Articles on Governance Minimize

Monday, January 27, 2014

Destination Leadership

by Bill Geist

CHAPTER 2:  Why We Do What We Do

In his Top Ten TED Talk and breakthrough book entitled Start with Why, Simon Sinek maintains the best predictor of success begins with asking that simplest of questions. It’s the question we hear repeatedly from young (and not-so young) children. The question that we, as adults, ask far too infrequently, knowing that the answer will likely be “because” or “I dunno.”   

Watch the video and read the book. Simon’s too good at connecting the dots from his fascinating research findings not to treat yourself. But, the bottom line is…the most successful companies are those that started with why they were going to produce something, not what they were going to produce.   

So, why Destination Marketing…and why DMOs?   

A Destination Marketing Organization is typically charged with attracting visitors to town, encouraging them to experience the region, spend their money…and then, return home and tell their friends so that they want to visit. And, with many of today’s consumers posting every facet of their lives on an increasing number of Social Media platforms, a single, exceptional experience could conceivably spawn hundreds (if not thousands) of other visits.   

The end goal of a Tourism strategy has traditionally been increased visitor spending of new dollars in a local economy; generating profits for businesses, jobs for residents and taxes for municipal, county and state government. The taxes on those new dollars being spent throughout the community on meals, entertainment, gifts and lodging create a situation in which governments enjoy new (and non-residential) revenues to provide much needed services. And maybe, just maybe, homeowner property taxes won’t have to increase as rapidly as they would without visitor spending powering the economy.  

Indeed, many states have calculated the tax implication to homeowners if visitors didn’t spend their dollars in their destinations. And, depending on the size and population of the State, those impacts range from $400 to $1000 in property taxes saved per year on the average home. Again, Tourism touches everybody.   

Because DMO efforts are often funded through special taxes levied on hotel stays, it’s been easy for people to dismiss Destination Marketing as simply an effort to place “Heads in Beds.”   

The “Heads in Beds” axiom has been repeated in DMO Boardrooms, City Council chambers and out on the street across the land for decades. And, it needs to stop.   

Sure, it’s a cute, catchy phrase that makes our sometimes difficult to understand mission easier to comprehend for Joe and Jill Public. However, this notion is dangerously limiting, suggesting that Destination Marketing only impacts a special interest group. Indeed, if the prime directive was filling hotels, only hoteliers (and the businesses that do business with them) should care.   

Trust us on this. It’s way more than just “Heads in Beds.” It’s also: 

• Cheeks in Seats 

• Torsos through Turnstiles 

• Feet on the Streets 

• Fans in the Stands  

• More in the Store.    

It’s also increased corporate investment in our communities and welcoming new residents (also known as a talented workforce) to maintain regional sustainability. After all, only about a quarter of the average visitor dollar is spent on overnight lodging. Another quarter is spent on food and beverages and roughly 20% is spent on shopping. To focus only on hotels would be ludicrous, but to ignore them is to under-achieve.  

Indeed, for many destinations, a sizable percent of their visitors never step foot in a hotel. They are VFR (Visiting Friends and Relatives). But, just because they aren’t sleeping in a hotel tonight, are they any less important of a visitor to our economy? What happens when friends and relatives stay at your place? Don’t you take them out to dinner, a show and an attraction or two? And, don’t you all go shopping at least one day? VFR tourists, while not overnighting in a hotel, are an important piece of the visitor impact pie.   Looking at this another way, if this was just “Heads in Beds,” why are destination websites awash in images, videos and stories of pretty much everything but hotels?   

Even more important (and probably even less visible) is the impact that a visit to a cool town can have on an entrepreneur. Recent research has revealed that half of all decisions to invest in a community were inspired by a visit, either for business or leisure pursuits. An Economic Development Director for the State of Michigan went on record saying his agency experiences a spike of corporate interest in investment opportunities in that State every time the sensationally evocative “Pure Michigan” television campaign airs across the nation.   

