Sport Tourism (Part I): Why Cities Should Subsidize Marathons, Not Stadiums

Few cities in Canada or the United States have been immune from calls to massively subsidize professional sports teams. Over the past two decades, dozens of cities have shelled out 9 figure subsidies, usually in the form of publicly-funded stadiums, in order to keep or attract professional sports teams. Sold as a necessary element of being a “big city”, and backed by wildly exaggerated claims of benefits economic or otherwise, report after report nonetheless shows that pro sports adds little to no net economic impact to a region. When there are gains, they’re likely offset by the subsidies being provided.

I’m part of the small minority fans who do travel regularly to watch sports (usually once or twice a year to see baseball). I’m fully aware, though, that we are – relatively speaking – few and far between. In the past couple of years, I’ve started traveling for another sport – distance running, when I started running half marathons.

Marathons have become big business as running has grown in popularity. While the proportion of people who run (half) marathons pales in comparison to the proportion who are professional sports fans, I nonetheless noticed something anecdotally. Nearly every runner I know travels semi-frequently to compete in races, and often with family/friends coming along. Initiatives like Team in Training coordinate travel for large groups. With this, they are spending on hotels, entertainment, and other amenities and experiences at their destination. I started thinking more seriously about what economic impact this has after competing in the San Diego Rock and Roll Marathon (I did the half) this June. Prior to picking up your race kit, you fill out an exhaustive survey covering the economic impact of your trip. I don’t remember every question, but I’m pretty sure they asked everything about my spending in the city short of how much I tipped my cab driver coming from the airport.

As the scholarly work shows (or any Google search would), there are many claims about significant economic impact from marathons. The consensus seems to be that the most profitable ones are found in the biggest cities (not a surprise since they have more capacity to put on big events), but even cities like Cleveland have claimed massive benefits.

I am inherently skeptical about economic impact claims, but when comparing these to reports around entertainment and sports, I see a couple of differences from experience:

1) For 99.99% of the participants, running a marathon is a conscious, deliberate undertaking. That is to say, it’s not a decision akin to “should we go to a hockey game or should we go to a movie?” It’s a decision to do a specific thing that requires weeks if not months of planning and training. Therefore, the substitution effect that applies to pro sports events doesn’t apply in the same way.
2) Related to this, many factors may contribute to a runner deciding to enter a given race (location, timing, other events that can go into a trip), it’s usually an either or proposition when comparing locations, not whether to do the event or not. When considering a race, I don’t usually think “should I run in San Diego or go to a resort in the Caribbean?”. I think “should I run in San Diego, Seattle, or Portland?” Surely runners would spend money on other hobbies and leisure activities if they gave up the sport, but I still see a key difference compared to spectator events.

With the Edmonton Marathon happening this weekend, I decided to look into where the Western Canadian races were drawing participants from, and what this might mean in terms of bringing activity to a given city. I looked at 6 races from across Western Canada in 2011 – Victoria, Vancouver, Edmonton, Calgary, Saskatchewan (Saskatoon), and Queen City (Regina), and broke attendees into where they listed their residence – CMA, rest of the province, regions across Canada, US, and international. You can see the full breakdown here.

The numbers in Western Canada show that people are willing to travel for marathons. I plan to repeat this down the road for events in Central and Eastern Canada to see how the trends compare across the country.

Marathons Across Western Canada – Breakdown of Participants

Here is a breakdown for each race of those from the CMA compared to those outside of it:

The Results
The British Columbia races draw the biggest number of out-of-town participants. Not surprisingly, as the two largest races, Victoria and Vancouver both claim large economic impact.

Victoria does very well in terms of participation for a metro of its size. Both it and the Okanagan race fall on Canadian Thanksgiving/American Columbus Day long weekend, which likely helps boost travel to the races.

The Prairie races are both smaller and more locally focused, yet even the smallest one brings in about 500 participants from outside the CMA (to say nothing of their friends and family). If you conservatively estimate the impact at 1-2 nights in a hotel, plus meals, incidentals, etc, a $500/person impact would add $250,000 to the local economy off of 500 runners. A drop in the bucket? Maybe. But for what the city has likely to put into the race (a small to non-existent investment), that’s a pretty decent return. Do enough events like this in different sports and leisure activities (such as arts and culture), and all of a sudden you’ve got a lot going on throughout the year and a steady injection of money into the local economy.

Key Considerations and Lessons
There is a Near Zero Sum Effect – Many of these races fall close to each other on the calendar – Vancouver and Calgary in May, Saskatchewan in June, Edmonton in August, Regina in September, and Victoria and Okanagan on the same day in October. This means that the vast majority of runners will be entering at most 2 of these races, maybe 3 (May-August-October). While there is room for races to attract new or lapsed runners, they are in a sense competing with the neighbours on the calendar to attract participants.

Cities Can Focus on Import Substitution – This Steven Cobb paper correctly points out that marathons can capture local runners who would otherwise travel to races elsewhere, and are now instead spending this money in the local area instead. For smaller marathons, this might be the best starting point to grow their race.

There is Room for Growth, But Only So Much – Nearly every city has at least one marathon by now, and more keep getting added. It feels very close to the point where the market will be oversaturated. Further, the smaller races are competing to catch up reputation-wise to the larger, more established ones.

What Can A City Do to Benefit?
There are lessons in this for cities. I see three major takeaways:

Make Your Local Marathon a Big Event – This goes without saying, but the most successful races are huge community endeavours, volunteer-wise, and in the attention they get from locals. In Edmonton, the Marathon barely registers. In part, it has the unfortunate timing of being the same weekend the popular Fringe Theatre Festival kicks off, but it still doesn’t command an attention (or participation level) commensurate with the size of our running community. There’s room to grow on the import substitution side, and making more of an event (and moving it back to a more central location) would help. Given how supportive Edmonton is of other major sporting events, I don’t think this is unreasonable.

Find A Selling Feature – What makes your city’s race special? Is it a great and/or scenic course? Do you have a killer after-party? Do you have a great race kit and medal? Are there tons of other things to do in your city? With everyone competing for runners’ business, the value proposition has to be strong in order to stand out.

Get Ahead of the Curve – Many of the most successful races are also long-running ones. Instead of playing catch up, it’s often best to carve out a niche or get ahead of the curve. I see trail running as the next big thing in the sport. It’s still largely a niche activity, but events like the 5 Peaks series are making it more accessible for casual runners. There’s a gap in terms of races that are accessible both in terms of distance/difficulty, and location (most are in mountainous or otherwise non-urban areas). For a city like Edmonton with its large parks and trails system, fostering an appealing urban trail marathon would very likely be a good bet, and offer an experience you can’t get in many other places.

Summary
I’m not arguing for massive subsidization like we’ve seen with pro sports. But I see plenty of reason to think that a city supporting a marathon, or other participatory events, in small ways – financial or not – can yield big returns. It’s these kinds of events that, with enough of them happening (in sports, arts and culture), can cumulatively add a big impact to a region at very little cost to the public.

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