Description
The purpose of this paper is to develop a method for estimating new direct tourism spending
resulting from a new event in an existing destination
International Journal of Culture, Tourism and Hospitality Research
Segmenting tourists by direct tourism expenditures at new festivals
L. Taylor Damonte Michael D. Collins Carol M. Megehee
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L. Taylor Damonte Michael D. Collins Carol M. Megehee, (2013),"Segmenting tourists by direct tourism expenditures at new festivals",
International J ournal of Culture, Tourism and Hospitality Research, Vol. 7 Iss 1 pp. 51 - 57
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Segmenting tourists by direct tourism
expenditures at new festivals
L. Taylor Damonte, Michael D. Collins and Carol M. Megehee
Abstract
Purpose – The purpose of this paper is to develop a method for estimating newdirect tourismspending
resulting from a new event in an existing destination.
Design/methodology/approach – Intercept surveys were conducted on site at six of nine festival
locations. Of the 308 festival participants approached at random and asked to participate, 264 agreed
to participate (86 percent response rate). Upon further inquiry, only 47 percent of those agreeing to
participate were found to be from zip codes outside of the Horry/Georgetown County ‘‘Grand Strand’’
tourist area. These 145 festival participants were administered surveys.
Findings – Less than 30 percent of total tourist spending at the festival is attributable to new tourists –
those who speci?cally traveled to the destination primarily for the event and have historically attended
Myrtle Beach less than one time per year. Consequently, the economic impact of the festival, in terms of
new spending, was relatively small compared to the total amount of tourist spending by all tourists at the
festival.
Originality/value – The study provides an example of an event for which new tourist spending could
have been overestimated if all tourist spending had been considered to be new spending.
Keywords Tourists, Food and drink, Expenditure, United States of America, Festivals, Economic impact,
New tourist, Switcher, Tourist type, Coastal Uncorked
Paper type Research paper
‘‘As the economy gets better, everything else gets worse’’ (Art Buchwald, 1925-2007). Citing as
an example, ‘‘The more cars that are sold, the bigger the pollution and traf?c problems you have’’
(‘‘Buchwald’s Law’’, Time, September 15, 1993).
In a sense, a destination is like a large service factory where the host community inputs
tourists who bring new spending. The new spending activity throws off both positive
externalities such as jobs and tax revenues, and negative externalities such as traf?c, noise,
and sometimes even crime. Often, a community changes its collective opinion of the value of
a visitor market based on the perception of negative externalities related to the presence of
that market in the community. An example of this occurred recently in Myrtle Beach, SC,
where in 2008 the community added a number of ordinances designed to quell the rise of
motorcycle events, which were perceived as bringing with them many negative externalities
during the month of May each year. At the same time, new festivals, including one entitled
Coastal Uncorked were created to replace the motorcycle-related visitation (Brandon; cited
in Anderson, 2011). Researchers were asked to estimate the economic impact of this new
event. Consequently a means of estimating newdirect spending resulting fromthe presence
of new tourists in the community was required.
Researchers studying the economic impact of festivals often collect data on direct spending
via surveys and use this data in economic input-output models to estimate the indirect and
induced impacts of these festivals on the regional economy. A number of common
DOI 10.1108/17506181311301354 VOL. 7 NO. 1 2013, pp. 51-57, Q Emerald Group Publishing Limited, ISSN 1750-6182
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PAGE 51
L. Taylor Damonte,
Michael D. Collins and
Carol M. Megehee are
based at the E. Craig Wall
Sr College of Business
Administration, Coastal
Carolina University,
Conway, South Carolina,
USA.
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methodological pitfalls have been identi?ed in estimating new direct tourism-related
spending (Crompton et al., 2001). Rigorous estimates of tourism-related economic impact
should be based on marginal revenue from visitors (i.e. revenue from new visitors to the
destination who would not have come had it not been for the event itself). Since the Myrtle
Beach area is a well-established tourist destination with over 100,000 transient
bedroom-equivalent units (Brittain Center for Resort Tourism, 2010) located on the US
East coast and has 73 percent rate of repeat visitation (Equations Research, 2010),
identifying purely new tourists’ spending could be challenging. This study provides a
research approach that addresses this challenge. The discussion includes other potential
tourism-related bene?ts of festivals.
Spending associated with non-local festival attendees is often assumed in festival impact
studies to be new tourist spending, which may or may not be the case (Crompton, 1995;
Hodur and Leistritz, 2006; Tyrrell and Johnston, 2001). In order to create an estimate of new
spending, the estimated total number of tourist-attendees must be reduced by the number
of visitors who are ‘‘casuals’’ or ‘‘time-switchers’’ (Crompton et al., 2001). Casuals
participate in the festival, in part, because they have already chosen to visit the area during
the time of the event; the event is, at most, a secondary reason for casuals’ travel to the area.
Switchers may have chosen to visit the area at the time of the festival primarily because of the
event. However, had the festival not existed the visitor still might choose to visit the area
during another time of the same calendar year.
