The Economic Impact of Major Sports Events: a Review of Ten Events in the Uk

The economic impact of major sports events: a review of ten events in the UK Chris Gratton, Simon Shibli, and Richard Coleman Introduction Over recent years there has been a marked contrast between the discussions around the economic impact of major sports events in North America on the one hand and most of the rest of the world on the other. In the USA the sports strategies of cities in the USA have largely been based on infrastructure (stadium) investment for professional team sports, in particular, American football, baseball, basketball, and ice hockey.Over the last decade cities have offered greater and greater incentives for these professional teams to move from their existing host cities by offering to build a new stadium to house them. The teams sit back and let the host and competing cities bid up the price. They either move to the city offering the best deal or they accept the counter offer invariably put to them by their existing hosts. This normally involves the host city building a brand new stadium to replace the existing one which may only be ten or ? fteen years old.The result is that at the end of the 1990s there were thirty major stadium construction projects in progress, around one-third of the total professional sports infrastructure, but over half of all professional teams in the USA have expressed dissatisfaction with their current facilities. Baade (2003) argues that since 1987 approximately 80 per cent of the professional sports facilities in the United States will have been replaced or have undergone major renovation with the new facilities costing more than $19 billion in total, and the public providing $13. billion, or 71 per cent, of that amount. The use of taxpayers money to subsidize pro? t-making professional sports teams is justi? ed on the basis that such investment of public money is a worthwhile investment since it is clearly outweighed by the stream of economic activity that is generated by having a professional sports team r esident in the city. Such justi? cations are often backed up by economic impact studies that show that the spending of sports tourists in the host city more than justi? es such a public subsidy.Crompton (1995, 2001) has illustrated that such studies have often been seriously methodologically ? awed, and the real economic bene? t of such visitor spending is often well below that speci? ed in such studies. This is  © The Editorial Board of the Sociological Review 2006. Published by Blackwell Publishing Ltd, 9600 Garsington Road, Oxford OX4 2DQ, UK and 350 Main Street, Malden, MA 02148, USA Chris Gratton, Simon Shibli, and Richard Coleman particularly the case given the need for such huge infrastructure investment needed to attract the professional teams.In Europe, however, city sport strategies have concentrated more on attracting a series of major sports events, such as World or European Championships, again justi? ed on the economic impact generated through hosting such events. Wh ereas many American sports economists (eg, Baade, 1996; Noll & Zimbalist, 1997; Coates & Humphreys, 1999) now consistently agree that studies show no signi? cant direct economic impact on the host cities from the recent stadium developments, it is not so evident that European style hosting of major sports events is not economically bene? cial to the host cities.This chapter looks at ten major sports events, all World or European Championships hosted by UK cities over recent years, all of which have been studied by the current authors. The difference from the North American situation is that these events move around from city to city in response to bids from potential host cities and in all ten cases did not require speci? c capital infrastructure investment to be staged but rather were staged in existing facilities. Before we look at these events, however, we brie? y review the literature on the economic importance of major sports events.The biggest by far of such events is the summ er Olympic Games, in particular in the infrastructure investment required to host the event, and the next section is devoted just to that event before the literature relating to all other major sports events is considered. The economic importance of the summer Olympic Games Despite the huge sums of money invested in hosting the summer Olympics, there has never been an economic impact study of the type described in this paper to assess the economic bene? ts of hosting the event. Kasimati (2003) summarized the potential long-term bene? ts to a city of hosting the summerOlympics: newly constructed event facilities and infrastructure, urban revival, enhanced international reputation, increased tourism, improved public welfare, additional employment, and increased inward investment. In practice, however, there is also a possible downside to hosting the event including: high construction costs of sporting venues and related other investments, in particular in transport infrastructure; tem porary congestion problems; displacement of other tourists due to the event; and underutilized elite sporting facilities after the event which are of little use to the