Consumers of cycling may have noticed an increase in ride-focused content across cycling media in recent years. Product-based pages are still just as popular, but promotion of mass-participation road cycling events seems to be popping up everywhere.
Organizers of such events understand that the group ride is a central pillar of road cycling culture; they know cyclists have an innate need to compare themselves to, and compete against, other cyclists. Enhancing this bunch experience is the event organizers’ raison d’etre – their mass-participation (otherwise known as gran fondo or cyclosportive) events offer desirable services and locations, with provisions ranging from basic traffic management to sanctuary-like conditions with massages, gourmet food and full road closures.
Now in its 14th year, Le Race – an iconic journey from Christchurch city to the picturesque French-influenced harbourside village of Akaroa – sits somewhere in the middle of the spectrum. Though the route remains open to vehicles, weekend traffic patterns and an early departure time (08:00am) deliver large tracts of car-free roads. Just in case, cycling “bunch police” are engaged to keep participants mindful of the regulations; they also have authority to pull rule-breaking riders from Le Race.
After years of procrastination and schedule clashes, I finally signed up for the challenging 100km route that features 1,443m elevation gain and, take note, eight cattle stops. Having previously lived in Christchurch for many years, I expected spectacular scenery, exhilarating descents, April (read: often surprising) weather and a lot of climbing. En route to the finish, these expectations were definitely met and, in the case of the climbing, exceeded. Quaffing the sponsor-supplied Leppin energy drink and stuffing my face with Easter buns amongst other happy-looking cyclists on the grassy finisher’s area, I deemed my NZD95 entry fee money well spent.
However, this money also represented a generous race pack, sleek (and disposable) timing chips, temporary road closures, dozens of marshalls, kitted-out volunteers, signage, free coffee and food, amongst many other inclusions. Having heard anecdotes about the profitability of “ride” events (as opposed to “race” events), I decided to seek out Simon Hollander from Tailwind Events to discover where my money went and whether Le Race is a rollicking gravy train for its owner.
After an initial post-University stint as a civil engineer in the 1990’s, Hollander is today a branch manager and partner at Harcourts; a successful real estate company with 60% market share in Christchurch, according to Hollander. “It scared me when I saw some of the middle-aged engineers biking to work with their lunch boxes on their panniers and work socks pulled up to their knees. I thought ‘Gosh that’s a wee bit of a scary thought to end up like that when I’m 40.’ I think my Mum thought I was mad to give it up.”
The change in profession proved to be a financially sound one. The ardent cyclist was able to indulge his love of cycling in style; chartered flights to the Lake Taupo Cycle Challenge with 37 of fellow enthusiasts a particular specialty. “I’d been taking a group of cyclists called ‘The Flying 38’ to do Lake Taupo and it was just 38 of us who chartered a plane to the ride. We took the front wheels off the bikes, put them in the ‘boot’ and literally walked onto the tarmac and took off. We did that for about five years then someone said, ‘look, that’s fun Simon but we’ve done Taupo; what else can we do?’ This is when I approached Astrid to buy the race and take it over.”
The Astrid mentioned above is Astrid Andersen; a name that, in New Zealand event management circles, is unfortunately associated with a landmark court case that saw the former Le Race director charged with criminal nuisance after a female cyclist died in a head-on collision with a car during the 2001 edition. Andersen was convicted in 2003, though the ruling was overturned on appeal in 2004.
During 2003, Hollander approached Andersen about taking over Le Race. “I said to her ‘if you’re interested, I’m happy to step in and get involved because I can see you’ve been through a heck of a time.’ At the time, she carried on. A year or so later, she asked if the offer was still up. By that time (2005) I had started the Festival of Cycling. We did a pretty good job and had visions of hitting 3,500 participants.”
Event logistics and race organisation for the inaugural two-day Festival of Cycling was contracted to Tailwind Events; an events management company registered by Hollander in May 2005. Andersen’s counter-proposal clearly impressed upon Hollander the possibility of owning multiple events; together with his solicitor, he set up ‘Mainland Cycling’ in July 2005 as an overarching parent for events under his directorship.
COUNTING THE NUMBERS
By 2006, Le Race entries had reached record levels with 1,500 cyclists participating. Interestingly, Giant Bicycles’ New Zealand division recorded its best-ever annual turnover that same year whilst 2007 bicycle imports (ordered in 2006) also reached historic highs on the back of positive sentiment.
As Hollander recalls, Le Race “had lost momentum with the legal issues, then suddenly cycling was in a boom in 2006-08 and (Andersen) got some good numbers. Now, when you’ve got 1500 riders and you used to have 600-700, you start to make some money and it’s all worth it.”
Whatever the factors contributing to that boom were, they were temporary. In the two years following, Le Race participation had fallen to 1000. When asked if this was a by-product of option-based dilution – given the general growth of cycling events – Hollander fishes for answers. “I think there was definitely more on the calendar, so people have more choice. That’s part of it. At the tail end of a recession (referring to the present year), we’ve definitely seen a downturn whereas running events have seen an upturn, interestingly.”
Despite the decline, or maybe aided by it, Mainland Cycling procured Le Race from Andersen in 2008. Capping the 2009 edition at 1,000 entries, the first edition of Le Race under the new management concluded incident-free, with former world junior road cycling champion Jeremy Yates’ victory validating the quality of the field. Only a few months later, Mainland Cycling bolstered its profile and portfolio by securing the Elite Road Cycling National Championships for three years.