The socio-cultural impact of tourism is particularly relevant to this study. Cohen (1979) writes
that the social interaction between tourists and residents can lead to social change. Several
models that help explain the impact of tourists and tourism on host communities and
residents have been proposed (e.g. Doxey, 1975; Butler, 1980; Ap, 1992). Doxey’s (1975)
Index of Irritation (Irridex) represents the escalating irritation of local residents as visitors’
impact increases. In Stage 1, Euphoria, the number of visitors is small, the host community
welcomes tourism, commercial activity is limited, and visitors try to blend in with the locals. In
Stage 2, Apathy, tourist-host community relationships become more formalized and locals
take visitors for granted. In Stage 3, Irritation, the number of visitors and their impact on the
host community has grown to the point that locals and visitors compete for resources. Finally,
in Stage 4, Antagonism, locals are openly hostile to visitors and they try to limit the negative
impact of tourism on the host community (Doxey, 1975). Several of the powers that be in the
City of Myrtle Beach had reached the Antagonismstage with the motorcycle-related festivals
when they began passing ordinances that would in effect kill the biker events and make
room for more local-friendly events.
Butler’s (1980) Tourist Area Life Cycle Model follows a similar path, wherein over time positive
perceptionsof touristsarereplacedwithnegativeperceptions. Stage1, Exploration, ismarked
by curiosity about a new tourism area, followed by Stage 2, Involvement, when the host
community begins to provide services for their visitors. The Development phase, Stage 3, is
marked by rapid growth and noticeable economic, social, cultural, and ecological impacts.
Heavy advertising and promotion to attract tourists is balanced with local resources. Stage 4,
Consolidation, is when the rate of increase in visitors declines but the absolute number
continuestogrowandeventuallyexceedthepopulationof permanent residents. InStagnation,
Stage 5, the destination is no longer fashionable and repeat visitors tend to be more
conservative. After Stagnation, whether the destination goes into Decline or Rejuvenation
dependsonthehost community’sabilitytocopewithtourismimpacts. Declinecanbeavertedif
policies canmaintainthedelicatebalancebetweenscarcecommunity resources andtourists’
demands (Butler, 1980). At some point, the negative impact of the motorcycle-related events
was seen to outweigh the positive economic impact of these events.
Finally, Ap’s (1992) social exchange theory suggests that permanent residents will enter into
exchange with visitors only if value of the bene?ts to be gained outweighs the costs of such
exchange. Tourism will be supported as long as the resulting bene?ts are valued, exchange
has a high likelihood of producing these bene?ts, and perceived costs do not exceed
perceived rewards (Ap, 1992). As in the explanations above, the bene?ts of the motorcycle
events were not perceived to outweigh the costs of such events.
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Method and results
The Coastal Uncorked event, which spotlighted cuisine of the Myrtle Beach area, was
produced at multiple lodging sites along the Myrtle Beach oceanfront on May 14-15, 2010.
Transportation (trolley) services to, from, and among the sites was provided as part of the
registration fee for the event. University students randomly approached event participants at
six of the hotels that served as ‘‘trolley stops’’ where food and wine was served, asking them
if they would participate in an impact study related to the event. Of the 308 event participants
approached, 264 agreed to participate. In order to determine which of the festival attendees
were tourists, the students asked each festival participant if they were from one of the local
counties (Horry or Georgetown). If the participant answered ‘‘yes’’, then they were thanked
for their participation but no survey was administered. Using this method of inquiry, 47
percent were found to be tourists – a tourist being de?ned as a person whose primary
residence was not in the Myrtle Beach area (Horry or Georgetown County, SC). Since only
those individuals who were tourists were asked to complete the surveys, only 145 of the
individuals who were approached were asked to complete the surveys. Based on ticket
sales festival organizers estimated that there were 3,000 participants at the event. Based on
the percentage of those individuals in the crowd who indicated that they were from the local
area, researchers estimated that 1,410 of the 3,000 event participants were assumed to be
tourists.
Based on a sample average party size of 2.8 people, 412 tourists were assumed to be
represented in the results of the 145 completed surveys. This equates to approximately
29 percent of the 1,410 tourists that attended the festival, according to festival
organizers.
Survey participants were asked to estimate the spending created by their party across eight
categories including lodging, restaurants and nightclubs, groceries, theatres, shopping,
and gas/transportation. The spending of new tourists was de?ned as spending done by
visitors who were not primarily in Myrtle Beach for a reason other than to attend the festival,
the so-called ’’Casuals’’, nor were they switching their visit to Myrtle Beach fromanother time
of the year, the so-called ‘‘Switchers’’. In order to place respondents into one of two groups
within the sample, researchers asked them to indicate to what degree the Coastal Uncorked
event in?uenced their choice of Myrtle Beach as a destination for the current trip. Those that
responded with at least 4 on a ?ve-point scale (with 1 ¼ not instrumental and 5 ¼ extremely
instrumental) were assumed to be more than casual participants. Participants were also
asked to indicate the number of times they had come to the Myrtle Beach area as well as the
number of years they had been coming (trips/years).
Respondents who were already coming to the area one or more times per year were
considered to be switching to traveling to the area during the Coastal Uncorked event rather
than coming here at another time during the year. Consequently, spending by these
Switchers was not considered to be new spending to the area. New Tourist spending was
estimated by including only spending by tourists who could not be classi?ed as either
Casuals or Switchers. Gross direct spending was estimated for each of three types of
tourists (see Table I):
B Type 3 (Casuals) – those tourists who attended Coastal Uncorked events this year but for
whom the events were not an instrumental reason for their choice of travel to the area this
time;
B Type 2 (Switchers) – those tourists who indicated that Coastal Uncorked was a relatively
instrumental part of their decision to travel to the area but who traveled to the area one or
more times per year anyway; and
B Type 1 (NewTourists) – tourists who have not historically traveled to the area at least once
per year and for whom Coastal Uncorked was a relatively instrumental reason for their
choice of visit this time.
