Tuesday, December 09, 2008

recession proof

there was an article posted on Runner's Web regarding triathlon in the current economic crisis.

the link is here:
i'm putting the full text of the article at the end of this post. according to the credits it was originally posted at the USA Triathlon home page, but i wasn't able to locate it there.

according to this article the sport of triathlon is recession-proof, in the sense that it keeps growing (in terms of numbers of races and competitors).

which is funny, because it's counter-intuitive. you'd think that in times of tight economics, when people are struggling to make money and doing everything to find ways to save it, that people would shy away from activities involving money not related to immediate survival. triathlon isn't exactly cheap--factor the costs of race suit, wetsuit, swim gear, bike gear, bicycle (the big $$$), running shoes, food, race fees, and the miscellaneous random expenses of the sport (and never mind luxuries like coaching, massage, yoga, etc.). given this, you'd think triathlon would be among the many things people in financial distress (most of the world's population right now) would be avoiding, or not even thinking about.

but i guess i'm wrong.

you could argue that people are using equipment they already have. but a lot of money is not tied to equipment, and can all these new competitors entering all these new races really be working with gear they already have? i doubt it. sounds like a big assumption to me.

you could argue that maybe the economic crisis really isn't all that bad, and there are more people out there with more money to spend than the news would lead us to believe. but then how does that explain all the grim economic statistics, a lot of which are coming from pretty reputable sources? seems a reach to say that too.

you could argue that maybe people are just foolish, and that in the face of one of the worst recessions in recent history--domestic and global--people are oblivious and spendthrift, and expending money they don't have. this, given my impressions of so much of human nature, is something i can entirely believe.

in which case, i want to know: where is everybody getting the money for all this?

and can i have some?

Triathlon: Is Triathlon Recession Proof?

COLORADO SPRINGS, Colo. (December 9, 2008) -- With virtually every aspect of the U.S. economy reeling, it figures that an expensive participant sport fueled by discretionary income would feel the pinch.

That's not the case, at least not yet, according to an informal survey of race directors across the country. If anything, the boom the sport has experienced in recent years continues despite the economic downturn.

In fact, USA Triathlon, the national governing body for the sport, saw its list of sanctioned races grow from 2,340 to over 2,500 and its total annual membership soar from just over 100,000 to 115,000 over the past year.

In September, no less a source than The New York Times hinted that the sport was recession-proof, calling it "a luxury hobby that does not seem to lose its luster even in an economic downturn."

"In tough times, people need a diversion more than ever," says Jim Rainey, whose Georgia Multisports Productions stages nine races in the Peach State. "At $65 or $75, it's still a cheap day of entertainment."

Because of the triathlon boom in recent years, athletes in most parts of the country can find plenty of races within driving distance. Without hotel and transportation costs, expenses consist of entry fees and training costs. Those are significant, to be sure, but still relatively modest.

"If an athlete can get in the car and go and not incur hotel fees, they're still going to go," says Jack Weiss, whose Ironhead Race Productions stages events in the Dallas-Fort Worth area. "But if they have to get on a plane where tickets have doubled in price and then pay for a hotel, they're going to think twice."

In the Tampa-St. Petersburg area, for instance, athletes can find at least one race virtually every weekend from mid-April through Halloween. Only the popular St. Anthony's Triathlon, which serves as a sort of national kickoff to the season, attracts a significant percentage of athletes from out of town.

"We continue to sell out fairly quickly," says Fred Rzymek, whose RPM Promotions company stages three triathlons and several other multi-sport events in the Tampa Bay area. "If anything, we're finding people are staying home and that has a positive impact on races locally."

Rainey staged a sold-out event in Georgia on Oct. 5 that followed on the heels of a tropical storm that sent gas prices up to $4.50 a gallon and yet he still had athletes trying to get in at the last minute. He figures he could have sold an additional 100 spots to the race, which he capped at 880.

Jeremey Davis, whose Set-Up Events stages races in the mid-Atlantic area, held a triathlon recently in the remote town of McCormick, S.C., on the border of South Carolina and Georgia, and attracted 115 college-aged athletes in a field of 600.

