“An event’s direct economic impact is defined as the amount of additional expenditure (i.e. new money) generated within a specific area as a consequence of staging it.”

That’s an example of the standard definition.

But here’s the real question:

🔍 “How much of that money actually stayed in the city — and helped local businesses, workers, and communities grow stronger?”

Traditional impact estimates rarely answer that

Because if we settle for reporting the Direct Economic Impact traditionally:

• We risk overpromising and under-delivering to cities and taxpayers.

• We create nice-looking numbers without showing real value.

• We miss the chance to learn and improve from one event to the next.

If we estimate direct economic impacts more deeper:

• We can build stronger cases for funding.

• We can design smarter events that create real local benefits.

• We can show real growth, not just temporary spending.

In my opinion.

Measuring accurately isn’t bureaucracy.

It’s a great piece of strategy.

Problem 1:

It counts money spent — not money kept.

The traditional method assumes:

“If someone spends money in the city, the city benefits.”

But that’s not how it really works completely. 

Problem 2:

It stops at the first spend — and ignores what happens next.

But it doesn’t ask:

Did the local business reinvest that money?

Did it pay local workers, who then spent their wages locally?

Did it lead to upgrades, new hires, better services?

Without these next steps, spending is just a one-time event —  not real economic growth.

Problem 3:

It multiplies what might already be gone.

Many economic impact reports show big numbers from "indirect" and "induced" effects.

Sounds great.

But here’s the catch:

If most of the original spending leaked out —(to chain hotels, global apps, HQs outside the city)— then there’s almost nothing left to circulate or multiply.

They’re multiplying an empty base.

Cities and organisers should not just need a headline number.

They would need to understand the full flow — from global footprint to local growth:

1. What was the total economic footprint? 🌍 (Total event-driven spending — local, national, and international — by visitors, organisers, other stakeholders)

2. How much of that was spent inside the host economy?💸 (New money entering the local city or region)

3. How much was retained by local people and businesses? 🔒 (What stayed — not just what passed through)

That’s what matters.

That’s what our Event Direct Economic Impact (DEI) Estimation model reveals — clearly and step-by-step.

It gives keys to unlock the last question. 

4. What happened after the money landed? 🔁 (Did it circulate again? Was it reinvested, used to hire, or build long-term capacity?)

That’s what drives real, lasting growth

Here’s the simple logic, how cities and local economies captures (should capture) the value of major events:

↳ Event generate spending by visitors, organisers and other stakeholders 

↳ Event brings new money into the city

↳ Local economy captures a share of it (retention)

↳ That money is re-spent, invested, used to hire

↳ Real growth: jobs, capacity, taxes, upgrades

↳ City and businesses reinvest in services, infrastructure, tourism

↳ The region becomes stronger, more competitive

↳ Long-term economic benefit and growth

So yes — retention leads to growth. 

But only when the system can first capture, then reuse, and later multiply the value locally.

Stop asking:

 “How much did people spend?”

Instead. 

Start asking:

 “How much stayed — and what grew from it?”

That’s the difference between spending and impact.

That’s what our Event Direct Economic Impact (DEI) Estimation model aims to.

It’s a logical tool and template to solve the pattern behind local economic growth - through major events.

Clearly and step-by-step.

• Total Gross Economic Footprint (€)

• Total Net Direct Economic Impact (Net DEI) (€)

• Local Economic Retention (Real DEI) (E)

• Total Number of Event Visits

• Total Unique Event Visitors

• Visitor Gross Spend (€)

• Organiser Gross Spend (€)

• Stakeholder Gross Spend (€)

• Local Gross Spending (€) (excl. tax)

• Domestic Gross Spending (€) (excl. tax)

• International Gross Spending (€) (excl. tax)

• Tax Collected from Visitor and Organiser Income (€)

• Tax Paid by Organiser and Stakeholders (€)

• Net VAT Position / Tax Yield Ratio

• Total Visitor Spending for Accommodation (€)

• Total Visitor Spending in Event Areas (ORG) (€)

• Total Visitor Spending in Local Economy (off-the-venue) (€)

• Total Visitor Spending Getting to/from Host City (€)

• Average Spend per Unique Visitor (€)

• Average Daily Spend per Visitor (€)

• And  much more details to share with ownership, stakeholders, or media