Based on the number of Type 3 (Casuals) tourist parties that participated in the survey
(n ¼ 63), Type 3 tourists accounted for 43.4 percent of the 145 total tourist parties that were
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surveyed. The estimated average spending in the area per Type 3 tourist party was $1,818
(Table II). Based on the proportion of Type 3 tourist parties in the sample, an average party
size of 3 people, and the estimated total number of tourists at the event (n ¼ 1; 410), direct
spending in the area by all Type 3 tourist parties in attendance at the festival (n ¼ 201) was
estimated to be $365,512.
Table I Categories of spending
Lodging
Restaurant-night
club spending
Spending
on
groceries
Spending
on
recreation
Spending
in
theatres
Retail
spending
Spending on
gas/transport
Other
spending
Total
spending
per party
Spending by Type 1
tourists, those who
rated CU $ 4=5 on
instrumentality and had
,1 trip per year to MB 502 303 124 191 139.29 155.77 118.62 175.00 1,710
Spending by Type 2
tourists, those who
rated CU $ 4=5 on
instrumentality but had
$1 trip per year to MB 459 307 185 350 106.67 431.82 104.23 75.00 2,020
Spending by Type 3
tourists, those who
rated CU , 4=5 on
relative instrumentality 619 277 150 121 123.30 221.79 140.00 164.38 1,818
Gross direct tourist
spending by all tourists
who attended Coastal
Uncorked 547 290 143 169 125.69 229.70 126.77 151.25 1,785
Note: Figures shown are spending in dollars
Table II Spending by tourist type
Total
spending
per
tourist
party ($)
Number
of tourist
parties
in
sample
Party
size
Total event
participants
represented
in the sample
Estimated
number of
tourists of
each type
attending
event
Relative
size of
the
group
(percent)
Estimated
number of
tourist
parties of
each type
attending
event
Total
estimated
spending
at the
event ($)
Percentage
of total
tourist
spending
(percent)
Spending by Type 1
tourists, those who rated
CU $ 4=5 on
instrumentality and had
,1 trip per year to MB 1,710 45 3.0 133 438 31.0 148 253,151 27.1
Spending by Type 2
tourists, those who rated
CU $ 4=5 on
instrumentality but had $1
trip per year to MB 2,020 37 2.3 86 360 25.5 155 314,011 33.7
Spending by Type 3
tourists, those who rated
CU , 4=5 on relative
instrumentality 1,818 63 3.0 192 613 43.4 201 365,513 39.2
Gross direct tourist
spending by all tourists
who attended Coastal
Uncorked 1,785 145 2.8 412 1,410 100.0 505 932,675 100.0
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Based on the number of Type 2 (Switchers) tourist parties that participated in the survey
(n ¼ 37), Type 2 tourists accounted for 25.5 percent of the 145 total tourist parties that were
surveyed. The estimated average spending in the area per Type 2 tourist party was $2,020.
Based on the proportion of Type 2 tourist parties in the sample, an average party size of 2.3
people, and the estimated total number of tourists at the event, direct spending in the area
by all Type 2 tourist parties in attendance at the festival (n ¼ 155) was estimated to be
$314,011.
Finally, based on the number of Type 1 (New Tourist) parties that participated in the survey
(n ¼ 45), Type 1 tourists accounted for 31.8 percent of the 145 total tourist parties that were
surveyed. The estimated average spending in the area per Type 1 tourist party was $1,710.
Based on the proportion of Type 1 tourist parties in the sample, an average party size of 3
people, and the estimated total number of tourists at the event, direct spending in the area
by all Type 1 tourist parties in attendance at the festival (n ¼ 148) was estimated to be
$253,150. Total direct spending in the area by all three types of tourists combined was
estimated to be $932,634.
Discussion
The creation of festivals to generate travel into a destination is a common practice for many
communities, particularly communities that thrive on a tourism-based economy. Such
festivals are typically created to increase demand during shoulder or off-season time
periods when demand is relatively weaker than during peak periods. Demand reaches its
peak in the Myrtle Beach area during the summer months of June through August. In 2008,
the City of Myrtle Beach passed several ordinances to discourage motorcycle-related
festivals – primarily in reaction to the perceived negative social impacts of increased crime,
traf?c, and noise associated with the biker events. Consequently, community organizers
collaborated to create a new food and wine festival as an alternate tourist event during
mid-May.
Community organizers were interested in understanding the economic impact of the event
and to con?rm that their investment in time and resources to promote and execute the
festival was justi?ed by the incremental revenue generated as a result of the event. While
some research has estimated the impact of an event based upon the total spending of all
participants, the present study illustrates a more appropriate method in that it describes new
spending separately fromspending that might have occurred at other times during the same
year. This method, therefore, creates a more appropriate benchmark for Coastal Uncorked
organizers to use in evaluating the impact of future events. (This is not to say that the
spending of so-called Switchers or Casuals is of little value – it is just not incremental
spending.)
Revenue generated by Switchers, which accounted for approximately 34 percent of the
estimated total direct spending by all tourists attending the event was revenue that could
have potentially been created during a higher demand period. However, as a result of this
shift in travel dates, additional capacity may have been made available in the market during
these higher demand dates, allowing additional travelers to visit the destination during the
higher demand period. This is a strategy that is frequently employed by hotels when they
attempt to lure group business into lower demand time periods with reduced room rates and
other incentives in an effort to protect prime dates for more lucrative business. This strategy
may prove equally effective for a destination as a whole.
