I Thought the Festival Would Be a Hit... But Both Spending and Visitors Decreased? [Festival Republic]

①Korea Tourism Organization Analyzes Data from 86 Festivals
Hwacheon Sancheoneo Festival Ranks First in Tourism Consumption Impact
Consumption Decreases During Jeongseon Arirang Festival Period
Visitors Increase in Jindo, Decrease in Jeju During Festival Period

As the number of various festivals held nationwide has increased to over 1,000, doubts about the economic and social effects of festivals have also grown. While festivals are expected to boost the local economy by increasing tourism consumption as visitors flock to the area, not all festivals have shown such effects. In some cases, the number of visitors has actually decreased, leading to a reversal in consumption trends.

The scene of the Daejeon 0 o'clock Festival, which opened on the 9th [Image source=Yonhap News]

Asia Economy examined data from 86 festivals designated as pilot cultural tourism festivals under the Enforcement Decree of the Tourism Promotion Act, using data from the Korea Tourism Organization's Data Lab to analyze changes in tourism consumption and visitor numbers in festival-hosting regions during festival periods compared to non-festival periods (four weeks before and after the festival). The '2023 Cultural Tourism Festival Big Data Analysis Report' published by the Korea Tourism Organization was also referenced.

As a result, among the 86 festivals held last year, 20 showed a decrease in tourism consumption in the host regions during the festival period. Additionally, 10 festivals showed little change in tourism consumption before and after the festival. This suggests that despite budget investments to hold these festivals, the effect of generating regional economic activity through consumption was minimal. Furthermore, three festivals were found where the number of external visitors actually decreased during the festival period.

Where Did Tourism Consumption Drop Sharply During Festivals?

Looking at the tourism consumption amounts for the 86 festivals last year, consumption increased by 17.3% during the festival period compared to the non-festival period. The total credit card tourism consumption for all 86 festivals was 334.9 billion KRW, with an average daily amount per festival calculated at 880 million KRW. Visitors from outside the region and foreigners accounted for 60% of the consumption in the festival areas. By industry, food and beverage accounted for the largest share at 57.1%, followed by shopping at 32.9%, leisure services at 5.2%, and accommodation at 3.1%. This indicates that most spending during festivals is on eating and drinking.

Examining individual festivals, the festival with the largest increase in tourism consumption during the festival period was the Hwacheon Sancheoneo Festival (January 7?29 last year). When setting the day with the highest tourism consumption in Hwacheon-eup, Hwacheon-gun, as 100, the average consumption level during the festival was 74, which was 34 points higher than the non-festival period (40). Considering that the average daily tourism consumption in Hwacheon-eup during the festival was 57.64 million KRW, it is estimated that consumption during the non-festival period was in the 30 million KRW range.

Visitors catching sancheoneo fish at the Hwacheon Sancheoneo Festival

The Hwacheon Sancheoneo Festival, a representative winter festival in Korea, has attracted over one million visitors annually since 2006, except for 2020 when it was closed early due to COVID-19. Last year, it was held for the first time in three years due to the pandemic. Given the number of visitors, consumption at Hwacheon's food markets and nearby restaurants inevitably increased compared to the non-festival period. During the festival, the average daily tourism consumption by outsiders was 40.85 million KRW, while locals spent 16.77 million KRW, with outsiders accounting for over 70% of total tourism consumption. Notably, 82% of outsiders' spending was on food and beverage.

In contrast, the festival with the largest decrease in regional tourism consumption during the festival period compared to the non-festival period was the Jeongseon Arirang Festival. When the day with the highest tourism consumption in Jeongseon-eup, Jeongseon-gun, was set as 100, the tourism consumption during the festival was 43, which was 14 points lower than the non-festival period (57). The average daily tourism consumption in Jeongseon-eup during the festival period (September 14?17 last year) was 120.28 million KRW. Although the total amount was larger than that of the Hwacheon Sancheoneo Festival, the festival failed to expand regional consumption compared to the non-festival period.

Which Festival Sees the Largest Increase in Visitors Before and After?

Visitor numbers also showed differences between festival and non-festival periods, similar to tourism consumption. The total number of visitors to the 86 festivals last year increased by 39.0% during the festival period compared to the non-festival period. The total number of visitors during the same period was 17.38 million, with domestic outsiders and foreigners accounting for 50.2%, slightly surpassing locals at 49.8%.

Scenes from the Jindo Miracle Sea Road Festival held last March [Image source=Yonhap News]

Looking at individual festivals, the festival with the largest increase in external visitors during the festival period was the Jindo Mysterious Sea Road Festival (April 20?22 last year). When the day with the highest number of external visitors in Gogun-myeon, Jindo-gun, was set as 100, the number of visitors during the festival was 90, while it dropped sharply to about 18 during the non-festival period, showing a significant gap. This festival commemorates the phenomenon of the sea road appearing between Jindo and Modo on the lunar calendar's last day of the second month and attracts about 10,000 visitors daily. Since the mysterious sea road is only accessible for a few days a year, external tourists increase significantly during the festival.

Festivals where external visitors decreased during the festival period include the Gangneung Coffee Festival (October 12?15 last year), Daegu Yakryeongsi Oriental Medicine Culture Festival (May 5?7 last year), and Jeju Fire Festival (March 9?12 last year). Among these, the Jeju Fire Festival showed the largest gap in external visitors between non-festival and festival periods. Since Jeju City's Aewol-eup usually has many tourists, it was interpreted that the number of visitors did not particularly increase during the festival. In fact, when the day with the highest external visitors in Aewol-eup was set as 100, visitor inflow during the festival was 67, while it was 72 during the non-festival period, indicating an increase rather than a decrease.

Festivals not only attract external visitors but also provide locals with unique enjoyment. Accordingly, local visits tend to increase during festivals. The Gimje Jipyeongseon Festival, held over five days from October 5 last year, saw the largest increase in local visitors during the festival period among the 86 festivals. When the day with the highest local visitors in Buryang-myeon, Gimje-si, was set as 100, visitor inflow during the festival was 91, more than ten times the non-festival period (9).

However, some festivals saw locals visiting the festival area less than usual. Including the Pyeongchang Trout Festival, seven of the 86 festivals fell into this category.

Hansung Baekje Cultural Festival Ranked First in Tourism Consumption Four Times in a Row, But...

The effect of festivals in generating additional tourism consumption or visitors is inevitably influenced by the usual level of tourism consumption and visitor numbers in the region. Areas with consistently high tourism consumption and many visitors are less affected by whether a festival is held.

The opening ceremony of the Hanseong Baekje Cultural Festival held last September (Photo by Songpa-gu, Seoul)

The festival with the highest average daily tourism consumption in the region during the festival period last year was the Hansung Baekje Cultural Festival, held in Oryun-dong, Songpa-gu, Seoul (September 22?24 last year). The Hansung Baekje Cultural Festival set the record for the highest consumption four times in a row in 2018, 2019, 2022, and last year. The average daily tourism consumption during the festival period exceeded 5 billion KRW.

However, the difference in tourism consumption in Oryun-dong between the festival and non-festival periods was minimal. The Korea Tourism Organization explained that this indicator reflects the total consumption in the administrative district where the festival was held, not just consumption generated by the festival itself. This is interpreted as the usual consumption scale being large since the festival was held in Seoul.

The Jeju Fire Festival, which ranked third in tourism consumption scale with an average daily consumption exceeding 3.4 billion KRW last year, showed a similar pattern. Due to the large usual consumption scale in Aewol-eup, tourism consumption during the non-festival period was higher than during the festival period. External visitor inflow in Aewol-eup during the Jeju Fire Festival was also lower than during the non-festival period.