Predicting demand

Greenaway, R.

Rob Greenaway & Associates

Rob Greenaway & Associates

1998

www.greenaway.co.nz

This paper tests the hypothesis that a high level of provision of resources for some recreation activities is a factor in their demise. The level of provision of resources for an activity generally rises in response to increases in demand for that activity. And when demand falls, redundant purpose-built facilities may result. The question is, did excess capacity result from a drop in demand, or did it help cause the drop?

Any resource manager – commercial or otherwise – will watch the ‘product lifecycle’ of their enterprise. They will be keenly interested in factors which affect demand, and will attempt to balance investment in product development with expected returns. Ideally a balance would be struck whereby supply and demand are equal. This never happens since the effects of competition, and other socio-economic factors, change the balance, driving the product lifecycle curve into tailspins, explosions or slow spirals.

Fashion is a fickle thing. If too many people take up a trend, its appeal may decline. If it appeals to a minority and is mainstreamed – adopted by the masses – it may also quickly decline. If a fringe activity is sanctioned by society, its appeal may also disappear. Skateboarding, for example, has gone through several swings in popularity – its product lifecycle curve has swayed from high to low several times, and is currently at a high. What caused the decline and what is sustaining the high?

By considering the history and current status of skateboarding and squash, the paper considers the effect of over-provision of resources on their product lifecycle.

The key conclusion is that ‘mainstreaming’ may have – in the past – had a negative affect on the lifespan of some recreation activities, if they were recognised by an original ‘fringe core’ (such as skateboarding). ‘Mainstreaming’ may be represented by the over-provision of resources. However, product lifecycles are now being more keenly observed by many commercial entities. Their interest in maintaining demand for the resources they sell encourages them to maintain a ‘cutting edge’ for their core service. This includes – especially with regard to skateboarding – music, fashion and heroes. The core service might not change, but the ‘ethos’ within which the activity exists might change substantially. Consider the commercialisation of rugby.

This scenario (the role of commercialism) poses questions for local authority recreation providers where their role is to correct for ‘market failure’. Squash, on the other hand, gives a clear example of how increasing diversity in demand for recreation activities affects the viability of purpose-built facilities.

The author intended to take a reductionist approach to testing the hypothesis, considering the vagaries of effects on outcomes as propounded by Chaos Theory, but concluded that it is a lot easier to just interview plenty of people.

Keywords:

Demand, Usage, Facilities, Planning, Management, Resources, Asset management

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Evaluation

National

Facilities

Clubs, Community, Other setting

Accomodation and facilities, Facilities (indoor), Facilities (outdoor), Sportsvilles/Multisport centres

Impacts- social, Participation, Performance, Planning

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July 13, 2012