www.pwc.fi Final Northern Stars of Ice Hockey Review of socio-economic economic impacts of 2012 IIHF Ice Hockey World Championship in Helsinki The review focused on direct and indirect economic impacts and in addition some social impacts were taken into consideration. Final Table of Contents Executive Summary ..................................................................................................................... 4 Introduction ................................................................................................................................ 5 Background and objectives .......................................................................................................................................... 5 Approach and methodology ......................................................................................................................................... 5 2012 IIHF Ice Hockey World Championship in brief ................................................................................................ 6 Organising an international sporting event ..................................................................................7 Driving forces.................................................................................................................................................................7 Image and reputation of the hosting country .........................................................................................................7 Legacy .......................................................................................................................................................................7 Experience society................................................................................................................................................... 8 Participation society................................................................................................................................................ 8 Fan culture............................................................................................................................................................... 9 Economic impacts.......................................................................................................................10 Introduction to direct economic impacts 3 .................................................................................................................10 Direct economic impacts of the World Championship in Helsinki .......................................................................... 11 Revenue ..................................................................................................................................................................12 Ticket sales .............................................................................................................................................................12 Marketing and sponsorship...................................................................................................................................12 Hospitality and other income ................................................................................................................................13 Expenses of the organiser ......................................................................................................................................13 Investments in infrastructure................................................................................................................................13 Proceeds from the World Championship .............................................................................................................13 Indirect economic impacts – Spreading wealth across the Helsinki Metropolitan region .....................................14 A questionnaire for ticket buyers ..........................................................................................................................14 Social impacts ............................................................................................................................. 17 People, skills, employment ......................................................................................................................................... 17 Volunteering ................................................................................................................................................................ 17 Other social impacts ....................................................................................................................................................18 Sporting and fan cultural legacy .................................................................................................................................19 Tone of discussions in the social media .....................................................................................................................21 Web-based media coverage and tone of news ...........................................................................................................21 Summary and conclusions..........................................................................................................25 PwC Page 2 of 27 Final List of references ........................................................................................................................27 Table of figures Figure 1: Cash flows of the 2012 IIHF Ice Hockey World Championship in Finland3 ............................................ 11 Figure 2: Breakdown of revenue and expenses .........................................................................................................12 Figure 3: Estimated indirect economic impacts ........................................................................................................15 Figure 4: Benefits of using volunteers........................................................................................................................ 17 Figure 5: Questionnaire responses on how the 2012 IIHF Ice Hockey World Championship strengthened or enhanced the following aspects according to the key partners.................................................................................18 Figure 6: Questionnaire responses on the impacts that the 2012 IIHF Ice Hockey World Championship had according to the visitors ..............................................................................................................................................19 Figure 7: Number of ‘likes’ on the Finnish “Lions” Facebook page......................................................................... 20 Figure 8: Number of engaged users on the Finnish “Lions” Facebook page .......................................................... 20 Figure 9: Results of the social media analysis ...........................................................................................................21 Figure 10: Number of news by theme during stages 1 and 2 of the media analysis ............................................... 22 Figure 11: Tone of the news reporting during stages 1 and 2 of the media analysis ............................................... 23 Figure 12: Changes in the tones of the reporting and specific issues covered in the various articles during stages 1 and 2 of the media analysis. .................................................................................................................................... 24 Figure 13: Summary of direct and indirect economic impacts and social impacts................................................. 