Socio-Economic Impacts of Event Failure: The Case of a Cancelled International Cycling Race

Abstract

The organization of large-scale sporting events implies different benefits and costs for hosting communities. However, little effort has been devoted to studying the impacts of event failures or postponed or cancelled events from the perspective of local residents. This paper is therefore concerned with the range of local residents’ perceived impacts resulting from the cancellation of the 2019 edition of the international men’s cycling race Tour of Croatia. In addition, it also examines if any significant differences exist between local residents familiar with the race and cancelling and local residents not familiar with the race, regarding the perceived impacts of this cancelled event on the hosting community. The number of perceived impacts was reduced by Exploratory Factor Analysis. Differences between local residents familiar with and those not familiar with the race and its cancelation were examined using the two-independent-samples Mann-Whitney U test. The results suggest that local residents not familiar with the event and its cancelation, when compared with local residents familiar with the event and its cancellation, perceive the majority of negative impacts as being weaker and most of the positive impacts as being stronger.

1. Introduction

The organization of events and festivals is confirmed as a method of promoting destinations, attracting tourists, and addressing seasonality in destinations [1,2]. Events and festivals usually vary enormously in type and form (e.g., sporting events, cultural events, music festival, etc.) and offer a variety of entertainment opportunities for both local residents and visitors. However, the management issues relating to different events and festivals are often surprisingly similar [3] and usually focus on the impacts they generate for hosting communities. While these large gatherings can give impetus to local economies, they can also cause some costs to people living in the area.

The same is the true of sporting events that are actually the most obvious manifestation of sporting activities, gathering both competitors and spectators. As argued by Getz [4], any direct involvement in organized sport is capable of generating planned events. Accordingly, the number of large- and small-scale events as well as the number of hosting locations has increased over the years. Despite the many stakeholders involved (competitors, spectators, sponsors, etc.), the local community is recognized as a key stakeholder [5,6]. Therefore, the relevance of sporting events stems directly from their impact on local, regional, and national economies [7]. More precisely, the costs and benefits sporting events generate for host communities is at the core of sport and event studies, and recent studies have consequently mostly examined the impacts of sporting events from the perspective of local residents. Most of the literature follows the triple bottom line approach [8,9] and distinguishes between the economic, socio-cultural, and environmental impacts of sporting events (e.g., [10,11,12,13,14,15]), although, as asserted by Dawson and Jӧns [16], negative legacies are sometimes neglected when planning and evaluating an event.

While previous research has focused on success stories, that is, large-scale sports events that have been held in large and developed countries like Australia, Canada, Germany, the United Kingdom or the United States of America (USA) (see [17]), event failures are difficult to document [18], so insignificant effort has been devoted to studying the impacts of event failures or postponed or cancelled events. Post-event analysis can evaluate an event as a failure if it attracted fewer visitors and sponsors and generated less revenue than planned. However, the postponement or cancellation of an event can also be considered a failure. Event failures and sporting event cancellations can also have severe negative impacts for organizers and local residents as well as whole destinations [19,20]. Yet, extant research focusing on broad socio-economic impacts of sporting event failures is scarce. In this regard, this paper is concerned with the range of impacts, from the perspective of local residents, resulting from the cancellation of the international men’s cycling race Tour of Croatia (the 2019ToC), which was supposed to be held in Croatia in April 2019. In particular, this paper outlines two main research questions: What are the main impacts of cancelled sporting events from the perspective of local residents? Do people who are familiar with the cancelled event perceive its social, economic, and environmental impacts differently than people who are not familiar with the event?

This paper contains four sections. The first section provides a review of the literature on the socio-economic impacts of sporting events. The implemented methodology is outlined in the second section, while the results of the empirical study are presented and discussed in the third section. The paper finishes with discussion and concluding remarks.

2. Literature Review

2.1. Positive and Negative Impacts of Sporting Events

The most important impacts of sporting events can be grouped into three categories, namely economic, socio-cultural, and environmental impacts. Economic and related tourism benefits are the most visible, and local residents usually perceive them as the most beneficial. They include such benefits as new investments, new employment, and increased tourism figures and tax revenues [1,21,22,23,24,25,26] but also include some non-monetary effects like improvements to a country’s or destination’s image [27,28]. On the other hand, sporting events can also produce excessive spending (on the event), increased taxes, and higher costs of living (higher prices of products and housing) for local residents [10,29,30,31].

Social and cultural impacts, also called “soft” impacts [32,33], are more difficult to measure and manage [8,34]. Some authors argue that sporting events can improve local residents’ quality of life, enhance social cohesion and pride, generate interest in a foreign country or culture, and increase sport participation [29,35,36,37,38]. Increased cultural conflicts (between local residents and tourists), traffic problems, security risks, vandalism, and hooliganism seem to be among the most relevant negative impacts for local residents [10,11,29,31,39,40].