"You'd think if anyone wouldn't have money, it would be college athletes," Davis said. "It doesn't seem to be affecting anyone. Triathletes are a resilient group, I guess."

If any niche of the industry would be affected by the economy, it would seem to be Ironman and Ironman 70.3 races. With entry fees that average $475 for an Ironman and $225 for a 70.3, and located in destinations where athletes spend multiple days either out of desire or necessity, an Ironman is an expensive proposition even in robust economic times.

Still, even with Ironman there has been no indication that the economy has had an impact, says Blair LaHaye, spokesperson for World Triathlon Corp., the parent company of Ironman, which in September was purchased by Providence Partners.

Just as sports fans continue to pay escalating ticket costs for major events, Ironman triathletes seem unfazed by the costs, even as the number of full- distance and 70.3 races has exploded in recent years.

"In some respects, it's a recession-proof sport," says LaHaye, who attributes Ironman's increased entry fees to increased fuel costs and vendor fees. "We have been fortunate not to see a downturn based on the state of economy."

It helps that the Ironman competitors have an average income of $161,000, according to WTC research, and that triathletes in general have higher incomes on average than the general population. They're not immune to shifts in the economy, of course, just perhaps better equipped to deal with financial adversity.

Tim Yount, senior vice president of marketing and communications for USA Triathlon, believes the sport should be able to weather the economic storm.

"We have been fortunate over the past two decades to be able to survive several economic slumps," he says. "Our belief is that the sport is the outlet that many need to escape from the everyday stresses of life. People may be more selective in the races they do, drive more and fly less but overall do the same number of races."

Weiss wondered how the economy would impact the sport late in 2001 after the burst of the technology stock bubble and the terrorist attacks of Sept. 11. One of his friends dealt with the loss of a high-paying job by dedicating himself even more to training and racing.

"He figured since he had the equipment and suddenly had more time to train, he could use the downtime to see just how good he could be," Weiss said.

Though the up-front cost to entering the sport of triathlon is significant, with bike and equipment purchases and perhaps one-on-one swim lessons for those who need it, triathlon is relatively inexpensive compared to other sports. Unlike golfers, who must pay greens fees for every practice round, triathletes can go for a training ride or run for nothing more than the cost of wear and tear on equipment.

While the economy may not be having an effect on the number of athletes registering for races, the cost of staging events has never been greater. Fuel charges for everything from police and emergency vehicles to pizza delivery have increased. Those costs get passed along to race directors and ultimately to athletes in the form of higher race fees.

Athletes also tend to be more demanding during tougher economic times, expecting more out of races. High-end "tech" shirts that were seen as premium items just a few years ago now are all but expected at triathlons, as are more extensive post-race spreads.

If athletes are not letting the economy dictate their triathlon participation, it could be because an "investment" in a race fee or piece of triathlon equipment rarely leads to disappointment like a foray into the stock or housing markets. At a time when few investments seem safe, that's a comforting thought.

"We can give you something you can hold in your hand," says Weiss. "Part of the problem with the stock market is you're selling hype; it's air. In our sport, we give you a real shirt and a real event and real equipment. At times like these, people fee better spending their money on triathlon. If nothing else, it's an escape from reality."

-- by Pete Williams (Special to USA Triathlon)


Bob Almighty said...

I think it's a matter of people looking at what helps take their minds off the crisis. Sport seems to have a medative effect, not to mention the "runners" high. Also with all the inspirational stories out there, some people may view their own lives in a differnet prosepective, that instead of sitting on the sofa focused on the doom and gloom of the mass media to actually go out and improve their health and situation.Afterall $1000 on a bike and a few race entries seems to have better long term effects than $1000 spent on Doctors' Bills and Pills later in life

Trihardist said...

Bob's right. We see pretty much the same thing at the gym. In tough times, people want to feel good. So while personal training definitely isn't recession proof, the trends are surprising during tough times.