When the Danish roads become the subject of a major international sporting event, a lot of questions naturally follow. In the pre-event phase there are questions about 'feasibility', which in this context translates into 'is it worthwhile?' to hold this event on Danish soil. We will know more about this when a few months have passed and, hopefully, competent people have produced a full report on the impact of the event from a Danish perspective. When the Ice Hockey World Championship was held on Danish soil in May 2018, I was part of a team that made such a report, and it was not published until the autumn of 2018, as it requires various resources (manpower, knowledge, relevant methods, finances, time, etc.) to execute on that part. That things cannot be isolated from time and context is also exemplified by this event. The type of event must always be taken into account, and this is an event which, unlike the Ice Hockey World Cup or last summer's European Football Championship with matches in Copenhagen, includes other conditions in terms of the time perspective of the event or, the possibilities it offers in terms of fan zones and similar activation offers (this event is not spread out over such a long period of time as is typically the case with team tournaments in major traditional team sports, from a Danish perspective, such as football, handball or ice hockey). Having said that, the Tour de France is a mega-event that has found its way to Denmark, which sports enthusiasts across geographical, demographic, psychographic differences can enjoy.
The commercial caravan, the brand angle and the strategy
The Tour de France is a gigantic global sports brand (which has developed its 'legacy' and brand capital over many years) and at the same time a massive sporting and commercial event and thus a considerable business. The rights holder behind the event, ASO, has a turnover of billions and the Tour de France is a major part of its activities. The Tour de France is, of course, a major sporting event followed with great fervour by people in well over 100 countries worldwide, where people sitting in front of the TV screen also get to watch what Denmark has to offer. Teams, riders, sponsors, media, fans, regions and cities are part of the huge commercial caravan that follows the race around. In this way, it is an excellent opportunity to showcase Denmark, also in terms of our historical and cultural heritage. It could prove to be a very good advertisement. At the same time, an event like the Tour de France typically generates considerable tourism turnover, with the entire Tour de France caravan and spectators in the form of cycling enthusiasts, hopefully here post-Corona, flocking to Denmark and spending money on accommodation, restaurants, shops, etc.
However, I think it is important to understand that such a mega event as the Tour de France on Danish soil speaks into a larger strategic apparatus that can enjoy associated synergies related to the event. Why, in general, we hold international sporting events on Danish soil is an interesting place to start? Surely there is a reason why Sport Event Denmark exists and has gained public support. It underlines that there is a strategic goal from the governmental and political side to attract international sport events to Denmark. In this respect, the Tour de France plays a role as one of many events that help to lift Denmark's unique ability to lift sports events of an international character, and thus the respective sports events also become a lever for each other. The Tour de France is therefore related to past and future events on Danish soil, both in cycling and in other sports.
Can the economic perspective stand alone?
For me, a mega-event like the Tour de France is a question of both the economic and quantitative angle as well as the more qualitative, intangible and value-based angle. This means that the initial total budget of around EUR 90 million is not sufficient to cover the costs of the event. DKK for the event has to be compared with the derived costs that the event municipalities and cities have for planning and staging as well as the costs that the state spends for security and police - there is further economic data in this live chat that I had with DR Nyheder. Then the whole cost element has to be compared not only with quantitatively measurable elements such as tourism turnover, media exposure and jobs, but also with more qualitative elements such as the overall footprint that the Tour de France will leave on Denmark. In this way, the overall and hybrid branding effect must be measured in relation to the value of the experience, i.e. the popular celebration and the cultural good that the event also guarantees.
The hybrid branding effect is characterised, among other things, by the fact that this event reaches a wide media audience, e.g. via television, but this effect is amplified via social media platforms, where the sporting and commercial caravan of the race can be expressed together with how social media acts as an extended branding arm when the focus is on the sports branding around the key sporting actors of the race, i.e. the riders.
Photos: excerpt from the book SPORTS MANAGEMENT: Management and Commercialization in the Sports Industry (Cortsen, Hehr & Nielsen, 2021).
The importance of holistic impact measurement
There's a lot of money at stake in the world's most prestigious cycling race. The Tour de France, and therefore ASO, gets the most out of the race financially and commercially; there is absolutely no doubt about that. This is because for the Danish organisers there is limited commercial income directly related to the Danish hosting in terms of what the possibilities would be if ASO was not so heavy on the rights part. This of course means that ASO has virtually all commercial rights to the event (see link to DR chat above).