Environmental impacts could be positive when new sport infrastructure is built on devastated land (see [41,42], but in most cases, local residents perceive environmental impacts as negative. If not planned properly, new sport tourism infrastructure can cause environmental damage to a host community [10,43], and many people gathered at an event generate an increased amount of waste, air and water pollution, and noise levels [10,31,44].

The above-mentioned impacts can be very intensive and visible on the state, county, city, or municipality level. This depends on the size of an event. For instance, large-scale events are more globally attractive to tourists and the media [12,45]. Growing media coverage and sponsorship has stimulated host cities to attach greater importance to tourism and other economic effects, resulting in a number of studies being conducted that deal with the various economic implications for hosts [46]. For example, the study of Minnaert [47] examines data from seven Olympic host cities, illuminating various impacts and benefits and calling attention to the under-researched area of mega-event social impacts. Glynn’s [48] research of the Olympics illustrates patterns of structuration and symbolization as a response to an event that configures a field at the level of the local geographic community. The general conclusion is that the larger the event, the greater the impact. However, small-scale events, if properly designed and implemented in practice, also have great potential to bring benefits to hosting communities (see [5,13,22,25,49,50]).

2.2. Event Failure and Impact of Cancelled Sporting Events

Besides the wide spectrum of impacts that follow any particular sporting event, the process of event planning should consider the development of contingency plans in case of major risks [51]. In most cases, organizers are able to manage major risks, but sometimes, unplanned circumstances happen and events fail. Event failure is the opposite of event success and can be evident post-hoc, that is, when the event has finished, by summarizing all the key numbers (visitors, revenues, etc.). Sometimes event organizers recognize problems that could negatively influence the event even before it actually starts and might decide to postpone or cancel the event they are organizing. Event failure can have severe negative impacts for organizers, especially if they have invested a significant amount of money in planning, bidding for, and preparing the event.

Previous research on cancelled events, as one type of event failure, and their impacts is scant. Academics put more focus on finding reasons for event failure than analyzing the consequences of such unfavorable outcomes. The main reasons why events fail are poor strategic planning and finances. Organizers often tend toward excessive commercialism and do not display sound financial practice, making wrong strategic decisions regarding the ticket prices and sponsors [18,52,53]. Market conditions such as the entrance of new competitors and uncertain visitor demand are also factors that might cause failure [53]. The next group of reasons refers to issues related to operations such as low-quality program and services and inadequate crowd control measures and queueing [52]. Anti-social behavior of festival participants (i.e., drinking, violence, littering, etc.) also represents a problem that can be seen as a threat for the success of events and festivals [54,55]. Finally, events and festivals could be postponed or cancelled because of bad weather conditions [19,20,54]. As highlighted by Olya [56], weather condition revaluation has become a necessity in event management to avoid possible negative economic, environmental, and social impacts.

Regarding sporting events, Fry et al. [19] and Kennelly et al. [20] tried to examine the consequences of cancelled events from the perspective of active participants (competitors). Their conclusions suggested that participants would not return to future editions of Ironman^® New Zealand [20] and that the postponement of the USA Cycling Cyclo-cross National Championships in Austin generated additional expenses for participants, such as flights, hotels, and car rentals [19]. In other words, participants could save a lot of money in the case of better communication, that is, if information on postponement is delivered on time. No study has been found regarding the impacts of cancelled sporting events from the perspective of local residents. However, as mentioned in the previous subsection, a significant amount of literature on the impacts of successfully finished sporting events does exist. It is therefore reasonable to assume that cancellation of a sporting event would cause impacts that are opposite to those of successful events. This means that local residents could suffer from missed opportunities to meet new people, decreased community spirit, decreased employment, volunteering, and learning opportunities, and from not having fun at the event. The image of the host destination could also be compromised, negatively affecting tourist flows in the future. At the same time, some traditionally negative impacts would be avoided. For instance, cancellation of an event would not cause additional traffic congestions, it would decrease anti-social behavior of visitors, and it would reduce environmental damage to a host destination.

3. Study Context

The international men’s cycling race Tour of Croatia was a major sporting event in Croatia. The first edition of the race took place in 2015, and since then, the race has entered into the World Bicycle Organization (UCI) calendar under the second HC (from the French “hors catégorie”) category. Six stages on a route of over 1000 km throughout Croatia hosted teams from the most senior rankings of classification, while images of Croatia were broadcasted on all continents. The route usually included both well-developed (mostly coastal) and under-developed (continental) tourist destinations. This sports project received support from the Croatian Tourist Board, the Central State Office for Sport, and some other telecommunication, media and hospitality companies.

