Tourism Subsidies: Short-term Transactions vs Long-term Innovation

In the global tourism industry tourism subsidies go by lots of different names: incentive, rebate, subvention, supplement. But regardless of the label, at the end of the day the DMO or some other destination entity ends up writing a check to an event organizer or tour operator in order to bring their associated visitor economy business transactions to town.

Ask DMO/destination leaders about subsidies and, after exclaiming how they’re out of control, they resign themselves to the fact that they are now just part of doing business.

Meeting professionals will tell you that, given eternal budget pressure, if there are incentives available, they’ll take them. For larger congresses and citywide events the provision of an incentive is now basically table stakes even in a booming meeting industry economy. (I heard one international association leader publicly say that unless the venue is FREE, they won’t even consider the destination.)

poker-cash_3104004kBring DMO leaders and meeting professionals together to discuss event incentives and the room feels more like the finals of the World Series of Poker with $millions on the table surrounded by stoic players quietly watching and waiting to play their cards.

Regardless of how and why we got here…tourism subsidies are a reality and we have to deal with them. But consider this: economists will tell you that transactional subsidies rarely work over the long-term for most industries. These subsidies typically create industry inefficiencies and can stifle long-term innovation because free cash has a way of smoothing over all sorts of systemic shortcomings in favor of short-term transactions.

The question for DMOs is this: Is there a better approach than transactional subsidies to event organizers and tour operators to help the local tourism industry and community thrive?

I believe there is. Simply put, DMOs need to consider “industry innovation incentives”.

maxresdefault-1

The Singapore Tourism Board has made this a cornerstone strategy and has recently established two new tourism industry innovation funds to enhance their tourism industry performance:

Singapore Kickstart Fund: The fund supports the creation and test-bedding of innovative lifestyle concepts and events with strong tourism potential and scalability. This is with the aim of enhancing the vibrancy of Singapore as a tourist destination in areas such as the arts, entertainment, dining, sports and retail.”

Singapore Experience Step-Up Fund: “The S$10M fund aims to encourage businesses to develop new tourism experiences that will enhance overall visitor experience and satisfaction in Singapore… The Board is also calling for proposals for tour development and technology initiatives.”

The STB has chosen to provide innovation incentives/subsidies as a way to create long-term competitive success through destination innovation/product development as opposed to a reliance on subsidies to generate short-term marketplace transactions.

Sadly, the STB, an acknowledged trailblazer in the DMO world, remains an outlier in this approach. In Europe and North America, transactional subsidies still rule as a foundational strategy for many DMOs to achieve their stakeholder mandated short-term room-night performance metrics.

I believe investing in “innovation incentives” are the type of DMO product development “NEXTPractices” contemplated in DMAI’s DestinationNEXT study. But its even bigger than that. It’s also about industry leadership organizations investing in the innovation capital of their industry’s future.

Still, I marvel at today’s explosion of tourism industry innovation. But the interesting thing is that most of it is coming via entrepreneurs from “outside” the established tourism industry ecosystem. (E.g. airbnb founder Joe Chesky is a design school graduate who was running a minor league hockey team when he started airbnb.)  Igniting industry innovation it seems is someone else’s responsibility.

But it doesn’t have to be. Imagine what $25K or $50K could do in the hands of two or three local tourism entrepreneurs with big ideas as compared to a far away tour operator looking to supplement their advertising budget.

With tourism revenues (and their associated tax revenues) growing across the globe, now is a good time to break with convention and consider how redirecting subsidies from short-term transactions to long-term innovation is the ultimate form of destination marketing legacy and long-term competitive advantage.

Advertisements

Understanding DestinationNEXT Phase II

Screen Shot 2015-07-14 at 4.02.35 PM

All you need to know about the level of interest in DMAI’s globally-developed DestinationNEXT project is this: the Phase I report was downloaded over 10,000 times.

At its core, the project focuses on defining the role and future opportunities for destination marketing organizations in the increasingly competitive and disruptive world of tourism.

