Why do countries “compete” to own Taylor Swift?

Taylor Swift’s concerts in Singapore will begin on March 2, taking place at the National Stadium with a capacity of 55,000 spectators, creating a fever for ticket hunting not only in Singapore but also in many countries. other countries in the region.

According to some experts, Taylor Swift’s presence in Australia could be worth billions of dollars to the national economy. However, according to economist Brendan Rynne from KPMG – one of the world’s largest auditing companies, the reality is much less.

Simulating the economic impact of major events is often abused to create striking headlines. Unbelievable numbers with great impact on the economy are often used to promote Taylor Swift’s presence in many different major cities recently.

According to Brendan Rynne, before Taylor Swift’s Australian tour, there were wild numbers being given. Taylor Swift’s global Eras Tour was the first tour in history to surpass the $1 billion revenue mark, with more than half a million tickets sold in Australia. With transport, accommodation and labor requirements as well as other spending in sectors such as restaurants and merchandise, estimates of the tour’s impact on the Australian economy have been as large as 1 billion dollars or more.

However, Rynne estimates that number is actually only about $10 million. Such a large difference is not surprising, but to experienced economists it is not unusual.

“In short, any spending by Taylor Swift fans in Australia is simply a transfer from one spending (or saving) category to another,” Rynne said. The real economic benefits come only from foreigners, who account for about 2%.

Rynne values Taylor Swift’s economic value at approximately $63 million based on international visitor data. Each foreign Tyaylor Swift fan spent about $500 on the day of the concert and then stayed an average of 11 days and spent an additional $6,000 each.

Event Pty Ltd director Simon Thewlis agreed with estimates of economic growth from Taylor Swift’s concerts, but he also noted that it was overblown.

“Artists earn a lot of money from selling tickets and goods and items. The entire program is shipped from the US. So a large proportion of USD will also flow to the US,” he said.

According to a new report from Japanese investment bank Nomura, Taylor Swift’s global tour has certainly had benefits for the local economy. However, the bank questioned the extent of the tour’s impact on national data.

Why do countries “compete” to own Taylor Swift?

Nomura global economist Si Ying Toh believes Taylor Swift’s push for consumption could attract the attention of economic analysts, but she also thinks the total macroeconomic impact could be negative. body has been inflated.

According to Nomura’s estimates, from the first quarter to the third quarter of 2023, Taylor Swift’s tour increased nominal US retail sales by 0.03% and real gross domestic product by 0.02%. According to the business’s calculations, for the whole of 2023, the female singer’s tour accounts for 0.5% of nominal consumption growth.

Data from STR that Toh cited shows that stops on The Eras Tour recorded a 3.1 percentage point increase due to inflation during the month of Taylor Swift’s visit. Data from hotel booking platform Trivago also shows a similar increase.

Looking at Chicago specifically, Toh estimates hotel prices have increased 3.1 percentage points thanks to the singer’s three performances. The city, which is the third most populous city in the US, recorded an 8.1 percentage point increase in occupancy rates and a 59% increase in hotel revenue per room during Taylor Swift’s tour.

As a result, the Illinois consumer price index (CPI) increased by 0.5 percentage points just for the female singer’s tour. CPI, an index that reflects the relative change in consumer goods prices over time, was raised due to the influence of this art event.

However, Toh emphasized that these improvements are unlikely to show up in national-level statistics from large economies such as the US, UK or Japan. She also said that, despite this, this mega tour should still be considered a potential stimulus for the economy in many countries around the globe.

On an international scale, small economies like Singapore and Sweden could benefit the most from Taylor Swift’s tour, and Toh emphasized that external influences play an important role in the economic model. reality, whether it’s a severe weather event, a pandemic or a pop concert. She further analyzed that, in recent years, tours have not only developed into a social phenomenon but also have the potential to become an important driver of economic activity.

Countries with small economies “crave” Taylor Swift

Taylor Swift’s concerts in Singapore will begin on March 2, taking place at the National Stadium with a capacity of 55,000 spectators, creating a fever for ticket hunting not only in Singapore but also in many countries. other countries in the region. Many people were willing to line up overnight for the chance to buy tickets, with prices ranging from 88 to 1,228 SGD depending on the category. Tickets for Taylor Swift’s concerts in Singapore also appear on the black market with prices up to 3,000 SGD (equivalent to 2,200 USD) for a VIP ticket.

Expert Cheong from Syntegrate LLP said: “If you look at the number of tourists coming to Singapore, their length of stay as well as their spending ability, I think that amount will be much larger than the sponsorship from Singapore. Government”.

With the rapid increase in tourist numbers and their spending, Taylor Swift’s concerts, which Cheong compares to F1 Grand Prix races in terms of scale, if performed well, will increase Singapore’s appeal as Top destination for event organizers.

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With the rapid increase in tourist numbers and their spending, Taylor Swift’s concerts, which Cheong compares to F1 Grand Prix races in terms of scale, if performed well, will increase Singapore’s appeal as Top destination for event organizers.

“This will send an international message, demonstrating that Singapore is aiming to attract high-yield and high-quality visitors. Concerts like this put us on the map of world event tourism.” world, similar to F1″ – Cheong emphasized his point of view.

He also believes that hosting these shows serves as a “destination revitalization strategy”, which will be even more important after the pandemic, when live events and tourism are in demand. is recovering strongly.

However, some industry experts believe that, although the $2-3 million sponsorship amount may be an important factor, it is not necessarily the only factor motivating Taylor Swift to choose Singapore as her only destination. most in Southeast Asia.

According to Christopher Khoo – CEO of travel consulting company MasterConsult Services, many other factors must also be considered, including infrastructure, connectivity, security stability and culture of the host country. direction. These are all important factors that every event organizer needs to consider.

As an example, Mr. Khoo mentioned the case of star Beyoncé, who had to cancel a concert in Malaysia in 2007 after protests by Muslim groups. He believes that such risks are less likely to occur in Singapore.

“All these factors must be combined so that concert organizers can consider a country as a good destination for concerts” – said Christopher Khoo. However, he emphasized that if the famous concert does well in Singapore, the whole region will also benefit from it. “If from there the organizers see that Southeast Asia is a potential market, they can choose other destinations such as Bangkok, Jakarta… instead of just flying to Australia. That way, the whole region can “All regions will be winners” – assessed an expert from the travel consulting company MasterConsult Services.