local population.Kasimati (2003) analysed all impact studies of the summer Olympics from 1984 to 2004 and found, in each case, that the studies were done prior to the Games, were not based on primary data, and were, in general, commissioned by proponents of the Games. He found that the economic impacts were likely to be in? ated since the studies did not take into account supply-side constraints such as investment crowding out, price increases due to resource scarcity, and the displacement of tourists who would have been in the host city had the Olympics not been held there.Although no proper economic impact study using 42  © The Editorial Board of the Sociological Review 2006 The economic impact of major sports events primary data has ever been carried out for the summer Olympics, Preuss (2004) has produced a compr ehensive analysis of the economics of the summer Olympics for every summer Olympics from Munich 1972 using secondary data, and employing a novel data transformation methodology which allows comparisons across the different Olympics.Despite collecting a massive amount of secondary data, Preuss’s conclusion on the estimation of the true economic impact of the summer Olympics is the same as Kasimati’s: ‘The economic bene? t of the Games . . . is often overestimated in both publications and economic analyses produced by or for the OCOG [Organizing Committee of the Olympic Games] . . . multipliers tend to be too high and the number of tourists is estimated too optimistically’ (Preuss, 2004: 290).Preuss, however, does make some strong conclusions from his analysis. He shows, for instance, that every summer Olympics since 1972 made an operational surplus that the OCOG can spend to bene? t both national and international sport. Popular stories in the mass media re lating to massive losses from hosting the Olympics have nothing to do with the Games’ operational costs and revenues. Rather it is to do with the capital infrastructure investments made by host cities on venues, transport, accommodation and telecommunications.These are investments in capital infrastructure that have a life of possibly 50 years or more and yet many commentators count the full capital cost against the two to three weeks of the Games themselves. Preuss points out that in strict economic terms this is nonsense: it is impossible and even wrong to state the overall effect of different Olympics with a single surplus or de? cit. The true outcome is measured in the infrastructural, social, political, ecological and sporting impacts a city and country receive from the Games. (Preuss, 2004: 26)Estimating the true economic impact of a summer Olympic Games properly therefore requires a huge research budget in addition to the other costs associated with the Games. Research needs to start several years before the Olympics and continue several years after they have ? nished. So far nobody has been willing to fund such research. There is increasing research output, however, relating to other major sporting events. The economic importance of other major sports events The study of hallmark events or mega-events became an important area of the tourism and leisure literature in the 1980s.The economic bene? ts of such events have been the main focus of such literature, although broader based multidisciplinary approaches have been suggested (Hall, 1992; Getz, 1991). Within the area of mega-events, sports events have attracted a signi? cant amount of attention. One of the ? rst major studies in this area was the study of the impact of the 1985 Adelaide Grand Prix (Burns, Hatch & Mules, 1986). This was followed by an in-depth study of the 1988 Calgary Winter Olympics (Ritchie, 1984;  © The Editorial Board of the Sociological Review 2006 43Chris Gratton, Simon Shibli, and Richard Coleman Ritchie & Aitken, 1984, 1985; Ritchie & Lyons, 1987, 1990; Ritchie & Smith, 1991). Mules and Faulkner (1996) point out that hosting major sports events is not always an unequivocal economic bene? t to the cities that host them. They emphasize that, in general, staging major sports events often results in the city authorities losing money even though the city itself bene? ts greatly in terms of additional spending in the city. They cite the example of the 1994 Brisbane World Masters Games which cost Brisbane A$2. million to put on but generated a massive A$50. 6 million of additional economic activity in the state economy. Mules and Faulkner’s basic point is that it normally requires the public sector to be involved in the role of staging the event and incurring these losses in order to generate the bene? ts to the local economy: This ? nancial structure is common to many special events, and results in the losses alluded to above. It seems unlikely that private operators would be willing to take on the running of such events because of their low chance of breaking even let alone turning a pro? t.The reason why governments host such events and lose taxpayers’ money in the process lies in spillover effects or externalities. (Mules & Faulkner, 1996: 110) It is not a straightforward job, however, to establish a pro? t and loss account for a speci? c event. Major sports events require investment in new