(Full disclosure here: I was part of the DestinationNEXT development Team that included InterVISTSAS Consulting,Gaining Edge and Global Meetings and Tourism Specialists.)

PROJECT OVERVIEW:

QuadrantsBy way of review the key takeaways from Phase I are:

  • The two key drivers ofDMO (and hence tourism’s community contribution) success are:
    • Destination Strength
    • Community Support and Engagement
  • DMOs find themselves in one of four performance quadrant-scenarios based on the two key drivers

In order to be more relevant and drive enhanced performance in the future, DMOs need to pursue three “transformational opportunities”:

  • Shift from Broadcast to Engagement in dealing with the new realities of the marketplace
  • Pursue Destination Management by building and protecting the destination brand strategy
  • Evolve the DMO Business Model through new collaboration and partnerships

DestinationNEXT Phase I draws the map for the DMO future.

DestinationNEXT Phase II gives DMOs a tool to find themselves on that map and then discover their own pathway to sustainable future success.

DIAGNOSTIC TOOL:

Screen Shot 2015-07-15 at 10.53.08 PMThe key Phase II deliverable is a diagnostic self-assessment tool that plots a destination’s perceived performance relative to the identified success drivers of destination strength and community support engagement in the Phase I performance quadrant-scenarios. The plot is developed through on-line response-assessments to 20 critical destination variables from single or multiple DMO leaders/stakeholder-users . The variables themselves are weighted based on relative importance and perceived importance from input by destination stakeholders. This helps customize the response for each unique destination.

The resulting Diagnostic Report is a strategic conversation-starter for DMO leaders and their stakeholders to seek answers to the question: “where do we go from here and how do we get there?”.

COMMUNITY OF PRACTICES:

To offer DMO leaders food for thought on their journey, Phase II envisions the creation and ongoing development of a Community of Practices (“COP”) to which DMOs can contribute and share practices that can help guide a DMO along their prospective future strategic pathway.

To kick-start its activation, the Phase II report includes a “Practice Handbook” of 20 BEST (current state) and 10 NEXT (future state) practice case studies that were harvested from extensive research as well as through globally crowd-sourced DMO submissions. Recognizing the diversity of the DMO universe, all the practices provided probably will not appeal to everyone. But by parsing the practices by budget, by geography, by business focus — with each practice providing an indication of its impact on destination strength, community support/engagement or both – there’s something for everyone. The report also “packages” the practices according to the identified Phase I Transformational Opportunities to further assist with strategic focus.

Screen Shot 2015-07-14 at 6.01.20 PM

It’s by no-means an exhaustive list, but it is definitely directional…if not inspirational in many cases. The COP has the potential to be an extremely valuable enduring legacy from the DestinationNEXT project and DMAI would do well to nurture its ongoing development as THE body of knowledge for the destination marketing profession.

WHAT’s NEXT?:

Reading the report is a good start. But if you are truly committed to considering the insights from DestinationNEXT, you need to take the diagnostic and see where you stand. DMAI is promising to organize workshops for members to understand how to use the diagnostic tool and the COP. From there it’s up to DMO leaders to discover their own pathway to the future.

There’s no secret DestinationNEXT formula for assured DMO success in here. It was never intended that way. It is a tool to inspire destination marketers to stop and take a look around at what others are doing today and see what they might be missing for tomorrow. Its an opportunity to discover a new pathway to the future for the destination and for the DMO. And as with every great leadership journey, it starts with the courage to act.

 

 

 

 

 

The Story of the Most Important Place in the World for Meetings

As destinations and venues all over the world try to convince people that theirs’ is THE place to gather, I reflected back on where many of my most important meetings have taken place.

Simple. Starbucks.

Let’s face it, who HASN’T had an important meeting at Starbucks? I’ve seen everything from job interviews, to theatre auditions, to creative reviews happen at Starbucks. And they happen on college campuses, in airports…even at the Great Wall of China.

So what makes Starbucks the world’s “go-to” meeting place? Obviously they are a globally known and accessible brand…but so is KFC and no one is saying “let’s brainstorm over a bucket of finger lickin’ good chicken”.

