The Big Interview – Paul Vaughan

Speaking exclusively to Sportindustry.biz ahead of the Emirates Airline Rugby 7’s tournament in London next month, Paul Vaughan, RFU business operations director, discusses the commercial impact that rugby sevens has had on the game, the benefits of the new South Stand at Twickenham Stadium, and his reaction to Ofcom’s new rulings on media pricing.

A new television spot has been aired on Sky Sports avertising the Emirates Airline Rugby 7’s tournament in London in May, a first for the RFU in promoting the 7’s game – what was the incentive behind generating the advert?

We think that the event lends itself to a movie rather than a 2D process. It gives us a chance to really show everyone what the tournament is all about and when it comes down to it – it’s just one big party with a great atmosphere.

So, although we have got print adverts and posters, we felt that the imagery lent itself to television. The advert will also be shown on many social networking sites.

What commercial impact has the 7’s tournament had on rugby?

The game of 7’s has actually been around for 100 years but traditionally it used to be a season closing party.

Then it went professional and arrived in the format of the World Series that started 8 years ago – this obviously had a large impact on how we then marketed the game.

The game almost took the same approach that Twenty20 cricket did when it first started as it gives easy access to the sport for children and students.

This meant that there was a whole other market for us to look at, so the introduction of 7’s has had a very positive impact on all aspects of the game.

How big an impact will the inclusion of the game in the 2016 Olympics have?

The inclusion of the sport in the Olympics will bring huge focus towards 7’s. I think it will be a big boost and more and more countries will adopt a permanent side to compete in the world 7s.

I think that it will also mean the USA could become a powerhouse in 7’s after the Olympics and the game could really take off over there.

I think that it will be a very popular inclusion at the Olympics – certainly at the Commonwealth Games stadiums were completely filled over the 2 days to watch the sport -with people cheering on every country.

How has the economic downturn affected British rugby?

I think from an English point of view we have got through it well so far – but if I go back to 2008 – we started to feel the pressure on the sport – hospitality sales fell off the cliff and we ended up thinking of any way possible to sell more tickets.

But hospitality picked up through 2009 and the Six Nations 2010 delivered fantastically – we were completely sold out at the Ireland match.

So the market is there and people want to use the facilities we have to offer.

On the sponsorship front things are very positive – we announced our latest partnership with QBE earlier in the year also Nintendo has signed a deal.

I can tell you that we have a number of very positive looking discussions going on with other potential sponsors at the moment.

What impact has the new stand had on Twickenham stadium?

The new stand delivers about another £400,000 per international match so it is a substantial revenue boost for us in both tickets and the commercial bolt-ons.

With everything included in the new stand, the gym, housing, the retail store etc, we will turn over about £3.5m this year which is fantastic considering that before it was built the turnover was less than £1m.

So our expectation is that figure will grow as people will soon release the great location of our stadium.

How has the RFU aimed to draw revenue in to Twickenham outside of rugby?

We are sticking to a core strand of business – so anything related to rugby we will do.

Our target group is predominantly rugby fans, so projects such as England Rugby Travel has added value to our business.

We have thought about all sorts of ventures but when we have experienced with things outside of rugby people find it very difficult to associate with us.

But we are always willing to do things such as concerts in the stadium – we have had great gigs with U2 and The Rolling Stones etc, but there is a limited market because of the huge competition.

We are very happy to show diversity – so long as it links to what we do.

England is hosting the 2015 Rugby World Cup – have commercial sales started yet?

The sponsorship rights sit with IRB – but there is large interest in place so the impression I get is that the World Cup will be fully subscribed with commercial partners.

IRB also own TV rights so they are packaging up the 2011 World Cup with 2015 – but I know that no UK deal has been struck on 2015 yet.

When it comes to our bit we know that we will have millions of tickets to sell so we will work through strategic directions so that people get good access.

We stage the women’s World Cup at the end of the summer, so one of the initiatives we are working on is – people buying tickets for that tournament can then go on to a priority list for 2015.

How bigger impact will the new Ofcom rulings have on the sport?

We don’t know scale of the impact yet but it really is destroying the primary market in TV sales.

We have always been open so that anyone can bid for our rights – it just so happens that Sky has outbid the others.

The fact that Virgin and BT are waiting for a discount downstream will have an effect on our TV rights that go up for sale again in 2015/16 – so we will be faced with limited number of people to bid for our rights, plus will Sky even bid as much as it previously has?

So we won’t know the full impact until we get to that point – if you combine lack of funds with the problems that Sky now has the BBC’s limited budget and ITV difficulties -you can imagine that the bids might not be as high.

We are also very disappointed in the way that we were consulted so late compared to the Premier League – the whole process is flawed if you ask me.