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Digital Revolut-ion: Why it's Important That WeWork On and Offline 🏢
While digital will remain an important pillar in every rightsholder’s strategy, the opportunity to also engage through physical spaces like offices and retail should not be ignored...
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Following WeWork’s 2023 second-quarter earnings report on Thursday, rumours began to circulate that the company may even soon file for bankruptcy.
WeWork has lost over 95% of its valuation - from $47 billion in 2019, the capitalization has recently fallen to as low as $361 million – but there could still be incredible value to be had from the embattled co-working provider.
Vladislav Solodkiy, ex-CEO and founder of Arival Bank and an early investor in 5 digital banks, put pen to paper to propose why buying WeWork might be a good move for Revolut, and its shared investor Softbank (which owns 56% of WeWork and 10% of Revolut).
“In recent years, the trend of online players moving offline (O2O) is no longer surprising - starting with e-commerce (Shopify, Etsy, Alibaba), showrooms are actively being developed by Apple, Tesla, and other players who make their main sales online, but need offline as a reduction in marketing costs, “embodiment” of the brand (it can be seen and “touched”, convey the spirit, sound, and smell), creation of education and training centres, and also consultation on complex products,” explained Solodkiy.
The Arival Bank founder also went on to cite the example of IdeaBank which has already carried out a similar, and successful experiment of the inverse, turning its extensive network of branches across Poland into co-working spaces.
“Through the purchase of WeWork, Revolut could not only bring its brand offline, reduce marketing expenses, and create consultation, education, and sales points for complex financial products but also strengthen its position in the USA (a market that has been elusive for Revolut and where WeWork has the strongest presence), and differentiate itself from competitors there.” He continued.
This, of course, is not an entirely unrecognisable pattern within the world of sport - particularly for anyone that has worked in sports marketing.
Financial institutions and digitally native brands (Think: Standard Chartered, AXA, Cazoo) often use sports partnerships to give themselves physical touch points with consumers and build trust.
While the stadium does already provide a physical touchpoint for fans within a home market, sports team’s fan engagement projects are often focused on digital (See: social media, mobile apps, etc.).
Considering Solodiky’s reasoning above, there is a lot more that could be done to create additional touch points both in and out of market when considering this online to offline (O2O) trend and how it applies to sport…
LaLiga are one example of a rightsholder considering this, having created a leisure concept called LaLiga TwentyNine’s.
The venues, which are present in Port Aventura, Madrid, and Doha, are experiential sports bars that ‘combine gastronomy, entertainment, football and sport’. They appear to follow a franchise model with ‘experts in gastronomy’ invited to be part of this project and in bringing a LaLiga TwentyNine’s to their city.
Another means to do this, as identified by Formula 1, is the concept of competitive socialisation venues.
Formula One opened F1 Arcade in London late last year, a concept which combines an immersive gameplay experience with premium food and drink offering, providing a year-round opportunity to engage and activate with fans.
This flagship location is expected to draw 350,000 people this year and F1 Arcade has plans to open 36 venues over the next half decade – with its first opening in the US in early ‘24.
While other rightsholders are yet to latch on in quite the same way, we have seen Major League Soccer (MLS) invest into TOCA Football. This will see them host various activities at TOCA Social venues as part of that deal.
There are similar opportunities to be had in sports like cricket via Sixes Social Cricket, which has venues across the UK, and opened one in Texas ahead of the launch of Major League Cricket (MLC) earlier this summer.
It wouldn’t have to stop there, either.
There are an endless number of other branded experiences, from shopping malls, theme parks, and fan-zones, to gyms, restaurants, and hotels that rightsholder could explore out of market…
They could also look to better capitalise on the physical space that they do already own in-market (i.e. their stadiums).
Tottenham Hotspur Stadium, for instance, boasts London’s No.1 outdoor attraction on TripAdvisor, the Dare Skywalk and F1 Drive, the world’s first in-stadium karting facility (set to open in Autumn 2023).
As part of their proposed stadium redevelopment, Manchester City plan to create a roof walk attraction of their own, a fan zone for up to 3,000 people and to use the upper floors as workspace for small businesses and start-ups (for similar reasons to Revolut’s potential purchase of WeWork).
So, while digital will remain an important pillar in every rightsholder’s strategy for a long time to come, this concept of O2O is showing pockets of potential and should not be ignored as a means to tighten up fan relationships and engage fans year-round.
In doing so, rightsholders could create a lot more value for both themselves, and their commercial partners, who are increasingly struggling to justify the cost of sponsorship when its core deliverable is simply visibility (See: rising number of clubs without front of shirt sponsors).
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