By Rob Starr, Big4.com Content Manager
PwC US reports that while the greater Houston area could see an approximate 40 percent increase in direct spending over the time they hosted the event in 2004, Super Bowl LI’s direct spending will be lower than $200 million for the first time in four years. Adam Jones — director, sports and tourism sector, PwC US, quarterbacked some answers to our questions.
Super Bowl direct spending is not expected to reach the $200 million level for the first time in four years. Why is that?
The direct spend activity realized by this year’s Super Bowl host market is not anticipated to reach the high-water marks set over the past few years and stay below the $200 million level
primarily due to lower destination costs and shorter average length of stay in the greater Houston area relative to those other recent host markets – New York/New Jersey, Phoenix, and San Francisco Bay Area.
Can you explain the “multiplier effect,” and its relevance?
The multiplier accounts for “indirect” impacts, such as a concession company’s purchase of goods from local producers and manufacturers, and “induced” impacts, which occur when the income levels of residents rise as a result of increased economic activity and a portion of the increased income is re-spent within the local economy.
Do national economic conditions factor in? How?
National economic conditions can affect visitor volume and spend levels generated by a Super Bowl as fan discretionary income and corporate entertainment and marketing budgets expand/contract with changes in the national economy.
What are some of the other factors used to crunch the numbers?
Other factors considered in our proprietary analysis include characteristics unique to this year’s event, such as the participating teams, attributes of the Houston market, such as destination costs, and scheduled corporate and other ancillary activities.
What has Houston done to prepare?
Houston is using the Super Bowl’s spotlight to showcase its diversifying economy and recent enhancements to downtown, including the convention center, Discovery Green, lodging and transportation, among others. Its centralized downtown with close proximity to the host stadium allowed this year’s host committee to plan events within a relatively small radius, enabling visitors to spend more time on experiences and less time traveling – ultimately enhancing the visitor experience while capturing greater overall return.