The fifth edition was scheduled for April 2019. However, a disagreement broke out between two key managers and was settled in court, upon which they parted ways. In addition, problems with sponsors arose and, contrary to the plan, the race was cancelled a few weeks before its planned start. One of the key managers plans to organize another race under the name CRO Race in October 2019. This race is also in the UCI calendar. While this race organizer describes the event as “postponed” rather than “cancelled,” the event was considered “cancelled” because the 2019ToC was not run on the scheduled days, and the alternative event to take place a few months later has a different name. Therefore, following Kennelly et al.’s reasoning [20], with the aim to explore local residents’ perspectives, we shall refer to the 2019ToC as “cancelled.”

4. Methods

4.1. Questionnaire

For the purpose of empirical study, a self-administered questionnaire was developed. The first part of the questionnaire consisted of items that measured local residents’ awareness of the event and the fact that it was cancelled. The second part of the questionnaire consisted of items that measured local residents’ perception of impacts of the cancelled event. Most of the items were modified from the Scale of Perceived Social Impacts (SPSI), originally developed by Kim et al. [29] while a few items were added considering the specific context of this research (cycling as an outdoor sport and the specific cancelled cycling event). In total, 31 items were used, of which 20 items measured negative economic, social, and environmental impacts, while 11 items measured positive impacts. The items on economic, social, and environmental impacts were operationalized with seven-point direct rating scales (1 = strongly disagree; 7 = strongly agree). The third part of the questionnaire captured socio-demographic details. The questionnaire was prepared in the Croatian language, but, considering that most of the items were taken over from the English literature, forward and backward translation by two independent translators was carried out to ensure content validity.

4.2. Data Collection and Analysis

Data were collected a month after the notice that the 2019ToC was cancelled, from May 2019 to June 2019 in the coastal as well as continental part of Croatia. The sampling procedure included multiple data collections. Trained fieldworkers approached adult participants in various public areas (shopping malls, public parks, etc.), explained the purpose of the study to them, and asked them if they were willing to complete the questionnaire onsite. The participants’ anonymity was guaranteed. To ensure a complete data set, we removed the questionnaires with missing values from further analysis. In total, 499 respondents completely answered the questionnaire, of which 243 were from the coastal part of Croatia and 256 from the continental part. Most of the respondents were from Zagreb, the capital city in the continental part of Croatia, and from Rijeka, a coastal city. Both cities were scheduled to host one stage of the 2019ToC.

Descriptive analysis was applied to explore the sample profile of the study and to calculate the means and standard deviations (SD) of proposed variables for the overall sample. In order to reduce the number of items, statements regarding the socio-economic impacts of not hosting the 2019ToC, as perceived by local residents, were subjected to Exploratory Factor Analysis (EFA) using the Statistical Package for Social Sciences (SPSS). The Kaiser-Meyer-Olkin (KMO) measure of sampling adequacy for all socio-economic impacts was 0.867 and Bartlett’s test of sphericity was significant (p < 0.001), indicating that factor analysis was appropriate for the collected responses [57,58]. The factors were extracted using Principal Axis Factoring (PAF) with Oblique (Direct Oblimin) rotation. Only factors with eigenvalues greater than 1 were retained, while with regard to sample size (which is above 300), items with a loading of less than 0.30 were eliminated from the final factor structure [59,60]. The factor’s internal consistency was confirmed by Cronbach’s alpha reliability coefficient. Finally, two-independent-samples Mann-Whitney U tests were conducted to answer the research question of whether statistically significant differences exist between the two groups of respondents. More precisely, in order to gain deeper insight into whether familiarity with the event statistically differentiates the local residents’ perception of the event’s social, economic, and environmental impacts on the hosting communities, the first test examined whether statistically significant differences exist between the group of local residents who had heard of the Tour of Croatia event and those who had never heard of the event. Regarding the group of residents who are familiar with the event, the second statistical test encompassed the group of residents’ who had heard about the cancellation and the group that had no idea that the 2019ToC edition had been cancelled.

5. Results

5.1. Respondents’ Demographic and Behavioral Characteristics

The sample profile is presented in

Table 1. Sample profile.

Variable	N	%
Gender
M	232	46.49
F	267	53.51
Education
No education	0	0.00
Elementary	8	1.60
Secondary	278	55.71
University	193	38.68
Postgraduate	22	4.41
Employment
Public sector	134	26.85
Private sector	163	32.67
Unemployed	77	15.43
Retired	25	5.01
Other	100	20.04
Age
Average age (years)	33.01

N—number; M—male; F—female.