Further, Casuals’ tourist participation, though not representing new direct spending, could
also be bene?cial to the long-term growth of a community’s social capital (Arcodia and
Whitford, 2006). While Coastal Uncorked may have only been a secondary reason for 43.4
percent of tourists at the event, the average favorability rating of Myrtle Beach and Coastal
Uncorked by these tourists was 4.2 and 4.1, respectively (on a scale of 1 to 5, with 5 being
extremely favorable). As noted above, this was the ?rst year of the Coastal Uncorked food
and wine festival. The high favorability ratings suggest potential for growth in attendance at
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the festival in the coming years and potential for positive long-term impacts on the local
tourism phenomenon.
Finally, the method provided internship opportunities for students at the local university.
Implementation of Coastal Uncorked brought together faculty research expertise with
opportunities for resort tourism management students to work with faculty and the lodging
properties that sponsored the Coastal Uncorked event. The acquisition of meaningful and
accurate data relative to a festival or event of this nature is often challenging for event
organizers to obtain. Organizers sometimes lack performance measurement expertise and
are often fully consumed with promoting and orchestrating the event. As a result, obtaining
data related to the economic impact of the event is often an afterthought and a challenge that
event organizers simply do not have the time, ability, or motivations to address. For
hospitality- or tourism-related academic programs, such an event provides an opportunity
for students and faculty to provide a valuable service to the industry. These programs may
bene?t by promoting their ability to administer meaningful, reliable, and relatively unbiased
economic impact studies as part of a menu of services that they offer to the hospitality
industry and their host community.
References
Ap, J. (1992), ‘‘Residents’ perceptions on tourism impacts’’, Annals of Tourism Research, Vol. 19,
pp. 665-90.
Arcodia, C. and Whitford, M. (2006), ‘‘Festival attendance and the development of social capital’’,
Journal of Convention & Event Tourism, Vol. 8 No. 2, pp. 1-18.
Anderson, L. (2011), ‘‘Brandon, Scott in IRS rules Coastal Uncorked tax exempt’’, The Sun News, April
21, p. A1.
Brittain Center for Resort Tourism (2010), ‘‘Tourism Economy Study: a proprietary research report of the
Clay Brittain Jr Center for Resort Tourism’’, Coastal Carolina University, Conway, SC.
Butler, R.W. (1980), ‘‘The concept of a tourist area cycle of evolution: implications for management of
resources’’, Canadian Geographer, Vol. 24 No. 1, pp. 5-12.
Cohen, E. (1979), ‘‘Rethinking the sociology of tourism’’, Annals of Tourism Research, Vol. 6 No. 1,
pp. 18-35.
Crompton, J.L. (1995), ‘‘Economic impact analysis of sports facilities and events: eleven sources of
misapplication’’, Journal of Sport Management, Vol. 9 No. 1, pp. 14-35.
Crompton, J.L., Lee, S. and Shuster, T.J. (2001), ‘‘A guide for undertaking economic impact studies:
the Springfest example’’, Journal of Travel Research, Vol. 40 No. 1, pp. 79-88.
Doxey, G.V. (1975), ‘‘A causation theory of visitor-resident irritants: methodology and research
inferences in the impact of tourism’’, Sixth Annual Conference, Proceedings of the Travel Research
Association, San Diego, CA, September, p. 195.
Equations Research (2010), ‘‘A proprietary research report in the 2011 Myrtle Beach Area Destination
Marketing Plan’’, available at: www.myrtlebeachareamarketing.com/docs/preso/CityCouncil_Feb2011.
pdf.
Hodur, N.M. and Leistritz, F.L. (2006), ‘‘Estimating the economic impact of event tourism: a review of
issues and methods’’, Journal of Convention & Event Tourism, Vol. 8 No. 4, pp. 63-80.
Tyrrell, T.J. and Johnston, R.J. (2001), ‘‘A framework for assessing direct economic impacts of tourist
events: distinguishing origins, destinations, and causes of expenditures’’, Journal of Travel Research,
Vol. 40 No. 1, pp. 94-100.
About the authors
Dr L. Taylor Damonte is a Professor and Director of the Clay Brittain Jr Center for Resort
Tourism in the E. Craig Wall Sr College of Business Administration at Coastal Carolina
University. He received a Bachelor of Science degree from the University of New Orleans
and went on to manage hotels and restaurants in the Mississippi Gulf Coast area. He later
received a Master of Science degree from the University of Southern Mississippi and a PhD
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from Virginia Polytechnic Institute and State University. He teaches a seminar in Resort
Planning and is the Principal Investigator on the Tourism Economy Study, a weekly analysis
of lodging business performance in the Myrtle Beach area of South Carolina. Current reports
based on that research can be found at www.coastal.edu/business/resort. He has delivered
hospitality and tourism seminars in Ecuador, Panama, Slovakia, Germany and China. Dr
L. Taylor Damonte is the corresponding author and can be contacted at:
[email protected]
Michael D. Collins is an Associate Professor, Resort Tourism Management, in the E. Craig
Wall Sr College of Business Administration at Coastal Carolina University where he teaches
in the areas of Resort Operations Management, Quality Management, and Quantitative
Methods; he also serves as Assistant Dean, Leadership Development and Corporate
Outreach. Prior to earning a PhD from The Ohio State University in Hospitality Management
(2007), he served the hospitality industry for 25 years including service as General Manager
of hotel and resort operations in Atlanta, Chicago, Los Angeles, Myrtle Beach, PalmSprings,
Salt Lake City and San Francisco for Wyndham International, Doubletree, and Hyatt Hotels
Corporation. He also holds a Master of Science in Strategic Leadership from Mountain State
University (2002) and a Bachelor of Arts in Humanities from Michigan State University
(1982).
