HVCB loses Asia contracts, keeps N.A.

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HONOLULU -- After 100 years of marketing Hawaii worldwide, the Hawaii Visitors and Convention Bureau will now share that job with multiple firms over the next four years after the Hawaii Tourism Authority decided to parcel out its approximately $25 million marketing contract.

For the HVCB, which has been under fire since a state audit uncovered the misuse of funds, the HTA decision means a loss of about $8 million per year or roughly a third of the contract. It also represents a shift in the way Hawaii traditionally sells itself.

HVCB will continue to market the Islands in North America, winning the largest portion of the contract, worth about $16.6 million, that also includes worldwide corporate meetings and incentives.

Tokyo-headquartered Dentsu will take over marketing Hawaii to Japan, and Marketing Garden will market Hawaii elsewhere in Asia.

The moves may result in about 15 layoffs from HVCB's China and Japan offices.

Europe will be handled by the Mangum Group, and the Walshe Group will market to Australia and New Zealand. Contracts take effect Jan. 1, 2004; planning will begin immediately, officials said.

The contracts attracted 13 written bids to the HTA. Oral presentations before in June allowed HTA board members and a panel of industry representatives to evaluate the proposals and pose questions to each company.

This was the first time bidders were allowed to write proposals for individual market areas. "We wanted to compare our traditional approach -- assigning one marketing contract for global activity -- to a new way of looking at the world as distinct and individual markets," said HTA president and CEO Rex Johnson. "The international markets, especially Japan, have presented us with unique challenges that call for new approaches. The successful bidders were able to draw on their market knowledge as well as their ability to appreciate the nuances of marketing programs in their respective areas."

The HVCB has faced severe criticism after a state audit revealed a misuse of funds that drew the resignation of president and CEO Tony Vericella.

The HTA is still investigating the issue.

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