25 PwC Page 3 of 27 Final Executive Summary Finland is known as a competent host for many world-class sporting events and efficient organisation as well as successful execution of large events have already become a tradition in Finland. Finland has hosted International Ice Hockey Federation (IIHF) World Championships six times since 1965. For Finnish Ice Hockey Association (FIHA) it is important to understand whether and how well the 2012 IIHF Ice Hockey World Championship met the original expectations. FIHA has requested PwC Finland to undertake a review of the socio-economic impacts of the World Championship in Helsinki area and Finland as a whole. The 2012 IIHF Ice Hockey World Championship in Helsinki had, to a large extent, the same drivers as any other major international sporting events: the organisers wanted to strengthen Finland’s image and reputation, attract visitors, leave a cultural legacy of a successful event, increase interest towards ice hockey, offer the visitors an experience to remember, and boost the local economy. As a part of the review PwC looked at the direct economic impacts in terms of the revenue and the expenses for the organiser. Indirect economic impacts on the economy which result from the direct spending were based on the information available about the visitor behavior, for example the transportation and accommodation as well as information obtained through a questionnaire sent to the ticket buyers. Some social impacts were also taken into consideration during the review, in particular the aspect of utilising volunteers in organising the event. The direct financial benefits from hosting the annual World Championships go to Finnish Ice Hockey Association (FIHA) and the International Ice Hockey Federation (IIHF). The direct net result of organising the event was 8.2 million euro. The estimates of the indirect economic impacts were made by projecting the results of the questionnaire sent to the ticket buyers against the official number of ticket buyers. Based on these estimates the World Championship indirect economic impacts were roughly estimated to be 45.6 million euro. The indirect economic impacts take place mainly in the Helsinki Metropolitan area. As the Finnish Ice Hockey Association is co-hosting, together with Sweden, the World Championship in 2012 as well as in 2013 the socio-economic impacts are expected to continue beyond this review. In addition to enhancing the interest towards ice hockey and increasing the fan culture and communality, one of the main social impacts created by the World Championship was the experience offered to the volunteers in helping to organise such an event. Further impacts were adding to the Metropolitan area’s event offering, and the emerging power of social media in engaging audience to share their experiences via new channels. On the other hand, the ticket pricing initiated discussion about the World Championship leaving some fans and families outside of the full experience. The World Championship that was intended to be “for every Finn” and to strengthen the sporting fan culture in Finland ended up being criticized for being the exact opposite. In this sense the organisers did not reach all their goals of bringing the experience to a wide audience, especially for families and junior players. PwC Page 4 of 27 Final Introduction Background and objectives Ice hockey is indisputably the number one sport in Finland and the Finns are known to be extremely enthusiastic ice hockey fans. Therefore the Finnish Ice Hockey Association was very proud to co-host, together with the Swedish Ice Hockey Association, the International Ice Hockey Federation (IIHF) Ice Hockey World Championship in 2012 and in 2013. This was a major international event for Finland, receiving both national and international attention. The World Championship was also promoted overseas by those teams who played in Finland. Matches were played in Helsinki and Stockholm during May 2012, where 16 teams battled in the 15 days of the contest. This World Championship Finland & Sweden was the 76th event in the series, but the first event that has been jointly hosted by two countries. In 2012 the semi-finals and finals were played in Helsinki’s Hartwall Arena, whereas in 2013 they will be played in Stockholm’s Ericsson Globen. The primary goal for the organisers was to ensure that World Championship was arranged in a best possible way for the players. In addition to this, enhancing the participation in sport and in particular in ice hockey was one of the key drivers for the organisers, the Finnish Ice Hockey Association (FIHA) and the World Championship organisation arranged a tour to promote the sport and the World Championship in Finland during March and April 2012. During this time the World Championship’s official mascot Hockey Bird passed through 18 Finnish cities. “Our mission is to make this World Championship an event that every Finn, regardless of age, gender, level of hockey expertise or place of birth, can enjoy,” said Mika Sulin, the general secretary for the 2012 IIHF Ice Hockey World Championship in Finland. The planning and execution of a large event involves significant organisational effort. Organising an event requires competence from many different disciplines, as well as mobilisation of resources in a society at a variety of levels – not least in the form of contribution from the volunteers. Finland is known as a competent host for many world-class sporting events, and efficient organisation as well as successful execution of large events have already become a tradition in Finland. Finland has hosted the IIHF Ice Hockey World Championship six times since 1965. However, good organisation of the World Championship itself is not enough, as the World Championship has a far reaching impact on society and economy, which also needs to be considered. For FIHA it is important to understand whether and how well the World Championship met the original expectations. With this in mind, FIHA has requested PwC Finland to undertake a review of the World Championship. The objective of this is to review the socio-economic impacts of the 2012 IIHF Ice Hockey World Championship in the Helsinki area and Finland as a whole. Another major focus of the review is on the societal impacts as well as on other value creating impacts, which the World Championship had. Approach and methodology The work conducted to review the socio-economic impacts included the following steps: Main financial information of revenue and expences utilised in this study was received from the Finnish Ice Hockey Association. In addition a questionnaire was sent to the ticket buyers via Lippupiste in order to obtain information on visitor spending as well as the views of the visitors on the event. A second questionnaire was sent to the key partners involved in organising the World Championship (e.g. accommodation, catering, transport) to obtain information about the benefits that they experienced from the World Championship as well as their general views about the organisation of the event. Interviews with the key partners were conducted in order to assess the availability of the information for the review. PwC Page 5 of 27 Final A two-part media analysis was conducted as part of the review in order to analyse the media coverage received before and during as well as after the event. In addition a social media analysis was conducted to assess what kind of attention the event received in the social media. The analysis aimed to map the contents and the tone of the discussions within the different channels of social media. A poll was posted on the Finnish “Lions” Facebook page, asking opinions about the most important impacts of the event. Other available information was also used, such as a survey undertaken on the volunteers. 