sports facilities and often this is paid for in part by central government or even international sports bodies. Thus, some of this investment expenditure represents a net addition to the local economy since the money comes in from outside. Also such facilities remain after the event has ? ished acting as a platform for future activities that can generate additional tourist expenditure (Mules & Faulkner, 1996). Increasingly, sports events are part of a broader strategy aimed at raising the pro? le of a city and therefore succe ss cannot be judged simply on a pro? t and loss basis. Often the attraction of events is linked to a re-imaging process and, in the case of many cities, is invariably linked to strategies of urban regeneration and tourism development (Bianchini & Schengel, 1991; Bramwell, 1995; Loftman & Spirou, 1996; Roche, 1994).Major events if successful have the ability to project a new image and identity for a city. The hosting of major sports events is often justi? ed by the host city in terms of long-term economic and social consequences, directly or indirectly resulting from the staging of the event (Mules & Faulkner, 1996). These effects are primarily justi? ed in economic terms, by estimating the additional expenditure generated in the local economy as the result of the event, in terms of the bene? ts injected from tourism-related activity and the subsequent re-imaging of the city following the success of the event (Roche, 1992).Cities staging major sports events have a unique opportunity to market themselves to the world. Increasing competition between broadcasters to secure broadcasting rights to major sports events has led to a massive escalation in fees for such rights which, in turn, means broadcasters give blanket coverage at peak 44  © The Editorial Board of the Sociological Review 2006 The economic impact of major sports events times for such events, enhancing the marketing bene? ts to the cities that stage them. Methodology The ten events under survey are detailed in Table 1.All but one of them, the 2002 World Snooker Championship (which was a contract for the host city, Shef? eld), were studied as part of a UK Sport funded research project to estimate the economic impact of the events. UK Sport is the body responsible in the UK for a ‘World Class Events Programme’ that supports sports governing bodies in their attempts to bring major sports events to the UK. Financial support is provided from lottery funding for both the bidding process and t he staging of the event if the bid is successful.Two of the events studies (the World Boxing Championships in Belfast, and the World Half-Marathon Championships in Bristol) were joint contracts with both UK Sport and the host cities (ie, Belfast and Bristol). The ten studies featured in this chapter were conducted using essentially the same methodology. This, therefore, provides the added value of having a dataset in which the events are comparable. It is the results of cross event comparability and the issues arising from such comparisons upon which this chapter isTable 1: Major sports events surveyed in the U. K. Year 1997 1997 1997 1998 1999 1999 1999 2001 2001 2002 Event World Badminton Championships European Junior Boxing Championships European Junior Swimming Championships European Short Course Swimming Championships European Show Jumping Championships World Judo Championships World Indoor Climbing Championships World Amateur Boxing Championships World Half Marathon Championsh ips World Snooker Championship Abbreviation WBC EJBC EJSC ESCSC ESJC WJC WICC WABC WHM WSC Host City Glasgow Birmingham Glasgow Shef? ld Hickstead Birmingham Birmingham Belfast Bristol Shef? eld  © The Editorial Board of the Sociological Review 2006 45 Chris Gratton, Simon Shibli, and Richard Coleman primarily concerned. The methodology employed in the economic impact studies was divided into ten stages, which can be summarized as follows: †¢ Quantify the proportion of respondents who live in the host city and those who are from elsewhere; †¢ Group respondents by their role in the event, eg, spectators, competitors, media, of? ials etc; †¢ Establish basic characteristics of visitors, eg, where they live and composition of the party; †¢ Determine the catchment area according to local, regional, national or international respondents; †¢ Quantify the number of visitors staying overnight in the host city and the proportion of these making use of commercial acc ommodation; †¢ Quantify how many nights those using commercial accommodation will stay in the host city and what this accommodation is costing per night; †¢ Quantify for those staying overnight (commercially or otherwise) and day visitors, the daily spend in the host city on six standard expenditure categories; †¢ Quantify what people have budgeted to spend in the host city and for how many people such expenditure is for; †¢ Establish the proportion of people whose main reason for being in the host city is the event; †¢ Determine if any spectators are combining their visit to an event with a holiday in order to estimate any wider economic impacts.Much of this analysis was undertaken using a standard questionnaire survey to interview key