Data and case studies highlight the significant, continuous returns from destinations’ investments in travel promotion.
When a U.S. destination markets itself well, everything from local businesses to public services and citizens win. Unfortunately, this critically important point is often misunderstood by some state and local lawmakers, leading them to question the value of public investment in travel and tourism promotion.
In August, U.S. Travel released the third iteration of its Power of Travel Promotion report, which includes case studies of U.S. destinations with successful marketing campaigns and details the return each destination reaped from their investment.
It also illustrates the flipside: the immediate and severe consequences to those states and regions that have elected to cut tourism marketing budgets.
Attracting more visitors to a city or state means more money spent on local attractions, hotels, retail, restaurants and transportation. Increased visitor demand and spending generates a “virtuous cycle” of economic benefits, including job creation, increased investment in infrastructure and city centers, plus crucial tax revenue to support essential public services like police, firefighters and educators.
It is essential for U.S. destinations to invest in promotion to keep visitors arriving from all over the world—and remain competitive with growing international destinations like China and the United Arab Emirates.
Here are some examples of the success stories and cautionary tales highlighted by U.S. Travel’s Power of Travel Promotion research.
In 2012, the New Mexico Tourism Department launched “New Mexico True,” a marketing campaign to increase awareness of the state’s attractions and combat travelers’ misperception of the state as an arid, barren desert without much to offer visitors. The impact was immediate and profound: the campaign continued to be invested in and by 2015 every dollar invested in the campaign generated $72 in visitor spending and $7 in tax revenue.
Nashville has long been a mecca for music lovers worldwide, but it was not embraced as the “Music City” until about a decade ago. A citywide commitment to building a strong, authentic and identifiable “Music City” brand through consistent travel promotion investment over the last decade has yielded significant results. Investment in promoting new developments like the Music City Center have helped attract more than $5 billion in visitor spending, directly supporting 58,000 jobs—and drawing in more than $1 billion in new commercial development.
The state of Washington, on the other hand, serves as a chilling cautionary tale about what can happen when tourism promotion is cut or worse, eliminated.
In 2011, the Washington State Legislature took the radical step of completely shutting down its tourism office. Neighboring states, likely sensing an opportunity to increase their market share, in turn raised their own promotion budgets. Montana alone increased destination marketing funding by 30 percent the following budget year.
Predictably, traveler spending in Montana grew 70 percent faster than in Washington state. Travel-related tax revenue in Montana also outstripped the more populous Washington. Without travel and tourism tax revenue generated by out-of-state visitors, Washington state residents would have to pay $400 more in taxes each year to maintain the level of public services they currently receive. Unfortunately, thanks to the 2011 shuttering of its state tourism office, those savings will dwindle over time, since Washington state travel spending and tax revenue lags seriously behind not only its neighboring competitor states, but the rest of the country as well—travel spending growth was 13 percent slower, and travel-generated tax revenue growth was a whopping 26 percent slower than the national rate.
Not all is lost, though. The Washington Tourism Alliance, Visit Seattle, local destination marketing organizations and tourism related businesses are all pulling double duty to advocate for restored funding. We will be tracking the results of any renewed investment for the state.
The Power of Travel Promotion: What Destination Marketing Means to Communities Nationwide is available on ustravel.org. For a quick taste of the report’s main findings, read the executive summary or download the fact sheet. Read reports from 2013 and 2011 here. And finally, learn how travel spending creates tax revenue and sustains jobs and wages in every state and every Congressional district with our economic impact map.
This post has been updated from a previous version, published in September 2016.