Impact of Major Sports Events on Regional Economic Development

International Sporting events, such as the Olympics and the FIFA World Cup are contested by hundreds of top athletes, and celebrated as sports festivals by people all over the world. Such events attract fans and visitors from all over the world.

Hosting such mega-events also provides a big boost to the local economy.

Benefits of Hosting Major Sports Events

While evaluating the costs and benefits associated with a particular event, usually the economic impact of the event receives the greatest attention.

Here are the main impacts of hallmark sports events.

Economic Impact:

Positives

Local Infrastructure is upgraded, new stadiums were built and existing ones are renovated to host all the games
Overall urban security measures are improved. Events may require several kilometres of security fencing.

Negatives

Big financial drain on the local economy. The games can leave regions with a huge debt and land them in an economic crisis.
Most of the development may take place in select areas, despite the huge expenditure incurred by the Government.

Political Impact

Positives

The success of the event can prove to the world that the country can host big, international events

Negatives

Locals may be critical that the money spent on the games could have been spent on improving healthcare, education and other services

Socio-Cultural Impacts

Positives

Most countries have a wonderful culture, which tourists get to experience. Besides, there are several attractions for the tourists. Visitors also get to interact with the local people.
The events provide several volunteering and short term employment opportunities to locals

Negatives

The events may increase pollution levels, especially in the water bodies where boat races are held
Local outbreak of diseases may prevent many more visitors from travelling to the host region.

So, hosting mega sports events help improve infrastructure, and provides the host community with an opportunity to secure high prominence in the tourism market place. It also demonstrates a country’s ability to execute a complex event of such a huge stature.

These are the major reasons why countries around the world bid for major sporting events such as the Olympics and the FIFA world cup.

Strategy for Hosting a Major Sports Event

Consumer Motivation

Visitors to big events usually have various motivations for attending an event; they all have different expectations. For example, fans could be attracted by a particular music festival because of factors such as fun and dance; novelty; excitement, group identity and entertainment; lifestyle etc.

In order to effectively serve recreation travellers at their destinations, it is essential for organizers to understand the psychological factors that motivate these travellers.

Events like the Olympics are much more than just sport events. For some stakeholders such as tourist operators, hotel owners, and even the local community, it is a great time to showcase the local culture, attractions, products and services.

For organizers of such events (and the destination) it is important to understand and analyze the motivation of participants so that appropriate products for their demands can be designed.

So, organizers/marketers should find out more about the motives and preferences of the various stakeholders; it can serve as a useful market segmentation tool that can attract more consumers towards a service/product.

For athletes, Olympics’ is the ultimate sporting event and getting a medal is a life-long dream for many. They expect the best sporting facilities, better organization of their respective games and practice sessions, accommodation that is closer to the venue, and which allows them to catch-up with athletes from other countries (at the end of the day).

For fans and visitors around the world, the Olympics is an opportunity to watch the greatest sporting spectacle on earth, watch athletes give their best (several world records are broken). It’s the time to meet fans from across the world, and indulge in a long global sports festival.

For tourists, it’s also an opportunity to explore and experience the local culture people and checkout popular tourist attractions. Most tourists organize their travel itinerary in such a way that they get to experience at least a few days at the Olympics. They expect availability of decent rooms, convenient transportation, feeling of safety, and warm and cheerful locals.

Tourism Strategy

Host Cities prepare a detailed tourism plan to capitalize in such events. As part of its tourism strategy, host cities undertake several infrastructure upgrade and beautification projects.

With sustainable tourism gaining significance worldwide, organisers now are also expected to host the event in a manner that has minimal impact on the environment and employ sustainable methods.

For events such as the Olympics, organisers used modular technology in the construction process, so that the structures could easily be dismantled and re-assembled/reused at some other location after the Olympics.

Downsides of Hosting Major Sports Events

Rio de Janeiro did a great job of hosting the Olympic Games in 2016. However, there are many who feel that Brazil is not enjoying the economic benefits of hosting the Olympics and many Brazilians feel the money could have been better spent on public services.

When IOC awarded the Olympics to Rio back in 2009, very few would have anticipated that the country would find itself in a political and economic crisis.

Rio Olympics has also drawn criticism for the way it has managed the Olympics legacy.

Several sports venues that should have been used by sportspersons are lying unused. Venues that should have been dismantled and rebuilt as schools elsewhere, has not been done. Brazil should have planned better as to how it would effectively use the Olympics legacy in the future so that the various sports facilities and world-class infrastructure continue to get used by budding sportspersons and helps them win medals for the country.

Brazil has also not been able to control pollution levels after the Olympics. This is where the authorities should have pulled up their socks together.

Also, in order to fully realize the cultural potential of such events, it’s important to do a thorough research on the visitors so that plans for tourism promotion can be improved.

The various stakeholders should also use the right marketing mix to make sure they are achieving the maximum benefit from the marketplace during such events.

Conclusion

Sports tourism is big business today, and events are a major and significant component of sports tourism, if you consider its impact on economy and inflow of tourists. Sports events are increasingly becoming an important tool for economic development for cities/regions; it also plays a very important role in changing the perception of a city/region in the foreign media and in the mind of foreign visitors.

These are the reasons why, despite the huge costs and scale of operations involved in hosting such events, cities try their best to win the bid for hosting the games.

Sport event tourism is seen as a substantial and highly desirable niche market. Cities in the developed countries have established sport commissions / corporations that bid for international events with the intention of promoting this form of travel, and destinations around the world furiously compete with one another in order to win the rights to host high-profile sport events.