interest groups at an event and the data collected was then analysed using a specialist statistical software package and spreadsheets to calculate the additional expenditure in the host economy. Multipliers It is the direct i mpact attributable to additional expenditure that this research concentrated upon, in order to allow for meaningful comparisons between events. That is to say, the comparisons do not include induced impact derived from the application of multipliers to the additional expenditure calculations. To do so would be to compare host economies rather than speci? c events, as multipliers are speci? c to a given economy. Moreover, the information needed to establish a multiplier for a given local economy is not always readily available.As a result, historically, consultants have used highly technical and ambitious multipliers that are not empirically based and are often ‘borrowed’ from other sectors (eg, construction), or other economies. This ‘borrowed’ type of multiplier analysis can be considered only a poor approximation at best and any ? ndings are most likely to be erroneous – not least because the multiplier is unique to the prevailing local economic co nditions and, to reiterate, this type of research is about comparing events and not economies. Most of John Crompton’s criticisms of poor methodology in the carrying out of economic impact studies 46  © The Editorial Board of the Sociological Review 2006 The economic impact of major sports events of major events are related precisely to the incorrect choice or use of multipliers (see Crompton, 1995, 2001). ResultsAbsolute impact Graph 1 details the absolute additional expenditure directly attributable to staging each of the ten events. The most signi? cant economic impact is attributable to the 2002 World Snooker Championship closely followed by the 1997 World Badminton Championships. Both these events took place over a twoweek period and this extended period for the events did lead to higher economic impact. The World Half Marathon Championships was different from the other events in the sense that it did not take place in a stadium or ? xed seating area and there were no tickets sold for spectators. Consequently the crowd at this event has been estimated in conjunction with the local organizing committee, city authority and the police.This estimate of the number of spectators, which has been used to calculate the economic impact, is on the conservative side. In ? ve of the ten events, the additional expenditure generated in the host economies exceeded ? 1. 45 m, which might be termed a ‘major’ impact. Although the majority of the events detailed in Graph 1, however, could be described as ‘major’ in the sporting calendars of those who organize the events, closer inspection of the ? gures reveals that it does not follow that a ‘major event’ in sporting terms necessarily equates with having a ‘major’ economic impact. For example, although the two swimming events, the 1997 Junior Swimming Championships in Glasgow and the European Short Course Swimming Championships in Shef? ld, were both European Champ ionships, they made a relatively small contribution to the economy of the host cities. In a similar manner to the word ‘major’, the words ‘world championships’ do not necessarily mean that there will be a large downstream economic impact. The 1997 World Badminton event generated economic impacts of ? 2. 2 million, whereas the 2001 World Half Marathon and 1999 World Indoor Climbing Championship generated more modest impacts of ? 584,000 and ? 398,000 respectively. Impact per day Although the absolute economic impact attributable to a given event is important in quantifying the overall bene? t that an event might have, it is a somewhat ? wed basis for comparison as the duration of events is invariably different. For example, the World Badminton Championships took place over 14 days and the World Half Marathon was over inside one and a half hours. Thus in order to make a standardised comparison of the economic impact attributable to events it is useful to exam ine the economic impact per day of competition. The results of this analysis are shown in Graph 2.  © The Editorial Board of the Sociological Review 2006 47 Chris Gratton, Simon Shibli, and Richard Coleman ?2,500,000 ? 2,265,092 ? 2,221,130 ?2,196,298 ?2,000,000 ?1,943,715 ?1,500,000 ?1,485,141 ?1,000,000 ?583,942 ? 508,920 ? 500,000 ? 397,921 ? 314,513 ? 257,802 2002 World Snooker 1997 World Badminton 1999 European Show Jumping 1999 World Judo 2001 World 2001 World Half 1997 European 1999 World 1998 European 1997 European Amateur Boxing Marathon Junior Boxing Indoor Climbing Short Course Junior Swimming Swimming Graph 1: Economic impact of ‘major’ sports events. ?700,000 ?600,000 ?583,942 ?500,000 ?485,929 ? 439,260 ?400,000 ?300,000 ?200,000 ?185,643 ? 158,652 ? 133,241 ? 132,640 ? 104,838 ? 64,451 ?100,000 ?56,547 ?- World Half Marathon World Judo European World Amateur World World Snooker World Indoor European European Show Jumping Boxing Badminton Climbing Short Course Junior Swimming Swimming European Junior Boxing Graph 2: Daily economic impact of major sports events. 