2012 IIHF Ice Hockey World Championship in brief 76th annual IIHF Ice Hockey World Championship Took place in Helsinki and Stockholm on 4. – 20.5.2012 16 ice hockey teams World Championship venue in Helsinki was Hartwall Arena and in Stockholm Ericsson Globen 938 million TV viewers in 114 countries 800 journalists and media representatives attended the event (Helsinki) Turnover of 27.3 million euro (Helsinki) Ticket revenue of 23.3 million euro (Helsinki) 301.000 spectators (Helsinki) PwC Page 6 of 27 Final Organising an international sporting event Driving forces An international sporting event is always a remarkable effort for the hosting organisation. In the way IIHF Ice Hockey World Championships are currently organised, the hosting organisation takes on a lot of the economic risks of hosting the event without any certainties of the number of visitors and paying customers. In the application process many sport event organisers compete against each other since the events give the location desired visibility and media attention in building reputation, as well as economic boost for the region through organising activities and tourism1. International events create additional business as well as opportunities for sponsors and partners, tax income for the government and means for building the city’s image and reputation from both event organising and tourism perspectives. Events also appeal to some of the current residents of the region by offering them experiences and opportunities to participate in the event as spectators or through volunteerism. The 2012 IIHF Ice Hockey World Championship in Helsinki had, to a large extent, the same drivers as any other major international sporting events: the organisers wanted to strengthen Finland’s image and reputation, attract visitors, offer the visitors an experience to remember, and boost the future of the Finnish ice hockey. One of the key drivers named by the organisers was to leave a cultural legacy of a successful event whilst increasing the interest towards ice hockey. Image and reputation of the hosting country In the current global economy, with increased competition over limited resources, countries and regions have to compete against each other for much needed investments creating employment and bringing tax income for the government through consumption and corporate tax1. International events help countries to create additional business as well as act as means for enhancing the city’s image. Countries and cities aim to attract residents, who bring with them revenue (direct and indirect), visitors who bring consumption and goodwill, companies who bring employment and attractive brands, capital investments in the city and region, as well as attention in the global media. Legacy Legacy is usually recognised as bringing long-term economic, social, and/or environmental outcomes for a host city from staging events. Whereas hosting an IIHF Ice Hockey World Championship is a short term, temporary event which may not require significant investments in the infrastructure compared to the olympic games, for example, the social outcome of such an event from a legacy perspective can depend on the success of the hosting country itself in the games. Such legacy has proven to have been especially cherished in Finland, being the small nation that it is on a global scale. In Finland, ice hockey is one of the few sports connecting a wide audience on a national level. According to a marketing study “Sponsorships and values in sporting” conducted by Taloustutkimus Oy in 20112, ice hockey is both the most valued and the most followed sport in Finland, leaving behind athletic sports and football. PwC Sweden (2011): With the Courage to Win: An evaluation of Region Skåne’s participation in the Handball World Championship 2011 2 Taloustutkimus Oy (2011): Sponsorships and value in sporting. 1 PwC Page 7 of 27 Final Experience society During the past decades the nature of sporting events has changed to be more commercial, consumption based as well as more audience engaging3. The event organisers aim at building the event under the concept of experience society where people are willing to spend their money on what they consider to be valuable experiences. To build such an experience, organising an event has grown from a mere facilitation of a contest or a tournament to planning the concept of the event, with a compelling story and offering the people attending the event a chance to participate in something that they consider to be unique, meaningful and entertaining. In addition to the actual World Championship taking place, the organisers build up an environment where the history of the sport is exhibited, legendary players are presented, dining is arranged according to the theme and merchandise is available with a wide range of products. For the 2012 IIHF Ice Hockey World Championship in Helsinki, a fan experience zone called “Hockey Garden” was set up next to the Hartwall Arena in Helsinki. This zone with a free admission was meant to serve as a meeting point for the fans. It held a Restaurant Hall of Fame, Ice Hockey Museum, Fan Megastore, kids and family activities such as face painting as well as some exhibition stands for the partnering organisations. For the World Championship in Helsinki, one of the goals for the organisers was to make the event accessible and available to all and to enable the audience and fans to participate in the event. Before the actual event started, the organisers arranged a hockey tour across Finland, reaching out to younger hockey fans and junior players by bringing some legendary Finnish hockey players to meet the youngsters and to promote the sport for the junior players. The tour took place in 18 cities in Finland as well as Tallinn, Estonia and it had a grande finale in Helsinki, where the Finnish Ice Hockey Association arranged, together with The Association of Friends of the University Children’s Hospitals, a concert with popular Finnish artists. A third of the donations made during the concert were allocated to support the children of low income families in playing ice hockey. The rest of the donations were allocated to the Research Fund of Children’s Diseases and different children’s hospitals across Finland. The hockey tour and the charity concert were both organised to promote the event but also to enable a wider audience in particular younger Finns to get to experience and take part in the event without having to necessarily attend the actual World Championship. Participation society The information age has significantly changed the role of the people attending major events and those following the event via media such as television. Especially the rapid growth of social media platforms such as Twitter and Facebook is having a tremendous impact on the sports world for fans, players, teams and sponsors alike. This is because social media has enabled the general public easy access to the latest news and commentary and lowered the threshold to participate in the discussion through micro blogs and social networks. Even if the proportion of sports fans actively participating, providing content and commenting online is low, it provides the organiser, fans, players and businesses alike an opportunity to increase communication, strengthen the image and the fan community as well as exchange views more than ever before. It is also worth noting that social media around an event usually gets most active when something goes wrong and there is room for criticism. Therefore the rise of social media has brought along better engagement but also higher visibility and vulnerability, as the control of the content is with the users rather than the organiser, for example. Nylund, Laakso ja Ojajärvi (2006): Urheilu, maine ja raha, tutkimuksia vuoden 2005 yleisurheilun MMkisoista. 