What the Rugby World Cup Means to New Zealand

The Rugby World Cup 2011 could generate US$1.67 billion (NZ$2 billion) for the global sports economy with overseas visitors to New Zealand generating US$654 million (NZ$782.5 million), according to new research commissioned by MasterCard.

MasterCard’s research - the Economic Impact on Global Rugby Part IV: Rugby World Cup 2011 - finds that sport associated economic activity may be worth up to US$11.7 billion (NZ$14 billion) to the New Zealand economy by the end of the decade.

The research is the fourth installment in a series commissioned by MasterCard Worldwide and undertaken by the Centre for the International Business of Sport (CIBS) at Coventry University, following economic impact reports on the 2010 Six Nations and Tri Nations Rugby Tournaments and a report on Rugby’s Emerging Markets in April.

The latest installment examines the value of RWC 2011 by looking at the short-term commerce flow through international fans spending in bars, clubs, shops, hotels, bookmakers and inside host stadia, along with spending by sponsors and organisations on marketing in the cities around matches. It also examines the longer-term economic impacts on New Zealand’s economy and the legacy of the tournament as a whole.

“This tournament will be like no other: it will attract stronger than ever interest across the world, which will in turn boost commercial interest in and activity around the event,” said CIBS Researcher, Dave Arthur.

The report finds that by the end of the decade, consumer expenditure in the New Zealand sports economy may be worth up to US$1 billion (NZ$1.2 billion). Increased tourism, civic sponsorship and business development resulting from the tournament is estimated to be US$1.21 billion (NZ$1.44 billion), while the number of people working in sport-related occupations could rise to between 52,000 and 58,000 by the end of the decade, according to the report.

Other factors likely to enhance short-term and long-term economic activity include the later time scheduling for RWC 2011 matches and the ongoing development of rugby in emerging market countries such as Romania, which has seen a 222% increase of Rugby participation since Rugby World Cup 2003, and Russia, who will be competing in their first Rugby World Cup.

Rugby World Cup’s Enhanced Brand Value

The tournament will also attract stronger than ever interest across the world due to the increased strength of the Rugby World Cup brand and the significance of it returning to its spiritual home - Rugby World Cup 2011 will be the first time the tournament has returned to the same host nation and the same Final venue since 1987.

Based on advanced ticket sales more than 95,000 international fans will be visiting New Zealand for RWC 2011, which kicked off on Friday night (9 September). Total ticket sales, which (including domestic sales) are expected to reach 1.35 million, will generate revenue of US$224.5million (NZ$268.5 million) for Tournament organisers.

“For the tournament to be contested in the sport’s spiritual home with the host nation ranked as number one in the world and among the strongest sport brands in the world, further enhances brand equity and the appeal of Rugby World Cup,” said Professor Simon Chadwick, Director of the Centre for the International Business of Sport (CIBS) at Coventry University. “Rugby World Cup is one of the top global sports events in the world behind the Olympics and the FIFA World Cup. Not only will New Zealand be benefiting from its impact and legacy for years to come, but the broader global sports economy will welcome the boost that this tournament delivers.”

The late scheduling of matches - many Pool games kick off at 20:30, while the semi-finals and Final kick off at 21:00 - are likely to encourage more spending in and around the cities hosting matches as fans enjoy the local hospitality before games, the report says.

An added ‘Sunday Bonus’ is predicted in the form of increased numbers of people travelling to Auckland for the Final. The report says the late scheduling will also offer a boost to broadcasters with a global audience of around 4 billion people expected to tune in to watch the tournament.

IRB Chief Executive, Mike Miller said, “RWC is one of the world’s top three major sports events and the largest in the world this year. As the report underlines, it will drive significant economic activity around the globe and, in particular, in New Zealand, both during the Tournament and in the longer-term ... We have no doubt the tournament will be spectacular and memorable. It is being contested in a nation that loves rugby and is ranked number one in the world and will be more competitive and unpredictable than ever. Alongside the more established rugby nations, fans will be able to see emerging nations such as Russia, who will be playing in their first RWC, and Romania where participation has risen 222% since 2003, adding to the appeal of the Tournament and inspiring further growth.”

Stuart Cameron, vice president, Regional Marketing, Asia Pacific, Middle East and Africa, MasterCard Worldwide, added, “Rugby fans from across the globe are descending on New Zealand for six weeks, and as well as engrossing themselves in the best the sport has to offer, they will be immersed in one of the most spectacular destinations on Earth. It has been 24 years since the inaugural Rugby World Cup took place in New Zealand, and as this research shows the competition and its economic value has come a long way since then.”

Rugby World Cup 2011 by Numbers

- US$224.5 million (NZ$268.5 million) ticket revenue based on sales of 1.35 million tickets
- US$204.1 million (NZ$241.7 million) to be spent on accommodation during the tournament
- US$187.7 million (NZ$224.5 million) to be spent on food and beverage
- 7.5 million litres of beer to be poured
- 7.35 million pies and sausages to be consumed
- 150,000 litres of sports drinks to be consumed

See also: Hong Kong Sevens: It’s Not Just Rugby!

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