Monday, July 2, 2012

Kimberly Rielly: The Economy of Adirondack Events

Lake Placid Horse ShowsWell, it’s officially summer.

I know this for a number of reasons; my two-wheeled vehicles are all tuned up and at the ready, the shoes piled near the door at my house are primarily open-toed, my golf clubs live permanently in the trunk of my car, I have at least one patch of poison ivy on my arm, and of course, the ratio of regional events per day has increased dramatically.

As a destination marketing organization (DMO) communicator, I’ve said it before: outdoor recreational opportunities; hiking, biking, paddling and the like are what draw visitors to the region. So how do events fit into the tourism equation?

OK, I’ve used the words “ratio” and “equation” in just two paragraphs, so I might as well issue a disclaimer: essentially, I’m a letters girl, not a numbers girl. However, I do keep track of economic impact data for major regional events – just in case someone asks.

I categorize events into two main categories: those that drive overnight visitation, and therefore result in the greatest economic impact, and those that enhance the experience of leisure travelers and residents already in close proximity to the event.

Generally, the latter includes events such as the arts and cultural performances that dot the Adirondack landscape, weekly demonstrations at the Olympic venues, and events that appeal to a general consumer, such as community Independence Day celebrations or an Oktoberfest. These events play a very important role as they diversify and enhance the overall visitor experience, and help to define the destination’s image.

Events that drive overnight visitation are also “weatherproof”. This doesn’t mean that if it rains they don’t get wet.  Rather, it means that the market for the event will attend despite economic conditions.  For instance, even if the price of gas is higher, competitors will still flock to Ironman Lake Placid and riders will attend the Americade motorcycle rally based in Lake George.

Communities and organizations often build events for themselves, and there are three required ingredients for them to be successful: time, volunteers and money.

I present the Adirondack Marathon and Distance Festival as a successful example of this type of event. In the 1990‘s, Schroon Lake was part of a destination planning process that listed shoulder season event creation as having the potential for positive economic benefit to the community. At that time, one of the community leaders happened to circumnavigate Schroon Lake via car, and determined that it was 26-mile loop. Soon after, the Schroon Lake Marathon was born. Now in its 16th year, the event incorporates a marathon, a half, and two relays in late September. It has taken community investment of money and time, and hundreds of volunteers to maintain its success as runners from all over pay their entry fees and stay in the area to run this Boston Marathon qualifier.Lacrosse

What our DMO has found, though, is that successful events, and the best chance to result in guaranteed attendance and a positive return on investment, are driven by the private sector.

Not only is a private entity concerned with adhering to the budgeted bottom line and existing demand for an event, but these events typically attract a very specific niche demographic, and organizers invest in targeted promotion to that specific market.

Examples of these events include Can Am Hockey and Canadian Hockey Enterprise events in Lake Placid, which fill the lodging properties during shoulder seasons and mid-week periods that would otherwise be slow. The Americade event brings thousands of motorcycle enthusiasts to explore the entire region, spending money on dining and shopping and lodging along the way. Ticonderoga and other lakeside communities benefit from the significant bass fishing tournament schedule on Lake Champlain.

The Lake Placid Horse Shows, the Ironman competition, Rugby and Lacrosse tournaments all top the list of events that support the sustained economy of the destinations in which they take place.

It bears mentioning that these types of events benefit the destination economically in direct correlation to the infrastructure available to host them. For example, Lake Placid has ice rinks for hockey, fields for lacrosse, and sufficient lodging to accommodate the groups. To derive economic benefit, the destination has to have the appropriate infrastructure (read: cash registers to collect the money).

Some of these events, whether a bike race or parade, require road closures and other types of interruptions.  Do we all have to endure hardship so that the tourism-related businesses can prosper? Our elected officials often hear these complaints, as was confirmed in a recent conversation I had with Randy Douglas, the Chair of the Essex County Board of Supervisors.  He puts it in context: “I sympathize with our residents’ frustrations when their everyday routines are disrupted. However, with the volume of tourists attracted to our area, the increase in revenues of sales and use taxes help offset the overall burden of property taxes on our year-round constituents.”

There are valuable ancillary benefits to these bigger events, too. Internationally-known Ironman garners Lake Placid a tremendous amount of media exposure, and supports the destination’s identity as a competitive sports center. Likewise, in the context of the lacrosse world, Lake Placid is known as a premiere destination for the fastest growing sport in the U.S.

Now, from a letters girl, here’s a sample of the numbers. Following is the estimated economic impact (direct spend- no multipliers) for the largest events in Adirondack High Peaks region in 2011:

  • Lake Placid Marathon: $1.6 million
  • Ironman Lake Placid: $10 million
  • ILNY and Lake Placid Horse Shows: $3.56 million
  • Saranac Lake Rugby Tournament: $1.9 million
  • Lake Placid Lacrosse: $3.6 million

As you can see, events can represent a great economic driver for a community, but there are many variables in the formula that determine what type, size and timing for an event will work for a given destination and its infrastructure.

If there aren’t enough lodging rooms in a community to welcome and benefit from the expected number of visitors for a new event, it’s not worth the investment of time, local volunteers and money to support it. However, an event that will fill a small town’s 60 lodging rooms mid-week in November that would otherwise be empty might just be worthy of pursuing.

OK, it is summer, after all, and after all those numbers, I’m now ready to drop my calculator and go outside. (As long as I’m not playing golf, I shouldn’t need it.)

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Kimberly Rielly

Kim Rielly is the director of communications for the Regional Office of Sustainable Tourism.




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