3 PwC Page 8 of 27 Final Participation in discussions in the social media during the 2012 IIHF Ice Hockey World Championship in Helsinki was very active. The World Championship initiated a lot of discussion in the traditional as well as social media and therefore probably reached a wider audience than such events have done before. Fan culture Organising a sporting event without fans would be a quiet and unmemorable event, far from the experience or feeling of participation that is usually sought after by the event organisers. Fans are the ones cheering the players for a better performance by setting the mood. Fans invest in their appearance, bring on the humour and want to show their support. In Finland, the hockey fans are mostly dedicated to their local Finnish national league teams, but once a year for the World Championship and every four years for the olympic games, they come together to support the Finnish national hockey team. Fan culture is also affected by social media, which allows the fans to come out with their views more, be open in showing others who they support and taking part in conversation concerning matters that have significance for them. One of the main objectives for the 2012 IIHF Ice Hockey World Championship in Helsinki was to build and strengthen the fan culture through organised activities and engagement. The aim was to build a sports culture endorsing history and traditions, taking pride over the national colours, showing a true “Lion spirit” (Finnish fan culture) with positive support and faith in winning. PwC Page 9 of 27 Final Economic impacts Introduction to direct economic impacts 3 The economic impacts of organising a major event usually consist of investments in the infrastructure of the event, the actual organising of the event and the impacts of the visitors of the event.3 Investments in the infrastructure can comprise of the building or constructing either permanent or temporary venues or other facilities, such as participant and visitor accommodation premises. These investments can be financed by the owner of the infrastructure, public subsidies or loan capital. The construction process will employ local contractors, designers, as well as goods and service suppliers. Event organising in itself has a positive economic impact on the local and regional economy as the organisers buy the goods and services from companies in the area, which again buy further goods and services from their suppliers. The organiser may also hire additional people to organise the event whose wages and salaries are consumed in the community together with the wages and salaries of the employees of the suppliers providing services for the organiser. The visitors of the event can be local, national or international. Depending on where they come from and for how long they stay, the visitors will spend money on a range of goods and services, i.e. accommodation, food and refreshments, transportation, shopping, culture and entertainment.3 When considering the total economic impact of an event, it needs to be noted that all the cash flows described do not give a clear picture of the economic impacts of an event. In general, the cash flows from one party to another and it remains unclear which part of the flow might have been spent elsewhere if the event had not taken place. It also needs to be considered whether the event might have a superseding or dislocation effect meaning that because of the event, some other events or activities generating similar cash flows during that same period were not organised or were organised somewhere else. The cash flows of the 2012 IIHF Ice Hockey World Championship are described in Figure 1 below. PwC Page 10 of 27 Final Figure 1: Cash flows of the 2012 IIHF Ice Hockey World Championship in Finland3 Revenue from TV-contracts and international sponsoring Sponsoring IIHF Ticket sales Purchases of services and goods Sponsoring FIHA Salaries Recompenses OWNERS (excl. Municipalities) OF INFRASTRUCTURE (stadium) MUNICIPALITIES OF THE HELSINKI METROPOLITAN AREA FINNISH GOVERNMENT Share of corporation tax revenue Corporation tax, VAT Purchases for investment State income tax Salaries LABOUR OTHER FIRMS TRAVEL AGENCIES PARTNER COMPANIES Purchases of services and goods Salaries Municipal income tax Ticket sales VISITORS (paying, accredited, guests of firms) Salaries PARTICIPANTS (athletes, team officials) Accommodation Direct economic impacts of the World Championship in Helsinki The direct financial benefits from hosting the annual World Championships go to Finnish Ice Hockey Association (FIHA) and the International Ice Hockey Federation (IIHF). IIHF operates as the main engager of the event and through its partner organisation Infront Sports and Media Ag it manages the international sponsorships and television broadcasting rights. IIHF has sold all marketing and broadcasting rights to Infront Sports and Media Ag who sells them on to national broadcasters. The World Championship in Helsinki and in Stockholm was broadcast in over 100 countries and territories worldwide with 70 broadcast partners.4 In Finland the broadcast partners were MTV Oy and Canal+. It was the first time in Finland when viewers needed to pay separately in order to watch all the games. However, all the games of the Finnish team together with the quarter and semi finals and finals were broadcast for free in accordance with the Finnish State Council’s recommendation to provide all nationally significant sporting events for free of additional charge to the viewers. Infront Sports and Media Ag and MTV Oy do not disclose the value of the broadcasting rights agreements as they are considered to be commercially sensitive information, so the cash flows relating to these, together with sponsorship agreements between Infront Sports and Media Ag and international sponsors such as Skoda have been left outside of the scope of this review. Instead the review focuses on the cash flows to and from the Finnish organiser together with some of the indirect cash flows generated by the visitors of the event. 4 Infront Sports and Media (2011): Facts and Figures: 2012 IIHF Ice Hockey World Championship. PwC Page 11 of 27 Final International sponsors, in addition Skoda, include for example AJ, Bauhaus, Henkel, Kyocera, Megafon, Nike, Nivea, Oxota, Raiffeisen, Tissot and Zepter. Revenue The revenues for the organiser mainly comprise of the ticket sales, income from sponsorship and some other income. Organisers received 23.3 million euro as ticket sales revenue, 2.6 million euro as marketing and sponsorship revenue and 1.4 million euro as hospitality and other income. The breakdown of revenue and expenses is presented in the Figure 2 below. Figure 2: Breakdown of revenue and expenses 2012 IIHF Ice Hockey World Championship Revenue Ticket sales MEUR 23.3 Marketing and sponsorship 2.6 Hospitality (commissions) Other income incl. restaurants, merchandise, travel agencies (commissions) Total 0.8 0.6 27.3 Expenses Administration and finance (inc. insurance and ticket sales costs) IIHF and Infront Ag 3.9 Construction 2.7 Marketing 2.6 Sports Activities 2.1 Program and information 1.4 Teams 0.9 Security 0.8 Transportation 0.4 Total Net result 4.3 19.1 8.2 Ticket sales Approximately 301.000 spectators attended the event generating revenue of 23.3 million euro. The tickets were priced by category and the prices ranged from 35 euro to 320 euro per ticket. In addition to the tickets sold, some were given to various stakeholders such as sponsors and partners. Visitor spending and views of the event are discussed in the following chapters. Marketing and sponsorship Marketing and sponsorship are an integral part of organising commercial events nowadays and in general, sponsorship holds a unique position in the marketing mix for companies because contributes to building brand awareness, providing differentiated marketing platforms, facilitating direct business benefits and providing