Carol M. Megehee, Associate Professor of Marketing in the Wall College of Business at
Coastal Carolina University, earned her PhDin Marketing fromthe University of Texas-Austin.
She teaches undergraduate Marketing Research and Buyer Behavior and graduate
Services Marketing Management. She recently published in the areas of consumption
experiences, cognitive processing, consumer culture, and marketing education in Journal of
Business Research, Psychology & Marketing, Marketing Education Review, International
Journal of Tourism Research, Journal of Services Research and International Journal of
Culture, Tourism and Hospitality Research, among other scholarly outlets. She is on the
editorial boards of Journal of Business Research, International Journal of Culture, Tourism
and Hospitality Research, Journal of Global Fashion Marketing and the Advances in Culture,
Tourism and Hospitality book series. She is an Academy Founding Member of the
International Academy of Culture, Tourism and Hospitality Research.
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doc_195924050.pdf
The purpose of this paper is to develop a method for estimating new direct tourism spending
resulting from a new event in an existing destination
International Journal of Culture, Tourism and Hospitality Research
Segmenting tourists by direct tourism expenditures at new festivals
L. Taylor Damonte Michael D. Collins Carol M. Megehee
Article information:
To cite this document:
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Segmenting tourists by direct tourism
expenditures at new festivals
L. Taylor Damonte, Michael D. Collins and Carol M. Megehee
Abstract
Purpose – The purpose of this paper is to develop a method for estimating newdirect tourismspending
resulting from a new event in an existing destination.
Design/methodology/approach – Intercept surveys were conducted on site at six of nine festival
locations. Of the 308 festival participants approached at random and asked to participate, 264 agreed
to participate (86 percent response rate). Upon further inquiry, only 47 percent of those agreeing to
participate were found to be from zip codes outside of the Horry/Georgetown County ‘‘Grand Strand’’
tourist area. These 145 festival participants were administered surveys.
Findings – Less than 30 percent of total tourist spending at the festival is attributable to new tourists –
those who speci?cally traveled to the destination primarily for the event and have historically attended
Myrtle Beach less than one time per year. Consequently, the economic impact of the festival, in terms of
new spending, was relatively small compared to the total amount of tourist spending by all tourists at the
festival.
Originality/value – The study provides an example of an event for which new tourist spending could
have been overestimated if all tourist spending had been considered to be new spending.
Keywords Tourists, Food and drink, Expenditure, United States of America, Festivals, Economic impact,
New tourist, Switcher, Tourist type, Coastal Uncorked
Paper type Research paper
‘‘As the economy gets better, everything else gets worse’’ (Art Buchwald, 1925-2007). Citing as
an example, ‘‘The more cars that are sold, the bigger the pollution and traf?c problems you have’’
(‘‘Buchwald’s Law’’, Time, September 15, 1993).
In a sense, a destination is like a large service factory where the host community inputs
tourists who bring new spending. The new spending activity throws off both positive
externalities such as jobs and tax revenues, and negative externalities such as traf?c, noise,
and sometimes even crime. Often, a community changes its collective opinion of the value of
a visitor market based on the perception of negative externalities related to the presence of
that market in the community. An example of this occurred recently in Myrtle Beach, SC,
where in 2008 the community added a number of ordinances designed to quell the rise of
motorcycle events, which were perceived as bringing with them many negative externalities
during the month of May each year. At the same time, new festivals, including one entitled
Coastal Uncorked were created to replace the motorcycle-related visitation (Brandon; cited
in Anderson, 2011). Researchers were asked to estimate the economic impact of this new
event. Consequently a means of estimating newdirect spending resulting fromthe presence
of new tourists in the community was required.
Researchers studying the economic impact of festivals often collect data on direct spending
via surveys and use this data in economic input-output models to estimate the indirect and
induced impacts of these festivals on the regional economy. A number of common
DOI 10.1108/17506181311301354 VOL. 7 NO. 1 2013, pp. 51-57, Q Emerald Group Publishing Limited, ISSN 1750-6182
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PAGE 51
L. Taylor Damonte,
Michael D. Collins and
Carol M. Megehee are
based at the E. Craig Wall
Sr College of Business
Administration, Coastal
Carolina University,
Conway, South Carolina,
USA.
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methodological pitfalls have been identi?ed in estimating new direct tourism-related
spending (Crompton et al., 2001). Rigorous estimates of tourism-related economic impact
should be based on marginal revenue from visitors (i.e. revenue from new visitors to the
destination who would not have come had it not been for the event itself). Since the Myrtle
Beach area is a well-established tourist destination with over 100,000 transient
bedroom-equivalent units (Brittain Center for Resort Tourism, 2010) located on the US
East coast and has 73 percent rate of repeat visitation (Equations Research, 2010),
identifying purely new tourists’ spending could be challenging. This study provides a
research approach that addresses this challenge. The discussion includes other potential
tourism-related bene?ts of festivals.
