Effectiveness of Destination Marketing Organizations Marketing - Case Study Example

Effectiveness of DMO Marketing Executive summary While there are a significant number of Australian organizations that are engaged in the marketing of tourism in Australia, Tourism Australia is considered the core marketer. Since the global economic crisis caused severe challenges to the gigantic Australian tourism industry, Tourism Australia has been involved with massive campaigns targeted at the foreign visitors, especially United Kingdom, United States, and China. Some of these campaigns resulted in negative outcomes, notable is “so where the hell are you?” campaign featuring Bingle (a model). Nonetheless, a more contemporary and flexible campaign “There’s nothing like Australia' was developed 2007 to increase the inflow of tourists from other countries, mostly western and Asian countries, in to Australia. The main purpose was however to reclaim the image of Australia maimed by the controversial “so where the hell are you?” campaign that never met Tourism Australia’s targets of attracting more foreign visitors. However, this as well questions the effectiveness of the Tourism Australia’s marketing campaigns. This has drawn a further need for basing the Tourism Australia’s marketing campaigns and strategies on Cox and Wray’s (2011) three critical factors for success in marketing: critical factors that significantly influence the effectiveness of marketing campaigns: Marketing Research as an Integral Activity, Targeting the Right Type of Tourist, and Promoting Unique Tourism Features, Clear Images, and a Solid Brand. A comparative analysis using Cox and Wray’s (2011) three critical factors highlights that the first campaign “so where the hell are you?” was ineffective while the current “There’s nothing like Australia' has been quite effective. This suggests that in addition to the other critical factors highlighted by Cox and Wray (2011) the three critical factors are significant and have to be put in consideration by Tourism Australia whenever marketing campaigns are organized TABLE OF CONTENTS PAGE Executive summary………………………………………………………………………………………………………………………………3 Introduction …………………………………………………………………………………………………………………………………………4 Marketing Research as an Integral Activity…………………………………………………………………...................5 Targeting the Right Type of Tourist.............................................................................................9 Promoting Unique Tourism Features, Clear Images, and a Solid Brand...................................10 Conclusion…………………………………………………………………………………………………………………………………………….12 References……………………………………………………………………………………………………………………………………………13 Introduction As competition among tourism destinations continues to step up, destination marketing has become a significant focus of tourism marketing/promotion research. While destination marketing would involve communication and articulation of the destination’s values and competitive attributes to potential tourists, the primary aim is to influence visitors’ destination preferences. Such marketing efforts are organized and coordinated by the Destination marketing organizations (DMOs) using various tools like social media and poster campaigns. Tourism Australia, a significant Australian DMO, likewise rolled out its major campaigns to tap the potential global market existing, notable being the World Travel Award’s nominee 'There’s nothing like Australia' launched in 2007 (WTA , 2012) and the controversial ‘So where the bloody hell are you’, launched in 2006. With this high contrast, the effectiveness of the marketing campaigns has thus been questioned. This particular paper therefore intends to examine the effectiveness of the DMOs in marketing Australia as a tourism destination basing on Cox and Wray’s success factors. Destination Marketing Organizations are created with the primary role of attracting both local and international visitors to the locale, while aiming at contributing to the local economy through various means including the purchase of room nights, organized visitor services, a variety of food and beverage, retail items, as well as transportation. Not only do they promote development, but they also promote the marketing of a particular destination, focus on the conference sales, and target tourism marketing and services. In addition, the Destination Marketing Organizations enhance the destination’s economic development by creating an increase in the visits from tourists and business tourist. Tourism Australia, as one of the major DMO’s in Australia, is therefore highly regarded in Australian tourism (Bornhorst et al. 2009). At over $100 billion worth, the Australian tourism industry is considered as one of the most significant industries in Australia generating higher revenues for the country’s growth. Just as Weaver & Lawton (2010) describe tourism industry, the tourism industry is characterized by a strong focus on tourism, events and hospitality. While Weaver & Lawton (2010) indicate the significance of stakeholders in tourism industry, it is also characterized by low concentration levels whereby the four main players control approximate 20% or less of the total revenue. A notable operator, Qantas, generates 15% of the total revenue from tourism. The low level concentration isn’t unexpected given that this industry is among the largest in the economy of Australia and aspires to be the country’s greatest export earner by the year 2040. The operators within the industry range from the small operators, such as tour guides, to the global corporations like Qantas (Tourism Research Australia, 2011). Despite generating higher foreign returns for the country, creating employment, and developing better future plans, which are all consistent with Weaver & Lawton (2010) arguments, the tourism industry has undergone serious challenges. The global economic/financial crisis specifically resulted in a significant decline in the visitor population. The visitors resorted to staying back in their country while on the other hand many Australians cancelled the family holidays. Other Australians utilized the opportunity presented by the high dollar to head overseas. In addition to this, the massive airline discounting made the industry to experience significant decline in profit margins. The erosion of its lucrative markets in Queensland