valuable networking and hospitality opportunities. The World Championship had 24 official domestic sponsors in addition to the IIHF head sponsor Skoda. The revenue from the sponsors to the organiser amounted a total of 4 million euro for 2012 and 2013. In return the sponsors got tickets for bringing guests to the World Championship as well as visibility in the marketing materials and the arena. PwC Page 12 of 27 Final Hospitality and other income In addition to ticket and sponsorship sales, the organiser received a proportion of hospitality sales, merchandise sales, travel agency sales and restaurant sales. The revenue generated from these activities was 1.4 million euro. Expenses of the organiser The expense budget of the organiser amounted to a total of 19.1 million euro, out of which 4.3 million euro was paid as administrative expenses including wages and salaries for nearly 30 people working approximately 6.000 days in preparation as well as during the three weeks of the event. Some 3.9 million were paid as the event organiser fee to IIHF and Infront Ag together with congress, program and accommodation fees for IIHF representatives. In addition 2.7 million was paid as construction expenses for investment in infrastructure at the arena, 2.6 million as marketing expenses, and 2.1 million as direct expenses relating to the World Championship such as rent for the venue, referee payments, ceremonies etc. Other significant expense items include transportation services, communications and medical costs. Overall the World Championship in Helsinki had nearly 50 goods and services suppliers. Investments in infrastructure As the arena, which served as the main venue in Helsinki, already existed at the time of the event, no significant investments in infrastructure were required. However, the Arena required temporary construction work to be conducted in order to bring the dressing rooms, media facilities and representation facilities up to the desired level. In addition, other temporary structures such as the ‘Hockey Garden’ were built. The costs of the construction work were significant for the organiser and amounted up to 2.7 million euro. Proceeds from the World Championship The proceeds from the World Championship will be handed to the Finnish Ice Hockey Association. From there the money will be directed towards coaching and junior activities. Amongst other initiatives, FIHA envisages an annual investment of 750.000 a year on training and salary costs 0f approximately 25 new skills coaches. PwC Page 13 of 27 Final Indirect economic impacts – Spreading wealth across the Helsinki Metropolitan region Indirect economic impacts from an event are generated by an additional demand for goods and services by the visitors attending the World Championship: hotels and other accommodation, restaurants, transportation, travel agencies, culture and recreation. Visitor spending in this review is limited to visitors who have purchased tickets to the World Championship via Lippupiste. Based on the figures available at the Finland’s Office of National Statistics there has been approximately 1% increase in the utilisation rate of the hotels in Helsinki from May 2011 to May 2012. The average room price has also increased from 105 euro in May 2011 to 125 euro in May 2012.5 The impact the World Championships had on transportation in Helsinki was also analysed. No increase was noted in the use of taxis during the event when comparing the passenger numbers between May 2011 and May 2012. Some additional passenger numbers were noted in the VR trains. Additional costs for Helsingin seudun liikenne (HSL) for providing public transport during the event was approximately 10.000 euro. This includes additional payments made to VR (national rail) and the bus operator. It can be estimated that during the World Championship the visitors spent approximately 250.000 euro for travelling to and from the games via public transport. As part of the co-operation HSL also provided passes for 5.000 people that were accredited for the event. A questionnaire for ticket buyers A questionnaire was sent to the ticket buyers after the World Championship were concluded in order to estimate the indirect economic impacts for the Helsinki region. Approximately 15.000 questionnaires were sent to those visitors that bought their tickets via Lippupiste and 2.250 responses were received, which represents a 15% response rate. The questionnaire enables a projection of the visitor spending during the World Championship. This projection includes only visitors who bought their tickets, as the visitors who were invited to the World Championship and did not pay for the tickets themselves are assumed to have had a different type of consumer behaviour during the event. The questions covered for instance visitor spending on various products and services. Qualitative questions concerning the arrangements of the World Championship and general opinions about the World Championship were also included in the questionnaire. According to the questionnaire, each visitor spent on average 354 euro in Helsinki during their visit, out of which 180 euro was on accommodation, 98 euro on food and drinks, 20 euro on transportation and 56 euro on merchandise and other shopping. By utilising the results an estimate of the indirect economic impacts of the World Championship has been made. This estimate is presented in Figure 3. 5 Tilastokeskus (toukokuu 2011 ja toukukuu 2012): Hotellikapasiteetti ja sen käyttö. PwC Page 14 of 27 Final Figure 3: Estimated indirect economic impacts Estimated indirect economic impacts (M€) 18 16 17 16 14 12 9 10 8 6 3 4 2 Accomodation Other products Transportation Food and beverage The estimates have been made by projecting the results of the questionnaire against the official number of ticket buyers. The estimates take into account various factors, e.g. if the visitor came from abroad or lives in the Helsinki metropolitan region. Accommodation and food and beverage account for a majority of the visitors’ spending. Other spending includes World Championship merchandise as well as general product purchases. The estimated spending on transportation covers travel to Helsinki as well as travel within the Helsinki Metropolitan region. In total, the World Championship indirect economic impacts were roughly estimated to be 45.6 million euro, which is considerably higher than the direct net result. The indirect economic impact takes place mainly in the Helsinki Metropolitan area. Tax benefit for the public sector in the form of non-recoverable value added tax (VAT) is estimated to be over 2 million euro. The additional demand for the services might have required the service providers to schedule additional working shifts, which has created employment and in the end an increased income tax effect, but these effects are out of the scope of our review. In other economic impact studies it has also been concluded that the main impacts of the major sporting events are focused on the investments made prior to the events and that short-term temporary events do not usually have longer term economic impacts to the economy or employment in the area3,6. What matters the most is the hosting region’s ability to attract the visitors and make them come back in the future as well as also to get them to recommend the location to their networks. However, many of the impact studies regarding major international sporting events such as the Olympic Games, have concluded significant legacy impacts. In a study by Visa Inc, concerning the 2012 London Olympic Games, the study concluded that the expected increase in international visitor expenditure can be equivalent to Kaupunkitutkimus TA Oy (2008): Eurovision Song Contest Helsinki 2007, Laulukilpailut yhteistyökumppanien ja yritysten näkökulmasta. 