Make no mistake about it, meetings are part of Starbucks’ business. But they look at their meeting story much differently than a DMO does.

Their story is about what happens when people gather at Starbucks. Its not about the square footage of their stores, the comfort of their chairs or how many parking spots they have. (But they do have free WIFI!). Their story is perfectly articulated in this commercial:

“Every day, good things happen when we get together.” Simple. Authentic. Human. They don’t even show their coffee. 

There are some interesting learnings from Starbucks in here for destination marketers and meeting industry advocates:

(1) Starbucks has figured out that meetings are first and foremost about people and the magic that happens when they get together. Its not about the room they meet in, the technology they use or what they eat when they get there. I know there’s a lot of pressure on DMOs to showcase their stakeholders’ businesses. Starbucks doesn’t even show their coffee. I am willing to bet that showcasing the legacies that have been created as a result of meeting in the destination would resonate more than presenting another staged meeting room set-up.

(2) Nobody cares about the number of cups of coffee Starbucks serves or the number of people they employ. Big numbers don’t resonate with anyone these days…because everyone has them…or can create them. Starbucks story is always the human perspective of their guest. Telling the destination story through the eyes of the visitor or the meeting attendee is more relevant and authentic than anything or anyone else. As the amazing Bruce Turkel says: “Its all about THEM.”

I had a professor in university who once challenged us to figure out what would happen if Microsoft (this was in the last century) got into the travel business. We thought they would fail because they “didn’t know the business”. Well they did and Expedia changed (for the better) the world of consumer travel purchasing forever. 

Starbucks is in the business of bringing people together and monetizing those connections around the coffee house culture. I wonder what would happen if Starbucks was to add a free, easily reservable (on a smartphone) private meeting room to some of its locations? No contracts. No F&B minimums. Free wifi. A compelling powerful global story about how the magic of human connections can change peoples’ worlds.

No one thought Microsoft would do it either.

Simple: The New DNA of Destination Marketing (Part Five)

Part Five and the final posting in a series on what the new fundamentals of marketing mean to DMOs and destination marketing professionals as inspired by the recent McKinsey article: “The Dawn of Marketing’s New Golden Age”.

Screen Shot 2015-04-16 at 10.45.30 AMMcKinsey-Speak:  Complexity is the enemy of speed and leading marketers are seeking greater simplicity.

DMSpeak: Bring order to chaos. Focus on where/how you can make the biggest difference for your customers and stakeholders. And then stick to it. Align your organization accordingly.

The Reality Check: As illustrated in a recent SKIFT article, the tourism and meetings/events ecosystem is not only economically enormous, it’s also complex. So it’s no surprise that when destination marketers of any size develop their business plans they are complex, often extending into 30-40+ page tomes in an effort to address all opportunities and constituencies. The inevitable impact of that complexity is fragmentation of limited resources resulting in the creation of a legion operating structures and relationships (often with disparate partners) that consume the two most important strategic leadership resources: time and focus. With the ongoing eruption of new tourism trends, brands, travel personae, partners, technologies etc, bringing order and simplicity to the destination marketing mission and process should be a quest for every DMO. Easy, right?

What Does That Look Like: Easier said than done. To get there requires tough choices to be made by DMOs two areas:

(1) Figure Out What Business You Are In: The travel ecosystem has completely transformed as its economic and social significance has grown. Marketplace roles and relationships have changed with the transformation as new technology and players have replaced legacy institutions and elements (for more on this please read “What Business Are We In?”). For the sake of destination marketing simplicity and focus, DMOs today need to discover their unique and compelling place in this new ecosystem. One that works for their destination. where they can deliver the most value. Then create a transformational roadmap to get there, and OWN it.

jimcollins04In Good to Great, Jim Collins proposes a brutally simple exercise for leaders to undertake to help focus their business. This may mean pursuing a completely new business and value proposition, one that could not have been imagined even five years ago.  Consider the Grapevine (Texas) CVB who made product development and experience management the cornerstone of their business. This includes managing a railroad, owning a heritage building and the creation of a foundation to preserve historical structures in the community. The result, the small North Texas community of 48,000 now receives 15 million visitors per year with an economic impact of $2.2 billion.

