What is Event Economics?
Event Economics is a simple one-stop shop for event evaluation. It draws on practical knowledge and experience acquired across 20 years and more than 500 event evaluations to provide the world’s first comprehensive measure of event impact and return on investment.
How do I use Event Economics?
The data entry wizard in Event Economics guides you through the event evaluation process – all you need to do is enter accurate information. For pre-event evaluations this requires reasonable assumptions about what the event will deliver. For post-event evaluations this generally requires surveys of event attendees and analysis of administrative data such as ticketing databases, accreditation databases, and the event’s profit and loss statement. Our online resource library will help you develop best-practice tools and skills to conduct post-event research.
Event Economics converts your data into robust estimates of event impact and return on investment that you can view immediately. The results are presented in an easy-to-understand dashboard that can be printed or downloaded to Excel for further analysis.
Why do I need Event Economics?
Major events are recognised globally as being important drivers of social and economic prosperity. Cities now compete strongly with one another for the right to host major events, often paying millions of dollars in hosting and delivery fees to capture the anticipated benefits. But what are the benefits, and how much should a city pay to secure them?
This is a classic investment problem that every city faces. It is a problem not only because the benefits are uncertain at the time the investment decision needs to be made, but also because some benefits are not easy to measure. The former can be managed to some extent by an experienced event analyst, but accurate measurement is a recurring problem that most cities would like to resolve.
The first objective of Event Economics is to provide a best-practice event evaluation framework that is capable of including, and valuing, the wide range of costs and benefits major events confer upon a host city. This includes both values that are revealed by observable prices like ticket revenues (market values), and things that do not have an observable market price like greater social capital (non-market values). The inclusion of non-market values is particularly important because they are absent from current evaluation frameworks, or appear as unvalued addendum and therefore receive little consideration in the decision-making process.
It is important to differentiate between the role of the framework, which defines and organises the things that need to be valued, and the measurement techniques that are used to derive the values. In the first instance, Event Economics is focussed on developing and socialising an enduring fit-for-purpose event evaluation framework. Once that has been achieved, the focus will be establishing and improving the measurement techniques used to populate the framework with values.
The second objective of Event Economics is to enhance the accuracy and integrity of the event evaluation process. Almost every event evaluation reports a positive economic impact, usually denominated in Gross Domestic Product (GDP). The numbers in these reports are regularly accused of being overly optimistic, as well as being based on naïve assumptions about how economies work. This criticism is generally justified and is discussed further in the PDF document below.
The third objective of Event Economics is to provide a transparent and repeatable event evaluation process that can be applied consistently within cities, and across cities. This addresses a major consistency problem that currently exists within New Zealand, while also reducing the dependence of cities on external consultants. This should result in costs savings as cities become more capable and self-sufficient. Event Economics uses Cost-Benefit Analysis (CBA) to achieve these three objectives. In doing so, it replaces Economic Impact Assessment (EIA) as the preferred event evaluation methodology in New Zealand.
Why is CBA the ideal evaluation framework for events?
Cost-benefit analysis (CBA) is a well-established evaluation framework that government agencies and businesses use to make investment decisions. Any type of cost or benefit can be included in a CBA, as long as it can be given a credible value. This gives social outcomes the same status as economic outcomes in the evaluation process, providing decision-makers with comprehensive measures of event impact and ROI.
Traditional GDP-style analyses can’t deal with many of the costs and benefits generated by events. This distorts the decision-making process and generally favours certain types of events. CBA levels the playing field by enabling the inclusion of both financial and non-financial costs and benefits. This means that community festivals can be evaluated in the same way as major concerts and sports events.
CBA is the ideal evaluation framework for events. It is a comprehensive, transparent and repeatable process that can be implemented consistently across a diverse range of events and regions.