6 PwC Page 15 of 27 Final a rise of around 18% in tourist spending compared to the levels that would be expected to occur had the Olympic Games not taken place.7 These estimates are additional to the normal seasonal uplift effects.7 Visa Europe (2012): Realising a Golden Opportunity: Visa Europe’s London 2012 Olympic and Paralympic Games Expenditure and Economic Impact Report. 7 PwC Page 16 of 27 Final Social impacts Arranging an international sporting event has several social impacts: engaging people, strengthening local cooperation, creating employment and bringing experience and building capacity in event organising that can be utilised in the future. International sporting events can boost the tourism and bring diversity and multiculturalism to the streets of the hosting region.3 People, skills, employment Nearly 30 people were working either full-time or part-time for the Helsinki event. In addition close to 900 volunteers offered their time to work for the World Championship and almost 50 cheerleaders entertained the visitors during the breaks at the game and almost 50 suppliers of goods and services were involved in organising the event. All the parties involved have gained experience in organising and participating in an international sporting event and this knowledge can be used for their benefit in the future. For the Finnish Ice Hockey Association, the event will act as a demonstration of their organising skills and as a reference for organising similar events in the future. Also the volunteers may well benefit from the experience they gained in the future. The Finnish Ice Hockey Association employed a range of people to organise the event. These people worked for a period ranging from several months to several years. It can be estimated that organising the event created approximately 6.000 working days which equates to approximately 24 years of employment. In addition to these directly employed people several suppliers of goods and services were used in organising the event. Contractors were used for example, for security, transportation and construction services. Volunteering Organised sporting in Finland is heavily dependent on the volunteers. From the children’s little league games to the major international sporting events organised, volunteers account for a significant part of the resources needed to run the activities. Usually sporting event volunteers have either a background in the sports in question, or they are volunteering to support the local sporting association where their children play. At a local level volunteers enable competitive activity. During the World Championship, the Finnish Ice Hockey Assocication had nearly 900 volunteers working in different areas ranging from building the venue to hosting the teams, from game operations and medical aid to communications and IT. In total, the volunteers worked approximately 50.000 hours during the three weeks of the event, which corresponds to roughly 500 thousand euros in saved wages and salaries for the organiser. Out of the volunteers, 250 persons were students at the Helmi Business College and 36 young unemployed persons participated through a partnership with The Personnel Centre of the City of Helsinki. FIHA provided the volunteers with training and clothing. Figure 4: Benefits of using volunteers Volunteering Approximate number of volunteers 900 Hours worked by volunteers 50.000 FTE (number of person years) 26 Estimated value of the volunteer work (€) 500.000 According to a questionnaire sent to the volunteers after the event by AMK of Lahti in their 2012 study ‘Vapaaehtoistyö urheilutapahtumassa: Case Jääkiekon MM-kilpailut 2012’, a third of the respondents were volunteering for the first time, approximately one out of four had volunteered 1-3 times before the World PwC Page 17 of 27 Final Championship in Helsinki and one out of five had volunteered ten or more times8. The remaining volunteers indicated that they had volunteered between 4-9 times. The motivation for volunteering varies. Almost 60 percent of the respondents named their interest in ice hockey and the wish to be a part of arranging the event as the main reasons for applying. Half of the respondents were also seeking for new experiences and one out of four named their general interest towards volunteering. One out of five also wanted to meet new people, and thought that the experience would benefit them later on in work-life or studies. New experiences, the atmosphere and new friendships were named as the best outcomes for the volunteers for participating in organising the event. In their open responses to the questionnaire, the volunteers expressed some criticism towards the outfits they were required to wear as well as the food offerings at the Arena. Considering how the food and outfits were the main compensation offered to the volunteers, according to many of the respondents better quality was expected from both. Volunteers were also hoping for more practical and team focused training instead of mass training for all groups. Other social impacts A separate questionnaire was also sent to the key partners involved in organising the World Championship. The questionnaire was sent to 76 companies and 29 responses were received giving a response rate of approximately 40%. The purpose of this questionnaire was to evaluate the benefits that the organisations gained from the partnership, as well as to investigate the key partners’ views on how the World Championship impacted society at large. Figure 5 below summarises the results from the questionnaire responses. Figure 5: Questionnaire responses on how the 2012 IIHF Ice Hockey World Championship strengthened or enhanced the following aspects according to the key partners In your opinion, on a scale of 1-4, how significantly does the World Championship strengthen or enhance: 8 Lahden AMK (2012): Vapaaehtoistyö urheilutapahtumassa: Case Jääkiekon MM-kilpailut 2012. PwC Page 18 of 27 Final The questionnaire for the key partners included a question in which different strengthening or enhancing effects of the World Championship concerning various aspects were investigated. The World Championship was naturally seen to have the greatest strengthening effect on the interest towards ice hockey together with effects on fan culture and communality. The World Championship was seen as having the least effect on Finland’s image as a nation and on Finland’s national identity and pride. However, the differences between the different aspects were not considerable as can be seen in Figure 5. According to the questionnaire over 70% of the key partners were of the opinion that as a result of their involvement in the World Championship their organisation received new customers and that it was financially beneficial for them to be involved in the World Championship. In general, the corporate partners were more positive than the visitors towards the benefits the World Championship has brought. Results of the visitor’s questionnaire are presented below in Figure 6. Figure 6: Questionnaire responses on the impacts that the 2012 IIHF Ice Hockey World Championship had according to the visitors On a scale of 1-4, how significantly does the World Championship strengthen or enhance: Similarly to the key partners, according to the visitors the World Championship was seen to have the greatest strengthening effect on the interest towards ice hockey together with effects on fan culture and communality. The World Championship was seen as having the least effect on the metropolitan area’s well-being. Sporting and fan cultural legacy One of the roles of international sporting events is inspiring youngsters to play ice hockey. The hockey tour that was organised across Finland, reached out to hockey fans and junior players outside the Helsinki area by bringing some legendary