As well as developing theories on relativity and quantum mechanics, thus ushering in the era of modern physics, Albert Einstein also perfected the art of napping. Although he supposedly liked to sleep ten hours a night, he still knew that he worked best after short naps throughout the day. So short in fact that he ascertained one second was optimal for replenishing his brain without wasting much time. He did this by hanging his hand over the arm of his chair whilst holding a spoon above a sliver tray; as soon as he nodded off his grip would relax and his much loved gravity and clashing metal would do the rest.
This strategy was both effective, since it worked 100% of the time, and efficient, since it didn’t require much effort on his part. I’m sure we can all agree that the current politicians in Tallahassee are at a level somewhere below Einstein’s efficaciousness, when it comes to setting funding to support Florida tourism, and its subsequent benefits. In these sensitive times for destination marketing organizations (DMOs), demonstrating positive returns on investment (ROI) are more important than ever to justify the marketing spend of public finds.
DMOs, such as Visitor and Convention Bureaus (VCBs), have the remit to drive visitors to their destination or county through providing information about the area relevant to the target audience; be it leisure travel, groups, sports planners, etc. They may also provide co-op’d marking materials or advertising for the partners to participate in. Some do have online booking engines for hotel rooms or attractions, but mainly they are to drive demand as an aggregator of their tourism partners, and as such a quantifiable ROI is not just a simple calculation.
According to the U.S. Travel Association, in 2016 travel directly generated $990.3 billion and supported 8.6 million travel industry jobs. However, this only tells part of the story, as an additional $1.3 trillion is generated for other industries and 6.7 million more jobs, thus $2.3 trillion total to the United States economy supporting 15.3 million jobs; that’s one-in-nine of all U.S. jobs that depend on travel and tourism. But perhaps a better way to help the average citizen understand the importance of the industry – even as they complain about how badly tourists drive – is that each U.S. household would be estimated to have to pay $1,250 annually in additional taxes without the revenue generated by leisure and business travel!
Take the example below, which relates to expenditure for sports travellers – e.g. people that travel to attend their kids’ little league of volleyball competition. Airfare and accommodation only about for 14% of the total whereas the biggest contributors are retail, dining and other activities undertaken whilst there.
How Does This Help Locally?
Educating others on the overall value of travel and tourism is one thing, but to make this tangible at a given destination requires the setting and tracking of key performance indicators. Certainly, survey based primary research can be used to do this. For example, Downs & St. Germain Research projected the impact of visitors to a Florida destination by calculating the number of visitor days annually and applying that to local taxes generated; it was 40% of total. Looking at Atlanta as a source market, they calculated a return of $10 million based on a marketing outlay of $4 million between the DMO and other partners.
Other destinations such as Michigan ($5.72 ROI) and California ($19) have undertaken their own research in recent years. Such a difference may suggest California’s marketing is more effective, but care needs to be taken in comparing the methodologies used, especially in terms of indirect impact. However, if primary research is not part of a current budget, then there are other ways to track the performance of marketing activity that are relatively easy The following is not an exhaustive list, but rather some suggestions towards accountability.
Setting Your Own Benchmarks
- Using Google Analytics is possibly the simplest way to attribute marketing activity performance. By tracking the channel source, such as organic, social media, referral, etc., it is possible to allocate how the visitor arrived at the website. Even online advertising that did not result in a click visit can be attributed through ad servers that track subsequent visits through other sources after being served a banner or video impression. Total visitors and sessions is obviously the top line, but bounce rate, time spent on site, pages of content consumed, and other pre-set conversion metrics (such as reaching a ‘Contact Us’ section) also tell a story about the quality of the audience – i.e. how relevant the content is to those targeted, and therefore likelihood to physically visit a destination.
- Monthly reporting, comparing both the previous month and the previous year, help to start building trends over time. Any data then (either proprietary, or using that from a similar type of destination’s research) that reports how many visitors we influenced to come to the destination can then be used to allocate a value and therefore ROI to the total marketing efforts.
Visitor Guides requested/downloaded
- Similarly, the number of guides distributed can be given a value based on their likelihood to drive visitation, and thus the ROI from the spend undertaken to promote them
- Technology allows us to target consumers who are demonstrably coming to an area based on their search and purchase behavior. If someone has bought a flight to Orlando and we’d like them to visit our beach for a few days whilst in Central Florida, or extend their business trip to take in golf and cuisine in our nearby county, then we can serve them ads before they leave. The average time between booking that flight and coming to Florida is about 56 days. By matching devices we can then tell if/when they are actually in our area from their mobile device(s). An attribution model will allocate some or all of the value of that visitor to those impressions.
- This requires more effort, but even excel can do regression analysis that allows you to create models where the input variables include media spend and/or impressions by channel, and the output is destination visitation based on, for example, STR visitation reports. You must take into account the time between inspiration, research, booking and visitation, as well as seasonality. Once set up however, they are easily updated with new data.
Anyone who’s worked in destination marketing knows that it’s not possible to please all the stakeholders all the time, far from it – but we can be accountable. Setting some relevant metrics is better that none, and they can always be improved or added to over time. It’s not an exact science, and it might be necessary to make some assumptions, but trends are relative and provide valuable data that helps improve strategy and tactics.