Travel -Tourism – Marketing
A Bright Spot in Rural
America?
John Keller
Tourism Defined
A segment of the travel market that consists of
individuals and groups that are known as "free and
independent travelers" or FIT
This definition distinguishes FIT travelers from
business travelers or convention visitors who typically
travel when and where necessary, rather than choose
a destination based on its individual appeal.
However, in assessing economic impact, business
and convention travel are normally included
Tourism and Leisure
Characteristics
Tourism is one of the most sensitive of all economic
opportunities relative to public resources. Without
public sector investment, most tourism sites remain
at the same scale with limited seasonal duration. A
major exception is gambling
Tourism and leisure returns major investments to the
public sector and is heavily taxed by the government.
Generally, the more money the public pumps in
tourism investment – the greater the return in taxes
and receipts.
Who Benefits?
Governmental Cash Flows
Tourist or Leisure tax
 Increased sales tax receipts
 Enhanced property tax returns
 CMB & Liquor tax
 Entertainment tax

Tourism Segmentation
Vacations
Holiday Trips
Business Trips Including Sales
Recreation and Leisure Trips
Gambling and Gaming
Sports
Research and Information - Genealogy
Conventions/Conferences
Top Tourism Demand
1. Eating and Drinking Places
2. Places of Accommodation
3. Recreation and Entertainment



Sports
Golf
Theme Parks and Cruises
4. Airlines
5. Local transportation – taxis and rentals
Top $ Economic Returns
Transportation and [Arrangement?]
Lodging
Food/entertainment
Retail Sales – specialties
Beverage and liquor
Primary and secondary attractions
The Context: The Nation
Almost every state (46 out of 50)
counts tourism among its top three
revenue-producing industries. This does
not include Kansas and Nebraska!
Nebraska!
“I even thought that I
was dead till I found
out I was just in
Nebraska.”
-Clint Eastwood
in “Unforgiven”
Redneck Institute
Stonehenge
Nebraska Car-Henge
Top 10 Tourist Destinations
18
50
35
Top Five World Tourist
Destinations
France
Spain
USA
Italy
China
In Parlance of Tourism
Its not where you go, its how much you
spend
Its not how many people, its how many
groups
Its not how much you spend in a day, its
how many days you spend
Top 5 World Revenue
Earners 2005 in Billions
84.5
36.7
33.5
29
19.9
United
States
Spain
France
Italy
China
Let’s Get This Out of the
Way
Tourism (generally a rural phenomena) in the
U.S. can reach the very height of quality and
plumb the depths of the disastrous
In other words – it can really suck
It can mine whole economies
It is generally not sustainable
It exploits cultures, people, workers,
communities, and whole regions
At the Same Time We
Really Enjoy It!
It can be Marginal
Flat Dumb
Or Faux Cultural
Genuine Amish County Store
The Old Standbys
The Who Gives A Damn
Category of Tourism
Always Looking For the
Can or Parking Space
Creating Amenities
“Asset theory of tourism” - successful tourism
depends on the availability of some immobile
attraction that people want to visit.
Popular tourist attractions are made rather
than discovered.
Rural tourism is just not linked to outdoor
activities. There is great diversity in tourism
activities- ethnic, historic, special attractions,
shopping, eco-tourism, religious events, etc.
And Yes – Kansas Land of Ahs
The fun started immediately when I
crossed the Missouri River into Atchison,
in the northeast corner of Kansas, and
found that the town was named for a
senator - from Missouri. In fact, David
Rice Atchison was president of the
United States for 24 hours, beginning at
noon March 4, 1849. He snoozed for
most of his term.
Home of the Black Squirrel
In 1987, the "Black
Squirrel Song" became
Marysville's, Kansas
official anthem:
"Lives in the city park,
runs all over town
The coal black squirrel will
be our pride and joy
Many more years to
come!"
Twine in Kansas
Near Insanity
Goodland
Rocket Fest
at Argonia
Weirder & Weirder
Picture of embalmed
Samuel Dinsmore in
his Mausoleum at
Lucas, Kansas here
Samuel P Dinsmoor at 89 & his 20 year old wife and year old son
Smaller and Smaller
Kansas Prairie Dog
Missouri Home Grown
Tourism
International Tourism
Eco-Tourism
Designer Tourism
World’s Most Expensive Tourism - Antarctica
From New Zealand
By Russian Ice Breaker
Assessing Tourism
Impact
Method 1 – Visitation


Assessed monthly, quarterly, annually
Repeat visitations are analyzed separately to
detect trends and patterns
Method 2 – Geographic Patterns





Within 50 miles
51 – 100 miles
Over 100 miles
Out of State
International
Tourism Impact - cont
Method 3 – Market Segmentation
Individuals
 Couples
 Families
 School Groups
 Tour Groups
 Other

Tourism Impact - cont
Method 4 – Spending Patterns
Average Total per visit
 Per Capita
 Segmented

Food and Drink
 Entertainment
 Accommodations
 Retail
 Transportation

Economic Impact
Segmented Overnight Expenditures
Accommodations – 1.00 - $16,197,001
 Food/Drink
.59 - $9,510,601
 Food Stores
.07 - $1,062,098
 Ground Trans.
.42 - $6,831,224
 Recreation
.34 - $5,321,185
 Retail Sales
.47 - $7,627,798

Analysis of Multiplier
Impact
The Multiplier Effect



A two percent increase in occupancy would
increase gross annual room revenues by
$1,000,000
A five dollar increase in the average daily rent
(ADR) would increase gross revenues by $1.5
million
Calculate how much the multiplier effect would
increase revenues to other sectors, such as retail
sales, for a increase in motel rooms?
Employment Impact
Employment Impact due to overnight stays