Finnish hockey players to meet the youngsters and to promote the sport for the junior PwC Page 19 of 27 Final players. The aim was to build a new generation sports culture endorsing history and traditions, taking pride over the national colours, showing a true “Lion spirit” with positive support and faith in winning. According to a poll posted in the Finnish “Lions” Facebook page, 690 people of the 867 people who voted (so nearly 80 percent), considered the development of fan culture and the feel of communality as the most important impacts of the event. Other options provided in the poll were increasing the Finnish national identity and pride, enhancing club and voluntary activities, increasing wellbeing in the Helsinki area, and increasing interest towards ice hockey as well as progressing collaboration between companies. The number of ‘likes’ increased on the Finnish “Lions” Facebook page steadily before the World Championship as presented in Figure 7 below. Figure 7: Number of ‘likes’ on the Finnish “Lions” Facebook page Total Likes 315000 310000 305000 300000 295000 290000 285000 280000 Figure 8 below presents the number of users that were engaged (engagement includes any click or story created) on the Finnish “Lions” Facebook page. The number of engaged users experienced a dip during the World Championship, which could be accounted for by the discussions and media coverage of the ticket pricing. Figure 8: Number of engaged users on the Finnish “Lions” Facebook page Engaged Users 500000 400000 300000 200000 100000 0 PwC Page 20 of 27 Final Tone of discussions in the social media An analysis was conducted in order to map the contents and tone of the discussions within the different channels of social media. The analysis covers discussions from two weeks before to two weeks after the World Championship. The analysis focused on sources from Finland and included for example discussion forums, blogs and twitter feeds. The main topic of conversation was the ticket pricing, which covers about 40% of the conversations included in the analysis. The ticket pricing received negative attention in the social media mainly concerning the high pricing of the tickets available. Also the cost structure of the World Championship received negative attention. It covered nearly 20% of the conversations analysed in the social media. Over 90% of the discussions included in the analysis were of negative tone. The positive comments covered various aspects of the games. The results of the social media analysis are shown in the Figure 9 below. Figure 9: Results of the social media analysis 60 50 40 30 Tone of the comments Neutral Negative 20 Positive 10 0 Web-based media coverage and tone of news This chapter of the report covers a media analysis, which was conducted as a part of the review of the socioeconomic impacts of the 2012 IIHF Ice Hockey World Championship. Wide media visibility and coverage help multiply the impacts and effects of a major sporting event, and also influence the wider effects of sporting events such as the image of a country, national identity and pride and the interest towards the sport in question. The media analysis was carried out in two stages, and covered Finnish web-based media. The first stage was conducted on the 11th of May, during the World Championship, and covered a time period from the 1st of April onwards. This stage focused on finding out the issues, and tone of issues, covered in the Finnish media before and during the World Championship. Over 700 hits were included in the first stage of the analysis. The second stage was carried out after the World Championship had ended on the 29th of May and focused on the media coverage and tone of reports after the World Championship. Over 400 hits were included in the PwC Page 21 of 27 Final second stage of the analysis. A web-based search tool was used in conducting the media analysis. The findings were categorised according to the theme of the article and according to the tone of the article. After a preliminary screening, six different categories were created: “Games/results”, “Teams”, “Players”, “Organisation and event organisers”, “Ticket pricing” and “Other issues”. Figure 10 below shows the amount of hits on various categories. Figure 10: Number of news by theme during stages 1 and 2 of the media analysis 250 200 150 100 50 0 The “Games/results” category comprises of news about specific games and the results of the games. This category was naturally the largest of all six categories during both stages of the analysis. The second largest category, “Teams”, comprises of news about the teams, for instance player nominations, team line-ups and team activities. The news on individual players were not included in the “Teams” category, as the amount of hits concerning specific players (e.g. player presentations and interviews) was relatively large. During the first stage of the analysis, the ticket pricing (high ticket prices) received negative publicity in the media. This negative publicity had however faded out during the second stage of the analysis. The natural reason for this is that the World Championship had come to an end. Additionally the changes in the pricing policy (discounted tickets) as well as the organisers public appearances regarding the ticket prices may have affected the number of news in this category after the event. The final category, which received the least hits in the media analysis, was “Organisation and event organisers”. This category included news on how the event organisers had succeeded (focus on arrangements at Hartwall Arena), what the atmosphere during games was like and how the broadcasting of various games (pay channels) had succeeded. The category “Other issues” mostly included news coverage of general hockey related issues, such as the two former famous hockey players, the Finnish television commentators and the partying of various teams (behavior and effects on players). The World Championship organisation and Finnish hockey profiles also received some criticism concerning their actions regarding the World Championship, which was categorised in the “Other issues” category. PwC Page 22 of 27 Final Figure 11 shows the tone of the news reporting during stages 1 and 2 of the analysis. Figure 11: Tone of the news reporting during stages 1 and 2 of the media analysis 100 % 90 % 80 % 70 % 60 % 50 % 40 % 30 % 20 % 10 % 0% Neutral Negative Positive The news about the games/results, teams or players were mainly neutral or positive in tone. When excluding the results of the first three categories (games, teams and players), news about the World Championship can be seen as quite negative. This may be due to the general public’s dissatisfaction concerning the ticket pricing, which almost exclusively received negative media attention. The negative attitudes may have had an impact on reporting on the event organisers as well. The category “Other issues” had mainly a neutral tone in the news. PwC Page 23 of 27 Final Figure 12 below shows the changes in the tones of the reporting, as well as specific issues covered in the news. Figure 12: Changes in the tones of the reporting and specific issues covered in the news during stages 1 and 2 of the media analysis. Category Number of news stage 1 & 2 Tone of news stage 1 & 2 Main themes Games/Results 218 154 Result and rosters No changes in the theme in between the stages Teams 217 96 Team practices and line-ups The latter stage had a focus on how the teams had played Players 117 93 Successes and nominations In the second stage focus was on players’ success and failures Organisation and event organisers 47 19 Broadcasting of the World Championship and the atmosphere in the audience The second stage saw an increase in the analysis of audience numbers and the music played during games