. The sample is evenly divided between female (53%) and male (47%) respondents, with the average age of participants being 33. Most of the respondents have finished secondary school (56%), but there is also a great share of respondents with a university degree. The average age of participants slightly differs from the Croatian population as a whole (according to the 2011 Census, the average age of the population was 41.7). Consisting of mostly young and educated respondents, the sample is similar to that in some other studies on sport event impacts (e.g., [10,29,61]), and it is expected that these differences will not incur bias in the analysis. Further, in most cases, respondents work in the private (33%) and public (27%) sector. Since the category “student” was not offered as an option in the questionnaire, many students probably declared themselves as “unemployed” or “other.” Regarding respondents’ awareness of the 2019ToC, the vast majority of respondents had heard about the 2019ToC (84%), but only 52% of them had heard that the 2019 edition had been cancelled (

Table 2. Respondents’ awareness of the 2019 Tour of Croatia (2019ToC).

Variable	N	%
Have you heard about the Tour of Croatia race?
Yes	421	84.37
No	78	15.63
Did you hear that the 2019ToC has been cancelled?
Yes	221	52.49
No	200	47.51

).

5.2. Descriptive Statistics on Event Impacts

Table 3. Mean values and standard deviation for proposed perceived impacts of the 2019ToC (N = 499).

Variable	Mean	SD
Negative impact variables	4.25
Decreased understanding of the other cultures and societies of visitors	4.10	1.72
Decreased interest in international sport events held in Croatia	4.46	1.78
Decreased opportunities for residents to meet new people	4.87	1.72
Decreased opportunities to inform the world about the hosting community (Croatia and hosting cities)	5.38	1.69
Decreased media visibility of Croatia	5.31	1.60
Diminished image of Croatia	4.70	1.86
Decreased community pride of Croatia residents	3.75	1.94
Decreased sense of being a part of a community in host cities	3.39	1.79
Diminished community spirit in host cities	3.44	1.84
Decreased trade for local businesses in host cities	3.93	1.73
Worsened economic conditions in Croatia	3.36	1.77
Fewer leisure facilities in host cities	3.75	1.79
Decreased employment opportunities in host cities and Croatia	3.68	1.86
Increased product prices in host cities’ shops	3.01	1.93
Decreased investment in Croatian tourism development	3.90	1.73
Decreased opportunities to enjoy cycling sports	5.40	1.67
Decreased volunteering opportunities	5.02	1.74
Decreased opportunities to learn about cycling	5.27	1.65
Missed opportunity for high-quality entertainment	4.49	1.89
No excitement generated for the host community	4.85	1.68
Positive impact variables	3.67
Avoided road closures/disruption in Croatia	4.68	1.68
Avoided traffic congestion in Croatia	4.18	1.88
Parking spaces in Croatian cities easier to find	3.44	1.78
Decreased interest of terrorists for future events in Croatia	3.17	1.74
Decreased risk of cyber-attack in Croatia	3.05	1.72
Decreased disturbance from visitors (e.g., drunkenness, hooliganism, disorder, and vandalism)	3.49	1.88
Avoided environmental damage to Croatian local communities	3.82	1.88
Decreased amount of litter and waste in Croatia	4.09	1.84
Decreased air pollution in host cities	3.36	1.93
Decreased noise levels in host cities	3.80	1.88

Note: Seven-point Likert-type scale was used (1—strongly disagree, 4—neutral, and 7—strongly agree).

presents the level of respondents’ agreement with particular social, economic, and environmental impacts of the 2019ToC cancellation. In general, respondents expressed more agreement with negative impacts (mean value 4.24) than with positive impacts (3.64). The statements that the cancellation of the 2019ToC has decreased “opportunities to inform the world about the hosting community (Croatia and hosting cities)” (5.38), ”the media visibility of Croatia” (5.31), “the opportunities to enjoy cycling sports” (5.40), and “opportunities to learn about cycling” (5.27) received by far the highest level of agreement from the respondents. A decline in community pride and spirit, and worsened economic issues are not perceived as major problems. In particular, respondents did not perceive “increased product prices in host cities” (3.01), “worsened economic conditions in Croatia” (3.36), “decreased sense of being a part of a community in host cities” (3.39), or “diminished community spirit in host cities” (3.44) as a result of event cancellation.

Regarding positive impacts, the respondents’ perception was quite neutral regarding most environmental impacts. In addition, respondents agree, to a moderate extent, that cancelling the 2019ToC prevented road closures or disruptions (4.68) in Croatia but did not improve parking problems (3.44). Finally, most of the respondents do not agree that security risks have decreased due to cancellation of the 2019ToC, that is, the risks of cyber-attacks (3.05) and terrorism (3.24) in Croatia are still present, as well as the interest of terrorists for future events in Croatia (3.17).

5.3. Results of Factor Analysis

Through several steps, factor analysis resulted in 30 items under eight factors with eigenvalues greater than 1 (

Table 4. Results of exploratory factor analysis.