It could also mean the status quo. But it starts with an engaging conversation around: “what business should we be in for the next X years?”. If it cannot be answered in one sentence, you’re not quite there yet.

the-greatest-movie-ever-40-728(2) Get Out of Initiatives That Are Not Part of (1): Perhaps the single most difficult thing for any DMO to create and act upon is a “Stop Doing” list. Every idea and initiative has an expiry date…particularly with the rush of new disruptors in the travel and tourism space. The annual printed visitor publication and meeting planners guide used to be the pinnacle of a DMO’s value proposition. Now…why would a visitor need one when they have TripAdvisor and a plethora of other virtual travel communities? DMOs need to face the brutal facts that there are going to be businesses that can do certain things more effectively for the destination with less risk than the DMO. Identifying those underperforming legacy marketing programs and relationships that are easier to keep than to ditch requires a lot of courage, but the inevitable result is simplicity that will allow DMO marketing investment to perform better in the high-value initiatives that really matter.

Here’s a simple yet provocative exercise to try the next time you’re stranded in an airport and your phone is getting recharged: figure out how many of today’s Fortune 50 companies still have the same core profit center business that they had ten years ago. Here’s a hint: The list does not include Apple, General Electric or IBM. What can be learned from this?

Its ironic that of the five identified DNA strands (ScienceSubstanceStorySpeed-Simple) of the new destination marketing reality, Simple might be the most obvious yet its the one typically requiring the most courage to actually implement – which is often the X-factor in the difference between harnessing the benefits of disruption and being a victim of it.

Speed: The New DNA of Destination Marketing (Part Four)

Part Four in a series on what the new fundamentals of marketing mean to DMOs and destination marketing professionals as inspired by the recent McKinsey article: “The Dawn of Marketing’s New Golden Age”.

Screen Shot 2015-04-07 at 10.23.54 AMMcKinsey-Speak:  Develop the management skills and organizational clout to bring cross-functional teams together swiftly. Achieve a shared vision with product developers to facilitate a speedy response to market changes.

DMSpeak: Partner fast and partner often to co-create solutions that get stuff done at the speed of the marketplace.

The Reality Check: Let’s borrow from Jim Collins here and “confront the brutal facts”: The notion of speed and DMO strategic action don’t often coexist. We don’t have a reputation for moving quickly when it comes to strategic undertakings. (This is not to be confused with tactical operations where most DMOs outperform when it comes to client service and guest response.) For strategic development we like to form committees and/or task forces to engage and give transparency to the opportunity and thought process. Then we vet the group’s recommended course of action with another leadership body. Engagement by process (often prescribed in a DMO’s bylaws or policies) rather than for advantage often rules the day for DMOs.  A consultative approach? Absolutely. Transparent governance? For sure. The problem is that today’s global marketplace is built upon “always-on” engagement instead of process, further accelerated by the speed of technology. And more often than not, the enterprise that engages fastest to identify and respond to a marketplace opportunity or trend, prevails…again and again.

Nestle-Digital-Acceleration-TeamWhat Does That Look Like: Engagement is not a codified policy process you can turn on and off when you want to get something done. Its a permanent enterprise practice. Its a brand value. The McKinsey article cites the example of how Nestle deploys “digital acceleration teams” to train existing business units on how to use today’s engagement technology (e.g social media) to stay engaged with their customers and also with their product development teams. For DMOs this means training and equipping sales and service teams with tools to help them discover marketplace trends and opportunities through the customer data and visitor conversations they deal with everyday. This is DMO gold. DMOs can go even further by extending that engagement connectivity to their myriad of diverse community partners and draw upon their marketplace perspectives to amass significant business intelligence that accelerates a destination’s response to opportunities. As Nestle discovered, an “always on” engagement platform accelerates product development. For DMOs it can also enhance the likelihood of marketplace success for campaigns and new destination services. It should even help a DMO support public and private sector product development investment in the destination.

