dccc2012 revised final economic impact study presentation

DC Caribbean Carnival:

Economic Impact Study 2011

Yuvay J. Meyers, Ph.D.

Debby Lindsey-Taliefero, Ph.D.

Allison J. Morgan, Ph.D.

Lynne J. Kelly, Ph.D.

Howard University School of Business

Roadmap

• Background

• Study Overview

• Survey Results – Patrons

• Survey Results – Business Owners

• Financial Analysis

• Final Recommendations

Background

• The DC Caribbean Carnival, Inc. was started to

celebrate Caribbean culture in Washington

metropolitan area in 1993.

• Flagship Event - DC CARNIVAL™ Extravaganza

Parade and Festival

Approximate annual attendance - 400,000 people

Parade – live performances and bands

International Marketplace, “DE SAVANNAH”

Background

• DC CARNIVAL™ is centered on Georgia Avenue in

the District of Columbia.

• The District benefits economically and culturally

from the celebration.

• The event also serves to strengthen community ties,

promote social harmony, as well as foster

multiculturalism.

Study Overview

• DC Caribbean Carnival, Inc. charged the Howard

University School of Business (HUSB) to quantify

the economic impact of the DC Caribbean Carnival.

• Data collection was carried out on June 25, 2011

during the Carnival.

Information gathered from both Carnival patrons and

business owners.

Study Overview – Research Tasks

Three major tasks including:

• A survey of event attendees focusing on the specific economic

contribution to the District of Columbia.

• A survey of local small businesses focusing on the economic

revenues earned during that event.

• An economic impact assessment, which involves an evaluation of

the direct contribution of the carnival attendees on the District of

Columbia.

Study Overview – Research Tasks

The goal of the study was to provide the following:

• Estimate of the expenditures of the patrons attending the 2011 Annual DC

CARNIVAL™.

• Estimate of the incremental sales tax revenues generated by 2011 Annual

DC CARNIVAL™.

• Estimate of the business revenues generated by 2011 Annual DC

CARNIVAL™.

• Estimate of the incremental business tax generated by 2011 Annual DC

CARNIVAL™.

Study Overview – Data Collection

• Participants

685 patrons

50 business owners

• Survey

Hard copy survey administration

No financial compensation

Participants entered to win an Apple iPad

Survey Results

• Key results summarized for patron survey and

business owner survey.

Survey Results - Patrons

• The majority of Carnival Patrons are local to Washington metropolitan area.

Survey Results - Patrons

• The majority of Carnival Patrons attended the Carnival with family and/or friends.

Survey Results - Patrons

• Many patron attended the Parade and Marketplace while at the Carnival.

Survey Results - Patrons

• The anticipated spending for the Carnival was on average less than $50.

Survey Results - Patrons

• Carnival Patrons reported being positive comments in terms of satisfaction with the Carnival more frequently.

Survey Results - Patrons

• The most frequently mentioned method to improve satisfaction at the Carnival was to extend the Parade.

Survey Results - Patrons

• The primary information sources for the Carnival were by Friends/Family and Word of Mouth.

Study Results – Business Owners

• Most of the business owners found an increase in customers during the Carnival.

71.7%

28.3%

During the DC Carnival, did your business receive any additional customers?

Yes No

Study Results – Business Owners

• Average customer expenditures during the Carnival was $50 or less.

38.8%

32.7%

20.4%

2.0%

2.0%

2.0%

2.0%

0.0%

0.0%

0.0%

0.0%

$10 or less

$11 to $25

$26 to $50

$51 to $75

$76 to $100

$101 to $200

$201 to $300

$301 to $400

above $400

$301 to $400

More than $400

0.0% 20.0% 40.0% 60.0%

On average how much did each customer spend during the DC Carnival?

$10 or less

$11 to $25

$26 to $50

$51 to $75

$76 to $100

$101 to $200

$201 to $300

$301 to $400

above $400

$301 to $400

More than $400

Study Results – Business Owners

• The majority of Business owners felt the Carnival helped the Georgia Avenue corridor.

91.8%

8.2%

Do you think the DC Carnival help or hurt business on Georgia Avenue corridor?

Help

Hurt

Study Results – Business Owners

• All business owners believed the Carnival should continue.

100.0%

0.0% 0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

120.0%

Yes No

As a local business, do you think the DC Carnival should continue?

Yes No

Study Results – Business Owners

• Average annual business income reported was typically $80,000 or less.

18.6%

9.3%

14.0%

18.6%

20.9%

18.6%

0.0% 10.0% 20.0% 30.0%

Less than$20,000

$20,00 to$34,999

$35,000 to$49,999

$50,000 to$64,999

$65,000 to$79,999

$80,000 orgreater

What is your business income?

Less than $20,000

$20,00 to $34,999

$35,000 to $49,999

$50,000 to $64,999

$65,000 to $79,999

$80,000 or greater

Study Results – Business Owners

• Satisfaction with Carnival activities was typically positive from business owners.