and some non-urban tourist havens was also witnessed along with declined visitor nights. These have been a major hit to the Australian Tourism and the Destination Marketing Organizations, more significantly to Tourism Australia. To counteract this, regain the tourist base, and increase visitor numbers, Tourism Australia has engaged in various promotional activities as suggested by Weaver & Lawton (2010). Notable of these is the advertisements through various mediums, showcasing and portraying Australia internationally as full of experience to be relived. The varying outcomes of the marketing campaigns however, have brought into question the effectiveness of Tourism Australia’s marketing campaigns to market Australia. Cox & Wray (2011) highlight three critical factors that significantly influence the effectiveness of marketing campaigns: Marketing Research as an Integral Activity, Targeting the Right Type of Tourist, and Marketing Research as an Integral Activity Cox and Wray’s emphasis on research signifies how research is a key determinant of successful operation. According to Cox and Wray (2011), the significance of research in the whole process of marketing a destination is immense hence can not be underrated or ignored in the whole process of marketing a destination. Cox and Wray(2011) further highlight that the key research areas to be put under consideration during the marketing process include assessing the destination in terms of the information needs, creating an inventory of the existing information resources, and finally specifying the main research task needed. The research task may be wide ranging including tracking of the visitation levels, measurements of the motivations associated with traveling, measuring the satisfaction of the visitors, and evaluating the effectiveness of the marketing activities. As well, they also noted that, in order for strategic organization marketing to be realized successfully, the market should be scanned for the purposes of determining the changes likely to affect the tourism region. As such, a good knowledge of the market and the consequent research are fundamentals in the design of effective marketing strategies (Cox & Wray, 2011) While the above mentioned research identifies various critical factors essential in destination marketing, Tourism Australia has been involved in a number of research activities thereby having various research other than the analysis of trends on the leading tourism markets in Australia, consumer trends, visitor arrivals and the forecasts, economic as well as aviation analysis. Tourism Australia has been involved in a number of research activities to ensure that it captures the target market, especially with regards to the global marketing campaigns. To make sure that its basic advertisements are applicable in all the major markets, Tourism Australia has been spending significant amounts on the marketing research activities. In the initial stage of ‘So Where the Bloody Hell Are You?’ Tourism Australia spent over six million dollars on marketing research which also included the focus groups with over 47 000 participants (Weaver & Lawton, 2010). Actually, according to Weaver & Lawton (2010), the DMO invested over 6.2 million dollars within a span of 18 months in the process of tracking its brand, studying its segmentation strategy and studying the international visitors. Besides, the funding was also used in organizing focus groups and in depth interviews. Through the given mechanisms, the DMO believed to have indirectly involved over 47000 tourists and tourism consumers globally in the development of the campaign. However much the DMO’s marketing research may have been well-planned, the information pertaining to culture and language in some of the destinations targeted, for instance the UK, seem to have not been researched on researched, resulting in controversies (Weaver & Lawton (2010). The campaign, while intending to portray Australian tourism internationally as full of care, variety and life, became a major controversial topic almost universally on the grounds of ‘profane’ terms as ‘Hell’ and ‘Bloody’. This resulted in a significant decline in tourist numbers, modifications by some countries (deleting Hell and Bloody) and the consequent ban of the campaign globally (Weaver & Lawton, 2010) . Domestic, inbound and out bound tourism Source: Australian Bureau of Statistics The advertising campaign was banned in UK, as UK perceived the term ‘bloody’ to be demeaning. UK’s Broadcast Advertising Clearance Centre (BACC) prohibited the use of such a term in television commercials. Canada saw further reason of banning it in the usage of the term ‘Hell’ depicting profanity and the fact that it generally discouraged alcoholism. While countries as America did not react to the campaign, other countries like Singapore made modifications on the advertisement so that the term ‘bloody hell’ never featured. Actually the whole phrase ‘‘Where the bloody hell are you?” was misinterpreted by some who assumed the phrase as implying that it was only ignorance that could be holding the world back from the attractions in Australia. Such occurrences, as Weaver & Lawton (2010) highlight, cost the destination in terms of image/perception and visitor numbers. From the intercultural view point however, the terms are interpreted differently with regards to politeness. In as much as they may be impolite to some countries, certain countries consider the terms as normal conversations. In the cultural-relativism view point, these terms are a part of the long standing culture of the Australians and their lifestyles (Wierzbicka, 2002) A pie chart illustrating the reaction of Australians to hell’ and ‘bloody’ (Hong, 2008)   From the controversies that the DMO encountered, the DMO launched another Campaign ‘There’s nothing like Australia' which was more contemporary and founded on the previous campaigns, only with more research. The advertisement was developed in phases whereby the first phase consisted of response from Australians regarding the advertisement. In the development of the next stage of this campaign, Tourism Australia conducted an extensive universal consumer research in addition to testing the given creative concepts not only in Australia but also throughout the global tourism markets. The testing was aimed at refining these concepts