Variable	Fac.1	Fac.2	Fac.3	Fac.4	Fac.5	Fac.6	Fac.7	Fac.8
Decreased understanding of the other cultures and societies of visitors	0.123						0.129	0.662
Decreased interest in international sport events held in Croatia								0.721
Decreased opportunities for residents to meet new people	−0.112	0.141		−0.432				0.411
Decreased opportunities to inform the world about the hosting community (Croatia and hosting cities)				−0.792				0.136
Decreased media visibility of Croatia				−0.849
Diminished image of Croatia	0.369			−0.574
Decreased community pride of Croatian residents	0.706		0.118	−0.152
Diminished sense of being a part of a community in host cities	0.812
Diminished community spirit in host cities	0.679							0.192
Decreased trade for local businesses in host cities	0.227			−0.215			0.429
Worsened economic conditions in Croatia	0.185						0.631
Fewer leisure facilities in host cities							0.618
Decreased employment opportunities in host cities and Croatia							0.812
Increased product prices in host cities’ shops				0.159	0.199		0.552
Decreased opportunities to enjoy cycling sports	−0.156		0.710	−0.106
Decreased volunteering opportunities			0.691
Decreased opportunities to learn about cycling			0.834
Missed opportunity for high-quality entertainment	0.102		0.536				0.133
No excitement generated for the host community	0.140		0.539
Avoided road closures/disruption in Croatia		−0.107	0.117			0.663
Avoided traffic congestion in Croatia			−0.124			0.861
Parking spaces in Croatian cities easier to find		0.325			0.118	0.398
Decreased risk of terrorism (e.g., bomb threat, etc.) in Croatia					0.774
Decreased interest of terrorists for future events in Croatia					0.971
Decreased risk of cyber-attack in Croatia					0.771
Decreased disturbances from visitors (e.g., drunkenness, hooliganism, disorder, and vandalism)		0.524			0.219
Avoided environmental damage to Croatian local communities		0.839
Decreased amount of litter and waste in Croatia		0.810
Decreased air pollution in host cities		0.819		0.109
Decreased noise levels in host cities		0.859
Eigenvalues	7.912	4.495	2.811	1.495	1.382	1.252	1.093	1.017
Variance explained (%)	26.373	14.985	9.370	4.983	4.606	4.172	3.645	3.390
Reliability alpha	0.886	0.906	0.814	0.844	0.893	0.716	0.810	0.787

Extraction Method: Principal Axis Factoring. Rotation Method: Oblimin with Kaiser Normalization. Rotation converged in 11 iterations.

): factor 1 (Fac.1)—Community deconsolidation (three items), factor 2 (Fac.2)—Environmental improvements (five items), factor 3 (Fac.3)—Knowledge and entertainment diminution (five items), factor 4 (Fac.4)—Community visibility and image deterioration (four items), factor 5 (Fac.5)—Decline in terrorist threats (three items), factor 6 (Fac.6)—Traffic relief (three items), factor 7 (Fac.7)—Economic problems (five items), and factor 8 (Fac.8)—Decline in socio-cultural exchange (two items). Altogether, the factors account for 71.524% of the variance. One item was discarded (decreased investment in Croatian tourism development) because its communality was low and factor loading was below 0.3.

5.4. Results on the Differences Between Perceived Impacts of Residents Familiar and Not Familiar with the Event

The first test compared the perceived positive and negative impacts of the cancelled 2019ToC between local residents who have never heard of the Tour of Croatia event and those who have heard of the event. In general, local residents who had not heard of this event expressed a lower level of agreement with most of the negative impacts and a higher level of agreement with most of the positive impacts. However, statistically significant differences exist in seven items out of 30 (

Table 5. Results of Mann-Whitney U test (2019ToC).

Variable	Have You Heard about the International Cycling Event Tour of Croatia?
	Mann-Whitney U	Wilcoxon W	Z	Sig.	Mean Rank a
Decreased interest in international sport events held in Croatia	13,834.500	16,915.500	−2.242	0.025 *	1 < 2
Decreased opportunities for residents to meet new people	13,332.500	16,413.500	−2.686	0.007 **	1 < 2
Decreased opportunities to inform the world about the hosting community (Croatia and hosting cities)	12,941.500	16,022.500	−3.071	0.002 **	1 < 2
Decreased media visibility of Croatia	13,085.000	16,166.000	−2.923	0.003 **	1 < 2
Diminished image of Croatia	13,672.500	16,753.500	−2.383	0.017 *	1 < 2
Missed opportunity for high-quality entertainment	13,976.000	17,057.000	−2.115	0.034 *	1 < 2
Parking spaces in Croatian cities easier to find	13,174.500	102,005.500	−2.813	0.005 **	1 > 2

Note: ** and * denote significance at the 1 and 5 percent level; ^a indicates which group can be considered as having the higher mean rank (1—never heard of the 2019ToC; 2—heard of the 2019ToC).

