Leicester Tigers, an English rugby team, finished bottom of the sport’s Premiership in 2019, coming close to relegation. That’s when the club turned to artificial intelligence to evaluate player performances and model the impact of different actions on the club’s probability of winning.
Since then there has been no turning back. The team won the 2022 Premiership, finishing top of the table among 13 other teams, thanks to artificial intelligence tools built by London-based sports data company, Prospect and its subsidiary, Oval.
Similar successes in cricket, football and other sports highlight the power of artificial intelligence to revolutionize sports as we know it.
The technology has numerous applications, including helping clubs scout players, analyze their performances and plan tactics against opponents in ways that were previously considered too complex. Furthermore, it opens up new opportunities for fans and teams to interact with each other, catering to the growing interest in sport.
“AI is providing new opportunities for sports properties to commodify the data of their fans and athletes, deepening their understanding of their customers and stakeholders and making their brand more attractive to investors,” Motasem El Bawab, chief information officer at the Barcelona-based consultancy firm N3XT Sport, told Fortune.
The implication? The influence of artificial intelligence on fan interest, team performance and overall competitiveness in sport could increase the value of sports clubs.
According to analysts at Deutsche Bank, the value of mergers, acquisitions and investments in the sports sector has increased eightfold, reaching approximately $37 billion in just four years. The sport has attracted large sums of money, as seen with Saudi Arabia’s interest in football when it paid Cristiano Ronaldo millions of dollars, making him the highest-paid athlete ever. Interestingly, the timing coincides perfectly with when interest rates skyrocketed in response to high inflation, which prompted reduced deals in other sectors.
Artificial intelligence is one of the reasons sports clubs have emerged victorious, the bank said in a statement last week. This also means that it is up to sports teams to find the best data tools and use them more efficiently to stay ahead of the competition.
“Detractors argue that sports statistics will be a zero-sum game once every team has them. We believe the opposite,” the bank’s analysts Luke Templeman and Galina Pozdnyakova wrote in a note last week. “We argue that the proliferation of sophisticated sports data analytics will level the playing field in leagues dominated by a small number of teams.” .
How does AI help you earn a lot of money?
It takes a lot to enhance sports clubs. In addition to financial metrics such as profits, the level of a team, who plays for that team and their track record also matter.
With AI tools available to teams, there are numerous opportunities to do what they are doing better, El Bawab said. He provided the example of how better performance and management strategies can directly increase ticket and merchandise sales.
“All these factors can significantly increase the valuation of a sports club demonstrating the potential for higher and more sustainable earnings,” he said.
Given everything that depends on such predictions, reliable data is critical. FC Barcelona, for example, uses footage of past football matches to evaluate the behavior patterns of opponents and devise game plans accordingly. The England women’s cricket team is partnering with Prospect to use artificial intelligence to pick the right players for different opponents by simulating mock matches in thousands of scenarios.
“For the most ambitious and innovative teams, there is now an exciting opportunity to leverage this [computing power and modeling tech] and we dare to do things a little differently,” said Jack Tozer, co-founder of Prospect Fortune. “Teams that are able to use AI better than others will undoubtedly benefit.”
This was stated by Mark Lillie, partner at Deloitte and leader of the sports sector in the United Kingdom Fortune that while sports organizations are still gearing up to increase investment in AI and data, technology will likely play a significant role fairly soon.
“As AI becomes a standard tool for competitive advantage, teams with strong AI capabilities and associated advantages could become more attractive investments, potentially driving valuations higher,” Lillie said, warning that AI “it won’t solve all the problems”, even if it is very powerful.
For sports personnel who are skeptical about AI doing their jobs, Lillie says “human expertise, intuition and leadership will still be crucial to success.”
Seb Daly—Sportsfile/Getty Images
Create a greater impact with sports fans
No matter the sport, fans are the lifeblood of the industry. Their interest helps increase the popularity of several clubs and leagues, bringing legions of fans into stadiums and motivating players.
While fans have long been at the center of sports, there is still a lack of engagement, SentientSport CEO Ryan Beal said Fortune.
“You get a surge in a season where it’s game day and a few days before the game everything builds up for the game and then after the game this kind of drops off again,” he said. When interest wanes, teams lose engagement with their fans, which is a huge monetization opportunity that AI can help realize.
This can come in the form of new content based on fan preferences so that each person interacts with their favorite team in a personalized way. AI tools can also help teams like Manchester United interact with a global fan base in their native language. Manchester United’s revenue reached a record high of £648.4 million ($805 million) in 2023, but there is a chance that number will almost double if it capitalizes on artificial intelligence, Beal said.
Digital experiences that help grow fan bases could open up a whole new revenue stream for sports clubs, which have until now relied on ticket sales, sponsorships and television rights to make money.
The shift to the use of artificial intelligence is well underway – said Templeman of Deutsche Bank Fortune that all sports teams are deliberating how to use AI, with the only difference being how they choose to implement it.
As more cases emerge of established teams relying on new technology tools, others will also begin to adopt similar capabilities to keep pace.
“There is an opportunity for data to help smaller teams become great teams… [and] big teams to start monetizing their global fan base,” Beal said. “So either you become a disruptor and everyone else catches up… or [you find] a new inefficiency to deal with to keep up with the times, which is what makes the sport so exciting.”