Formalizing the Tourism Marketing and Economic Development Partnership

A colleague of mine from Vital Economy – one of the US’ foremost social enterprises focused on community economic development strategies – forwarded me a recent Forbes article about how cities are getting serious about marketing campaigns to attract talent to their destinations. They cite LouisvilleMontrealClevelandCalgaryRaleigh and Houston as examples of cities that have established comprehensive community development initiatives under various organizational constructs, such as economic development offices (EDOs) or chambers of commerce, to market their destinations as great places to live and work.

When you go to their respective websites (check-out Montreal in particular) you’ll find that their look, feel and approach is strikingly similar to that of a DMO looking to engage visitors. And why not:

  • EDOs are attracting talent and investment.
  • DMOs are attracting visitors.
  • Both are dealing with intensely competitive global marketplaces (the “war for talent” and investment is every bit as brutal as competition for meetings and events).
  • Both want to build relationships with executive-level decision-makers as well as engage individual consumers.
  • Both are in the destination marketing business – presenting their destination’s emotional and pragmatic benefits to their target audiences with the objective of making their community a better place to live, work and play.

The potential partnership synergies are enormous.

When DestinationNEXT identified the development of new business models as one of three provocative transformational opportunities for the future of DMOs, the top element in business model evolution was “greater involvement in broader economic development initiatives.”

So what does that look like?

There are currently numerous DMOs that have recognized the important opportunity that closer working relationships with EDOs presents for everyone in the community. For starters, many progressive communities have already seen fit to include the film and/or sports commissions as part of the current DMO since they too are in the business of marketing the destination. At the same time, many of those relationships remain issue and/or opportunity based – that is to say that there are currently very few examples of ongoing formal structural or MOU-type DMO-EDO initiatives with measurable objectives and aligned strategies.

Old DMO Design

Maybe the time is right for everyone to think a little bigger. Since DMOs and EDOs are BOTH in the destination marketing business (though to different audiences) does the future destination marketing organization one day look like this?:

New DMO Design

Consider some of the benefits of a broader consolidation with EDOs:

  • More business leads: Combining relationship networks across geographies and industries will help develop more leads for meetings/events, business investment etc.
  • Community support: Bringing stakeholders together in one entity will help community engagement and stakeholder understanding (e.g. business and investment community) of destination marketing activities, building both marketplace and political capital for use where and when needed.
  • Brand alignment: One consistent destination story will improve traction in intensely competitive marketplaces.
  • Destination development: Having a destination development plan (e.g. convention center expansion, tourism improvement district etc) that is broadly endorsed by tourism and economic development leaders/constituencies will help secure the required government policy support as well as private/public sector financing.
  • More business generation capacity: Enhanced operating efficiencies allowing for greater investment in direct business-generating destination marketing and economic development activities.

However, the idea has three fundamental challenges:

  • Funding: With prescriptively defined funding already in-place for many DMOs through hotel tax allocation and other lodging-based voluntary levies, having those proceeds dedicated to anything but visitor transaction generation could present problems.
  • Leadership: While the big picture mission (“making the community a better place to live, work and play”) won’t get much challenge, the need to also meet the expectations of the diverse individual stakeholder groups for each organization will take considerable energy.
  • Culture: This could be the biggest challenge of all. For example, while most tourism stakeholders have a richly-grounded hospitality ethos, the economic development mindset can be very bottom-line driven. Can they co-exist?

Of course its idealistic, simplified and maybe even naïve. But if superior relationship development and operational performance from community destination marketing initiatives in intensely competitive marketplaces is the objective, the concept of one organization formally leading a community’s various destination marketing initiatives is worth exploring.

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THE SECOND COMING OF THE CELEBRITY TOURISM AMBASSADOR

At one time or another most DMO executives and their local partners have considered enlisting the services of a celebrity (however defined) native son or daughter to pitch their destination. “They’ll do it and they’ll do it for free because they’re from here” are the typical expectations.

My experience has been:

  • Most don’t want to do it because they don’t want to look like they can be bought to pimp a destination.
  • They’ll do it but want BIG money to do as little as possible…and only if/when they feel like it.
  • Be careful what you wish for. Hitching your carefully cultivated and managed destination brand to a paparazzi target (remember “Snookie”?) that uses twitter as a weapon of mass destruction just might cause more damage than you’re able to clean-up.