Accommodation
Eating & Drinking
Food Stores
Ground Trans
Recreation
Retail Sales
Air Transportation
1.00 – 278
1.45 – 417
0.10 - 28
0.60 – 167
0.70 – 195
0.60 – 167
0.60 - 167
Tourism and Leisure
Demand Factors
Population Increase

If all other factors are held constant the demand
for a tourism commodity increases as the
available population of potential consumers
increases
Family Structure Changes

Family oriented tourism and leisure is a major
demand factor in tourism. As the family structure
changes demand shifts to meet the new reality of
the family – its size, composition, age, culture
Demand Factors - cont
Distance to Source

Tourism and leisure visits are distance sensitive. A
great many leisure and tourism visits will be within
a day’s drive of the clients. Major example of
decreasing distance is to build more golf courses
Transportation Rates

Nearly all tourism and leisure is sensitive to
transportation costs. Transportation cost and time
minimization is the key to increasing visitation.
Conversely, increasing transportation costs will
have a major impact on demand – just ask
Australia
Demand Factors - cont
Demographics

AGE


The consumption of tourism and leisure goods
is highly structured around age. Changes in
age patterns impacts both demand and the
type of leisure consumed
Economic Status - Affluence

The ability to pay remains a major factor in the
type of activities, the amount of time spent in
visitation, and the cost of accommodations
Factors the Influence
Gross Spending
Age
Family composition
Length of stay
Location of visit (NYC is a lot more expensive that
Disney World or Vegas)
Income level of client
Type of transportation selected (if you fly you rent
cars)
Nature of opportunity at source (skiing is expensive –
so is eco-tourism)
Tourism Diversity
Why Do You Choose A Destination?







Have not been there
Been there and liked it
Cost
Interest in particular place/activity
Kids/family/partner want(s) to go
Diversity of activities at source
2 fers – get your tourism around your business
events
Marketing and Advertising
Tourism marketing involves identifying local
attractions, developing facilities and services
to meet visitor needs, identifying the tourism
market segment which applies to the
attraction, and pursuing linkages within those
market segments.
Tourism marketing must consider complex
factors – distance from population centers,
availability of good transportation, cost
involved, competition, etc.
Marketing Tourism
Identify the Target Market
Demographic (age, income, gender
education and occupation)
 Geographic
 Psychographic (enthusiasts such as
boating, skiing, gardening, history, military)

Position Statement
The Position Statement – “Positioning”



Positioning is the place you occupy in your target
customer's mind
The goal is that, when your customer decides
they're ready to consume tourism, they think of
you first – or at least they think of you?
The positioning statement usually includes two
elements: Your unique selling proposition (what
makes your business special) and your target
market (your most important customer segment).
Marketing Strategy
Marketing Strategy entails emphasizing
key elements (Peeing) of your
Marketing Mix
Product
 Place
 Price
 Promotion

Marketing Mix
For example, if you have a great
array of desirable products (+), at
very competitive prices (+), but a
poor location (-) and a moderate
amount of promotion (0), your
assessment might look like this:
Product
Price
Your Enterprise
+ advantage
+ advantage
Place/Location
Promotion
- no advantage
0 disadvantage
Plotting Price/Quality
Quality
A
high
B
C
D
low
high
E
Price
Sweet Spot
F
G
low
Marketing Objectives
The final part of the marketing plan is the
creation of clear objectives for the amount of
advertising required



Must be specific (increase in visitation or an
increase in first time visitors)
Must be measurable (increase profitability by 5.0%
Must be realistic (objectives must be based on
reasonable criteria such as an increase of 5.0% in
first time visitation compared to the previous 6
months)
Immutable Laws of
Marketing
1. It is better to be first than it is to be better.
2. If you can't be first in a category, set up a
new category you can be first in.
3. It is better to be first in the mind than to be
first in the marketplace.
4. Marketing is not a battle of products, it's a
battle of perceptions.
5. The most powerful concept in marketing is
owning a word in the prospect's mind.
6. Two companies cannot own the same word in
the prospect's mind
Marketing Laws - cont
6. The strategy to use depends on which rung you occupy
on the ladder.
7. In the long run, every market becomes a two horse
race.
8. If you are shooting for second place, your strategy is
determined by the leader.
9. Over time, a category will divide and become two or
more categories.
10. Marketing effects take place over an extended period
of time.
11. There is an irresistible pressure to extend the equity of
the brand.
Marketing - cont
12. When you admit a negative, the client will
give you a positive.
13. In each situation, only one move will
produce substantial results.
14. Unless you write your competitor's plans,
you can't predict the future.
15. Success often leads to arrogance, and
arrogance to failure.
16. Failure is to be expected and accepted.
17. The situation is often the opposite of the way
it appears in the press.
Marketing - Conclusion
18. Successful programs are not built on fads,
they're built on trends.
19. Without adequate funding, an idea won't get
off the ground.
20 When things go really
Wrong it can get ugly
Marketing As Branding
“Marketing is building a brand in the mind of the
prospect." "If you can build a powerful brand you will
have a powerful marketing program. If you can't, then
all the advertising, fancy packaging, sales promotion
and public relations in the world won't help you
achieve your objective."
Branding means creating an emotional association
(such as the feeling of success, happiness, or relief)
that customers forms with the product, service, or
company
Last Step - Feasibility
The failure rate of rural tourism and
promotion ventures without competent
feasibility studies is 3.5 times as high as
those with proper assessment
The core of the feasibility study is the
assessment of the penetration rate
Penetration Rate
P x F = PR where
P = Penetration Rate
F = Frequency of Penetration
PR = Penetration Rate
Example
Market Area
Participation Rate
Frequency
PR
A
20%
2.5
50%
B
20%
1.0
20%