48  © The Editorial Board of the Sociological Review 2006 The economic impact of major sports eventsIn Graph 2 we see that the events with the highest absolute economic impact, The World Badminton Championships and the World Snooker Championship, are only ? fth and sixth in importance in relation to economic impact per day and it is the World Half Marathon Championship which is most important on this measure, where the daily impact and the absolute impact are identical, closely followed by the World Judo Championships and European ShowJumping Championships. Visitor and organizational spend Generating economic impact is not UK Sport’s rationale for attracting major events to the UK. As previously suggested, however, it is a useful device by which to justify the funding of an event in economic terms.Therefore in order to be able to forecast economic impact it is essen tial to understand the components that create economic impact. In broad terms these can be identi? ed as: †¢ Organizational expenditure, ie, expenditure made directly by the organizers of an event in the locality where the event is taking place. †¢ Competitor or delegation expenditure, ie, expenditure made directly by those taking part in the event and their support staff in the locality where the event is taking place. †¢ Other visitor expenditure ie, expenditure made directly by those people involved with an event other than the organizers and delegations. Other visitor groups include of? cials, media representatives and spectators.In the interest of simplicity the three types of expenditure can be collapsed into two categories, ie, organizational expenditure and visitor expenditure (delegation and other visitor expenditure combined). Using the ten events in the sample, the relative amounts of expenditure attributable to organizational and visitor expenditure can be seen in Graph 3. Graph 3 indicates that for all except one of the events (the European Junior Boxing Championships), the economic impact attributable to organizational expenditure was a minor part of the total economic impact with a highest percentage score of 26% (World Amateur Boxing Championships) and a lowest percentage score of 0% in the European Junior Swimming (not illustrated). The European Junior Boxing Championships was a relatively small event which did not attract signi? cant numbers of spectators.For the events included in this sample, the vast majority of the economic impact (greater than 80%) was caused by visitors and therefore it is logical to concentrate the subsequent secondary analyses on visitor expenditure. The reason why the majority of events in this research have relatively low levels of organizational expenditure is because they were all events that took place within existing facilities and existing infrastructure. There was no need to build or upgrade exi sting facilities and therefore virtually all expenditure incurred by organizers was on revenue items necessary for the operational running of the event.  © The Editorial Board of the Sociological Review 2006 49Chris Gratton, Simon Shibli, and Richard Coleman 100% 7% 7% 8% 9% 10% 12% 13% 26% 90% 80% 52% 70% 60% 50% 40% 30% 48% 20% 10% 0% 93% 93% 92% 91% 90% 88% 87% 74% European Short World Indoor Course Climbing Swimming World Snooker World Judo European Show Jumping World Half World Badminton World Amateur European Junior Marathon Boxing Boxing % Visitor spend % Organisational spend Graph 3: The relative proportions of visitor and organizational spending at major sports events. Visitor expenditure At this point it is worth disaggregating total visitor expenditure into its component parts of spectator, competitor (delegation) expenditure and other visitor expenditure.In 1997 the six events studied were illustrated along a continuum of ‘spectator’ to ‘competitor a nd others’. Using the results of the ten events studied since 1997, this continuum can be upgraded to indicate the composition of visitor expenditure at an event. The revised continuum is shown in Graph 4 and this disaggregates the expenditure of ‘others’ from that of ‘competitors’. From Graph 4 it can be seen that at ? ve of the ten events featured, the majority (at least 51%) of the economic impact can be attributed to spectators and these would be categorized as ‘spectator driven’ events. By contrast, at the remaining events the economic impact was driven by other groups (principally competitors), in particular at the two swimming events.The Short Course and Junior Swimming events are characterized by having large numbers of competitors staying in commercial accommodation and relatively small numbers of spectators (990 and 640 admissions respectively) most of whom are either the friends or families of the competitors; such events are categorized as ‘competitor driven’. 