Of course, even with a commitment to an “always on” engagement platform, DMOs should also be taking steps to streamline their governance culture in order to be supportive rather than constraining to the required speed to succeed in today’s marketplace realities.

Next Up: Simple

Story: The New DNA of Destination Marketing (Part Three)

Part Three in a series on what the new fundamentals of marketing mean to DMOs and destination marketing professionals as inspired by the recent McKinsey article: “The Dawn of Marketing’s New Golden Age”.

Screen Shot 2015-03-10 at 1.42.14 PMMcKinsey-Speak: Learn to relinquish control of stories as customers interpret and modify them on social media.

DMSpeak: Today destination story-telling is not about a special hotel offer or your newest attraction. It’s about activating and enriching an ongoing marketplace conversation with content and perspective rather than trying to control it.

The Reality Check: According to Think With Google: 83% of people turn to social media sites for their travel inspiration while only 31% turn to destination-specific websites. And the gap is growing. The reason for that gap in my humble opinion comes down to one thing: TRUST. Most destination-specific websites are all about broadcasting offers and well-polished pitches about the latest and greatest experiences of their members/partners/stakeholders. They are not about what the best experience is for YOU…which is what you expect the people in your social media network to tell you. And you TRUST them.

Screen Shot 2015-03-10 at 2.11.59 PM

Destination marketers struggle with the difference between selling and engaging. It’s not that they don’t understand the difference. They have been told that the quickest way to a transaction is to ask for the business. But the world has changed. To quote the Cluetrain Manifesto: “Markets are conversations. Their members communicate in language that is natural, open, honest, direct, funny and often shocking.” DMOs need to join the conversation as an enriching participant rather than as a controlling broadcaster. The best way to do that is to produce relevant and authentic content.

What Does That Look Like: Brands everywhere are migrating their marketing strategy toward the generation of “stories” that showcases what their brand values and experiences are all about, engaging targeted users (through social media and live events) to comment, augment and even participate in the story. While some DMOs have succeeded wildly in their content marketing and story-telling (e.g. Tourism Australia’s Best Jobs in the World campaign), most are reluctant to abandon the comfort zone of the broadcast offer mentality.

Last week Greg Oates wrote a great piece about how DMOs are beginning to deploy content strategies to engage their meeting planner customers. Marriott has been doing it “brilliantly” for two years. This includes their support of one of the most provocative travel storytelling places I know: Gone on Medium.com.  Check it out.

Let me share two great examples of DMOs that create stories to engage their customers:

Screen Shot 2015-03-13 at 5.26.39 PMTourism Tofino: I’ve highlited the work of this small DMO before but their commitment to stories and user-generated content as their core marketing strategy is impressive.

 

Screen Shot 2015-03-13 at 5.28.57 PMTravel Oregon: Their home page is a collage of user-generated image content linked to Instagram. They also have a library of user-generated narrative stories about Oregon travel experiences…all written by real people just like you.

 

The Hack: One of the easiest and most effective story platforms for a destination is aScreen Shot 2015-03-13 at 8.01.12 PM blog. But I continue to shocked by how few destinations actually have one. Visit CincinnatiUSA has a fine example of using a blog to create stories that engage its customers, specifically meeting planners. And not an offer of dates, rates and space in-sight.

DMOs need to make the development of stories that engage their customers as their primary vehicle for creating inspiration and activating conversations about their destination. Its no longer about the offer. Or the product. Its about the story. And the conversation.

This Just In: Tourism New South Wales CEO Sandra Chipchase is pushing the DMO content marketing envelope and sees her organization becoming more like a publishing business: “For us, the biggest competition is not between the countries. It’s about information. That’s where the real battleground is. It’s about how to get user-generated content and and get people to follow the aspirational content produced by people and the brand.” (source: SKIFT via @SamShankman).

Substance: The New DNA of Destination Marketing (Part Two)

Part Two in a series on what the new fundamentals of marketing mean to DMOs and destination marketing professionals as inspired by the recent McKinsey article: “The Dawn of Marketing’s New Golden Age”.