0

0

1

2

3

2

2

1

3

8

5

5

8

10

8

18

13

16

0 5 10 15 20

Parade

Marketplace

Total Event

Please tell how satisfied you were with 2011 DC Carnival?

Completely satisfied

Mostly satisfied

Somewhat satisfied

Neither satisfied or dissatisfied

Somewhat dissatisfied

Mostly dissatisfied

Completely dissatisfied

Financial Analysis

• Includes the following analyses:

Cost Benefit Analysis

Estimated Patron Expenditures

Generated Sales Tax Revenues

Financial Analysis - Assumptions

• Washington DC government provides $30,422 in

support to the Carnival.

• The Carnival Board is required to pay $338,700 in fees

to the Metropolitan Police Department for enforcement.

• The total event cost is $584,483.

• Comparisons made with the Toronto Carnival,

Scotiabank Caribana.

Cost Benefit Analysis

• The DC CARNIVAL™ makes $39.48 for each dollar spent and produces approximate sales tax revenues from the attendees of $1,298,230.00.

DC Caribbean

Carnival 2011

Toronto Scotiabank

Caribana 1998

Budget* $584,483 $416,250

Number of Attendees 400,000 1,200,000

Attendee Expenditure $ 21,637,166 $198,000,000

Cost-Benefit Ratio***(Expenditure/Budget) $37.02 $475.68

SalesTaxes Earned† $1,298,230 $25,740,000.00

Carnival Estimated Patron Total Expenditure and

Generated Sales Taxes by Number of Attendees

• The Caribbean Carnival provides increasing returns scale to the Washington, DC economy on a whole.

Number of Attendees 400,000 300,000 200,000

Number of Patrons by Category

Family and Friends 111,839 83,879 55,919

Group 72,836 54,627 36,418

Individual 80,000 60,000 40,000

Total Patrons 264,675 198,506 132,337

Average Household Size, DC 2.21 2.21 2.21

Average Expenditure $ 81.75 $ 81.75 $ 81.75

Total Expenditures $ 21,637,166 $ 16,227,875 $ 10,818,583

Cost- Benefit Ratio $ 37.02 $ 27.76 $ 18.51

Sales Taxes Generated @ 6% Tax Rate $ 1,298,230 $ 973,672 $ 649,115

Estimated Incremental Revenues by

Number of Attendees • The estimated incremental revenue per business was $751.52. Depending

on the number of business along the DC Caribbean Carnival parade route or at the marketplace, the incremental revenues range from $75,152 (n=100 businesses) to $300,608 (n=400 businesses).

Consumer's Average Expenditure Per Business $ 26.84

Average Additional Customers 28

Estimated Incremental Revenues Per Business $ 751.52

Number of Business 100 200 300 400

Total Estimated Incremental Revenues along DC Caribbean

Carnival Parade Route $ 75,152 $ 150,304 $ 225,456 $ 300,608

Final Recommendations

The DC Caribbean Carnival provides significant

economic value to the Washington, DC economy.

Additional key recommendations are

highlighted:

Final Recommendations

1. To encourage the expansion of the Carnival,

advertising of the event earlier and using larger

outlets may help to yield a wider attendee base.

2. The DC Carnival is a family event. Therefore,

materials promoting the Carnival as well as

activities chosen to supplement the Carnival

should bear this in mind.

Final Recommendations

3. This is an opportunity for corporate sponsorship.

Corporations with a local presence should be made aware of

the opportunities available to sponsor the DC Carnival and

support this cultural event in the District.

4. Attendees are spending the majority of their money on food

and beverage items. Getting additional vendors to

participate in sales of these items may be able to encourage

additional individuals to attend the Carnival.

Final Recommendations

5. The age group of Carnival participants is on

average between 18 and 45. The Carnival might be

attractive to individuals in other age brackets if

there were designated places to sit.

6. The carnival committee should continue to ensure

that the event remains an affordable family

friendly event.

Final Recommendations

7. Extending the parade route could be of great

benefit to attendees and businesses.

8. Some participants felt that law enforcement was

too aggressive to attendees. Possibly utilizing a

civilian security detail could minimize part of this

problem. Or working with the city and the police

force on cultural sensitivity may be necessary.

Final Recommendations

9. Viral marketing campaigns should be a key

method of event advertising moving forward.

10. Working with the local businesses before the

event is essential.

HUSB Research Team & Contact

Information Yuvay Meyers, Assistant Professor • ymeyers@howard.edu • 202-806-1553 (w) Debby Lindsey-Taliefero, Associate Professor • dlindsey@howard.edu • 202-806-1568 (w) Allison Morgan, Assistant Professor • aj_morgan@howard.edu • 202-806-1605 (w) Lynne Kelly, Assistant Professor • ljkelly@howard.edu • 202-806-1658 (w)