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Asia’s lavish party is crunched Asia's lavish party is crunched
(about 6 hours later)
By Mariko Oi BBC News, Hong Kong The 40,000-seater stadium was packed with all sorts of colourful fans, but they are spending much less than before By Mariko Oi BBC News, Hong Kong
"This is our Christmas in March," says Roland from Australia."This is our Christmas in March," says Roland from Australia.
He and his seven mates in spiky yellow wigs are attracting much attention at the Hong Kong Stadium.He and his seven mates in spiky yellow wigs are attracting much attention at the Hong Kong Stadium.
"We fly in from all corners of the globe to party together. It's been our yearly reunion for the last 10 years.""We fly in from all corners of the globe to party together. It's been our yearly reunion for the last 10 years."
The Hong Kong Sevens event has been part of the region's social calendar for over three decades.The Hong Kong Sevens event has been part of the region's social calendar for over three decades.
It is famously known for crazy costumes - more so than the actual rugby tournament.It is famously known for crazy costumes - more so than the actual rugby tournament.
"I think I saw about 10 minutes of rugby today," Roland laughs."I think I saw about 10 minutes of rugby today," Roland laughs.
They don't want to be seen as spending money and being extravagant Allan Payne, Hong Kong Rugby Football UnionThey don't want to be seen as spending money and being extravagant Allan Payne, Hong Kong Rugby Football Union
Almost every possible costume theme is covered, from typical nurses and school girls to Oompa-Loompas and Borat-style underwear.Almost every possible costume theme is covered, from typical nurses and school girls to Oompa-Loompas and Borat-style underwear.
Many of them queue for hours to get into the South Stand, where they drink, dance, cheer and boo.Many of them queue for hours to get into the South Stand, where they drink, dance, cheer and boo.
Some fans even pee in the stand, as they fear losing their spots by going to the bathroom.Some fans even pee in the stand, as they fear losing their spots by going to the bathroom.
Cutting backCutting back
It attracts more than 100,000 spectators each year, and even amid the global downturn, visitor numbers are steady.It attracts more than 100,000 spectators each year, and even amid the global downturn, visitor numbers are steady.
The 40,000-seater stadium was full throughout the weekend.The 40,000-seater stadium was full throughout the weekend.
"The tickets were sold out straight away," says Allan Payne, executive director of the Hong Kong Rugby Football Union (HKRFU)."The tickets were sold out straight away," says Allan Payne, executive director of the Hong Kong Rugby Football Union (HKRFU).
"Luckily for us, people have chosen to come to the Sevens despite the recession.""Luckily for us, people have chosen to come to the Sevens despite the recession."
But they are spending a lot less during their stay.But they are spending a lot less during their stay.
"There was a huge shift in buying behaviour this year. More draft beers were sold - because they are cheaper," says Linda Kwan of Igor's Group, which runs 30 bars and restaurants in Hong Kong."There was a huge shift in buying behaviour this year. More draft beers were sold - because they are cheaper," says Linda Kwan of Igor's Group, which runs 30 bars and restaurants in Hong Kong.
"Sales fell at least 15% from last year.""Sales fell at least 15% from last year."
Companies are also cutting back on their spending.Companies are also cutting back on their spending.
Until last year, the hospitality suites of the stadium were mainly occupied by financial institutions.Until last year, the hospitality suites of the stadium were mainly occupied by financial institutions.
But investment bank Goldman Sachs and insurer AIG were both absent this year as they sublet their corporate boxes, which cost them $58,000 to $84,000 (£41,000 to £59,000) a year.But investment bank Goldman Sachs and insurer AIG were both absent this year as they sublet their corporate boxes, which cost them $58,000 to $84,000 (£41,000 to £59,000) a year.
AIG received a government bailout, and both firms are under increasing scrutiny over how they spend their money.AIG received a government bailout, and both firms are under increasing scrutiny over how they spend their money.
The ones that decided to kept their boxes are scaling back in other ways.The ones that decided to kept their boxes are scaling back in other ways.
"They don't want to be seen as spending money and being extravagant," says Hong Kong Rugby's Mr Payne."They don't want to be seen as spending money and being extravagant," says Hong Kong Rugby's Mr Payne.
This means lavish entertainment and gifts are the thing of the past.This means lavish entertainment and gifts are the thing of the past.
Justifiably lavish?Justifiably lavish?
Nevertheless, food and booze was not in short supply in the corporate boxes. Should taxpayers' money be spent on such entertainment?Nevertheless, food and booze was not in short supply in the corporate boxes. Should taxpayers' money be spent on such entertainment?
"It's necessary spending," says Peter Hoflich of research firm The Asian Banker."It's necessary spending," says Peter Hoflich of research firm The Asian Banker.
There is the emotional stance of 'What will our shareholders think if we are seen to be spending all our money on what is globally renowned as a lavish party' Sports marketing analyst Ben Heyhoe FlintThere is the emotional stance of 'What will our shareholders think if we are seen to be spending all our money on what is globally renowned as a lavish party' Sports marketing analyst Ben Heyhoe Flint
"Corporate entertainment is important for these banks in maintaining key relationships. Many of these government funds are not donations, but loans that the banks need to pay interest on and eventually repay."Corporate entertainment is important for these banks in maintaining key relationships. Many of these government funds are not donations, but loans that the banks need to pay interest on and eventually repay.
So if they find it critical to spend on corporate entertainment that is up to them."So if they find it critical to spend on corporate entertainment that is up to them."
But what about the business of being title sponsors?But what about the business of being title sponsors?
"Since many of these sponsorship agreements were made in good times, the heat is off them for their current sponsorship deals."Since many of these sponsorship agreements were made in good times, the heat is off them for their current sponsorship deals.
"But it will be interesting to see how banks will justify renewing these contracts," Mr Hoflich says."But it will be interesting to see how banks will justify renewing these contracts," Mr Hoflich says.
Credit Suisse and Cathay Pacific say they plan to continue supporting the Sevens.Credit Suisse and Cathay Pacific say they plan to continue supporting the Sevens.
But they both declined to comment on whether they had come under increasing pressure from investors not to sponsor the event.But they both declined to comment on whether they had come under increasing pressure from investors not to sponsor the event.
"While the Sevens has a phenomenal global brand and iconic status, there is the more emotional stance of 'What will our shareholders think if we are seen to be spending all our money on what is globally renowned as a lavish party?'" says sports marketing analyst Ben Heyhoe Flint."While the Sevens has a phenomenal global brand and iconic status, there is the more emotional stance of 'What will our shareholders think if we are seen to be spending all our money on what is globally renowned as a lavish party?'" says sports marketing analyst Ben Heyhoe Flint.
"Whether these firms will continue to sponsor sporting events is the question on all rights holders' minds - not just the HKRFU.""Whether these firms will continue to sponsor sporting events is the question on all rights holders' minds - not just the HKRFU."
Last year, the Sevens received $1.875 billion in sponsorship revenue, according to Asia Sponsorship News, aside from ticketing and corporate hospitality.Last year, the Sevens received $1.875 billion in sponsorship revenue, according to Asia Sponsorship News, aside from ticketing and corporate hospitality.
While Mr Payne says this year's tournament has matched income from last year, he admits next year will be even harder.While Mr Payne says this year's tournament has matched income from last year, he admits next year will be even harder.
"This year's corporate spending was budgeted in before the global recession worsened. We realise we will have to work a lot harder to get their support for next year's tournament.""This year's corporate spending was budgeted in before the global recession worsened. We realise we will have to work a lot harder to get their support for next year's tournament."