). In particular, local residents not aware of the 2019ToC perceive six items significantly lower (decreased interest in international sport events held in Croatia, decreased opportunities for residents to meet new people, decreased opportunity to inform the world about the hosting community, decreased media visibility of Croatia, decreased image of Croatia, and missed opportunity for high-quality entertainment) and one item significantly higher (parking spaces in Croatian cities easier to find) than respondents who are aware of the 2019ToC.

Among respondents who had heard about the event, the second test compared the perceived positive and negative impacts of the cancelled 2019ToC between local residents who did not hear and those who did hear that the 2019ToC was cancelled. Again, local residents who did not hear that the 2019ToC was cancelled expressed a lower level of agreement with most of the negative impacts and a higher level of agreement with most of the positive impacts. However, statistically significant differences exist in 10 items out of 30 (

Table 6. Results of Mann-Whitney U test (2019ToC cancellation).

Variable	Did You Hear That the Tour of Croatia Race 2019 ed. Has been Cancelled?
	Mann-Whitney U	Wilcoxon W	Z	Sig.	Mean Rank a
Decreased understanding of the other cultures and societies of visitors	19,275.000	39,375.000	−2.300	0.021 *	1 < 2
Decreased interest in international sport events held in Croatia	19,327.500	39,427.500	−2.258	0.024 *	1 < 2
Diminished image of Croatia	19,563.500	39,663.500	−2.067	0.039 *	1 < 2
Decreased community pride of Croatian residents	18,022.000	38,122.000	−3.308	0.001 **	1 < 2
Diminished sense of being a part of a community in host cities	18,825.000	38,925.000	−2.663	0.008 **	1 < 2
Decreased volunteering opportunities	17,132.500	37,232.500	−4.066	0.000 **	1 < 2
Decreased opportunities to learn about cycling	18,868.500	38,968.500	−2.658	0.008 **	1 < 2
Missed opportunity for high-quality entertainment	19,450.500	39,550.500	−2.154	0.031 *	1 < 2
Decreased interest of terrorists for future events in Croatia	18,695.500	43,226.500	−2.777	0.005 **	1 > 2
Decreased risk of cyber-attack in Croatia	19,270.000	43,801.000	−2.316	0.021 *	1 > 2

Note: ** and * denote significance at the 1 and 5 percent level; ^a indicates which group can be considered as having the higher mean rank (1—did not hear of the 2019ToC cancellation; 2—heard of the 2019ToC cancellation).

). In particular, local residents not aware of the event cancellation perceive eight items significantly lower (decreased understanding of the other cultures and societies of visitors, decreased interest in international sport events held in Croatia, diminished image of Croatia, decreased community pride of Croatia residents, diminished sense of being a part of a community in host cities, decreased volunteering opportunities, decreased opportunity to learn about cycling, and missed opportunity for high-quality entertainment) and two items significantly higher (decreased interest of terrorists for future events in Croatia and decreased risk of cyber-attack in Croatia) than respondents who are aware of the 2019ToC. It is worth mentioning that statistically significant differences in both tests were found for only three statements (decreased interest in international sport events held in Croatia, diminished image of Croatia, and missed opportunity for high-quality entertainment).

6. Discussion

The factor analysis conducted on items relating to local residents’ perception of the impacts of the cancelled event revealed a conceptually clear and predictable factor structure with eight factors: community deconsolidation, environmental improvements, knowledge and entertainment diminution, community visibility and image deterioration, decline of terrorist threats, traffic relief, economic problems, and decline in socio-cultural exchange. As expected, this factor structure can be divided into positive (environmental improvements, decline of terrorist threats, and traffic relief) and negative impacts (community deconsolidation, knowledge and entertainment diminution, community visibility and image deterioration, economic problems, and decline in socio-cultural exchange). This is also consistent with many previous findings on the perceived impacts of sporting events (see [1,10,21,22,24,26,28,29,31,38,39,43,44]). However, two minor deviations arise within the items. Loadings of the item “decreased opportunity for residents to meet new people” implied it should be primarily factored to community visibility and image deterioration instead of to the expected decline of socio-cultural exchange (as is the case in Kim et al. [29]) where the loading was only slightly lower. A possible explanation is that local respondents saw an opportunity to meet new people as a possible way for word-of-mouth promotion of the event. Second, contrary again to Kim et al. [29], the item “decreased disturbance from visitors (e.g., drunkenness, hooliganism, disorder, and vandalism)” was perceived as unrelated with terrorism and cyber risks. Instead, this item factored into environmental improvements, showing that local residents distinguished between terrorism risks and consequences of vandalism that, if not prevented, could be tangible and visible, especially in the degradation of public spaces. This linkage between security and pollution issues was also found in the study of Liu et al. [39] investigating the expected social impact of the Beijing 2022 Winter Olympic Games.

