The Economic Impact of SXSW in 2014
Though I'm sure South by Southwest (SXSW) needs no real introduction, the economic impact data for the 2014 edition have just been released by SXSW & Greyhill Advisors.
The 28th annual edition was held on March 11-16, and as always, CIMA did present a Canadian Blast mission that included 26 Canadian artists/bands and representing a delegation of 42 Canadian companies at the Canadian Blast BBQ & Showcase and the various Canadian Blast showcases at Canada House. With Canadian acts forming 20% of the international acts at SXSW in 2014, Canada Stand participants made 851 new contacts, met with 981 existing ones and held 510 meetings. In total, 205 deals were started and 31 were finalized, with expected potential revenues reaching $2,158,950 within 36 months. See more about CIMA's results here.
While we knew our mission to SXSW in 2014 was a success, the economic impact data that was just released gives some additional insight into just how much of an impact SXSW really has on the city of Austin. Given that Austin is often cited as a benchmark for Toronto's music scene, this data should further bolster the argument that these types of festivals provide important economic benefits.
What do we know about SXSW 2014's impact on Austin? Here's a snapshot:
The economic impact at a high-level:
- SXSW was responsible for injecting more than $315.3 million into Austin's economy in 2014, a healthy increase over the $218.2 million figure in 2013.
- The direct, indirect and induced local economic benefit of SXSW operations, i.e. the operational output, was $121.9 million.
- The SXSW registrant attendance expenditures were $136.5 million in 2014, this figures refers to all of the direct, indirect, and induced local economic benefit of all attendees: SXSW badge holders, industry professionals, wristband holders, exhibitors, single visitors of events.
- The economic impact of the SXSWeek participant expenditures were valued at $136.5 million; this figure refers to all direct, indirect and induced economic benefit of all SXSW Guest Pass Holders and parties affiliated with SXSW. [This figure is a new addition for the 2014 economic impact study].
How does this $315.3 million enter and benefit Austin's economy?
- The direct impact is $218.2 million. This includes any expenditures that are directly injected into the local economy by SXSW, official sponsors, event attendees and exhibitors.
- The indirect impact is valued at $55.6 million. This includes any increases in sales, income and jobs associated with companies that benefit from SXSW expenditures.
- Finally, the induced impact, i.e any spending effects that can be attributed to individuals who experienced increasing earnings as a result of SXSW, was valued at $51.1 million.
The impact on the hospitality industry:
- SXSW continues to be the single most profitable event for Austin's hospitality industry.
- In 2014, SXSW directly booked 13,990 hotel reservations, a total of 60, 450 room nights.
- As a result of scarcity, the average nightly hotel rate increased by 12%.
The value of increased coverage of SXSW and Austin in various media channels
- In 2014, SXSW and Austin received over 86.7 billion broadcast, print and online impressions.
- The estimated value of this coverage exceeded $78.7 million; a huge jump from the 2013 numbers driven by on-site, nationally broadcast programs like Jimmy Kimmel Live.
Interesting in reading more? You can consult the report here: http://greyhill.com/blog/