Evaluation of Sporting Events in the UK
The Significance of Economic Benefits, Political Decision Making and Cultural Changes
Essay 2012 9 Pages
Evaluation of Sporting Events in the UK: The Significance of Economic Benefits, Political Decision Making and Cultural Changes
In the postmodern age, sporting events are an integral part of people’s lives because they inevitably receive news of sporting events from televisions, radios, newspapers, magazines and new media. Famous UK sporting events such as the London 2012 Olympic Games, the Premier League, Wimbledon Championships, the RBS 6 Nations and the Test Match have been assumed to be the interest of general audiences by the media. From the perspective of the media, sporting events in the UK are utmost important and are worth paying billions of pounds for broadcasting rights. From the perspective of audiences, the broadcasting of sporting events has given them opportunities to increase their awareness of the events and their associated issues, such as news of sports teams and companies of sponsors. This awareness, in turn, may be the impetus for them to get involved in sporting events and visit the host cities. From the perspective of the government, UK sporting events have positive and negative impacts to the economy in the long term. These impacts require not only the co-operation of event organisers but also the contribution of the community, for example the impact of tourism. This paper will evaluate, firstly, the direct and indirect economic benefits which are brought by sporting events at the national level; secondly, government decisions with regards to the economic development of sporting events; thirdly, cultural changes in a society due to sporting events which the government advocates for.
UK Sporting Events Bring Economic Benefits to the Country
In evaluating economic benefits brought by sporting events at the national level, focus should be on the economic impacts for host cities, apart from benefits which merely influence events’ costs. This is because an event which has an operational loss can still generate benefits to other industries in the same region, such as accommodation and transport industries (Bowdin et al 2011). The significance of sporting events in the UK relies on the sizes and types of the events. UK Sport developed an event typology in 1997 to measure economic impacts of sporting events, in which Type A, irregular major international spectator events, and Type B, major spectator events, generate the largest economic benefits and media interests to the host cities (UK Sport, 2004). A very high number of Type B events are held in the UK annually in fixed sporting venues (Gratton & Taylor, 2000). With significant media exposure, this type of event brings economic benefits to the country directly and indirectly. An example of such event being the Wimbledon Championships.
It is stated that “the All England Lawn Tennis Club (AELTC) and the Wimbledon Championships is fundamental to the town’s current and future image, brand and (consequentially) economic performance” (Merton Council, 2010, p.48 [online]). The historical annual Wimbledon Championships is a universally recognised hallmark event which has already become synonymous with the name of the town (Bowdin et al, 2011). It enhances its own profile and the profile of Wimbledon by attracting media interest to the event. Locally, it had the broadcasting partnership with the BBC for eighty-five years and this will be continued until 2017 according to the AELTC’s plan (The AELTC, 2011 [online]). Internationally, in 2010, The Championships reached audiences in 187 territories through television broadcasting (The AELTC, n.d.b [online]). There are 350,000 visitors attracted to the two-week Championships each year (Culture, Media and Sport Committee, 2008 [online]).
Direct economic benefits derive from the expenditure of tourists who visit Wimbledon for the Championships. In addition, the media exposure of the Championships also contributes to the towns and the surrounding districts entire tourism industry in terms of leaving an impression on audiences who may consequently travel to the region for other reasons. Overseas tourism expenditure in Merton, which is one of the London Boroughs where Wimbledon is situated, shows a constantly growing tourism trend since 2004. It increased from £58 million in 2004 (London Development Agency, 2009 [online]) to £88 million in 2009 (Greater London Authority, 2011 [online]). Although the domestic tourism expenditure in Merton was volatile between £16 million and £20 million from 2006 to 2009, the boroughs estimated share of total London tourism expenditure has shown an increasing trend in the above mentioned years and reached 1.5% in 2009 (Greater London Authority, 2011 [online]). It has to be emphasised that the growing phenomenon of Merton’s tourism is not merely because of the broadcasting of the Championships, it also relies on the efforts of multiple industries in the borough. However, it is believed that Wimbledon’s reputation which is aggregated by the annual Championships associated with the media has brought significant benefits to the region in terms of tourism.
Moreover, the broad media exposure of the Wimbledon Championships also attracted global companies to sponsor the competition. This has created direct and indirect economic benefits to the region and the country. Sponsorship allows event organisers to minimise the cost of the event and increase the available funds within the borough. From the perspective of the government, the money that is brought by sponsors is beneficial to the whole UK economy, as the worth of the UK sponsorship market was £934 million in 2007, in which 51% was made up of sports (Mermiri & South, 2009 [online]). On the other hand, indirect economic benefits derive from taxation associated with any selling activities of sponsors in the UK. For example, Polo Ralph Lauren, the Official Outfitter of Wimbledon, sells its Wimbledon designed apparel in the new Centre Court Wimbledon Shop and the Wimbledon online shop (The AELTC, n.d.a [online]). The Corporation Tax from the limited company and the Value Added Tax from customers are seen as government revenue. Furthermore, the government would benefit more from these taxations when more customers are aware of the sponsors from the Championships and purchase their products and services in other regions of the UK.