“My concept behind Le Race and Festival of Cycling was ‘bring cycling to the people and they’ll come’”, explains Hollander, “as opposed to the local clubs that had been pushed out into the local towns and the wop-wops. They did that because it was cheaper; they still got similar participation, but no spectators. This is why we bought the elite nationals to downtown Christchurch, and we’ve gotten crowds of 15,000-20,000. That’s massive in terms of a national cycling championship in NZ. But coming with that is the huge costs of running it.”
In 2010, the downward trend of race entries continued across all Mainland Cycling’s mass-participation events. However, race entries would pale into insignificance in the following months, as Christchurch felt the wrath of two major earthquakes. The September 2010 earthquake rattled Christchurch’s infrastructure but mercifully spared lives, but the February 2011 earthquake that followed devastated lives and homes.
Though it was reported that up to one-fifth of Christchurch’s population had fled the crippled city, by March 2011, Tailwind Events communicated its intent to hold the event in October. Amazingly, Le Race was still able to attract 620 entries. Despite another violent earthquake in December 2011, and literally thousands of aftershocks, the 2012 edition recorded a further 13% increase to 697 entries.
THE UPS AND DOWNS OF CYCLING EVENT MANAGEMENT
Mainland Cycling’s dual role as steward of a major sanctioned event and owner of an iconic “fun” race has offered Hollander a glimpse into the unique opportunities and challenges inherent to both models.
“Le Race and the Festival are different because it’s a recreational event and we charge entry fees, etc. The (council) system is so big and cumbersome that the traffic management plans we put in are simply looked at based on traffic and the rulebook. They don’t look at things in terms of cycling and events. Sometimes you just can’t fight that. You’re stuck. It’s a quandary to have a safe race but still lower your costs; you can’t cut safety, so all of these items are locked in.
Traffic management costs have gone from $9,000 four years ago to $16,500 this year (2012). I don’t know if they’ve got any more signs out – I haven’t been out to count them – but the compliance costs are so much more than ever before. Marshalling costs are $4,000-$5,000; there’s no such thing as a volunteer that comes along just for fun anymore. Those days are gone. We have some serious costs in terms of St John’s ambulance who we have in our traffic management plan – $4,000-$5,000, whether we use them or not.
When you start cutting down on prizes and giveaways, people feel that. I’m not prepared to compromise on having good sponsor coverage, finishing rewards and timing. There are a few economies of scale – stock ordering, admin, etc – as we have more than one event.
We’re trying to put back into the local area. We shifted the finish line (in Akaroa) to the main street now, whereas before it used to end down a small side street. We don’t charge a site fee for the locals to have a food stall. The local butcher had a stand and they did hugely well with the sausage sizzle and kids raising money for the local school. Parents from the local school do the marshalling around the hilltop to Akaroa at $40-$50 each, and you’ve got 100 of them, so all of that helps.
The Elite Nationals are unusual. Our hands are tied in that Bike NZ (the national cycling federation) organizes the main sponsor, so I can’t get any more money out of them. 360 volunteers are needed; half of them come along for a free t-shirt and fun and lunch, pretty much. The Elite Nationals used to just come and go without anyone knowing, but now we’re on all the news channels for three nights, we’re on SKY TV, and we’ve got 85 pages of media clippings.
It’s rewarding when you see the media coverage and the crowds, whereas a few years ago there were two cows and three sheep watching; but we can’t sell TV rights in NZ. If you’re rugby, they pay you; but not for cycling.”
THE ROLE OF SPONSORSHIP
With current entries 30% below the preferred level, rising fixed costs have blunted any prospect of profitability from entry fees alone. “I’m sure there’s people that look at the events and do the basic maths”, surmises Hollander. “You know, 700 entries times the entry fee. If you do that, you get nowhere close to our expenses so the rest of it comes from sponsors. The sponsors we have now have stuck with us. It’s all very well saying ‘support us because we’ve had a tough couple of years with the earthquakes in CHCH’, but so have they.”
Does this mean sponsors have to be part philanthropist? “Yes, I think they do. Dare I say it, they have to have a passion and love for the sport otherwise they just wouldn’t get involved. Those that have gotten involved and worked it and leveraged off it have done really well. It’s not the sort of thing where you can throw money at it, then walk away and expect to get a return. Coffee Culture, for instance, did a really cool thing where they had Tour de Coffee Culture. With Facebook etc, it became quite popular. There’s stuff like that they plug into.”
INTROSPECTION – IS IT WORTH IT?
So far, Hollander hasn’t yet benefitted financially from his plunge into cycling event management. “It doesn’t make sense at all financially, so I have just done it for the love. We’ve got a good team of people. There’s a few people here (at Harcourts) that help out, my family helps out, and the core group of three or four turns into 20 and 100 marshalls on the day. I rely on the local cycling clubs and commissaires; I couldn’t do it without them.
At 600-700 riders, Le Race doesn’t make sense. Ideally, I’d like to cap the race at 1,000 and leave it at that. We want to get back to that level. At 1,500 entries, there were all sorts of traffic problems, issues with getting to Akaroa, traffic jams, and unhappy locals.
Do we acquire more events, or get involved with more events, or do we look after the ones we currently have and make them better? Is there going to be an attrition rate of events anyway? Is that just the local market? I don’t know the answer.
At some stage though, you’ve got to pay the bills. Let’s just say it’s a normal person’s annual income that I’m personally putting into it. My hope with the Elite Nationals is that, after three years, people will now pay a bit more money to get involved with it, but we’ll see.”