Screen Shot 2015-02-27 at 7.54.48 AMMcKinsey-Speak: Marketers can directly shape the business by evolving the customer experience and the development of products and services.

DMSpeak: If destination marketers really want to add greater value, think beyond dates, rates and space. Destination marketers need to play an increasing role in being a steward of the development of the destination product and experience as a way to grow the business of tourism and its contribution to the community.

The Reality Check: Destination marketing leadership can no longer be exclusively anchored upon the results of aggressive sales pitches and flashy promotions. As McKinsey notes: “As more advanced marketing science and analytics take hold, they make it increasingly natural for marketing to go beyond messaging and to shape the business, particularly the experiences of customers, the delivery of functional benefits, and the drive to develop new products and services.” 

Walt DisneyAs great at story-telling as Disney is, they are even more masterful at translating a vision into a compelling destination experience. They know that without a carefully crafted product experience, there isn’t a story to talk about.

What that means is that destination marketing organizations should look at this as an opportunity to evolve their mission beyond the traditional “heads in beds” focus to leadership around “quality of place” – an elevated mission that focuses as much on the development of an authentic, compelling visitor experience as it does on telling its story. And destination marketers are uniquely positioned to engage all participants in the experience conversation — industry, community and visitor — in order to enhance the long-term impact of tourism on the community economy and its quality of life.

What Does that Look Like?: One of the three transformational opportunities noted in DMAI’s DestinationNEXT study was Growing and Sustaining the Destination Brand: “This could include the creation of a tourism master plan for the destination outlining a vision of how the tourism industry “footprint” will evolve over time, impacting the destination’s economy, social fabric and environmental sustainability.”

The Tourism Master Plan (TMP) is the co-created roadmap for a high-value evolution of the destination experience…which ultimately is its brand. In the case of a TMP, that roadmap could include the evolution of infrastructure, attractions and cultural experiences, even leadership structures and policy recommendations.

The master plan process is about engaging stakeholders about the reality of their destination experience/reputation by asking them to help shape the future of the experience and ultimately the brand. Successfully activated, it will take all stakeholders on a journey to long-term business success and quality of place through tourism.

This is an unparalleled community leadership opportunity for DMOs as only the DMO has the community and marketplace capital to extend conversations about the destination well-beyond traditional stakeholders to include the wider local community (e.g. the local economic development leaders) as well as a destination’s customers – tour operators, meeting professionals and visitors themselves.

Screen Shot 2015-03-03 at 11.23.33 AM

The Hack: There is no definitive structure for a TMP. It’s a developing “next practice” for destination marketers. The best way to get started is to take a look at what others have done and be part of the conversation. TMP’s have been around for a while, primarily in resort areas. TMP’s in urban destinations are gaining traction with plans now in-place for Vancouver, Winnipeg, Drumheller (Alberta), Curacao and Myanmar. TMP’s are currently in various stages of development in Indianapolis (a project I am honored to be part of) and in the Greater Palm Springs area. I am sure there are others.

This Just In: Las Vegas continues to define exceptions as well as the exceptional. With their recent purchase of the Riviera Hotel property (including gaming license) to ensure there is an adequate supply of convention space to meet future needs, the Las Vegas Convention and Visitors Association has moved beyond the realm of Las Vegas’s chief convention and tourism rainmaker into an architect of the future of the Vegas brand experience.

Next Up: Story

The DNA of (Destination) Marketing’s Golden Age

Recently McKinsey published an amazing article that really nails the driving forces behind today’s marketing (r)evolution and what I have referred to in this blog as Destination Marketing 3.0. They summarized five defining elements that marketers need to come to grips with in order to be relevant and successful:

  • Science: Advances in data, modeling, and analysis allow precise measurement and management of customer decisions and more targeted spending.
  • Substance: Marketers can directly shape the business by evolving the customer experience and the development of products and services.
  • Story: The ways to tell a story are morphing continually, drawing on richer digital interactions and more powerful communications tools.
  • Speed: Consumer preferences, market dynamics, and product life cycles change with stunning velocity in a digital economy.
  • Simplicity: Complexity is the enemy of speed and leading marketers are seeking greater simplicity.