Nevertheless, the opportunity to be part of the Tour de France comes at a high cost, which is why public subsidies are typically used for such sporting events, where the public expects a return in terms of tourism turnover, branding effect, but also through the great psychological effect that can be associated with producing sporting events as a cultural good for the population. In addition, the Tour de France can help support initiatives that make sense from a political point of view in a wider context, such as the promotion of health and movement when masses of fitness riders cycle across the Storebælt Bridge in a customised activation event. It also fits well politically in terms of creating engagement among the population and involving them in the event, as well as having a synergy in terms of Denmark's identity as a green and sustainable nation, where cycling is a big part of everyday life.
Photos: excerpt from the book SPORTS MANAGEMENT: Management and Commercialization in the Sports Industry (Cortsen, Hehr & Nielsen, 2021).
Activation is a result of preparation
Preparation is always important in relation to performance. If you don't prepare, you prepare to fail. I therefore look forward to the start of the Tour de France on Danish soil and hope that the organisers are well prepared and have the weather and the good Danish mood with them. The preparation phase is an opportunity to get to know the sports product that the Danish organisers themselves will be putting on the table, which is important when the focus is on delivering a good product, but also on gaining additional knowledge to deal with logistical challenges and to get inspiration for all the creative product and brand activation opportunities that are, after all, available in relation to such a mega event.
ASO lives from the Tour de France and therefore has a strong focus on the quality of the sports product. As mentioned above, we are talking about a mega-event in sport, which is a huge business, where ASO as the rights holder has a turnover in the billions with the Tour de France as a major part of the activities. As a sports product, the Tour de France contains a mix of tangible and intangible factors (including how the core product in the form of the race itself can be coupled with the related side events around the country), which ultimately need to deliver the best possible footprint with the stakeholders who buy into the product, i.e. everything from fans (fan interest is the engine that drives sports products) to media, sponsors, event destinations, etc. In this handover to stakeholders, ASO as rights holder is very dependent on the event destinations bidding for the event, as they have to jointly lift the overall sport event experience. Therefore, all else being equal, a sporting event like the Tour de France is more likely to find its way back to Denmark (or that speaks to what I wrote above about Danish events helping to lift each other up, because I don't necessarily think this one will come back) if this experience is good. However, that again depends on whether Denmark (with Sport Event Denmark and the governmental level in the lead) thinks that this is a good strategy, and that is a whole other discussion.
A look at the commercial circus
The Tour de France caravan is a big commercial circus like other major sporting events. Therefore, there are very good branding opportunities associated with the event, because it is an event that people have embraced for many years. The low level of sponsorship in the budget is typically linked to the fact that over time the rights holders of the major events, ASO in the case of the Tour de France, have started to hold on even more tightly to the sponsorship rights. The organisers usually get a smaller percentage of ASO sales and on the sponsorship side may have some hospitality rights that they can manage, but as we have also seen with UEFA and the European Football Championship for example, the international rights holders are coming in with great brand awareness and holding on tightly to their commercial rights in terms of also taking the lion's share of the sponsorship pie. Therefore, there is also a high dependency on public funding in these types of events, where Denmark as host country or the individual host cities then need to capitalise on other benefits, e.g. tourism turnover, destination positioning via the media and thus branding value, production of a cultural good and thus a good emotional sports experience for the population, creative activation opportunities, etc.
The political sale of events
One of the problems with big events is that they are often dressed up to sell to the public. Here it must be borne in mind that politicians live by popularity, and in the pursuit of this they may have an interest in the reality - economics, branding and impact (e.g. number of TV viewers) - being dressed up for the event to justify the public subsidy. Therefore, this also requires a nuanced approach, where it is important to weigh the direct costs, but also the DNA of cycling, i.e. that it is an outdoor sport, which of course requires costs to provide a framework for the event and therefore includes high costs for logistics, security, etc., against the direct revenues, i.e. a limited sponsorship income, but nevertheless a high expected tourism turnover and branding effect. However, this must also be weighed against the more intangible benefits such as the value of sport as a cultural asset, the opportunities to activate and involve the population, etc. Here, the economic calculation models commonly used and applied do not usually show the sensitivity that takes all these factors into account, and even if this event relies on a large public subsidy, there should be enough benefits to justify the event if its holding is optimal, also in activation terms (see photos above in relation to the discussion on the issue of calculation models above). However, it depends on how preparation and event activation find each other!
Why is the Danish sport model important?
