Sunday, February 8, 2015

Support Your Local Independent Races and Race Directors

Swim Start at Surf City Long Course 2014
The month of January was a busy one despite no races on the calendar.  Two major triathlon conferences highlighted the month: the USAT Race Director Symposium and Triathlon Business International.  Both are great conferences with a major stake in the success of multisport.  USA Running has some of the same topics on their agenda as they meet this month. 

There was a clear theme articulated at both USAT and TBI that independent and grass roots events are critical to the sport.  Whether you are a runner or a multisport athlete, we all know that you just don’t go out and qualify for the Boston Marathon or Kona without going through a lot of training and racing at local events. Despite this, there isn’t an independent race director who doesn’t feel some level of survival pressure for a multitude of reasons.   

What do we know about multi sports events in early 2015?  Participation has not shown growth across the board like it did in years past.  Adult annual membership in USA Triathlon has not declined but it hasn’t grown significantly year-over-year as in the past.   Record high growth was reached in 2013 with 2014 being slightly more but not as much growth as past years.  Youth races have grown a lot in the US, about 15% year over year. 

What are some of the contributing factors to this slowing in growth in adult races?  Lack of races? Lack of interest? Expense?  Uneven economic recovery in different regions? Maybe a little bit of all.   Add to that the fact that triathlon isn’t exactly a spectator friendly sport in many venues.

None of these are simple things to tackle and any opinions here just scratch the surface of the contributing factors.  Plus, it’s easy to track USAT and USA Cycling because they have annual membership statistics and it makes it easier to track .  Running races do not have the same comparative metrics, other than the number of participants and race distance.

Explosion of Races

First, has been the explosion of races at all levels of both running and multisport events over the past two or three years.  This seems counterintuitive to statistics saying that race participation is flat in multisports.   It really means that there are the same number of participants to spread around to more races and the US market is saturated, and the competitive pressure is huge.

Regardless of whether it is a new or longstanding race, some are very well run events with professional race directors and/or long running non-profit events that have become annual traditions in communities.  Some are not really well run events but they still create “calendar” pressure in communities and on race calendars – how do you know what you get when you sign up?  The good news is that the good events will eventually survive and the marginal ones will fade away.  Still, this causes some turmoil when a new event comes on to a calendar and creates conflict and competitive pressure with an existing event.  Multiple events on the same weekend not only create athlete conflict but also impact the ability to get services and volunteers.

The sheer number of races and other events results is pressure on community calendars and competition for permits.  This also creates a separate set of problems for a community in providing police or safety services.  There are too many events that don’t clean up after themselves, or have a cavalier attitude in dealing with permits, traffic, neighborhoods or community organizations.  Eventually they suffer from community backlash, causing special events and permitting agencies to place a moratorium on any future events or expansion of existing events.   

It is absolutely incumbent on any event be good neighbor and community partner in order to maintain their position and grow their events.   An event that isn’t a great community partner is likely to suffer from the athlete who didn’t appreciate the bad attitude from the neighbors and doesn’t come back again, or the lack of support, parking, hotels, etc.   We hear it all the time from local businesses and neighbors – they are suffering from event fatigue because they have to deal with it every single weekend in some communities.  There have been several high profile long-term events in running and cycling not taking place this year due to an inability to get permits for various reasons.  When that happens sometimes there is a waterfall effect into other events and communities that impacts even the great events. 

Sponsorship is also another area impacted with the growth in number of events.  Potential sponsors get asked continually for product, services and money.  Unless you find a sponsor who is not endemic to the sport, chance of cash sponsorship is slim to none unless you have a fairly large race property.    Sponsors depend on customer capture and supporting smaller local events is not worth the investment for them.   Add to that a lack of media support and it makes it very difficult to recruit large sponsors.

Even sponsorships of in-kind are difficult for smaller, local companies because while it’s not cash it’s still a bottom line expense for that bike shop or running store, and there are just too many races asking for support that is beyond the means of the small shops.  The events that can forge an ongoing relationship with a great local sponsor are light years ahead in understanding and appreciating sponsor value. 

So how does this impact an independent race?  They have to support almost all race functions out of registration fees because they generally cannot hope to capture cash sponsorships to help lift an event’s profile.

“Bucket List” Events

Second, there are the “bucket list events’ such as cornstarch spewing color runs and neon electric runs.   These are the social activities that were seeing tremendous popularity in the past years.  That popularity seems to be on the decline as participants move on to some other form of entertainment, since they really aren’t “runs” as much as they are “experiential” events.   They really are entertainment, not sports, even though they are presented as 5K runs. 

Some obstacle course events even fit in this category as they are probably are not enduring across all ages and genders for a long period of time.   Running through fire, hauling truck tires and telephone poles or belly crawling through a mud pit are not likely enduring activities for the majority of the population, or at least not over and over again.  These are the type of events that come on the scene and stay for a few years and they may morph into something else or disappear completely.  Sam Mansfield, the CEO of  the US Obstacle Course Racing Association thinks the rise in popularity has something to do with the fact that we do them to associate with the Navy Seals and Special Forces soldiers we hear about in the news every day and it helps make a connection as we slog through the longest war in our nation’s history.  Despite that, 60% of all obstacle course races went bankrupt in 2013!  The long-term survivors will eventually be reduced to a pretty short list of successful and well managed events but they will probably still hold appeal for a slightly different type of athlete, mostly male, average age is 25.  Only a small portion of Spartan or  Warrior Dash participants are triathletes.  They also have an issue with the “one and done” racers who move on to other sports.

