CNN just reported that New Orleans’ Mardis Gras can bring a billion dollars in economic benefits to New Orleans, though they implied it would be less this year with “only” 700,000 visitors to Mardis Gras this year.
I’m initially very skeptical of both these numbers. I was in New Orleans a few years ago and it sure didn’t look to me like the French Quarter could sustain anything approaching that number of people.
I’ll check up but I’m guessing this is a bogus statistic based on unreasonably large multipliers. It’s a common trick in tourism metrics used to justify budgets and ad campaign results, and greatly confuses analysis of the tourism situation in various regions.
Let’s run some fuzzy math here: The main thing at Mardis Gras is drinking. Let’s assume drinks reflect half the economic impact of the event and cost an average of $5 per drink. That would suggest that during Mardis Gras 1 million people drink …. 100 drinks each!?
More:
New Orleans CVB Economic Development report says 300 million impact of Mardis Gras, 5.5 Billion Annually from 10.1 million tourists. This is less than a third what was quoted by CNN for Mardis Gras, but still is a pretty unbelievable $545 per *person* per visit so I’d like to see where they are getting these numbers.
Joe Duck 
A billion dollars? Those multiplier equations take into consideration all kinds of spending. I, too, have questioned dollar amounts for various festivals and events – but have learned money is often spent before, during and after the party – all contributing to the bottom line.
Right Greta, it’s not just the immediate spend, but a billion is a *lot* of money for even a million people to spend in a few days. Airline tickets should not be included in this so that’s a LOT of bourbon and beer.
The 300 million sounds more reasonable and may be based on something like 1 million people x 100 per day x 3 days average visit. This would be more in line with other impact studies I’ve seen.
They must including all the “missing” money from the Katrina aid…CNN must be assuming that the money will be “clean” as it re-enters the economy! š
I have yet to see an economic impact report put out by a DMO or CVB that wasn’t a self-justification tool. There are dozens of input/output models to calculate multiplier effects of tourism spending – not one is pure science.
Nobody can argue that there is economic impact, but how much and for how long? For that matter, what gets included/excluded from measurement? When does activity get classified as “tourism”? I love tourism research, but I’m a dork like that.
Two of the largest ever development projects ever in Adirondack history are now being vetted. The impetus for both of these were “economic impact” studies conducted for tourism. Funny thing, the goal in the tourism community was to encourage the growth and retention of tourism related businesses. We are losing more and more to private development. Ironic. I guess my point is that this type of study is relatively harmless until someone bases a real decision on its results.
TourPro – do you have some linkage to those projects or studies? I think there are a lot of parallels between Adirondack tourism and Southern Oregon. Lots of small biz, few big resorts, very spread out over a big area.
The contrasts with Las Vegas, or big city tourism like NYC, are really interesting to me. I’m beginning to think you cannot bring “big ticket” tourism to rural areas effectively and that the best approaches would be modest projects to help the small, locally run businesses.
Its hard to get data from sources without an existing bias. Many hotel rooms are rented out to four college girls but in actuality eight or ten will be there. Do you include the phantom hotel guests in meals and drinks? Do you include the income from a tour guide who sold a package tour? Would photos of crowds give a more accurate count than publicity agents? Certainly the claimed sum seems very high.
A billion dollars worth of bourbon.
I do belive I have just attained enlightenment! š
On a more realistic note: I have data from the other end of the consumer end of the spectrum. Guesstimated cost per day per person when my wife and I go on vaca is $350. So that’s 2,857,143 visitor-days to get to a gigabuck.
Now my interest is piqued, I think I’ll pull some numbers and get a better estimate of our daily spending. The mooted per diem amount above does include airfare.
Fools Gold: In the interest of Social Science research, please send location of that hotel room.
Tommo: It’s a BIG BOTTLE.
Interesting “other” billion dollar tourism events based on my weak interpretations of a few studies:
* Annual Revenues – MGM Grand Hotel, Las Vegas
* Annual Total Impact, Oregon Coast
Well, some pundits will often add up the cost of a “mega trial” and the cost of the automatic death penalty appeal, cost of imprisonment, etc., but if you ask the local motel and restaurant owners who tallied up the reporter’s rooms and bar bills, murder can indeed be profitable. A town’s treasury often benefits from media truck parking fees and police certainly love the overtime and the pension-kick it gives them. That is why there are often a lot of police retirements soon after a major case. High profile murder cases can be profitable… to some!
Alright, here are some of the results:
Northern New York Travel & Tourism Research Center – This research consortium was initially formed by tourism professionals to provide marketing data and develop a baseline for future analysis. The Adirondack Club and Resort development has based much of its business plan on the results of this initial EIS.
Another research organization has produced reports for both the Lake Placid CVB and the Olympic Regional Development Authority. Here’s the PDF of ORDA’s EIS:
Click to access orda_economic_report.pdf
SUNY Plattsburgh’s Technical Assistance Center also tabulated the results for the CVB’s study which of course indicated a great return on investment in tourism promotion. Also of note was there recent study done for Westchester County tourism. Sorry, can’t find those…google?
We are swimming in studies, most with the same result or message. All of them have flaws, but when you look at the general results, the message is clear.
I’m a firm believer that tourism is an under appreciated mechanism for economic development. Witness the cabinet level attention most countries have for this industry. The poorest countries in the world recognize the value of tourism – foreign exchange and a product for export. There is no doubt that the ROI in tourism is well worth the effort.
The tourist income may be skewed to certain recipients but it is definitely true that it takes very little capital or knowledge to establish a resort hotel in some touristy destination. Its a cheap industry to import and the dollars, once spent, will stay but the tourists will leave.
Certain towns may not like the festival traffic jams but the funds are appreciated. Restaurants, stores, small businesses are often appreciative of tourist dollars but uncounted in economic studies.
Its a matter of cost accounting sometimes. A casino is often viewed as a boon to the local economy but no one tallies up the costs of the alcoholism, drugs, prostitution, mortgage foreclosures or wife beatings and allocates those costs to the casino. Such costs are viewed as speculative and remote in time and place.
http://traveldancing.info – if you have a problem with your PC
Just a follow-up, the repeat of the previously mentioned study just came out:
Tourists Make a Billion-Dollar Impact on Northern New York
While not perfect, it does provide something which resembles a barometer.
mbt ladies shoes Mardis Gras a billion dollar tourism event? Iām skeptical. | Joe Duck