These are just some of the reasons why a DMO must be about more than just filling hotel rooms. It must be about bringing the most people to town for the most reasons over the most days…which varies greatly from destination to destination. Indeed, it’s not “Heads in Beds.” It’s “Heads.”  

A more sophisticated view holds that the true prime directive is marketing the entire destination because, in most cases the hotel is not the reason for the visit; simply the vessel. A place to stay is a necessary consideration so that the consumer can take in the attractions, experience the culture, taste the culinary wonders and participate in destination activities. If we successfully sell and market the destination, we fill the hotels.     

As noted in the previous chapter, however, there is a growing global realization that DMOs possess a much larger opportunity to positively impact their communities and regions than previously understood. New research is opening the eyes of Destination Leaders far and wide that a DMO’s impact is considerably greater than just the overnight visitor.   

There was once a “mantra” (likely perpetuated by hoteliers and grant programs) that a DMO should be restricted from marketing within 70 miles of home base. The rationale (flimsy as it was): Consumers within 70 miles will return home at the end of a day, not spending the night in a destination hotel. Today, there is a growing realization that this is simply not true. In talking with a Fort Worth hotelier a few years ago, he shared that 70% of his weekend overnight stays were from DFW Metroplex zip codes. None of those guests lived 70 miles away…and part of the reason his hotel was insanely profitable were consumers that old-school “rules” would have ignored. Of course, he and his DMO knew better than to play by those rules.   

The reality is that all the content that a DMO generates and curates for those outside of 70 miles is just as useful for those within 70 miles. So, why not repurpose it for the home crowd? In many communities, locals often gripe that “there’s nothing to do here.” And, that’s because nobody is charged with promoting the assets of a community to the community.    

This is not to say that the DMO should be taking out advertising in local media (although, Visit Fort Worth did just that to encourage DFW Metroplex residents to spend the night after their day seeing the sights and sites). It’s also making sure that locals know that the DMO website is the go-to source for what to do any time, day or night.   

In a way, Destination Marketing Organizations haven’t changed as much as the definition of “destination” has changed. Once a term that was clearly associated with Tourism, today’s communities are destinations for so much more. From the next stepping off point for Millennials and Generation Z, who are discovering their future direction, to a magnet for corporate investment, the words community and destination are almost interchangeable.   

In 2015, Longwoods International released a breakthrough study that irrefutably tied Tourism advertising to community awareness and appreciation for more than its assets and attractions. Indeed, researchers discovered a “Halo Effect” that extended out across real estate, career building, college selection and retirement.   

After interviewing over 18,000 out-of-state consumers about their attitudes toward ten  destinations (state and community), Longwoods found that respondents had a 65% higher opinion of a place if they had seen an ad for that destination…as a good place to live (not just visit). Those same respondents had a 79% higher opinion of the destination as a good place to start a career and start a business. There was a 66% lift in opinion of the destination as a good place to attend college and a 79% bump as a good place to retire. And, when those individuals actually visited the destination, the image lift was even more complete. All this from a “Tourism” ad (For the full synopsis of the “Halo Effect” study, go to Longwoods-Intl.com).   

For those critics of communities, regions and states investing tax revenue into Destination Marketing, these findings clearly indicate that cutting a DMO’s budget is a sensationally bad idea. For those places with an interest in the long-range viability and sustainability of their communities, the work of a DMO is akin to a match-maker, opening the door of awareness and possibility.    

Tourism truly is the first date for Economic Development.  

If we didn’t ask “Why,” this would be about Heads in Beds.   

The “Why” behind Destination Marketing is economic development, the generation of personal and community wealth and an enhanced Quality of Life for all residents. The “How” is encouraging and marketing great experiences in our community that everyone, visitor and resident alike can enjoy. The “What” is, hey…we’ve got some cool hotels so you don’t have to go home tonight.   

Get it?  

Author: Terri White
0 Comments

Categories: Articles, DMO ImpactNumber of views: 52940

Tags: