Our local economy expected big things from last year’s Rugby World Cup, with images of shop tills ringing, hospitality venues booming and glittering commercial sponsorships for our All Black super stars. This was certainly the image whipped up by the Government and event promoters in the lead up to the world’s third largest sporting event.
So did it deliver?
While many industries are still counting the benefits, and early indicators were promising, many economists are painting a fair less lucrative picture.
Mastercard, the event’s main sponsor, predicted that spending by overseas visitors could reach $782 million, with a direct economic benefits of $411 million. But the estimate so far from the New Zealand Institute of Economic Research is nearly $250 million short, with just $540 million injected into our retail sector.
And while the alcohol industry appears to be the big winners (almost 1.6 million Heinekens were sold in stadiums nationwide), overall, Kiwi business owners were less than enthusiastic about the boost the RWC brought to their door. Just 9% of local businesses rated the event as financially beneficial, compared with a massive 89% that were hoping for benefits in a pre-tournament survey. While Auckland Council acknowledges that many businesses feel ‘ripped off’, they do state that the World Cup brought 107,000 additional visitors to New Zealand, and the low reporting of positive effects may be a reflection of an uneven spread of benefits. The small business industry was one of the main sectors identified as largely missing out on economic benefits.
And in a further blow, The New Zealand Institute of Economic Research last week released it’s Quarterly Survey of Business Opinion and found that ‘very strong expectations for the December quarter, which may have been related to the Rugby World Cup, did not materalise’.
In the wake of the World Cup, consumers are tightening their belts and remaining cautious about spending, particularly in light of recent economic conditions in Europe. Core retail spend fell in December, weakening retail trade, with the effects likely to be felt throughout the first quarter of 2012.
Did your business benefit from the Rugby World Cup? We’d love to hear your experiences below!