States Cutting Back on Tourism Advertising

USA Today: Fewer state and local governments are urging Americans to "come and visit us" — just as more people say they're hitting the road or are ready to go. About 20 states have cut spending in the past year on advertising and other promotion and support to try to lure tourists and their vacation dollars, the U.S. Travel Association says.

That includes states that depend heavily on tourists' dollars such as Hawaii, Washington, New York, South Carolina and Arizona. One state — Washington — has shut down its tourism promotion office after lawmakers couldn't come up with the $2 million they usually spent to attract visitors.

Tight budgetary times are the reason for the cuts. They're resulting in less advertising aimed at getting visitors. Many tourism offices are laying off employees, inviting fewer travel agents and writers in on "familiarization" trips, and avoiding expensive trade shows, where state travel officials traditionally have courted corporate travel and convention planners.

"Everybody has to figure out how to do more with less," says Mike McCartney, CEO of the Hawaii Tourism Authority, which had its budget lowered and capped at $69 million each of the next four years compared with $81 million a year ago. "You're not going to see a lot of our ads on CNN."

The cutbacks come as many Americans and businesses have shaken off their recession-induced skittishness and are traveling again. Spending on travel and tourism increased 0.6% in the first quarter of the year after an increase of 2.6% in the fourth quarter of last year, according to the latest figures from the U.S. Department of Commerce's Bureau of Economic Analysis.

Reflecting a growing demand for travel, overall growth in prices for travel and tourism goods and services rose 9.8% in the first quarter after a 1.7% jump in the fourth quarter of 2010. Many Americans — more than six of 10 — said they were tired of sitting at home and were ready to travel again this summer, a USA TODAY/Gallup Poll found in May. According to the poll, they were willing to go on vacation knowing it would probably cost them more than a year ago.

Selective ad spending

With slashed budgets, state marketers are learning to do without expensive advertising tools they've relied on. Few states buy national ads. Instead, some spend what advertising money they have on select, targeted markets.

The Nevada Commission on Tourism, for instance, has stopped advertising in publications such as Conde Nast Traveler and National Geographic. It's pouring its ad dollars into ads in cities such as Los Angeles, Phoenix, San Francisco and Seattle, says spokeswoman Bethany Drysdale.

New York no longer has money for television ads, says New York Economic Development Commissioner Ken Adams, whose tourism marketing budget was cut 39% to $7.4 million in the past two years.

Many state tourism officials say the budget cutting is shortsighted and costs them visitors, which ultimately hurts their states economically.

In bypassing national advertising, Arizona has "missed some marketing opportunities," says Sherry Henry, executive director of Arizona's Office of Tourism. Like other states, Arizona has tried to target markets it thinks will deliver visitors. Now that its fiscal year 2012 budget is $8.6 million compared with $19 million in 2009, Henry's office focuses on Chicago and Los Angeles. "We don't have the bandwidth we once had," she says. In 2007, when its budget was $26 million, her office spent $9 million on advertising.

"That's more than our budget right now," Henry says. "When you don't advertise, (travelers) don't keep Arizona on top of (their) mind. And they're going to choose somewhere else."

Social media

Fewer dollars means tourism directors turn to other ways to try to lure visitors. Some have turned to less-expensive online options — such as Facebook, Flickr photo contests and other social media channels.

Nevada tourism officials met with Google to learn about the keywords and search results related to state tourism — such as Hoover Dam or Highway 50, the loneliest road in America. They paid the search engine to ensure that Nevada's online ads show up on websites that discuss these topics and terms, Drysdale says.

Tighter budgets foster more partnerships with the travel industry. In a deal with JetBlue, New York saved money by allowing the airline to paint the state's iconic "I Love New York" logo on an Airbus A320 in a co-branding campaign.

The Hawaii Tourism Authority has partnered with hotels to buy large newspaper ads in San Francisco. Smaller cities and towns that have relied on state marketing efforts could be disproportionately hurt by cutbacks, some say.

"The biggest challenge will be in rural areas, in smaller communities who don't have the budget that Seattle has to market itself," Marsha Massey, outgoing tourism director for Washington told the Seattle Weekly.

Some states that salvaged their tourism budgets had to fight for every penny. Texas had drafted a budget to slash tourism promotion funding to $5 million for 2012-2013 from $32 million projected for 2011. State lawmakers eventually voted to retain spending levels after hundreds of tourism officials rallied in Austin this year to lobby against the cut.

"We were disheartened when we saw the (draft) budget," says Texas Hotel & Lodging Association CEO Scott Joslove. "We've never had that low of a begging point."