This paradigm would now appear to be changing. It seems that some high profile destination brands have decided that the risk and investment in a celebrity tourism ambassador are worth it in order to take their brands to new levels of affinity as the competition for attention and revenue continues to escalate:

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New York City (Taylor Swift): The Big Apple hired her even though she’s not a native daughter nor does she live there. She does have over 70 million Twitter followers however. Perhaps it was “brand defense” given The Donald’s continued reference to his NY heritage.

 

ThorAustralia (Chris Hemsworth): Tourism Australia hired him to follow in the steps of perhaps the world’s most famous tourism ambassador, Paul Hogan. To a whole generation of travelers and more, Crocodile Dundee was the embodiment of all things Australia. It will be interesting if consumers come to associate Mr. Hemsworth as much with Australia as they already do with Asgaard.

Josh DuhamelNorth Dakota (Josh Duhamel): North Dakota is one of the US’s least visited states and its most widely-known story-line of late involves a wood-chipper in the academy award-winning movie Fargo. Hiring native son Josh Duhamel to tell tales from the “Peace Garden State” appears to be working with a reported 20% increase in visitor guide distribution during 2015. No word on his impact on wood-chipper sales.

_83389027_640Tokyo (Godzilla): The appointment of Godzilla will have boomers reminiscing about their exploits at drive-in movies but I am not sure how it extends the Tokyo brand story. It was brilliant, however, in terms of generating press releases and photo ops. At least Godzilla’s not at-risk for inappropriate social media behavior.

California: Visit California’s “Dream Big” commercials use numerous A-B-C list Hollywood celebrities to tell the California story. For California it not only makes sense, but it’s totally expected given the Hollywood DNA in the overall California brand and lifestyle. It’s an essential and unique brand truth that is hard to ignore. Not surprisingly, no sightings of the Governator.

So the question is: does the investment in the use of celebrity tourism ambassador move the needle (however defined) for a destination? To get a very basic and organic answer I did what has become the go-to first-step for people: I asked Google…or rather, I used Google Consumer Surveys to ask 500 people in the US the following question:How much does the appearance of a celebrity tourism ambassador in marketing campaigns influence your decision to visit a destination? 

Celebrity Survey

Overall, just under 11% of the population are “moved” by the existence of a celebrity tourism ambassador, with an additional 11% in the gray area of uncertainty. Peeling back the data a bit, the impact of a celebrity tourism ambassador declined slightly as household income rises. In a world where the influence of peer-to-peer travel recommendations is skyrocketing while the influence of traditional placement advertising plunges, this result is not at all surprising.

Time will tell if any of the recent investments in celebrity tourism ambassadors will actually amount to anything more than a press release and a photo op. The only strategic reason I see for enlisting a celebrity tourism ambassador – simply put — is to have their well-known story and tribe of followers attached to your destination’s not-so-well-known story to create a bigger and better story with people that don’t know your destination’s story. In North Dakota’s case, it might be exactly what the destination is looking for as recent campaign results bear witness to. But for more widely-known destination brands and stories…you have to wonder about the ROI.

Let’s face it; signing-up a celebrity with a big story and big tribe of followers to extend yours is hardly destination marketing magic. You just need a telephone (to call an agent), a lawyer to write-up a complicated contract with lots of protection in it and a check with lots of zeroes on it. But as the data above shows…you’re unlikely to initiate a stampede of visitors to your destination. Except of course if you’re using Godzilla.

mqdefaultThe magical thing for DMOs to pursue is to find and share the smaller, more authentic stories about real people doing incredibly cool things in the destination that anyone can have access to. The Greater Palm Springs CVB is producing some great high-energy video content about a myriad of activities with that expand/enrich their destination’s story. This one has already had over 400K views.

If you create and share enough of the authentic and compelling stories that make your destination unique, pretty soon you’ll be the ones attracting the celebrities to your destination. But this time you won’t have to pay for them.