Regarding the mean values of particular items, considering the fact that the studied event was cancelled, the results are quite expected and consistent with the extant literature in many ways. Because of event cancellation, at the aggregate level, respondents generally perceived more negative impacts than positive ones. It seems that the local residents’ perceived impacts related to community visibility and image deterioration and knowledge and entertainment diminution are more substantial than economic impacts and impacts related to community deconsolidation. While previous studies recognized improved image and greater visibility of the hosting community in the worldwide media as the most significant positive impacts [37,62,63,64], the opposite result found in this study, that the local residents’ perceived image and visibility of the hosting community were decreased due to event cancellation, is not a surprise. Similarly, the high mean scores of items within the factor Knowledge and entertainment diminution are consistent with Kim et al. [29], who found knowledge and entertainment opportunities (of held sporting events) as being very important for hosting communities. Without the events, these opportunities decrease, that is, they do not happen. Negative consequences on socio-cultural exchange were slightly above the median value, challenging the previous findings on the high importance of this group of impacts [29,39,65]. Further, while local residents usually consider that community spirit and pride as well as sense of being a part of the community will be reinforced by sporting events (see [43,63,66]), the results of this study suggest that the opposite does not hold; cancelling the event does not reflect negatively on local residents’ perception of community consolidation and pride. The case is similar with regard to economic impacts. Although the economic dimension is recognized as an important positive impact of hosting sporting events [10,11,30,31], local residents considered that the cancellation of the 2019ToC did not cause major negative economic consequences.

On the other hand, a group of positive impacts was expected to emerge due to the 2019ToC cancellation. Contrary to expectations, however, local residents did not give much importance to them. The means within the traffic relief factor vary. Yet, it could be said that respondents found traffic relief as more beneficial than improvements in security risks or environmental issues. Traffic congestion has proved to be a major problem when organizing sporting events (see [10,11,30,37,44]), and this study found that the decision to cancel the 2019ToC provided a relief to traffic participants but not to the extent it was expected. Respondents agree that road closures and traffic congestion across Croatia would be slightly decreased due to the 2019ToC cancellation but that it would not improve parking problems. This suggests that the 2019ToC and other similar sporting events are not the major cause for traffic problems in Croatia, especially when it comes to finding parking places, which are hard to find even without sporting events. In a similar manner, respondents did not see notable improvements in environmental issues. They perceived that only the amount of litter and waste in Croatia would be slightly less (in comparison to the “with event” scenario). This finding could refer to Hritz and Ross [11], Ntloko and Swart [67], and Twynam and Johnston [64], who found no relation between sporting events and environmental impacts. It seems that Croatian residents also see environmental problems as permanent and not dependent on events. Finally, the means of all items within the decline in terrorist threats factor are low, suggesting that this study did not establish that risks of terrorism would be reduced in the eyes of residents. This corresponds with previous findings that local residents did not perceive a significant increase in the risk of terrorist attacks during and after sporting events [29,40,63] although opposite findings also exist [30]. Therefore, the fact that event cancellation will not change the perception of terrorist threats seems to be true. Unfortunately, terrorist threats are ubiquitous around the world, especially in large and developed countries like France, the United Kingdom, or the United States, and, in most cases, they are not related to sporting events. This means that, in general, risks of terrorism are more dependent on country image and contextual issues than on whether sporting events have been held or not.

Further analysis tried to examine whether local residents’ awareness of the event influenced their perception. What is the most obvious is that local residents not aware of the event, when compared with local residents aware of the event, had lower estimates, of most of the negative impacts and higher estimates of most of the positive impacts. Still, not all of these differences are statistically significant. More precisely, local residents not aware of the 2019ToC demonstrated a statistically significant lower level of agreement with all four items within the factor Community visibility and image deterioration than those who are aware of the 2019ToC. Hallmann and Breur [28] and Kaplanidou and Vogt [68] suggest that there is a common image capital of both the sport event and the hosting destination and that events can be used to strengthen the destination image. It can be assumed that Croatian residents who have heard about the 2019ToC event are more aware of its international appeal and marketing potential. Similarly, the residents aware of this event are also familiar with the opportunities the event provides, primarily opportunities to meet new people and entertainment opportunities, too (which are common consequences when being a part of the event; see, for instance [13,29]). On the other hand, residents not aware of the event have the somewhat unrealistic expectation that parking places would be easier to find due to the 2019ToC cancellation. The group of local residents was further divided on those who had not heard and those who had heard that the 2019ToC was cancelled. Local residents who had not heard of the cancellation, when compared with local residents who had heard of the cancellation, had lower estimates of most of the negative impacts and higher estimates of most of the positive ones. They expressed a statistically significant lower level of agreement with items within the community deconsolidation factor. In particular, residents’ awareness of event failure influenced community pride and sense of being a part of the community negatively. In other words, the higher the awareness of event failure, the greater the residents’ estimates on negative impacts regarding community cohesion and networking. Additionally, residents’ awareness of event failure led to more critical thinking about lost knowledge and entertainment opportunities as well as a decline in socio-cultural exchange. On the other hand, residents not aware of event cancellation expressed a statistically significant higher level of agreement with two positive items within the decreased terrorist threats factor, confirming the importance of terrorism issues when it comes to event impacts. However, this result contradicts the previous finding on the level of the whole sample that the perception of terrorist threats did not change due to event cancellation. On the contrary, it suggests that people who had heard of the event but not of its cancellation believe that the cancellation decreased the interest of terrorists.