Ticket pricing 72 9 Costliness of the tickets, discounted tickets and the pricing policy in Sweden New issues during the second stage Championships’ tickets vs. NHL ticket pricing Other issues 78 57 Two former ice hockey players, criticism against the championship organisation, “hockey quiz” and additional activities New issues included the partying of various teams and Finnish commentators Neutral PwC Positive Negative Page 24 of 27 Final Summary and conclusions Summary of the main economic and social impacts is presented in Figure 13. In addition to those summarised in the Figure 13, some additional impacts as assessed by key partners and visitors (see pages 18-19) were recognised. Figure 13: Summary of direct and indirect economic impacts and social impacts Area Indicators Direct output Indirect output Outcome Direct economic impacts Net result for FIHA 8.2 million € Additional coaching has been arranged for junior players Increased coaching services for junior players Indirect economic impacts Impact on the Helsinki region 45.6 million € (estimated) Additional demand for goods and services by the visitors Increased spending in the Helsinki Metropolitan area Additional expenditure of goods and services Monetary flows for suppliers Supplier employment, tax income for communities and government Increased demand for goods and services, more tax income Charitable income Fund raised in the charity concert (104.000 € inc. VAT) Donations allocated to Children’s hospitals, Research Fund of Children’s Diseases, and to support the children of low income families in playing ice hockey Health services and research on children’s diseases, availability of ice hockey as a hobby for low income families Volunteering 50.000 working hrs Value of volunteer work 500.000 € (estimated) Competitive advantage when applying for the World Championship or other large events by being able to show the value of the volunteer work Volunteering Estimated 140 hours on training the volunteers Training and development received, improved employment opportunities Capacity building, new experiences, the atmosphere and new friendships for the volunteers Interest towards ice hockey Hockey tour in 18 cities with estimated 12.000 – 15.000 participants in total Helping to raise the awareness towards the World Championship Increased visibility and increased interest towards ice hockey Social impacts Based on the review conducted of the socio-economic impacts, the direct economic impacts of the 2012 IIHF Ice Hockey World Championship in Helsinki were relatively neutral in relation to the economy of the greater Helsinki area. The reason for this is that direct financial benefits from hosting the annual World Championships go to Finnish Ice Hockey Association (FIHA) and the International Ice Hockey Federation (IIHF). The direct net result of organising the event was 8.2 million euro. PwC Page 25 of 27 Final Based on these estimates made, the World Championship indirect economic impacts were roughly estimated to be 45.6 million €, which is considerably higher than the direct net result. The indirect economic impacts take place mainly in the Helsinki Metropolitan area. In addition, the tax benefit for the public sector in the form of non-recoverable value added tax (VAT) is estimated to be over 2 million euro. In addition to enhancing the interest towards ice hockey and increasing the fan culture and communality, one of the main social impacts created by the World Championship was the experience offered to the volunteers in helping to organise such an event. The importance of volunteers has been widely acknowledged in arranging international events. One of the main drivers for applying as a volunteer in the World Championship was the general interest towards ice hockey and willingness to gain new experiences. Based on the feedback from volunteers however, some did not feel as appreciated as they would have expected. As presented in Figure 13, the monetary value of volunteerism in Helsinki was an estimated 500.000 euro, which corresponds to approximately 3 percent of the expenses. Further impacts were adding to the Metropolitan area’s event offering, and the emerging power of social media in engaging audience to share their experiences via new channels. On the other hand, the ticket pricing initiated discussion about the World Championship leaving some fans and families outside of the full experience. The World Championship that was intended to be “for every Finn” and to strengthen the sporting fan culture in Finland ended up being criticized for being the exact opposite. In this sense the organisers did not reach all their goals of bringing the experience to a wide audience, especially for families and junior players. The World Championship initiated a lot of discussion in the traditional as well as social media and therefore probably reached a wider audience than such events have done before. Criticism towards events spreads around quickly in social media. This is the downside of the participation society, whilst making it possible ‘for every Finn’ to take part in discussions about the World Championship. Based on the questionnaires, the organisers succeeded in the practical arrangements, which further strengthen Finland’s reputation as a good event organiser. Based on a study conducted by IIHF, co-hosting was mostly viewed positive by fans as well as sponsors and nearly 90% of the respondents thought that co-hosting could have a positive effect on ticket sales9. Main outcomes of the review are that the financial planning of an event needs to go tightly hand in hand with the social goals set for the event. If participation of the fans together with a stronger fan culture and engagement with the fans is desired, then it needs to be ensured e.g. the ticket pricing is designed so that it allows a wide variety of public to attend the event. The organiser has adjusted the ticket pricing for the World Championship in 2013. 9 IIHF (2010): First insight on competition format and co-hosting research findings. PwC Page 26 of 27 Final List of references 1. PwC Sweden (2011): With the Courage to Win: An evaluation of Region Skåne’s participation in the Handball World Championship 2011 2. Taloustutkimus Oy (2011): Sponsorships and value in sporting. 3. Nylund, Laakso ja Ojajärvi (2006): Urheilu, maine ja raha, tutkimuksia vuoden 2005 yleisurheilun 4. Infront Sports and Media (2011): Facts and Figures: 2012 IIHF Ice Hockey World Championship. 5. Tilastokeskus (toukokuu 2011 ja toukokuu 2012): Hotellikapasiteetti ja sen käyttö. 6. Kaupunkitutkimus TA Oy (2008): Eurovision Song Contest Helsinki 2007, Laulukilpailut yhteistyökumppanien ja yritysten näkökulmasta. 7. Visa Europe: Realising a Golden Opportunity (2012): Visa Europe’s London 2012 Olympic and Paralympic Games Expenditure and Economic Impact Report. 8. Lahden AMK (2012): Vapaaehtoistyö urheilutapahtumassa: Case Jääkiekon MM-kilpailut 2012. 9. IIHF (2010): First insight on competition format and co-hosting research findings. PwC firms help organisations and individuals create the value they’re looking for. We’re a network of firms in 158 countries with more than 180 000 people who are committed to delivering quality in assurance, tax and advisory services. Tell us what matters to you and find out more by visiting us at www.pwc.com or the PwC Finland page at www.pwc.fi. This publication has been prepared for general guidance on matters of interest only, and does not constitute professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this publication, and, to the extent permitted by law, PricewaterhouseCoopers Oy, its members, employees and agents do not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it. © 2013 PricewaterhouseCoopers Oy. All rights reserved. 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