 

If I (Only) Had a Million Dollars – Core Strategies for Small DMOs

DSC_0014-1Ask many DMO leaders where they spend most of their time and budget security is typically at or near the top of the list. Whether it’s a fear of losing what they have or a quest for more, this is what keeps many a DMO leader awake at night.

Starting this week I am beginning a series of postings on key DMO strategies for different budget challenges. Of course, every DMO and destination have different community and visitor economy profiles that makes the development of a standard set of a core strategies difficult. However just because a DMO has inherent budget limitations should be no excuse to be less remarkable. Today, I believe budget is less of a determinant of performance than ever before. In today’s hyper-connected flattened marketplace, ALL DMOs can be remarkable. The key is focusing on doing a few things REALLY well and having the courage to discard/ignore approaches that have hit their expiry date.

The Magic of Today’s Small DMO Opportunity

For small DMOs (defined herein as those having operating budgets of $USD 1 million or less), I believe these are the “best of times”. While iconic destinations will always have significant appeal, one of today’s most important visitor trends is the quest for a unique, authentic experience – and often this means a smaller, lower profile destination where people are seeking the ultimate travel driver – ESCAPE. This is the sweet spot for the small DMO.

And even though visitor economy competition has never been as intense as it is now, destination marketing professionals in small DMOs have never had access to so many powerful tools, rich visitor data and vast relationship networks than today – and most of them are free.

So with that as a set-up here are six core approaches and strategies for small DMO leaders (and even larger DMOs since the principles and data points remain the same for the most part):

Spend Your Time and Money Here:

  • Engage Your Community as an absolute imperative. This is not about lobbying your local government/partners for money. This is about sharing a compelling story of why tourism matters to the average citizen and how theyselfie-vacation have the starring role in making it happen. With only a small budget, you need to inspire your community to be its biggest story-tellers and magic-makers. Visit local schools and business leaders. Ask them what they think makes your destination remarkable. Hold selfie contests. Crowdsource local photos and videos. Create a local tourism movement.
  • Digital Domination: You don’t have the time or money for a multi-platform marketing assault so make your destination website your channel of first resort. In 2014, Google reported that 74%/77% of leisure/business travelers used the web as their primary source of travel planning and that 50%/54% respectively used their smartphones during their trip. Creating a responsive (mobile-friendly) SEO optimized, visitor-centric website that shares your destination’s story along with how and where to find it should be your DMOs primary marketing investment.
  • It Takes a Village – Cultivate TripAdvisor engagement: Just because you say your destination is awesome does not mean potential visitors are going to believe you. But they do believe people who’ve been there, done that. And with a monthly audience of 375 million TripAdvisor is where people go to share and to explore. A December 2013 study by PhoCusWright indicated that 67% of travelers check TripAdvisor several times per month. You need to inspire your visitors to share their experiences and to coach your community to engage there. Contests and incentive awards work wonders…and the pay-off is HUGE.

Approaches and Strategies To Avoid:

  • Printus Interruptus: Don’t pay to print anything. One of the sacred cows for many destinations is the visitor guide…but once it’s printed it’s out of date. Let someone who is in the publishing business do what they do best and manage this sacred cow. As a DMO fully-engaged with your community, you’ll be the one with the latest and the greatest experiences, sharing them with visitors on a timely basis via your digital channel of first resort along with your inspired community story-tellers.

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  • Avoid Temptation from “Mad Men”: Stay away from paid advertising. Your budget also will not allow you to hit frequency/reach critical mass to get any kind of audience recall traction. Besides, research continues to indicate that travelers increasingly rely the most on personal contacts for travel inspiration and that their trust in paid advertising continues to decline.
  • Not Just Members Only: Many DMOs started as membership-models. And it worked in a pre-hyperconnected world. But as a small DMO you need to be seen as inclusive in your community, not exclusive. Potential visitors (particularly millennials) have decreasing trust in membership organizations as they have inherent biases and are perceived as not transparently supporting visitor needs. DMAI’s DestinationNEXT study actually found that almost one-third of existing member-based DMOs were looking to move away from the membership model over the next five years.