Brilliant. Clear. And please don’t even think about saying “Yeah…but they don’t understand our business.” If you’re part of a business on this planet in 2015, they apply.

So…over the next five weeks I’ll cover each of these five elements translating McKinsey-speak into DMSpeak. Today, we’ll start with the impact of science, as defined by McKinsey, is changing the way destinations market.

Screen Shot 2015-02-20 at 3.51.52 PM

McKinsey-speak: “Marshal big data and analytics for insights into choices along decision journeys.”

DMSpeak: Customer data analytics are as powerful as a site inspection. Spend as much time (and money) collecting and analyzing data from your their worlds as wining and dining them in your’s.

The Reality Check: As much as destination marketing long-timers like me say that the convention and tourism business is all about relationships, increasingly success is being built on data. Big data. Tourism is big business. And just like every other big business, knowing how and when customers act in the planning and even during the purchase and enjoyment itself is where the gold is. Focus groups are old world. Its now about engaging with your customers throughout the entire decision journey, and beyond, and identifying those points/places in the decision journey where a high-impact, well-placed message/action can activate the desired move in the decision process. This means destination marketers are going to have to make the collection and analysis of customer data an ongoing quest to compete with other destinations and even other non-tourism brands for consumer attention and cash. And tourism’s data-generation capability is boundless. So there is plenty of work to go around.

What does that look like?: Google (and yes…they are increasingly becoming part of the travel ecosystem) published this amazing compendium — The 2014 Traveler’s Road to Decision. This is a mandatory reference guide for all destination marketers. Sleep with it. Ignore its data-driven insights at your peril. Then go and create your own.

The Hack: Developing data analytics is not a natural part of the destination marketing culture. So before DMOs start a stampede to hire in-house data scientists, finding a competent partner is a good strategy. Because collecting tourism data is a community-wide undertaking, you’ll also likely have to develop some kind of community data-sharing protocol with your partners (e.g. hotels, attractions) to develop one set of destination analytics that the community can draw from to inform tourism strategies and tactics at the destination and individual enterprise level. And then imagine what kind of marketplace/customer advantage and loyalty you could create if you could develop a special set of analytics specifically for your tour operator and meeting planner clients to learn from. Now were talking. That’s a powerful destination marketing value proposition indeed.

National-Hockey-League-imageThis Just In: The National Hockey League (hardly an enterprise ever mentioned at the cutting edge of innovation in the world of professional sport) recently published a new rich analytics website in partnership with SAP, presumably for fans that play fantasy sports who are looking for a big data edge. It seems big data is the newest fan magnet.

Next Up: Substance

Ecuador Goes All-In: $3.8 million for a Super Bowl Ad

You have to give Ecuador credit for going where most DMO destination communities would love to go but never do — a prime-time commercial on the year’s most watched US TV show. I am sure national tourism industry pride was beaming at the thought. While the tourism minister claimed that if US visits to Ecuador only went-up 1% in 2015 the ad will have paid for itself, was that really the objective of a one-time all-in investment? And more importantly, did it work?:

If the objective was to generate transactions to pay for the ad: there was no overt call-to-action (other than the Ecuador web URL) or offers in the spot to create urgency to act. Looking at available web analytics there has been no spike in traffic so far.

If the objective was to introduce a defining brand statement or start new conversations about Ecuador: Can’t say I took away any deep (new or differentiated) emotional connections to Ecuador from the spot. Nor did the spot even rate a mention in any of the Super Bowl spot reviews or social media sites I follow. And why would it? It wasn’t brand new (it came out in late 2014) and it was entirely predictable in the toughest commercial line-up on the planet. What is there to talk about?

Point is: If you’ve mustered-up the resolve and resources to share your destination story on a stage amidst the toughest conditions imaginable, you’ve got to have the courage to go all-in and do something remarkable to distinguish yourself with your audience and at the very least inspire a new conversation.

