The private sector and events

This chapter profiles the multiple contributions of the private sector to event planning and policy making, funding, management and marketing. Event stakeholders from the commercial world are diverse and range from corporate leaders and entrepreneurs to small to medium-sized businesses whose services make up the numerous links in the event supply chain. At the macro-level, the vision and resources of corporate leaders impacts on both national and

local portfolios of events. Sponsorship resources from the private sector and philanthropic contributions of business leaders provide a significant proportion of the funds needed to grow arts, sports and business events. Apart from the political and strategic leverage of corporate leaders and the provision of dollars through sponsorship and philanthropy, the private sector also brings entrepreneurial vision to the design and creation of events. Event organisers and promoters who are involved in staging, producing and marketing events make up a highly specialised industry globally that is gaining increased professionalism and credibility. At the micro-level, a complex network of businesses provide event-specific services (e.g. planners,

promoters, venue owners/managers, entertainers, merchandise and licensing firms) while many others provide event-support services (travel and transport, tourist attractions, accommodation, retail and professional services). In effect, the private sector is both a recipient of revenue from events as well as the provider of direct and in-kind sponsorship. Another growing avenue of private sector concern and engagement with events relates to their

impacts on local and global communities and contributions that can be made by businesses to social, environmental and economic sustainability. Increasingly, a significant role must also be played by business leaders and operators in ensuring the responsible management and continuity of events.

Ownership of events does impact on the extent and ways in which the private sector is involved in their planning and staging (Andersson and Getz 2009). Medium-to large-scale public events (e.g. national competitions, the Commonwealth Games, World Cup Soccer and the Olympic Games for which governments often serve as underwriters) and profit-oriented festivals and events run by venues, firms or investors as commercial initiatives (e.g. rock concerts and

blockbuster theatre productions) may seek more private sector services and generate higher revenues. While not-for-profit events may be influenced by business leaders who engage with them for philanthropic reasons, business opportunities do tend to be fewer where market expansion or growth of the event is not a primary goal. However, the private sector has a collective interest in the economic impacts generated by events of all types and a commercial interest in the business opportunities to be achieved through engaging with one or more events. As towns, cities and nations rely increasingly on place marketing to promote economic

growth, the stature of events (business, sports and arts-related) as vehicles to re-image and position destinations for investment or tourism has grown (AT Kearney 2005; Hall 2006). There are now many illustrations of event staging for the purpose of place branding to attract new and repeat tourists, to expand current industries and businesses and create new ones. Cities are under constant pressure to show positive economic development and ‘mega-event strategies’ bring the potential for new funding sources. Among the myriad of events globally that are sought after are FIFA’s World Cup Soccer event, the Olympic and Commonwealth Games, government meetings, e.g. the Commonwealth Heads of Government meeting (CHOGM), and business events like World Expo. However, the injection of funds into local hallmark events and well-known cultural and artistic festivals, e.g. Carnival in Rio and the Edinburgh Festival in Scotland, also serves to maintain a strong brand presence for their host cities. The 2010 FIFA World Cup in Cape Town was a major place-imaging initiative for South

Africa. In order to generate long-term business legacies (in addition to sport and community benefits) at least R14 billion in public sector investment was spent on infrastructure and more than double that amount was invested by the private sector (www.capetown.gov.za). Industry development was facilitated through sector-specific interventions to showcase local products and services and to establish contacts for long-term business. However, opportunities provided by events such as the World Cup for small to medium enterprises (SMEs) can be variable. With 95 per cent of all tourism businesses in South Africa in the SME category, concern was expressed in the lead-up to the Cup that around 85 per cent of these businesses could provide services to the event, but at least half of them needed support to properly leverage the opportunities (Correia and van Lill 2010). Hence, benefits from events can accrue somewhat unevenly across the private sector and serve a fairly narrow range of interests. Equitable representation of the private sector can be particularly challenging in developing economies where the quality, quantity and reliability of products and services can be less predictable. Aside from immediate tourism industry benefits (related to travel, accommodation and visits

to attractions), the infrastructure improvements and upgrades associated with special events are key activities that directly engage the private sector. The bid by Australia’s Gold Coast for the 2018 Commonwealth Games was prompted in part by the upgrades anticipated for sports facilities, road and transport infrastructure and new high-density housing and offices along the coastal strip (Queensland Events 2010). While the forecast cost of the bid was in the vicinity of $11m ($Aust. without staging costs), both the community and private sector operators were expected to benefit from these infrastructure projects. The staging of major and mega events also leads to greater success in attracting other events. The IOC session to select the host for the Olympic Games illustrates this snowball effect. In 2005, this event brought over 100 voting members of the IOC, some 1,500 journalists and 500 other visitors to Singapore. Beyond the $19 million generated in tourism receipts, this was an event where hoteliers, media, logistics and programme providers each shared in the benefits (Yuen 2008). In turn, the event brought new interest among international sports federations in holding world and regional championships in Singapore. Again, expanded business for companies in the events, tourism, construction, retail, entertainment and service sectors was expected.