Spending associated with non-local festival attendees is often assumed in festival impact
studies to be new tourist spending, which may or may not be the case (Crompton, 1995;
Hodur and Leistritz, 2006; Tyrrell and Johnston, 2001). In order to create an estimate of new
spending, the estimated total number of tourist-attendees must be reduced by the number
of visitors who are ‘‘casuals’’ or ‘‘time-switchers’’ (Crompton et al., 2001). Casuals
participate in the festival, in part, because they have already chosen to visit the area during
the time of the event; the event is, at most, a secondary reason for casuals’ travel to the area.
Switchers may have chosen to visit the area at the time of the festival primarily because of the
event. However, had the festival not existed the visitor still might choose to visit the area
during another time of the same calendar year.
The socio-cultural impact of tourism is particularly relevant to this study. Cohen (1979) writes
that the social interaction between tourists and residents can lead to social change. Several
models that help explain the impact of tourists and tourism on host communities and
residents have been proposed (e.g. Doxey, 1975; Butler, 1980; Ap, 1992). Doxey’s (1975)
Index of Irritation (Irridex) represents the escalating irritation of local residents as visitors’
impact increases. In Stage 1, Euphoria, the number of visitors is small, the host community
welcomes tourism, commercial activity is limited, and visitors try to blend in with the locals. In
Stage 2, Apathy, tourist-host community relationships become more formalized and locals
take visitors for granted. In Stage 3, Irritation, the number of visitors and their impact on the
host community has grown to the point that locals and visitors compete for resources. Finally,
in Stage 4, Antagonism, locals are openly hostile to visitors and they try to limit the negative
impact of tourism on the host community (Doxey, 1975). Several of the powers that be in the
City of Myrtle Beach had reached the Antagonismstage with the motorcycle-related festivals
when they began passing ordinances that would in effect kill the biker events and make
room for more local-friendly events.
Butler’s (1980) Tourist Area Life Cycle Model follows a similar path, wherein over time positive
perceptionsof touristsarereplacedwithnegativeperceptions. Stage1, Exploration, ismarked
by curiosity about a new tourism area, followed by Stage 2, Involvement, when the host
community begins to provide services for their visitors. The Development phase, Stage 3, is
marked by rapid growth and noticeable economic, social, cultural, and ecological impacts.
Heavy advertising and promotion to attract tourists is balanced with local resources. Stage 4,
Consolidation, is when the rate of increase in visitors declines but the absolute number
continuestogrowandeventuallyexceedthepopulationof permanent residents. InStagnation,
Stage 5, the destination is no longer fashionable and repeat visitors tend to be more
conservative. After Stagnation, whether the destination goes into Decline or Rejuvenation
dependsonthehost community’sabilitytocopewithtourismimpacts. Declinecanbeavertedif
policies canmaintainthedelicatebalancebetweenscarcecommunity resources andtourists’
demands (Butler, 1980). At some point, the negative impact of the motorcycle-related events
was seen to outweigh the positive economic impact of these events.
Finally, Ap’s (1992) social exchange theory suggests that permanent residents will enter into
exchange with visitors only if value of the bene?ts to be gained outweighs the costs of such
exchange. Tourism will be supported as long as the resulting bene?ts are valued, exchange
has a high likelihood of producing these bene?ts, and perceived costs do not exceed
perceived rewards (Ap, 1992). As in the explanations above, the bene?ts of the motorcycle
events were not perceived to outweigh the costs of such events.
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Method and results
The Coastal Uncorked event, which spotlighted cuisine of the Myrtle Beach area, was
produced at multiple lodging sites along the Myrtle Beach oceanfront on May 14-15, 2010.
Transportation (trolley) services to, from, and among the sites was provided as part of the
registration fee for the event. University students randomly approached event participants at
six of the hotels that served as ‘‘trolley stops’’ where food and wine was served, asking them
if they would participate in an impact study related to the event. Of the 308 event participants
approached, 264 agreed to participate. In order to determine which of the festival attendees
were tourists, the students asked each festival participant if they were from one of the local
counties (Horry or Georgetown). If the participant answered ‘‘yes’’, then they were thanked
for their participation but no survey was administered. Using this method of inquiry, 47
percent were found to be tourists – a tourist being de?ned as a person whose primary
residence was not in the Myrtle Beach area (Horry or Georgetown County, SC). Since only
those individuals who were tourists were asked to complete the surveys, only 145 of the
individuals who were approached were asked to complete the surveys. Based on ticket
sales festival organizers estimated that there were 3,000 participants at the event. Based on
the percentage of those individuals in the crowd who indicated that they were from the local
area, researchers estimated that 1,410 of the 3,000 event participants were assumed to be
tourists.
Based on a sample average party size of 2.8 people, 412 tourists were assumed to be
represented in the results of the 145 completed surveys. This equates to approximately
29 percent of the 1,410 tourists that attended the festival, according to festival
organizers.
Survey participants were asked to estimate the spending created by their party across eight
categories including lodging, restaurants and nightclubs, groceries, theatres, shopping,
and gas/transportation. The spending of new tourists was de?ned as spending done by
visitors who were not primarily in Myrtle Beach for a reason other than to attend the festival,
the so-called ’’Casuals’’, nor were they switching their visit to Myrtle Beach fromanother time
of the year, the so-called ‘‘Switchers’’. In order to place respondents into one of two groups
within the sample, researchers asked them to indicate to what degree the Coastal Uncorked
event in?uenced their choice of Myrtle Beach as a destination for the current trip. Those that
responded with at least 4 on a ?ve-point scale (with 1 ¼ not instrumental and 5 ¼ extremely
instrumental) were assumed to be more than casual participants. Participants were also
asked to indicate the number of times they had come to the Myrtle Beach area as well as the
number of years they had been coming (trips/years).
