With perhaps the exception of Glasgow and the 2014 Commonwealth Games, there are fewer examples of cities that have strategically planned for such outcomes prior to any decision to go ahead and bid/host an event. The concept of bidding, losing and then still achieving physical and other legacies, in other words, aiming to strategically gain legacies just by bidding, is relatively new but gaining recognition. The Mayor of Boston, Martin J. Walsh, recently said in relation to the city’s 2024 Olympic bid: “Whether you oppose or support the Games, whether you are a business leader or a community activist, whether you live in Boston or work here, we can all agree that having a two-year, public conversation about the future of our great city is a good thing”.

The introduction of the recent IOC Olympic Agenda 2020 reforms, including specific measures to help reduce the costs of bidding, is a recognition that if bidding becomes unattractive due to sunk costs being too high, it might reasonably be assumed that fewer cities will be prepared to bid in the future, leaving only a relatively small number of the world’s major cities with the capacity to stage the spectacle that is the Olympic Games.

In the meantime, however, the cost of bidding has continued to escalate. Tokyo reportedly spent $150 million on its 2020 Olympic bid and Boston 2024 has a stated budget of approximately $75 million over the next 32 months. The almost unprecedented drop-out of Stockholm, Munich, Krakow and Oslo from the 2022 Winter Olympic Games bid process was largely attributed to the perceived cost of bidding and hosting relative to the likely legacies, which in turn led to a lack of public confidence and support. In February, Edmonton withdrew its bid to host the 2022 Commonwealth Games, citing financial reasons and leaving Durban as the only remaining bidder.

Bidding and not winning is both a short and long-term risk for bidding cities as well as the rights owners involved. A bidding city that does not win loses its investment in making the bid and may only see that as a longer-term investment if a future and ultimately successful bid is made, as in the case of Pyeongchang, which bid three times for the Winter Olympics before it finally won the right to host the event in 2018.

It is possible, however, to identify a number of distinct benefits enjoyed by a candidate city whatever the outcome, and therefore maximise the potential for a return on investment if and when the bid is lost. Researchers in the Economic Analysis and Policy Group at the University of California have found that unsuccessful bids to host the Olympics have an impact on trade every bit as significant as the effect of actually hosting the Games. This suggests that the Olympic effect on trade, as an example, is attributable to the signal a country sends when bidding to host the games, rather than the act of actually hosting such an event.

The benefits directly attributable to the bid process include:

• International city branding: bidding for any global event immediately raises the international profile of the city and puts it on the map. This is especially significant for emerging destinations.
• Identifying aims, objectives and goals: formulating a bid forces candidate cities to identify their own metrics for success.
• A long-term plan: bidding for but not winning an event can yield constructive criticism of a city’s proposals that allow and encourage it to successfully bid another time, such as in the case of Pyeongchang.
• City development: bidding for a global event encourages the adoption of new benchmarks for city development, changing the rules of engagement and prompting real progress in city development. The imposition of multiple external deadlines actually helps the city to achieve disciplined and rapid progress and yields valuable lessons in time management.
• Working together: bidding for a global event means that city, regional and national authorities have to work together to plan the full range of logistics.
• Physical legacy: bidding for a global event requires that venue development plans be drawn up well in advance, setting out budget projections and long-term usage, and often that sites and land must be assembled and prepared before the final bid outcome is known.
• Urban transformation catalytic effect: most importantly, the ‘catalytic’ effect on urban transformation that is derived from hosting a global event is, to a large degree, experienced from the earliest moments of bid formation, as indicated by the research on trade impact.

Against the backdrop of a global economy that is still struggling to gain momentum, the escalating costs of bidding for major events and the challenge of building public support, cities can still benefit from the bid process. Bidding to fail is unlikely to be a supportable policy but there is evidence to suggest that with the right approach, the bid process can be a catalyst for significant long-term legacies, regardless of the outcome.

