NASHVILLE -- The Destination Marketing Association
International's (DMAI) annual CEO meeting last week may have been held here in
Music City, but the buzz was all about the Sunshine State.
Among those who had gathered here were many CEOs of smaller
and seemingly more vulnerable destination marketing organizations (DMOs) around
the country. Their shared concern was that if Visit Florida was having to fight
for its existence, who among them was safe?
Florida is, after all, what U.S. Travel Association CEO
Roger Dow in his keynote address here called "the darling of the travel
industry." It set record visitation numbers for the past five years, and
in 2015 it became the first state to welcome more than 100 million visitors in
a single year.
And yet, Florida's House of Representatives in February
voted overwhelmingly to cut Visit Florida's budget by 67%. Florida Gov. Rick
Scott, a Republican, has been tirelessly campaigning in defense of Visit
Florida, crisscrossing the state to persuade residents of the organization's
value and educate them about how much tourism contributes to Florida's coffers.
In the Hot Seat
Florida Gov. Rick Scott has been crisscrossing his state,
drumming up support for Visit Florida, its destination marketing organization.
News editor Johanna Jainchill spoke to Scott about why the travel industry
needs to defend its DMOs. Read More
Visit Florida's troubles began last year when it was
revealed that it had paid the rapper Pitbull $1 million to promote the state,
leading to the resignation of Visit Florida's CEO in January. Florida's house
speaker, Richard Corcoran, a fellow Republican who is said to have his eyes on
a gubernatorial run in 2018, has taken on the organization with as much zeal as
Scott has invested in defending it.
As of last week, no companion bill had been introduced in
the state Senate, and several people in Florida's tourism industry said there
is not much appetite in the upper house to introduce one. However, whether or
not the bill passes, the Florida legislature will ultimately decide on Visit
Florida's budget, for which Scott has requested $76 million.
In a facetious jab at Florida lawmakers, DMAI chair Gary
Sherwin, CEO of Visit Newport Beach, said, "I would love to say to the
Florida legislature on behalf of the state of California and all its
destinations, that agreeing to unilaterally disarm yourself by cutting
marketing will be a boon to our state, and we'd like to thank you."
On a more serious note, Sherwin called cutting Visit Florida's
budget "a horrible mistake."
"They have to understand that other states will benefit
when they decide to take this action," Sherwin said. "Ours will be
one of them, and there will be others as well. But the people of Florida and
the jobs that people depend on will go away."
But in fact, the current political climate is placing more
strain on these DMOs.
"Part of the challenge is that right now -- and we saw
it in the presidential election -- there is anti-government sentiment, people
saying let's make government small," Sherwin said. "Leave only the
essential services and get rid of everything else. There are consequences to
those decisions. ... When there's a downturn, a lot of politicians say, 'Well,
I can fund tourism or I can put cops on the streets.' Our answer is, 'If you
fund tourism, you can do both.' But a lot of politicians don't understand that."
Learning from past cuts
Every person in attendance it seemed could rattle off the
names of places that severely or entirely cut their marketing funds --
Washington, Colorado, Pennsylvania and Chicago -- only to quickly learn that
whatever they saved in their budget they lost many times over in visitor
Dow said it was "an irrefutable fact that if you
increase spending, more people come, more visitors come. If you decrease
spending, less visitors come, there is less spending, less jobs happen. There
is case after case after case, but people don't listen."
He cited the example of Pennsylvania, where the tourism
budget was chopped from $30 million to $7 million. After five years, the state
saw its regional market share drop 17%.
"They saved some money," Dow said. "For every
dollar they saved, the state lost $3.66 in tax revenue."
Colorado, which Dow called "the poster boy or girl for
our story," closed its tourism marketing office in 1993 for seven years.
But it took until 2016 -- almost 23 years -- to win back the market share it
had in the '90s.
Yet, other destinations don't seem to learn from those
DMAI CEO Don Welsh, who was CEO of Choose Chicago when its
budget was slashed in 2015 by $7 million, said, "It had taken us five
years to get it to a respectable level, and overnight it was cut by 42%."
As a result, Welsh said, he had to lay off 29 people and
close international offices in Mexico and Canada. The sudden disruption, he
said, slowed Chicago's momentum and likely cost the city hundreds of millions
of dollars in economic impact in the eight months it took to get the funding
"When a city starts getting into a groove, like with
Nashville, you have to have continued investment," Welsh said. "If
you all of a sudden shut it off, it's not like you can turn the faucet back on
the next day."
Nashville, which has almost doubled its marketing budget
over the last five years, saw a record 13.9 million visitors in 2016, while
also setting records in hotel rooms sold and hotel taxes collected. Its success
correlates directly with the support it gets from its top leadership,
specifically mayor Megan Barry, who spoke at the DMAI meeting and explained
that her support for tourism marketing dollars comes down to the numbers.
"To me it's data-driven," she said. "Was this
going to have an economic benefit if we made this investment? What was going to
be the dollar-to-dollar return that we could see from the tourist industry?"
With that industry
now supporting almost 60,000 Nashville jobs, Barry is convinced.
"Every time you buy a beer, you help pay for a police
officer," she said. "Every time you buy a meal, you help me pay for a
In conclusion, she told those in attendance, "Have a
great time -- and spend a lot of money."