50  © The Editorial Board of the Sociological Review 2006 The economic impact of major sports events 100% 12% 90% 80% 70% 60% 50% 40% 30% 20% 10% 9% 0% World Indoor World Snooker European Show European World Judo Climbing Jumping Junior Boxing Spectator World European Short European World Half World Amateur Junior Marathon Boxing Badminton Course Swimming Swimming Other 8% 9% 4% 13% 28% 6% 15% 22% 12% 24% 10% 19% 28% 35% 36% 33% 44% 40% 81% 78% 74% 72% 56% 66% 51% 43% 37% 32% Competitor/DelegationsGraph 4: The continuum between spectators’ and other visitors’ expenditure. Key determinants of economic impact In order to investigate the relationship between the absolute scale of an economic impact and the number of people who generated it, we now examine economic impact against the total number of spectator admissions as shown in Graph 5. This does not include events which were not staged in stadiums and where the specta tor admissions were approximations, as there were no audience data available (eg, the World Half Marathon). Graph 5 indicates that there is a very high correlation (r = 0. 91) between the number of spectator admissions at an event and the economic impact attributable to that event.Therefore it can be concluded that if economic impact is an important consideration in determining whether or not to support an event, then the number of spectators is the principal determinant of absolute economic impact. As a consequence of this ? nding it can be concluded that in elite level sport (ie, the type of event likely to be supported by UK Sport), ‘competitor driven’ events are unlikely to generate as much economic impact in absolute terms compared with ‘spectator driven’ events. It could be argued that if all or most of the spectators attending an event were local people, then the economic impact attributable to that event would be relatively small as there would be o nly a small net change in the economy ie, most expenditure would be ‘deadweight’. In order to investigate this possibility 51  © The Editorial Board of the Sociological Review 2006Chris Gratton, Simon Shibli, and Richard Coleman ?2,500,000 Correlation coefficient r = 0. 91 Snooker Badminton ? 2,000,000 Show Jumping Judo Economic Impact ?1,500,000 Boxing ?1,000,000 ?500,000 Junior Boxing Indoor Climbing Short Course Swimming Junior Swimming ?0 5000 10000 15000 20000 25000 30000 35000 40000 45000 Spectator Admissions Graph 5: The relationship between spectator admissions and absolute economic impact. further, we examine the relative proportions of local to non-local admissions as detailed in Graph 6. According to Graph 6, there was only one instance of local admissions exceeding those of non-local people: the World Half Marathon Championships.The World Half Marathon had 55% of spectators from the local area. This was a direct result, however, of the Bristol Half Maratho n running alongside the elite event, hence there were many people from Bristol supporting family and friends in the mass participation event. Moreover, of the remaining events, the event organizers at the European Show Jumping and the World Amateur Boxing interfered with the market conditions, in that signi? cant numbers of complimentary tickets were passed to local people in order to increase the attendance at the events. Hence it is reasonable to conclude that the majority of spectators to events come from outside the local area and this therefore con? ms the earlier assertion that absolute economic impact is critically dependent on the number of spectators attending an event – a point emphasized still further when one considers that the correlation between non-local admissions and absolute impact while still high (r = 0. 87), is not as high as the correlation using total spectator admissions. The key points emerging from this initial results section can be summarized as fo llows: †¢ The most appropriate way to compare the economic impact attributable to various events is on an economic impact per day basis; 52  © The Editorial Board of the Sociological Review 2006 The economic impact of major sports events 100% 9% 90% 13% 17% 25% 27% 34% 38% 45% 55% 80% 70% 60% 50% 100% 91% 87% 83% 75% 73% 66% 62% 55% 45% 40% 30% 20% 10% 0% European Junior World Indoor Swimming 990 Climbing 5,444 World Judo 16,000European Short World Snooker European Junior World Amateur World Badminton European Show World Half Course 33,276 Boxing 1,690 Boxing 18,300 21,702 Jumping 40,000 Marathon 15,000 Swimming 640 Visitors Locals Graph 6: The relative proportions of non-local and local spectators at events. †¢ Spectator driven events are likely to have a higher economic impact than competitor driven events; †¢ The key determinant of total economic impact is the number of spectators attending an event; †¢ For most major sporting events, visitors from outside t he immediate area are likely to account for the majority of admissions. Additional bene? ts The Balanced Scorecard approach to event evaluation This ? nal section may interest event organizers and practitioners, as well as social scienti? analysts, in that it acknowledges that the bene? ts associated with events are far reaching and not merely con? ned to economic impacts. This section uses the ‘Balanced Scorecard’ approach to event evaluation (see Figure 1) developed from original work at Harvard Business School. Apart from an event’s economic impact, additional aims and bene? ts might arise in the form of media value linked to coverage at home or internationally. Moreover, linked to such coverage may be place marketing bene? ts for key aspects of the host city or area, which could ultimately impact upon tourism by increasing