathons and nine online races in mainland China throughout the year, attracting more than 1.5 million participants. 2020 Turbo’s advertising and promotion expenses were approximately RMB 917.1 million, accounting for approximately 11.2% of total revenue.
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