Final answer:
A positive spectator experience fosters repeat patronage and recommendations, enhancing a sports event's reputation and sales. The increase in sales from spectator spending can boost revenues directly for the event organizers. However, the broader impact on the local economy may be less beneficial if entertainment spending is shifted away from other local events with higher economic multipliers.
Step-by-step explanation:
Having a positive spectator experience is crucial for the success of sports events and by extension, the businesses that benefit from such events. Spectators who have a positive experience are likely to become repeat customers and can potentially recommend the event to others. This is key to building a good reputation, which is essential for any business. A strong reputation leads to a higher perceived value of the service offered, thus potentially allowing the business to charge higher prices or sell more merchandise. Moreover, happy spectators are more likely to spend money on concessions and souvenirs during the event, thereby directly increasing sales.
However, the assumption that entertainment spending is fixed suggests that money spent on professional sports events might come at the expense of other local entertainment options. This could lead to a reallocation of spending within a local economy and could potentially shrink it if the economic multiplier for sports is lower than for other local entertainment. Therefore, while positive spectator experiences can increase sales for the sports business itself, the overall impact on the local economy is nuanced and could be less significant than initially perceived.