7. Conclusions

In previous studies, the consequences of event failures, in particular from the perspective of local residents, have not received any particular attention, making a comparison of the results of this particular study very difficult. In an attempt to examine the broad economic, social, and environmental impacts of sporting event failures (the first research question), this paper has focused on the cycling race 2019ToC, which was supposed to be held in Croatia in April 2019 but was cancelled because of a disagreement between two key managers and because of sponsors who hesitated with financial support. This being a cancelled sporting event, the initial premise was that the cancellation of the event would cause impacts that are opposite to those of successful events. Therefore, a set of statements was proposed to measure both the positive and negative impacts of event cancellation from the perspective of local residents.

Factor analysis reduced the number of statements to eight factors (community deconsolidation, environmental improvements, knowledge and entertainment diminution, community visibility and image deterioration, decline of terrorist threats, traffic relief, economic problems, and decline in socio-cultural exchange). In general, based on the mean scores of particular statements, residents do not perceive much change in the triple bottom line regarding the cancellation of the 2019ToC. However, some subtle differences between statements exist, and it seems that negative impacts related to community visibility and image, and knowledge and entertainment opportunities are more substantial than negative impacts related to economic conditions, community consolidation, and socio-cultural exchange. On the other hand, local residents did not give much importance to any of the expected positive impacts. Additionally, the results suggest that, relative to local residents familiar with the event and its cancellation, local residents not familiar with the event and its cancelation perceive the majority of negative impacts as being weaker and most of the positive impacts as being stronger.

To summarize, the novelty of this paper is that it emphasizes the need to measure the economic, social, and environmental impacts of a sporting event failure from the perspective of local residents. This area of research is still under-researched and, therefore, the findings have theoretical implications in the field of sport management, event management, and event sport tourism. First, this study confirms the already established main groups of the broad social, economic, and environmental impacts of sporting events. The study, however, raises questions regarding linkages between community visibility/image and socio-cultural exchange variables, on the one hand, and between security and pollution issues, on the other. Second, the opposite direction of impacts, compared with those of successful events, contributes to the scarce literature on event failures. Additionally, these findings could have critical implications for event planners and managers as well as public sector administrators. Since many public and private organizers invest a lot of money in different sporting events abroad, it is important to know the true impacts of such events. On the other hand, in the case of sporting event failures, it is also important to know what opportunities were missed due to event cancellation. This would be important for all stakeholders involved, especially for hosting communities, whose support is crucial for an event’s success [12,41,69,70]. In other words, the more benefits local residents perceive, the greater their support. Consequently, in the case of the 2019ToC, if missed opportunities are significant, it is reasonable to predict that support for the event to be reestablished would be high. On the other hand, the public sector should develop strategies to balance the negative impacts of event cancellation, above all the intangible impacts (such as diminished international visibility of a country or lost opportunities for residents to enjoy and learn about sports) that often outweigh the economic benefits, as claimed by Liu et al [65].

One of this study’s limitations arises from the fact that the respondents gave their perceptions/opinions, so their responses cannot be considered as facts of what really happened due to the 2019ToC cancellation. A different study would need to be conducted to determine and measure the actual impacts, both negative and positive, of event cancellation. The inclusion of some objective data (for instance, economic losses) and comparison with actual local residents’ perceptions would certainly improve the quality and scope of the analysis. Another limitation arises from the sampling method, and it is possible that a sample from some particular area of Croatia (a specific county, city, or municipality) would provide different results and conclusions. Therefore, for future research, it would be interesting to compare the results between local residents of two or more host and non-host cities. In addition, the socio-demographic characteristics of local residents are often found to have an influence on the perceived economic, social, and environmental impacts caused by the organization of sporting events [37,44]. Another possible limitation of this study could be the average age of the study’s participants, which is lower than in census data. Consequently, future papers should examine whether the socio-demographic characteristics of local residents, in particular age and education, influence the perceived impacts caused by event failure. Also, it would be interesting to test if the wealth (measured by monthly income) or occupation (connected to sport and tourism or not) of local residents guides their perception of event impacts. This refers to the possibility of splitting Croatia into individual regions according to the degree of development criteria and investigating whether people who live in more developed regions (e.g., the capital city is more developed than other cities; coastal cities are usually more developed than continental cities) perceive the impacts of event failure differently from those living in less developed regions.