What can New Zealand learn from the 2010 Football World Cup?

As New Zealand gears up to showcase its numerous attractions and sporting prowess to an anticipated 85,000 foreign visitors - and millions more who will view the matches on television - businesses are fine tuning their plans to get maximum exposure, and income, from this much-hyped event.

We look at the South African experience in 2010, examine the parallels and lessons we can learn, and explore the steps that businesses in New Zealand should take to turn this into a superlative event for everyone.

The Football World Cup in South Africa

“In 2010 the world was rather shocked to discover two things about South Africa,” said Gavin Chait, Risk Analyst and Strategist for London-based Whythawk. “First, that it’s rather a long way away and British Airways and South African Airways found rather creative ways of exploiting their almost total monopoly on long-haul landing rights there. Second, that South Africans take sport rather seriously and can host a budget-busting sporting extravaganza as well as anyone.”

“Over the course of four weeks, in June and July last year, 309,000 international visitors arrived and found the infrastructure good, the people friendly and they had a fantastic time. The country held together although the much-vaunted economic benefits failed to materialise.”

“South Africa is hardly alone in experiencing financial losses from hosting these big-ticket events but may have been a tad naïve in expecting the sorts of returns they did,” continued Chait.

“Many of the hotels, which opened in expectation of the mass bookings and tourism spin-offs during and after the event, were disappointed. FIFA returned thousands of bookings too late for hotels to do much about it. They also returned tens of thousands of airplane tickets.”

“It is likely that these pre-emptive bookings had both driven up prices and deterred visitors, who decided to stay home and watch the festivities on television.”

Chait explained that all logos and all imaginable variations of the words 2010 Soccer World Cup, or in our case, Rugby World Cup 2011, are trademarked and the manufacture or sale of branded memorabilia or use of these words in advertisements and printed media is not allowed, except by licensed trademark holders.

The reality of these mega-sporting events is there is a lot of regulation around business opportunities at these events and little opportunity for entrepreneurs to jump onto the profit-making bandwagon unless they’re large enough to be official sponsors – most of these are legally tied-up and carefully monitored.

The Rugby World Cup in New Zealand

So what can New Zealand businesses realistically expect from RWC 2011 scheduled to run from 9 September to 23 October? Apart from both being sport-mad long-haul destinations are there any lessons we can learn?

RWC 2011 is a much smaller event that the Soccer World Cup (SWC) hosted by South Africa. We’re expecting between 81,000 and 85,000 visitors compared to 309,000, and TV viewers are expected to be about 30-million for the RWC 2011 final compared to 300-million for some SWC matches.

Despite this difference, New Zealand is likely to benefit economically from the event, while South Africa didn’t. Unlike South Africa, which poured millions into building new infrastructure and facilities, New Zealand is for the most part making use of existing stadia and infrastructure.

“New Zealand should make money out of the event at the economy level – less on TV rights, but more overall as it is spending less,” said Liston Meintjes, an independent financial consultant based in South Africa. And more money in the New Zealand economy should have a positive knock-on effect for all businesses, explains Meintjes. Businesses also stand to benefit from the TV coverage and general exposure and goodwill that New Zealand will generate in the lead-up to, and during, the event.

Like South Africa, most of the opportunities for Kiwi businesses will be in specific sectors like accommodation, travel, tourism and hospitality – both in the host centres and match towns and cities, and in the surrounding tourist areas.

Businesses in the entertainment, restaurant, accommodation and tourism sectors will need to prepare to make the most of the event. Businesses outside those sectors should look for ways to add value to the tourism experience or supply items that might be needed by these sectors – like refurbishments and upgrades, linen and toiletries, signage, PR or websites.

How can you prepare?

With less than six months before the grand kick-off in Eden Park, New Zealand’s largest stadium, the best way for businesses to prepare to make the most of the RWC 2011 is to identify the opportunities and challenges they face – and find ways to maximise the opportunities and remove the obstacles.

Brainstorm with staff, businesses peers, colleagues and mentors to ensure you draw up a comprehensive list of the opportunities and obstacles particular to your business.

If, for example, you’re expecting some business from foreign tourists, can you provide information or sales service in foreign languages? Can you make it easier for visitors to work out the cost of goods or services in their own currency? Are you going to offer additional services like free WiFi or Internet access to attract customers? Is it easy for people to find and access your business – is your signage adequate and do you have enough parking or other facilities?

It might be more viable to set up joint ventures with other businesses. Can you offer an interesting tourism experience or package? Can you collaborate to make unique, or even personalised “made in New Zealand” gift packs?

Do you have an easy-to-use website that offers up-to-date information and have you arranged to print and distribute pamphlets advertising your business at Info Centres and other strategic places?

Even if your core business is not likely to benefit directly from RWC 2011 you might be able to identify opportunities that you can leverage with a little thought and planning. At the worst case, using the attention around the games makes it strategically a good time to launch a new product, or open a new branch or office overseas. It would also be a good time to find out if any potential overseas customers, buyers, partners or agents are coming over for the games. Can you schedule a few important business meetings with contacts travelling to New Zealand?

A word of caution

There are restrictions on the use of the words Rugby World Cup or RWC 2011 and you can’t use these words in advertising or sell memorabilia with these words unless you are an official RWC 2011 sponsor. You can find out more information on the official RWC 2011 website.

Written by Sharon Davis - Lead Writer, The Small Business Company Limited.
Any views expressed in this article are the views of The Small Business Company Limited and do not necessarily represent those of BNZ, or its related entities.

Disclaimer

The information in this publication is provided for general information only, and is a summary based on selective information which may not be complete for your purposes. This publication does not constitute any advice or recommendation with respect to any matter discussed in it, and its contents should not be relied on or used as a basis for entering into any products or taking such actions described in it. Bank of New Zealand strongly recommends recipients seek independent legal and financial advice prior to acting in relation to any of the matters discussed in this publication. To the maximum extent permissible by law, neither Bank of New Zealand nor any other person involved in this publication accepts any liability for any loss or damage whatsoever which may directly or indirectly result from any information contained in or omitted from (whether negligently or otherwise) this publication.