Understanding the context and staging the event in a holistic way is crucial for event success. In Denmark, we have a unique sports and athletics model that manages to lift sports events, including those of an international nature, in a way where the national level works well together with the regions, municipalities and event cities. This also interacts with the accessibility and inclusiveness of sport participation that our voluntary community also provides a perfect framework for. Sport has a unique ability to lift social responsibility and this speaks into some societal effects related to our Danish sport model, which is part of the unifying way we lift sport in Denmark. When roads are already closed down, it provides some good activation opportunities that help to clarify such things, and this accountability and sustainability aspect is important anno 2022. We have a high level of participation in sport in Denmark, both in terms of active sportsmen and women and volunteering, and when exercisers are given the opportunity to drive across the Storebælt Bridge or take part in similar events, the Danish model of sport is therefore also included, with all that this entails in terms of social communities, education, integration opportunities and health economic effects over time.
I have been involved in impact analysis for major international sporting events and have also written about it in my sports management book (see photos from the book above and link to report on the 2018 Ice Hockey World Championships), which came out last year. The problem is often that our research and typical calculation models rely on the quantitative and thus the tangible effects and are therefore not sensitive enough to provide a valid and thus comprehensive overall picture that also includes the value-based and qualitative elements. It could be that Denmark is presented as a cycling nation, that Denmark can show off in the most beautiful way in the summer landscape, that Denmark can show its progressiveness as a GREEN nation or that Denmark can activate the societal value related to our unique sport model.
The fact that Jørgen Leth has returned to the media to cover the Tour de France is interesting in relation to this and how the portrayal of cycling goes beyond the sporting, but is constantly in the balance between the sporting narratives around the riders and other key players on the one hand and the race or event's relationship to the cultural and historical 'heritage' that exists as the Tour de France caravan cuts through particular landscapes. The mediaisation of the race also becomes a question of marketable entertainment. Understanding a sports brand is as difficult a discipline as understanding winning culture. Many think they understand it, but the more we look at things, the more we often realise we don't. Sports branding is dependent on time and context, and it needs to be relevant in the here and now, but then at the same time is dependent on the quality of the activation that is created. Holger Preuss has written about 'legacy' in relation to mega events and also assesses the importance of not only including economic and tangible factors, which over time has also influenced the practical reality that rights holders behind sport events measure in practice.
Photos: Holger Preuss has written about different 'tangible' and 'intangible' as well as 'soft' and 'hard' event structures related to megaevents in sport (Preuss, 2007).
How about nuancing discussions about sport and politics?
Sportswashing is and has been for some time a highly debated topic, including by yours truly. From the Danish side, we have continuously discussed the meaning of the World Cup in Qatar (or as I would say the 'lack of meaning', because Qatar should never have been awarded the hosting), just as Russia's role in this context was also addressed to a greater extent after the invasion of Ukraine. It makes good sense to debate this issue, but it is interesting from my perspective that from the Danish side we on the one hand criticise the World Cup in Qatar and the use of sportswashing (probably also based on the premise that 'sport can be an important promotion and branding platform to wash an image clean', because if it, as the countries concerned do, did not have an effect, we would not need to criticise to the same extent), while at the same time many in Denmark see it as a problem that we have to hold major international sporting events on Danish soil. I think it is relevant to draw that nuance of the debate in here, as the sportswashing discussion contains the angle that top sport is an effective branding tool. That is why it is surely OK for us in Denmark, also on the basis of some of the arguments above, to use international sporting events to position ourselves in the world community and show the world all the good things that we stand for in Denmark. It is surely a good mouthpiece to put 'action' behind the enormous 'talk' of certain other countries (such as Qatar) not meeting our standards of 'good governance'. That's why it's meaningful that we in Denmark also brand ourselves through sport.
What is the path to a successful sports event?
For me, this issue is about the whole being staged and talked about in a way that creates some positive and differentiated impressions on international visitors, but also leaves a trace of being a relevant cultural good for the Danish population. The interesting question from a holistic sports economics perspective is whether the Tour de France and the event should be assessed as a cost or a loss (based on the direct costs incurred, assuming that the focus is on the budget of approximately €90 million, and the related costs) or an investment (where the difference between the cost side and the revenue side - also taking into account the spin-off effects) in branding or producing a cultural good for Danes (sport also reflects identity and summarises what it means to be Danish) or parts of the Danish population (in the event regions and cities).
References:
Cortsen, K. H., Hehr, M., & Nielsen, R. (2021). Sports management: management and commercialization in the sports industry. Copenhagen: Hans Reitzels Forlag.
Preuss, H. (2007). The conceptualisation and measurement of mega sport event legacies. Journal of sport & tourism, 12(3-4), 207-228.