the number of visitors to the area in future as a result of media coverage afforded to an event.Public perceptions of places can also impr ove as a  © The Editorial Board of the Sociological Review 2006 53 Chris Gratton, Simon Shibli, and Richard Coleman Economic Impact Sports Development Event Aims Media & Sponsor Evaluation Place Marketing Effects Figure 1: The ‘Balanced Scorecard’ approach to evaluating events. result of people’s experiences at major sports events, which in turn might lead to repeat visits as evidenced by qualitative feedback from spectators at some of the events. Furthermore, an immediate bene? t of staging an event might involve some form of sports development impact which could encourage more people to take up a sport being showcased.The long-term effect of any increase in participation could be tracked, although it may be dif? cult to prove causality. To illustrate some of these points, examples are drawn from three events: the European Short Course Swimming Championship, World Amateur Boxing and World Half Marathon. Examples of additional bene? ts Apart from revealing an e conomic impact on Shef? eld of almost ? 315,000, the research into the European Short Course Swimming Championships at the time also audited the public pro? le by analysing the television coverage of the event. In addition to the UK television coverage the event was also shown across Europe in Germany, Finland, Italy and Croatia. Audience data and broadcasts were con? med by the Broadcasters’ Audience Research Board (BARB) and calculations using industry standard methodologies were made relative to: †¢ Percentage Share: The proportion of people watching a given programme expressed as a function of the total number of people watching television at that time. †¢ Television Rating (TVR): This is the key performance indicator of the size of an audience for any given programme. TVR is expressed as the percentage of all the people in a country with access to a television actually watching the programme or programme segment in question. 54  © The Editorial Board of the S ociological Review 2006 The economic impact of major sports events Table 2: Television coverage of the European Short Course Swimming Championships Indicator Number of Programmes Total Duration (Minutes) Cumulative Audience (000s) Highest Share Achieved Highest TVR Achieved UK 6 369 5,451 23. 0% 4. % Other European 12 718 2,522 9. 8% 9. 0% Total 18 1,087 7,973 23. 0% 9. 0% Using the ? ve countries from which the broadcast and audience data were available, the European Short Course Swimming Championships attracted a cumulative audience of 7,973,000 of which 5,451,000 were UK viewers as summarized in Table 2. The data has two practical applications: †¢ For event promoters, in order to acquire a greater appreciation of the commercial value of the event in terms of related advertising and sponsorship sales. Commercial revenues contribute to the operating costs of an event and hence achieving value for money is the key when advertising and sponsorship sales are being made. For host venues, advertisers and sponsors, who can evaluate the return on their investment. For example, the total value of the Shef? eld City Council support of the event was ? 25,000. This can be traded off against the value of the place marketing achieved. Using the data in Table 2, a degree of quantitative evaluation of place marketing can be made. A ‘Shef? eld National City of Sport’ advertising board was on display at pool deck level alongside the advertising board of the main sponsor (Adidas). Using sponsorship industry standard methodology, it is relatively easy to calculate the proportion of the 1,087 broadcast minutes during which the board was on full view promoting the city of Shef? eld.The World Amateur Boxing Championships in Belfast achieved a total cumulative audience of 6. 6 million in the UK, which included 330,000 young people under the age of 16 (ie, potential for a sports development impact). Across 13 programmes (mainly on BBC2), the event was screened for a total of 551 minutes (9 hours 11 minutes), with live feed and highlights screened to more than 20 countries. The UK viewing ? gures peaked at 2. 06 million with the audience share at this point being 22%. Based on analyses of the television coverage using specialist sponsorship evaluations, estimates suggested that a major sponsor enjoyed media exposure worth ? 51,014 in the UK alone.Data such as this provides a sound baseline against which sponsors can assess the extent to which they have achieved a return on  © The Editorial Board of the Sociological Review 2006 55 Chris Gratton, Simon Shibli, and Richard Coleman their investment. In this instance the sponsor invested ? 63,000 and in return they received exposure that would have cost more than ? 