33RD ANNUAL HONOLULU MARATHON
This year's Honolulu Marathon is on pace to add $100 million to the local economy
IN ALMOST EVERY race, there's a turning point where the runner makes a crucial decision that determines how the race will finish.
For the Honolulu Marathon, which got off to a slow start with 167 entries in 1973, that moment came in the 1980s when event organizers decided to go East. It was that business plan that elevated a local footrace into a world-class destination event. On Sunday, it is expected to attract as many as 28,000 total participants, of which more than 60 percent will come from Japan.
JAPAN ENTRANTS FOR HONOLULU MARATHON
*Registration count as of Wednesday
Source: Honolulu Marathon
"We knew we didn't have the resources to compete in other markets so we made the decision to focus on Japan," said Jim Barahal, president and chief executive of the Honolulu Marathon.
While the Honolulu Marathon is just another great destination event to the U.S. mainland market, which is saturated with marathons ranging from the elite Boston Marathon to the popular Rock and Roll Marathon in San Diego to the new Las Vegas marathon, it has proven to have tremendous appeal for the Japan market, both participants and sponsors alike.
A comprehensive survey of 1,200 participants in the 2004 Honolulu Marathon and Race Day Walk by Hawaii Pacific University found the events together pumped $90.7 million into the local economy last December. This year the marathon, which has expanded its expo and Friday night luau/concert, is on pace to generate $100 million, Barahal said.
The first Japanese visitor ran in the Honolulu Marathon in 1976, with the numbers increasing gradually until it took off after Japan Airlines began sponsoring the event in the late 1980s. A few years into JAL's sponsorship, participation in the Honolulu Marathon had doubled, Barahal said. By 1995, the marathon's benchmark year, the Japan field had grown to 21,717 participants or 63 percent of the 34,434 total runners who participated in the event, he said.
This year nearly 80 percent of the Honolulu Marathon's 26,571 current entrants are from out of town, with 16,293, or 61.3 percent of them, coming from Japan.
"Twenty years of developing the marathon as a brand name in Japan have paid off," Barahal said. The marathon, which has about 20 paid employees, staffs offices in Hawaii and Japan year-round. More than 10,000 volunteers will join paid staff on race day, he said.
Honolulu's geographical proximity to Asia and its popularity with Japan visitors has given it the edge to grow sponsorships from $10,000 a year in 1987 to the more than $2 million it will receive this year from its six Japan-based sponsors, including title sponsor Japan Airlines as well as D.C. Card, Nike Japan International, Konami Sports Clubs, Amino Value and NTT DoCoMo.
"I wish my stock portfolio had done as well," said Barahal, whose course for success has served as a performance model for other successful Hawaii sporting events like the SBS Open, an LPGA tournament that takes place annually at Turtle Bay Resort, and the newly organized JAL ITU World Age Group Triathlon Championship.
THERE'S TREMENDOUS competition for dollars and play in the burgeoning sports tourism industry, said Mike Story, the Hawaii Tourism Authority's newly hired sports events manager.
"There are hundreds of sports offices popping up internationally as well as at the state and city levels," Story said. "And last year, in the U.S. alone, there were more than 13,000 biddable events"
It's a high-stakes game where the winning destination gets the dollars, Story said, adding that part of his job is to figure out how the state can more aggressively target active lifestyle tourists.
There need to be more events like the Honolulu Marathon, which don't receive state or local funding, yet bring large economic benefits to the community, he said.
Honolulu Marathon organizers have seemingly developed the perfect business model where both the title sponsor and the organization reap the rewards of their relationship, Story said.
While many Honolulu events are desperate for dollars, the Japan-side success of the Honolulu Marathon has resulted in intense sponsor competition.
"We get lots of offers from Japan companies each year, but we like to keep the number of sponsors small so that the companies that we work with get something out of their participation," Barahal said. "Our focus in terms of sponsors is on building loyalty and long-term relationships."
Destination events like the Honolulu Marathon work for sponsors like Japan Airlines because they encourage travel, said John Korff, president of Korff Enterprises, a company that organizes sporting events and brought the ITU world championship to Hawaii in 2003.
"You can't just go ask sponsors like JAL to fund any event in Hawaii. This is a unique business model that works for them," said Korff, who spent 15 months courting the company to become the title sponsor for his world championship event as well.
Korff hopes his event, which brought more than 2,000 triathletes from nearly 50 countries and pumped an estimated $20 million into Honolulu's economy this spring, will continue to grow in the same fashion as the successful marathon.
"Getting international sponsors is crucial for any Hawaii event that wants to grow to a professional level," said Korff.
IN HAWAII, almost every major pro sporting event is sponsored by a company outside of the state, because they attract people who aren't part of the market, said Korff, who has taught sports business classes at Harvard University, Columbia University and most recently at New York University.
It's challenging to find local sponsors in Hawaii because they just don't get enough bang for their buck, he said.
"Most of the time there aren't enough local participants in destination sporting events to appeal to Hawaii companies," Korff said.
Mainland companies usually don't want to fund sporting events in Hawaii either because the local market is relatively small and isolated compared to other U.S. destinations where for the same investment or less they can get spill-over coverage in nearby cities or states, he said.