COMPANY FOCUS
Capita Symonds Sport and Leisure has been involved with major event feasibility studies for the 2014 European Swimming Championships, the 2015 Rugby World Cup, the 2015 World Athletics Championships and the 2015 EuroBasket event. Associate director Simon Molden discusses the wider benefits for the hosts
EVENT IMPACT F
or those involved in major sporting events, 2010 was an interesting year, with the 2012 Olympic Games getting ever closer
and significant public debate around the wisdom of two other events – the 2018 FIFA World Cup and 2015 World Athletics Championships – coming to these shores. On the face of it, major sporting events are a very attractive commercial proposi- tion, attracting hundreds of thousands of spectators and showcasing a city or coun- try to a worldwide television audience. However, for the host federation, the
commercial reality can be somewhat dif- ferent with the international governing body often keeping most of the income – including television rights, sponsorship and corporate hospitality – while leaving the host to pick up the organisational and bidding costs. Then there’s the often-required ‘guar-
anteed fee’ and examples from recent years such as the Rugby World Cup (£80m required by the International Rugby Board for 2015) that indicate just how significant a sum this can be. If you add in other pitfalls, such as the late release of sponsorship packages to the host fed- eration, thereby reducing their potential value, the financial case for hosting a major event can be marginal at best. Clearly major sporting events are a very good thing for the international
The 2017 World Athletics
Championships could attract 500,000 visitors to London
federations; the 2006 World Cup alone netted FIFA a tidy £260m. However, why would any association, city or public body ever consider bidding for (and underwrit- ing) one when they are largely left with ticketing income, costs and risks?
The wider benefits The answer lies in the wider benefits, economic and other, that hosting a major sporting event delivers. For example, if the World Athletics Championships were to come to London in 2017, it has been estimated that it would attract in the region of 500,000 visitors to the city over a nine-day period. The level of spend- ing generated could add up to tens, even hundreds, of millions of pounds and even for a city the size of London the case can be compelling. It’s the same for other events: the Rugby World Cup has been estimated to have an economic impact of £2.1bn for the host; for 2006 FIFA World Cup in Germany, it was £7.4bn. Not surprisingly, with these numbers
being quoted, some have sought to cast doubt over the credibility of methodolo- gies used to estimate these ‘impacts’. However, the recent development of the eventIMPACTS Framework should bring a more standard approach. As well as the economic arguments,
events can be a very effective way of showcasing a host. Returning to the
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World Athletics Championships, it has been estimated that for the prestige events, such as the 100m final, the total global television audience in 2009 approached 100 million.
Bidding considerations Aside from economic considerations, the benefits of well-planned major events are wide-ranging – from improved facilities and enhanced elite performance to a vol- unteering legacy and increased grassroots participation. In the two years following the 2003 Rugby World Cup, the RFU esti- mated that there were 50,000 new players, directly attracted by England’s success. So, despite the costs, there are many
considerations to take into account when choosing whether to bid for a major event and with careful targeting the upfront investment can be justified. Nev- ertheless, planning remains fundamental. By selecting an event with a strong
resonance in the host economy, a wide global reach and a strong, preferably terrestrial, television exposure, and then carefully planning it, governing bodies, city authorities and governments can be onto a winner.
Contact Simon Molden at
simon.molden@
capita.co.uk or +44(0)7825 226922
Issue 1 2011 © cybertrek 2011
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