51,000 to purchase in the commercial marketplace, ie, 81% of their total investment. In addition to UK television coverage, broadcasters from other countries also bought the rights to screen the event and thus there would be additional media value obtained for the sponsor from this worldwide exposure.Although the worldwide television exposure was not analysed in this instance, it is possible to access the audience data as demonstrated by the European Short Course Swimming Championships example, or alternatively where this is not possible, sponsorship evaluation companies can apply a ‘rate card’ based on a ? at rate for 30 seconds of advertising time on a particular channel. A similar methodology can be adopted in order to estimate the place marketing effects associated with television coverage. At the World Half Marathon, Bristol City Council was responsible for underwriting the event and for a signi? cant proportion of the running costs. In return the place marketing bene? ts linked to the exposure of the ‘Bristol’ brand, amounted to a notional ? 2,000 of exposure. In order to maximize any place marketing bene? ts for a particular location, event organizers should consider working close ly with the host broadcaster in order to ensure the showcasing of key local attractions as the backdrop to human-interest features around the event coverage. Shef? eld City Council used such human interest features (known as ‘postcards’) to great effect during a major snooker event in 2002 such that the combined place marketing effects for the city were a notional ? 3. 2 million, ie, the commercial cost of the exposure created by the event, based on the cost/1000 viewers of a 30 second television commercial.Apart from media value and place marketing, the ‘Balanced Scorecard’ approach also refers to sports development effects and these were analysed during the research at the World Amateur Boxing in Belfast. In the run-up to and during the championships a community development programme with boxer Wayne McCulloch entitled ‘Train with Wayne’ provided young children and potential future champions with the opportunity to become involved in the spor t of boxing. Up to 100 youngsters participated during the televised build up to the Championship. During the event ‘Come and Try It’ sessions were enhanced by concessionary tickets to the event, school visits and discount packages.Furthermore, training for potential young boxers was also strengthened through the involvement of 300 local volunteers in the event, training for technical of? cials, time-keepers, judges, medical personnel and competition managers. This event has therefore left a broad legacy of enhanced skills which maybe used to maintain the impetus provided by the staging of the event. As well as the economic impact attributable to the World Amateur Boxing (? 1. 49 m), the pro? le of Belfast as a city of world-class sport was enhanced through the marketing of the event and the televisual exposure of the ‘Belfast’ brand throughout the world. Collectively, the boxing and the previous success of the World Cross Country Championships provided the catalyst to formulate 56 The Editorial Board of the Sociological Review 2006 The economic impact of major sports events an events strategy for Northern Ireland, designed to help re-image the Province through sport. In summary, given the complex aims and objectives increasingly associated with major sports events, in future more detailed analysis and evaluation will be necessary to satisfy the needs of different partners. Adopting a methodology linked to (for example) the ‘Balanced Scorecard’ could move beyond simple economic impact studies, to include TV, media and sponsorship evaluations as well as sports development, home soil advantage and other legacies. ConclusionsThis chapter has provided a detailed overview of ten economic impact studies undertaken at major sports events, all World or European Championships, in the UK since 1997. Each study represents a value-for-money appraisal of an event, by quantifying the net change in the host economy that is directly attri butable to the event and measurable in cash terms using detailed audit trails. The evidence presented vindicates (in economic terms) the decisions made by UK Sport to use Lottery funding via the World Class Events Programme to attract many of the events. Moreover, the detailed database of event evaluations possessed by UK Sport provides the evidence to inform future strategic decisions relative to the type of events that the UK may consider bidding for in years to come.According to such evidence and in order to maximize potential economic impact, the following should be considered prior to bidding: †¢ The ability of the event to attract people from outside the host area and thereby reduce the ‘deadweight’ percentage of those attending; †¢ Generally the greater the absolute number of spectators the more signi? cant the economic impact and junior events are likely to have the smallest impacts as they rarely attract many spectators; †¢ The economic impact is not necessarily a function of the status of an event in world sporting terms; †¢ The number of days of competition and the availability of local commercial accommodation to allow visitors to extend their dwell times in the host area.Beyond the development of the economic impact model, this chapter has demonstrated how the event evaluations have evolved and should continue to evolve in order to better understand the likely legacies of events long after any medals have been presented. 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