Respondents who were already coming to the area one or more times per year were
considered to be switching to traveling to the area during the Coastal Uncorked event rather
than coming here at another time during the year. Consequently, spending by these
Switchers was not considered to be new spending to the area. New Tourist spending was
estimated by including only spending by tourists who could not be classi?ed as either
Casuals or Switchers. Gross direct spending was estimated for each of three types of
tourists (see Table I):
B Type 3 (Casuals) – those tourists who attended Coastal Uncorked events this year but for
whom the events were not an instrumental reason for their choice of travel to the area this
time;
B Type 2 (Switchers) – those tourists who indicated that Coastal Uncorked was a relatively
instrumental part of their decision to travel to the area but who traveled to the area one or
more times per year anyway; and
B Type 1 (NewTourists) – tourists who have not historically traveled to the area at least once
per year and for whom Coastal Uncorked was a relatively instrumental reason for their
choice of visit this time.
Based on the number of Type 3 (Casuals) tourist parties that participated in the survey
(n ¼ 63), Type 3 tourists accounted for 43.4 percent of the 145 total tourist parties that were
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surveyed. The estimated average spending in the area per Type 3 tourist party was $1,818
(Table II). Based on the proportion of Type 3 tourist parties in the sample, an average party
size of 3 people, and the estimated total number of tourists at the event (n ¼ 1; 410), direct
spending in the area by all Type 3 tourist parties in attendance at the festival (n ¼ 201) was
estimated to be $365,512.
Table I Categories of spending
Lodging
Restaurant-night
club spending
Spending
on
groceries
Spending
on
recreation
Spending
in
theatres
Retail
spending
Spending on
gas/transport
Other
spending
Total
spending
per party
Spending by Type 1
tourists, those who
rated CU $ 4=5 on
instrumentality and had
,1 trip per year to MB 502 303 124 191 139.29 155.77 118.62 175.00 1,710
Spending by Type 2
tourists, those who
rated CU $ 4=5 on
instrumentality but had
$1 trip per year to MB 459 307 185 350 106.67 431.82 104.23 75.00 2,020
Spending by Type 3
tourists, those who
rated CU , 4=5 on
relative instrumentality 619 277 150 121 123.30 221.79 140.00 164.38 1,818
Gross direct tourist
spending by all tourists
who attended Coastal
Uncorked 547 290 143 169 125.69 229.70 126.77 151.25 1,785
Note: Figures shown are spending in dollars
Table II Spending by tourist type
Total
spending
per
tourist
party ($)
Number
of tourist
parties
in
sample
Party
size
Total event
participants
represented
in the sample
Estimated
number of
tourists of
each type
attending
event
Relative
size of
the
group
(percent)
Estimated
number of
tourist
parties of
each type
attending
event
Total
estimated
spending
at the
event ($)
Percentage
of total
tourist
spending
(percent)
Spending by Type 1
tourists, those who rated
CU $ 4=5 on
instrumentality and had
,1 trip per year to MB 1,710 45 3.0 133 438 31.0 148 253,151 27.1
Spending by Type 2
tourists, those who rated
CU $ 4=5 on
instrumentality but had $1
trip per year to MB 2,020 37 2.3 86 360 25.5 155 314,011 33.7
Spending by Type 3
tourists, those who rated
CU , 4=5 on relative
instrumentality 1,818 63 3.0 192 613 43.4 201 365,513 39.2
Gross direct tourist
spending by all tourists
who attended Coastal
Uncorked 1,785 145 2.8 412 1,410 100.0 505 932,675 100.0
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Based on the number of Type 2 (Switchers) tourist parties that participated in the survey
(n ¼ 37), Type 2 tourists accounted for 25.5 percent of the 145 total tourist parties that were
surveyed. The estimated average spending in the area per Type 2 tourist party was $2,020.
Based on the proportion of Type 2 tourist parties in the sample, an average party size of 2.3
people, and the estimated total number of tourists at the event, direct spending in the area
by all Type 2 tourist parties in attendance at the festival (n ¼ 155) was estimated to be
$314,011.
Finally, based on the number of Type 1 (New Tourist) parties that participated in the survey
(n ¼ 45), Type 1 tourists accounted for 31.8 percent of the 145 total tourist parties that were
surveyed. The estimated average spending in the area per Type 1 tourist party was $1,710.
Based on the proportion of Type 1 tourist parties in the sample, an average party size of 3
people, and the estimated total number of tourists at the event, direct spending in the area
by all Type 1 tourist parties in attendance at the festival (n ¼ 148) was estimated to be
$253,150. Total direct spending in the area by all three types of tourists combined was
estimated to be $932,634.
Discussion
The creation of festivals to generate travel into a destination is a common practice for many
communities, particularly communities that thrive on a tourism-based economy. Such
festivals are typically created to increase demand during shoulder or off-season time
periods when demand is relatively weaker than during peak periods. Demand reaches its
peak in the Myrtle Beach area during the summer months of June through August. In 2008,
the City of Myrtle Beach passed several ordinances to discourage motorcycle-related
festivals – primarily in reaction to the perceived negative social impacts of increased crime,
traf?c, and noise associated with the biker events. Consequently, community organizers
collaborated to create a new food and wine festival as an alternate tourist event during
mid-May.
