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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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.