Time will tell if Pete Carroll’s last-minute play call was the only bad play-calling decision on Super Bowl Sunday or not.

Critical DMO Leadership Actions for 2015 – Part Two

TDAmeritradeBPCameraIt’s hard to believe that the stream of 2015 travel marketing trend and strategy recommendations continues through the first month of 2015. I found two more freshly published articles today alone. So to help destination marketers make some simple sense of it all, last week I published “Making Content Creation an Organizational Core Competency” as part one of a two-part series on Critical DMO Leadership Actions for 2015.

Only two? Like I said, I am keeping it really simple.

The second critical DMO leadership action for 2015 is around the need to develop new DMO partnership strategies.

DMOs have made developing partnerships to extend their marketplace visibility and strength of voice an organizational imperative. Being on the watch for new marketing relationships has become as important as doing the marketing itself. All of which has created a veritable red ocean of DMO partnership activity to the point where a DMO CMO said to me yesterday “Who doesn’t have a partnership with [profile industry enterprise]?” With DMOs eternally on the hunt for ways to create compelling new value for their constituents and their communities, why pursue partnerships with the usual suspects?

Today, a different partnership perspective is required. And it starts with reframing the DMO’s mission beyond the typical travel and hospitality value construct to embrace a broader community economic development paradigm for their destination.

Enlarging Your Territory: Forging New Partnerships With Economic Development

To get there DMO leaders need to get comfortable with the fact that they are in the business of economic development as much as in the business of tourism marketing (and certainly more than in the hospitality business).

destination-promotion-an-engine-of-economic-development-6-638This is not really new news from an intellectual standpoint. In fact Business Events Sydney (the Sydney DMO) explored the idea in 2010 and published the ground-breaking study A Scoping Study of Business Events: Beyond Tourism Benefits. And most recently Oxford Economics published Destination Promotion: An Engine of Economic Development outlining the opportunity that DMOs were staring at.

For Business Events Sydney, the results of activating the findings of the 2010 study were game-changing: “We also delivered a business case to government that now aligns the work we do with their economic development framework and secured additional recurrent funding that enables us to continue to secure events that contribute to NSW driving innovation, collaboration and global connectivity.” commented Business Events Sydney Chief Executive Officer Lyn Lewis-Smith.

Consider that at their core essence DMOs and Economic Development Offices (“EDOs”) are on similar missions: deliver incremental economic and social benefits/legacies to their communities to make them better places to live, work and play. However, like twins separated at birth they grew-up speaking different languages. To get the job done one was all about unleashing emotional inspiration and high-touch service while the other was all about showcasing business pragmatics. One developed relationships with event organizers and experience designers. One engaged with investment officers and policy strategists. And rarely did the two communicate let alone join forces – even though they would eventually end up at the same destination meeting or congress with their respective clients. In fact, they often competed with each other for local funding and visibility.

Does this sound effective?

So…what does a DMO-EDO partnership look like?: It obviously depends on the needs of community but consider some recent examples:

logo

While destination “ambassador” programs are nothing new as way to attract events to a destination, Liverpool’s community stakeholders have looked at the opportunity well beyond the typical tourism/events industry potential:

  • Community Engagement: By creating a branded club with an incredibly diverse community constituency, they have extended the community footprint and understanding of why the tourism/events are relevant and how it contributes to a better quality of life.
  • New Measures of Success: Club Liverpool’s leaders have made it quite clear that their objectives go beyond traditional tourism measures by stating: “…entice major national and international events to the city and attract inward investment from a global audience.” A key part of making that real is positioning Liverpool’s economic development leaders as equal partners in the initiative.

In other communities like Denver and Phoenix today’s DMO-EDO partnerships include collaborative development around such mutually beneficial initiatives as air services development, business development missions and branding. And its working!

With the intensities of today’s global competition for capital and visitors, and limited resources being what they are, the time to forge a partnership that leverages the talent, resources and networks of both enterprises to improve performance and the destination value created is now.

And I think we’ll all find that we do speak the same language: the language of business.