Many destination marketing organizations (DMOs) have a real aversion to risk. For some, the need to justify their funding to government stakeholders can cause fear of pursuing newer models and strategies. Meanwhile, leading destination marketers are isolated, finding themselves unable to make the changes that are necessary to address the critical problems faced by today’s destination marketers in 2016. Is there a better way forward?
Digital marketing and business development specialist Martyn Collins believes that a better way can emerge through collaboration and conversation. Drawing from deep experience in digital marketing, branding and development of destinations across the United Kingdom, Collins shared that he has observed many obstacles to change in the destination marketing world during his career based in the UK, including the “inertia of tourism marketers who are frightened to stray away from anything outside of their regular habits.” He says that in a typical strategy, “they would build a website, buy some AdWords and make brochures with a limited focus on measuring success.”
Risk-averse DMOs are proceeding with caution to maintain their funding
Some of these cautious tendencies stem from the need to justify public funding models to public sector stakeholders, Collins says. DMOs often follow what seems like the safest course to maintain their budgets from year to year. For example, many UK DMOs depend today on a single destination management system (DMS).
Having worked in this software industry, Collins sees the lack of options available today as a barrier to growth. He says that at one time there were at least fourteen other viable DMS systems available to the UK. After many closed down, only two were left: “About 80% of the DMOs in England went with one of those two systems and the other 20% couldn’t afford it. Late last year, those two companies merged, meaning that in the UK, there’s only one DMS supplier. That company is completely influential on what a DMO is able to do.”
Although choosing to use the DMS as the safest option may allow UK DMOs to sustain public funding for now, Collins says that this dependency on one system leaves little room in DMO budgets for promotion, product development, or a strategic approach, and therefore, little room for true change toward the future.
Emerging from this dependency is a desire for DMOs to become booking partners as a way of generating commissions to help sustain them economically. This week there is a major conference in the UK, organised by the Tourism Management Institute (TMI) entitled “TMI Hot Topic 2016 – Creating a bookable destination.” DMOs are no longer working strategically and are instead concentrating on trying to compete with OTAs and businesses to get a share of online booking commission. “It’s a real worry that strategic leadership is sacrificed by the need to earn commissions,” said Collins.
Destination marketers are talking about the future
For DMOs, is there an alternative way forward that leads beyond the dependencies of current models and the need to make the “safest” economic choices? The best way to find out is to share challenges together. Recognizing the need for improvement and conversation within the industry, Collins created the LinkedIn group, “A New Model for Destination Marketing,” as a space for forward-thinking destination marketers to share ideas and trends that could help them reimagine the way they work. Almost three thousand destination marketers are there – why not start a conversation?
Related reading: The responsive DMO: Why defining effective leadership is critical to overcoming industry disruption
Featured image credit: Lemsipmatt, Flickr
I have always wondered why DMO’s never think about getting revenue’s from datadistribution. In my opinion a great and (almost exclusive) opportunity for DMO’s! After having experimented with this model for almost a decade I’m convinced that this will be the challenge for many DMO’s in the near or far future!
Regards, Bauke Folkertsma
Hi Bauke, I too am convinced that there are other commercial models that DMOs could adopt and I’m sure that there is a whole new thread that we could follow to explore this. What concerns me though is that when DMOs struggle to maintain core funding they have little or no resource, ability or time to provide strategic leadership, let alone innovate.
I had lost track of this debate a bit but how ironic that there is now just one principle DMS supplier! To be fair to TMI they don’t solely talk about booking systems etc but in an age where “core” public funding continues on a downward trend then you can’t blame DMOs for looking at alternative funding streams. The key questions remain though, what is their purpose and who are they there to serve?
Hi Jeremy, the struggle to find alternative funding streams must surely be an innovation inhibitor and why DMOs choose to go head to head with market leading OTAs is beyond me.
As to what their purpose is I’d quote the DMAI who say “DMOs need to redefine their role from one that focuses on broadcasting information and offers to one that develops credible engagement with potential visitors.”