The global humanitarian crisis that is the COVID-19 pandemic has pitched destination marketing organizations (DMOs) into rapid and ever-changing planning scenarios.
Destination Think’s Chief Strategist William Bakker unpacked several scenarios with insights specifically for destination marketers as part of his keynote on strategic planning during Day 1 of our Virtual Forum on April 7, 2020.
At Destination Think, we’ve scanned the most relevant consultancy and research related to DMO strategy during COVID-19. One of the resources we’ve drawn from is McKinsey & Company’s four levels of residual uncertainty model. Here is how William summarized these levels through a destination marketing lens:
Level 1: Clear enough future
This level is typically where DMOs operate. When the future seems clear, you understand your parameters and they are predictable. You know your markets, your industry, the experiences you offer, what different times of year look like, and what events are on the calendar.
If you have international markets, you understand visa restrictions. You understand what air access looks like. When you brief your agency about promotional campaigns, you have a strong understanding of your investment and what returns you will likely receive.
Level 2: Alternative futures
A typical DMO will sometimes enter Level 2. Here, there are two or three possible futures impacted by several variables. For example, this will occur if your DMO is trying something new such as a new market or a new niche. There are both more options and more uncertainty at this level.
Level 3: Range of futures
At this level, there are a dozen or more possibilities, not just two or three. Understandably, this makes it harder to plan for specific, long-term actions. However, planning for a variety of scenarios can prepare your DMO to quickly take action when the time is right.
Level 4: True uncertainty
This is when you have no idea where you are or what will happen next. There are times when local or national events, such as extreme weather or violence, can result in temporary uncertainty. The speed and impact of the COVID-19 pandemic have led to true uncertainties for most destinations around the world.
Shifting from true uncertainty to a range of futures
William walked us through the level of strategic planning most DMOs operate with, and where they need to shift to in the age of COVID-19. His thoughts are summarized as follows:
- In the first few weeks of the crisis, most people were operating at Level 4: true uncertainty.
- Many DMOs are now at Level 3, where it is possible to plan for a range of futures. Clarity is emerging about paths the virus might take as well as models showing what could happen to the economy.
- We see most DMOs still operating with a Level 1 (clear enough future) mindset. That’s because Level 1 is what they’re used to. The result is that the DMO pushes or adjusts its plan each day as things change.
- DMOs need to take a Level 3 mindset. Consider the range of futures to understand the impacts of each possibility. Then, create corresponding strategies and plans through scenario planning.
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