I know. Easier said than done. But for small DMOs, making just a few of these choices can result in significant performance results enhancements even though your resources are comparatively smaller. And as compared to larger DMOs and larger destinations, you can probably activate them much more quickly and consider their impact. That makes your sweet spot even more tasty.

Next week: What Would You Do With an Extra Million $’s?

Funding Challenges? Its Your Choice.

Regularly I hear from destination marketers that they don’t have enough money to do the job expected of them or that they are being outspent by their competitors. Which is probably why DMO leaders spend so much of their time focused on trying to grow their revenue base or, at the very least, ensuring what they have remains protected.

Hard to argue with that choice of leadership focus in any business.

But two media stories last week got me thinking that DMO leadership focus needs to, above all else, constantly define, redefine and steer the core business of the organization. Which means making tough choices that often involve saying “no more”.

The first is from Natchez, Mississippi (made famous by John Grisham) where a consultant concluded that the DMO there was primarily focused on managing and finding sponsors for local events and not on the job of actually inspiring visitors to visit Natchez. It’s a good thing John Grisham is so prolific.

The second story is from the Boston Globe that reported in great detail about how DMO’s wined, dined and buried in swag, meeting planner attendees at a recent meetings industry convention.  It was reported that one destination even went as far as providing “skinny jeans” to a client prospect.

In both cases I understand the need for destination marketers to keep their local stakeholders happy by supporting their communities and driving sales transactions. But are these the type of things that a high-performing marketplace organization should be doing to build a thriving tourism ecosystem in its community? Is this what Jeff Bezos or Marissa Mayer would do if challenged for funding and relevance?

Which brings me back to my point: if the primary business of your DMO is running local events, outfitting your client prospects in the latest fashion or even printing maps and brochures for your visitors, you will never have enough money to do the job. In fact, you’ll probably lose some or most of what you already have because eventually someone else will do these things better and more cheaply.

Like most businesses today, funding and capital are attracted to new ideas that confront disruption or define new market spaces for their brand. Why would a destination marketing business be any different?

Before destination marketers invest their time and local political capital in the quest to increase their funding, it might be a good idea to first banish low-value “legacy” tactics. And just like any start-up pitching investors, destination marketers need to have more than a spending plan…they need a vision for how they are going to evolve their business and brand to new levels of performance.

Many DMO’s don’t have a funding challenge. They have a business challenge. One that can often be addressed by DMO leaders asking tough questions about their current investment choices for making a real, sustainable difference for their communities. More often than not those choices start first with having the courage to stop-doing some long-standing habits that are now becoming vices.

Destination Marketing 3.0: Do You Have the Courage to Destroy Your Own Business?

One of the premises of this blog space is that today’s destination marketers, faced with substantial relevancy challenges, need to reboot themselves. And over the last month I’ve offered a number of personal perspectives on what I believe that looks like, often citing some awesome examples of what some DMO’s are doing to evolve in the face of disruptive forces and challenges to their long-standing value proposition.

But in speaking with destination marketers and, more importantly their customers, what I keep hearing is that most destination marketers are more comfortable avoiding a disruptive change strategy than they are at activating one.

ImageThere are plenty of examples of industries (e.g. retail music), companies (e.g. Kodak) and professions (e.g. travel agents) whose marketplace relevancy was destroyed by disruptive change because they avoided making the necessary disruptive choices to ensure their ongoing relevance.

At Amazon, Jeff Bezos has his own recipe for disruption. Inspired by Clayton Christensen, one of the world’s foremost experts on disruptive innovation, Mr. Bezos actually challenges members of his leadership team to devise strategies to destroy their own business lines and then put the disruptive strategy into play before someone else does. Can’t wait to see what he does to the publishing industry with his Washington Post acquisition.

So…this week, rather than continuing to share my perspective on what higher-value, higher-relevance destination marketing looks like, I’m going to throw-out a challenge to see what comes back:

What would you do to destroy an existing DMO business line?

If you see that challenge as a little too provocative, the alternative challenge is this:

Why do many destination marketers struggle with making disruptive choices for their businesses even with an acknowledged relevancy challenge?

In this blogspace I’ve extolled the virtues of engagement to create rich conversations on opportunities and challenges. So lets have one shall we.

Bring it.