GEM: a new phase in the globalisation of sport

This week’s print edition of The Economist contains no fewer than four articles specifically on sporting themes which relate to Brazil, the USA and Poland. Sports business stories seem to be originating from an ever wider range of countries, which is a sign that a new phase in the globalisation of sport is well underway. It could be called the GEM phase – gravitating to emerging markets.

While the high profile political dimension of modern sport dates back at least to the 1930s (the Bodyline Tour of the English cricket team to Australia in 1932-3; the 1936 Olympic Games in Berlin) and the economic significance at least to 1984 (the Olympic Games in Los Angeles), the true globalisation of sport arguably only arrived in the mid-1990s with the Bosman ruling which opened up the free movement of footballers within the European Union.

The new GEM phase, which has its origins in about 2001, relates to the deliberate targeting by sports rights-holders and sponsors of emerging markets such as the so-called BRIC and Next 11 countries (Brazil, Russia, India, China; Bangladesh, Egypt, Indonesia, Iran, South Korea, Mexico, Nigeria, Pakistan, the Philippines, Turkey and Vietnam).

In retrospect the IOC’s decision to allocate the 2008 Olympic and Paralympic Games to Beijing was perhaps the key catalyst for this new phase of development. Between them the BRIC countries are hosting an edition of the Olympic Games in 2008, 2014 and 2016. The odd one out is India but New Delhi will host the 2010 Commonwealth Games and an Olympic bid may follow. The hosting of the FIFA World Cup in South Africa next year and the gradual shift of Formula One Grand Prix races to emerging markets also fit the pattern.

When it was announced last month that Standard Chartered Bank would sponsor Liverpool FC for four years the press release explicitly stated that the partnership would help drive the bank’s brand awareness “across core markets in Asia, Africa and the Middle East”. Promotion can also work the other way around: Chinese computer manufacturer Lenovo sought to promote the brand in Europe and North America through its Olympic sponsorship deal.

With its global remit and free-market focus, The Economist is well-placed to chart how the GEM phase progresses. I expect to see more sports business stories soon about BRIC and Next 11 countries, including companies from these markets signing up for global sponsorship properties. The tendency for international sport to gravitate towards emerging markets could turn out to be one of the most significant legacies of Beijing 2008.

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