Event Consolidation and Mergers

Third, are the mega-event companies.  You know them, World Triathlon Corporation and Lifetime Fitness, the Rock & Roll Marathons, and recently the Challenge Family races moving into North America.   Wherever Challenge announces a new event you can be sure that WTC will not be far behind with a new event, or vice versa as close in geography as possible.   They are battling head-to-head for mindshare in the long and ultra distance endurance market.   They are expanding their portfolio by purchasing or creating new events at an unprecedented rate.  The unfortunate result of this is that races are not filling like in past years (remember we are in a flat period – same number of participants, more races). 

Up until a few years ago an Ironman event, regardless of whether it was a 140.6 or a 70.3 would fill within days, if not minutes of registration opening.  That only happens with a few benchmark events now.   Personally, I think this is not a sustainable model and there will need to be a serious weeding out of events that aren’t making the cut.   Because these companies must return a profit to their boards they will have to change or make cuts to survive, or potentially suffer a financial collapse.  A collapse or failure on this scale could have a catastrophic effect on the growth of triathlon and multisport for a long time. 

At Triathlon Business International, Dan Empfield called for a possible meeting of these mega events with local independent race directors to create some synergy and continuity between events.    Felix Walchshöfer from Challenge Family stated that in Europe that the Challenge Family gets together with the local race directors and actually works to support all races so that they can actually complement each other and make each other successful.  He recognizes that the independent races are actually fueling the training opportunities for Challenge Family events.  Furthermore, he wants to bring that model to North America with regional meetings, but you have to wonder how it will be received here, or if it’s even legal.    At some level, you can’t help but root for the underdog and hope that Challenge is successful with their event philosophy.  They are still a family run company and maintain some of those deeply rooted beliefs from their early days.  They do not serve shareholders looking for a return on their equity stake.

Dennis Messick from WTC was more reluctant to agree to this type of meeting when pressed by Dan, and I’m still not sure he really bought in, although I did hear him say “okay” when asked for the third time.  Whether or not this can actually happen or be successful in the US market remains to be seen.   

But then again, they are partnering with Lifetime Fitness to produce the shorter events in order to concentrate on 70.3 and 140.6 events.  That should give pause to some independent race directors as well, as Lifetime builds their sprint and Olympic portfolio.   The relationship with Ironman and Lifetime Fitness could be the best thing or the worst thing to happen to triathlon and running in terms of growing the sport.   Good for getting more people out of gyms into the sports.  Bad if they want to create a virtual monopoly of events across all levels of the sport. 

There has been an huge explosion of 70.3 events, new and purchased, that are not filling but creating considerable competitive pressure on other similar distance events because people will automatically sign up for a WTC branded event whether it provides a great athlete experience or not.  Not everyone in the industry  (race directors, retailers, sponsors)  is convinced that this will have a good effect on the sport overall.  One race director at TBI told us that even though he has an official 70.3 event his biggest competitor is WTC with another 70.3 event located close to him because they can make more money on their owned events versus licensed events.  Then there’s Tahoe 70.3 and Santa Cruz 70.3 a week apart.  What’s with that? One can only conclude that the writing is on the wall for a discontinued Tahoe at the end of that contract. We’re still not sure that Santa Cruz is ready for the usual onslaught of thousands of triathletes on a weekend in hopes of elevating the Big Kahuna to it’s prior peak attendance years. 

Price Pressure

With few exceptions, when a race gets purchased by another company or merged with a larger group events or a series, the first thing that happens is the price goes up.  Why?  To support the corporate infrastructure and pay licensing fees, thereby keeping that huge marketing machine alive.  In order to survive the events have to become “cookie cutter” events that all look and feel the same.  Conversely, that can also be what makes them successful in setting user expectations for a series of races when it’s well done.    It’s more likely that events lose their own personality. We’ve seen that happen over the years with Ironman events.  When North America Sports was running events in North America each event had it’s own unique flavor and the cost per race was between $375 and $425.  Now every event has the same clothing with a different logo for the simple reason that it’s easier to negotiate volume deals.   The prices for races are higher and the races are packed with thousands of athletes, the expos are all the same, staples like the pre-race pasta dinner and awards banquets are victims of cost saving measures in order to provide greater return to investors who are demanding returns at greater levels in exchange for support.    I’m not sure everyone agrees that this creates a better athlete experience in the long run.


So what’s the point of all this discussion? It is not to say that you shouldn’t go out and do a color run or mud run or an Ironman, because we all do!  

Ironman events are bucket list items for many triathletes and recognized as the pinnacle of achievement for a triathlete, just like the Boston Marathon for runners.   Only about 15% of all triathletes ever compete in a full distance event, yet it continues to be the event that defines triathlon.  More importantly, it should fueling the participation in shorter distance events on the way to that achievement.   The bread and butter of those shorter distances are the local, independent events that already exist.  It’s counter productive to create new events when there are so many in the market with something to offer.

The two major endurance event categories of running and triathlon continue to appeal to both genders across all age levels – from youth to senior – and well run events with great experiences will likely prevail in the long run.

We need to get some of that excitement back into triathlon and local running events.   There are a lot of fun events out there that don’t require you to be a beast or go long distances.  The only requirement is for you show up and have fun and get to the finish line. 

As we mentioned in the recent newsletter there three major reasons you should get out there and support local and independent events:

  • Homegrown events support their local communities at all levels, both social and economic 
  • They provide unique race experiences for the athletes that seem to get lost in the shuffle of event series or large events.
  • Local races probably are a better investment dollar per dollar. 

All things considered, it’s a very organic system at the local level and there are a lot of moving parts.  We want to encourage you to continue to support your local races and their sponsors to make sure they don’t go away!    If that happens then all you have left is the big races with higher prices and travel expenses.

See you at the races!