Community organizers were interested in understanding the economic impact of the event
and to con?rm that their investment in time and resources to promote and execute the
festival was justi?ed by the incremental revenue generated as a result of the event. While
some research has estimated the impact of an event based upon the total spending of all
participants, the present study illustrates a more appropriate method in that it describes new
spending separately fromspending that might have occurred at other times during the same
year. This method, therefore, creates a more appropriate benchmark for Coastal Uncorked
organizers to use in evaluating the impact of future events. (This is not to say that the
spending of so-called Switchers or Casuals is of little value – it is just not incremental
spending.)
Revenue generated by Switchers, which accounted for approximately 34 percent of the
estimated total direct spending by all tourists attending the event was revenue that could
have potentially been created during a higher demand period. However, as a result of this
shift in travel dates, additional capacity may have been made available in the market during
these higher demand dates, allowing additional travelers to visit the destination during the
higher demand period. This is a strategy that is frequently employed by hotels when they
attempt to lure group business into lower demand time periods with reduced room rates and
other incentives in an effort to protect prime dates for more lucrative business. This strategy
may prove equally effective for a destination as a whole.
Further, Casuals’ tourist participation, though not representing new direct spending, could
also be bene?cial to the long-term growth of a community’s social capital (Arcodia and
Whitford, 2006). While Coastal Uncorked may have only been a secondary reason for 43.4
percent of tourists at the event, the average favorability rating of Myrtle Beach and Coastal
Uncorked by these tourists was 4.2 and 4.1, respectively (on a scale of 1 to 5, with 5 being
extremely favorable). As noted above, this was the ?rst year of the Coastal Uncorked food
and wine festival. The high favorability ratings suggest potential for growth in attendance at
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the festival in the coming years and potential for positive long-term impacts on the local
tourism phenomenon.
Finally, the method provided internship opportunities for students at the local university.
Implementation of Coastal Uncorked brought together faculty research expertise with
opportunities for resort tourism management students to work with faculty and the lodging
properties that sponsored the Coastal Uncorked event. The acquisition of meaningful and
accurate data relative to a festival or event of this nature is often challenging for event
organizers to obtain. Organizers sometimes lack performance measurement expertise and
are often fully consumed with promoting and orchestrating the event. As a result, obtaining
data related to the economic impact of the event is often an afterthought and a challenge that
event organizers simply do not have the time, ability, or motivations to address. For
hospitality- or tourism-related academic programs, such an event provides an opportunity
for students and faculty to provide a valuable service to the industry. These programs may
bene?t by promoting their ability to administer meaningful, reliable, and relatively unbiased
economic impact studies as part of a menu of services that they offer to the hospitality
industry and their host community.
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About the authors
Dr L. Taylor Damonte is a Professor and Director of the Clay Brittain Jr Center for Resort
Tourism in the E. Craig Wall Sr College of Business Administration at Coastal Carolina
University. He received a Bachelor of Science degree from the University of New Orleans
and went on to manage hotels and restaurants in the Mississippi Gulf Coast area. He later
received a Master of Science degree from the University of Southern Mississippi and a PhD
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from Virginia Polytechnic Institute and State University. He teaches a seminar in Resort
Planning and is the Principal Investigator on the Tourism Economy Study, a weekly analysis
of lodging business performance in the Myrtle Beach area of South Carolina. Current reports
based on that research can be found at www.coastal.edu/business/resort. He has delivered
hospitality and tourism seminars in Ecuador, Panama, Slovakia, Germany and China. Dr
L. Taylor Damonte is the corresponding author and can be contacted at:
[email protected]
Michael D. Collins is an Associate Professor, Resort Tourism Management, in the E. Craig
Wall Sr College of Business Administration at Coastal Carolina University where he teaches
in the areas of Resort Operations Management, Quality Management, and Quantitative
Methods; he also serves as Assistant Dean, Leadership Development and Corporate
Outreach. Prior to earning a PhD from The Ohio State University in Hospitality Management
(2007), he served the hospitality industry for 25 years including service as General Manager
of hotel and resort operations in Atlanta, Chicago, Los Angeles, Myrtle Beach, PalmSprings,
Salt Lake City and San Francisco for Wyndham International, Doubletree, and Hyatt Hotels
Corporation. He also holds a Master of Science in Strategic Leadership from Mountain State
University (2002) and a Bachelor of Arts in Humanities from Michigan State University
(1982).
Carol M. Megehee, Associate Professor of Marketing in the Wall College of Business at
Coastal Carolina University, earned her PhDin Marketing fromthe University of Texas-Austin.
She teaches undergraduate Marketing Research and Buyer Behavior and graduate
Services Marketing Management. She recently published in the areas of consumption
experiences, cognitive processing, consumer culture, and marketing education in Journal of
Business Research, Psychology & Marketing, Marketing Education Review, International
Journal of Tourism Research, Journal of Services Research and International Journal of
Culture, Tourism and Hospitality Research, among other scholarly outlets. She is on the
editorial boards of Journal of Business Research, International Journal of Culture, Tourism
and Hospitality Research, Journal of Global Fashion Marketing and the Advances in Culture,
Tourism and Hospitality book series. She is an Academy Founding Member of the
International Academy of Culture, Tourism and Hospitality Research.
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