“The leisure trade had a really optimistic yr in 2022 and a welcome restoration is certainly underway, however we’re not out of the woods but,” mentioned Michael Furtschegger, world head of leisure at AGCS. “Within the three years for the reason that coronavirus first hit the headlines, the world has modified. The sector should proceed to evolve consistent with new applied sciences, proliferating platforms, and seismic shifts in patterns of consumption, in addition to adjustments within the public temper, significantly amongst youthful generations.”
Regardless of the challenges confronted by the trade, customers are returning to their most well-liked leisure venues or platforms, AGCS mentioned. International field workplace receipts reached $25.9 billion final yr, a 27% rise from 2021, in accordance with Gower Road Analytics. Nonetheless, that quantity remains to be 35% under the typical for the three years earlier than the pandemic.
Stay music income is predicted to surpass pre-pandemic ranges subsequent yr, with digital music streaming subscriptions driving progress in recorded music, the place revenues are predicted to succeed in $45.6 billion in 2026, up from $36.1 billion in 2021.
Stay theater can be seeing a comeback, with rising receipts and attendance. The worldwide sports activities trade can be proving resilient, supported by media rights, sponsorship offers, and a calendar of worldwide occasions and tournaments, AGCS mentioned.
Nonetheless, the leisure trade will not be resistant to financial tendencies resembling workers shortages and rising prices, AGCS mentioned.
“Our leisure shoppers are feeling the results of inflation, with elevated manufacturing and live-event prices,” Furtschegger mentioned. “Staffing prices have risen following the talents scarcity that occurred within the wake of the pandemic, when many left the trade. Venues are scarcer than they had been as a result of there are nonetheless many exhibits postponed from the pandemic that must happen along with new occasions and festivals. Larger occasions could also be thriving, however smaller occasions are extra challenged by components resembling venue, transportation, and vitality prices. We anticipate to see extra consolidation within the trade, with smaller, struggling manufacturing corporations and venues being purchased by bigger operators.”
High quality not amount
Know-how has lowered entry boundaries for content material creators, with virtually anybody capable of add content material to TikTok or YouTube. In the meantime, the foremost studios and tech companies are launching their very own platforms. The quantity of content material now being distributed makes high quality a key differentiator in a crowded market, AGCS mentioned.
“We see a transfer in direction of high quality in movie manufacturing, however this doesn’t come low cost,” mentioned Wanda Phillips, head of North American leisure insurance coverage at AGCS. “Companies must know they’ve enough insurance coverage cowl for stylish productions. The place prices enhance, so, too, do exposures as a result of the prices are larger with every day of capturing, and this could possibly be mirrored in any insurance coverage loss.
Environmental, social and governance points are having a rising affect on the leisure sector, AGCS mentioned.
This yr’s Oscars ceremony will characteristic inexperienced attire on the Purple Carpet because the Academy encourages a extra sustainable strategy to awards trend. In reside occasions, the British band Coldplay has promised to halve the carbon emissions related to its present world tour, in comparison with 2016-2017, and has made an array of sustainable commitments, together with paying a surcharge for aviation gasoline, sourcing moral and sustainable merchandise, and planting a tree for each ticket bought.
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“Youthful generations are significantly involved about sustainability, and pageant organizers are responding to this,” Furtschegger mentioned. “Increasingly more leisure organizations are committing themselves to sustainability targets to cut back the emissions related to reside excursions.”
With streaming now a basic a part of the leisure and media sector, digital conferences are a selected progress space, AGCS mentioned. The worldwide digital occasions market was valued at greater than $114 billion in 2021 and is predicted to develop at a compound annual progress price of 21.4% between 2022 and 2030.
Even with no reside viewers, digital occasions nonetheless face dangers, together with transmission failure as a result of climate or pure disaster, fireplace affecting the published unit, or community points impacting broadcasting infrastructure. Rented tools and studio house will also be susceptible to property and casualty liabilities.
Digital actuality is the fastest-growing leisure and media section, with world progress between 2021 and 2026 predicted to carry the section to $7.6 billion. Gaming is forecast to account for 85% of whole VR income by 2026.
“Because the worlds of gaming, music and leisure proceed to converge, gaming platforms resembling Fortnite and Roblox are more and more serving as leisure and social hubs, whereas gaming content material is crossing over to social media and streaming platforms,” Furtschegger mentioned.
Well being and security protocols, rising climate hazards and crowd security are a number of the high threat issues the leisure sector ought to monitor, AGCS mentioned.
“The COVID disaster and the latest tragic capturing incident on a movie set have proven that the trade wants to stay vigilant about well being and security protocols,” Furtschegger mentioned.
Local weather change is one other trigger for concern.
“We’re seeing extra irregular weather-related occasions – heavy storms and flooding in Europe and brushfires in California, for instance,” Furtscchegger mentioned. “These inevitably trigger havoc for reside occasions, each when it comes to cancellation publicity but in addition damages and human security.”
“Crowds have all the time carried inherent dangers,” mentioned Kurt Miner, managing director of leisure at Allianz Threat Consulting, North America. “Occasion organizers are actually higher capable of monitor giant teams of individuals and hold them protected, in addition to artists, with using real-time video monitoring. Security specialists can remotely monitor two or three occasions, which may every be going down over 15 acres or extra, recognizing threat issues resembling blocked exits or broken boundaries. They’ll additionally monitor social media to pre-empt gate-rushing and forestall stampedes, sending a safety contingent to the situation earlier than the state of affairs will get out of hand.”
Slips and falls are the commonest reason for claims from live-event insurance policies, so organizers ought to ensure that medical workers and transport to native medical services are on-site, AGCS mentioned.
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