Andy Preece (andy.preece@archtam.com) is director (sport) with ArchTam Economics. Based in London, Andy has helped cities, local organising committees and international federations evaluate, bid for and plan for multi-sport and single-sport major events.

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As well as sport, the event sector also includes cultural, political and trade events, large and small, and all have the potential to generate a wide range of well-documented economic benefits for the host city or community. Events also create media attention, increase the quality of life in our communities and can dramatically increase the global profile of emerging destinations.

In less than 100 days, Baku will host the inaugural European Games, which will be broadcast in 53 countries around the world, including the United States, China and across the Arab world. Speaking at the 2015 World Economic Forum in Davos, the Azerbaijani Government Minister of Youth and Sports said: “Hosting the Games in June this year is not just a single special event for us, but a part of our nation’s broader strategy”.

More and more cities are also recognising that events are a major reason people travel. There are few reliable estimates of the global value of event-based sport tourism, but it is widely recognised as one of the fastest growing tourism sectors. The sport tourism industry in Canada alone surpassed $5 billion in spending in 2012 according to the Travel Survey of Residents of Canada (TSRC) and the International Travel Survey (ITS).

If cities and other communities wish to be players in the national or global marketplace for major events, they must organise the appropriate resources and infrastructures to be effective. However, the issues around event tourism are complex. The effective delivery of major events and event tourism requires the involvement of a multiplicity of agencies, all of which have different objectives for hosting any particular event. Most of the tourism organizations involved are in the private sector, and many events are organized by volunteers who do not think of themselves as part of a strategic process.

EventScotland is the national events agency for Scotland and was established in 2003 to coordinate stakeholders and to generate, bid for, attract and sustain events which drive tourism and create international profile for Scotland. It was one of the first such organisations to develop a national events strategy, ‘Scotland, The Perfect Stage’. In the last ten years more than 1,000 events have been supported by EventScotland, including the Ryder Cup 2014 and the Glasgow 2014 Commonwealth Games, generating significant economic and social impact.

Preparing and implementing a major event strategy recognises all these realities, providing mechanisms for resourcing event organizations, encouraging and recognizing volunteers, informing the private sector and encouraging its understanding of the overall system and the benefits it is deriving. To be effective, a major event strategy must also be developed with a clear understanding of the need for both a partnership approach and for governmental leadership.

This leadership role also allows cities to develop the strategy with their own goals firmly in mind and to identify how the system can be managed to deliver specific goals such as revitalizing the downtown core, linking with the education and knowledge sector, building civic image and fostering community pride.

A key outcome of a strategy is a process or set of guidelines to help inform which events to prioritise, as all too often, decisions about which events to bid for are not made strategically but in response to short-term pressures, which are frequently political. If analysis is undertaken, in many cases it only measures whether the event will be good for the city economically. Such forecasts attract media attention but have often been shown to be exaggerated and are rarely subjected to post‐event scrutiny.

When considering bidding for or creating an event, the decision-makers should ask: “Is this event better than all the other ones out there that we could be bidding for and why?” This kind of analysis requires a strategic approach and a process for evaluating potential events, and the collaboration of all the various agencies who will be involved in the bidding and hosting process. The process should assess potential major events against the goals or values of the City and its partners.

These goals can be restated as three key questions:

• Alignment: is this the kind of event the city should support?
• Capacity: does the organizing committee or entity have the ability to deliver a first-class   event?
• Benefits: will the event deliver the benefits – social, community, economic and infrastructure enhancement – that the city expects?

Criteria can then be established for each of these goals and potential events assessed against them, allowing events to be compared, and proposals strengthened prior to bid submission, as well as providing a basis for event performance assessment after the event has taken place. The use of such a methodology ensures that the City will be bidding on the best set of events to meet its overall goals and objectives – the right events for the right reasons.

Andy Preece (andy.preece@archtam.com) is director (sport) with ArchTam Economics. Based in London, Andy has prepared sport tourism and event strategies for a number of cities and governments.

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