apart from ensuring that the experiences featuring in the advertisement resonated with the target consumers within its markets. On the other hand, responses from consumers regarding the campaign were monitored through the campaign evaluation studies/research using various indicators such as consumer preferences, consumer awareness impacts, and the main intention of visiting Australia. Quantitative measures were also applied in tracking the visitation numbers along with the destination visited. Besides, the ability of Tourism Australia to attract as well as work with the industry partners on this campaign was also measured. This latter campaign, also the current one, has therefore been very effective as there was a significant increase in the number of visitors following its success. International Visitor Arrivals Source: Forecast 2012, Issue 1 Targeting the Right Type of Tourist According to Cox and Wray, targeting the appropriate tourists is one of the critical factors in consideration when aiming to market a product or service. Actually, they argue that not all tourist types are suited and invited in tourist destinations. In light of this, Cox & Wray hold that destination stakeholders should consider various segments within the tourist market with specific emphasis on their ‘fit’ with the destination’s attractions as well as the tourism objectives supported by the local community. While there are criteria to undertake this and determine fit to the destination’s development and its image, Cox & Wray (2011) highlight that of primary concern initially is the kind of visitors the destination aims to attract. Tourism Australia has emphasized on strategies of getting visitors to visit the country. In this case the DMO emphasizes on identifying the target market according to Weaver & Lawton (2010), The target market was the experience seekers who had characteristics that were best suited for achieving the objectives of Australia. This was for the purposes of increasing yield as well as dispersal where they spend twice the amount an ordinary traveler spends and disperse three times as travelers would. In line with this, a plan to develop a campaign having such desired impacts was underway. The campaign was to aim at making visitors commit to spending their holidays in Australia. ‘So where the bloody hell are you’, was designed by Tourism Australia and targeted at overseas markets (Weaver & Lawton (2010). The results from this advertisement were contrary to the expectations of Tourism Australia. Its profound ineffectiveness was indicated by the reduced number of visitors after the campaign. According to Tourism Australia (2012), the population of Japanese tourists significantly dropped by up to 5.7% compared to the previous year, where German and UK contributions were 4.7% and 2.3% respectively. However, tourist numbers from United States increased slightly, with same increase in countries that never received the screening of the advertisement, such as China. Overall, the advertisement failed to deliver the expected outcomes. visitor arrivals (2006 and 2007). Source: ABS (2013). Source: ABS (2013). On the other hand, 'There’s nothing like Australia' global marketing campaign was targeted at Australia’s overseas markets including USA, New Zealand, China and UK. The campaign proved to be the best platform to communicate to the DMO’s target audience the message that Australia, with its numerous attractions, was a compulsory destination to visit and which guaranteed the best experiences in tourism throughout the world. The target audiences (broad audience) of this particular campaign entailed the leisure travelers with higher predisposition of visiting Australia. In as much as the target audiences differed in the individual markets, those consumers who had their holidays in Australia were predominantly well-travelled, sophisticated consumers. The very campaign also targeted the main consumer audiences by emphasizing and showcasing the world’s best aspects in Australia, which included accommodation options and the associated facilities, glamour and thrill of Australia’s contemporary cities, the universally renowned wine and food, and the superb natural wonders (Tourism Australia, 2013). Through a focus on the examples of the nation’s best product, encouraging the visitors to travel more and spend much on the Australian holidays was promising. Tourism Australia had believed that the approach would resonate perfectly well especially with Asia’s developing, wealthy middle-class individuals mostly in the key markets like China, South East Asia, as well as the fast-emerging Indian and Indonesian markets. Overall, the campaign’s effectiveness was much pronounced that within a short time it received attention, acceptance, recognition and appreciation globally, to an extent that it was among the three nominees for the world’s leading destination marketing campaigns 2012 (WTA,2012) Promoting Unique Tourism Features, Clear Images, and a Solid Brand As highlighted by Cox and Wray (2011), the role of unique identity in destination marketing is quite substantial. Presenting a unique identity in the tourist markets thus leads to a successful marketing strategy. In the same measure, just as highlighted in Cox and Wray (2011), the key values of the brand require clear articulation and translation to achieve competitiveness. Cox and Wray (2011) further state that the articulation and translation has to be done in an enticing way that sends an emotionally appealing message to lure the potential visitors. This is also highlighted in Weaver & Lawton (2010) where it is also highlighted that for successful marketing to be experienced, the potential visitors should be offered unique experiences as a strategy for differentiating the destination from its competitors and gaining competitive advantage. To add on this, Ritchie (2009) and Weaver & Lawton (2010) further assert that regions attain prosperity once they initiate “themed” promotions providing visitor with the real sense of identity on what the region’s main offerings are. On the other hand, establishing a clearly defined market position along with developing a strong image of the destination in the tourists’ mind all serve to prioritize the destination in the tourists’ minds when it comes to decision on the destination to travel to. Despite this however, provision of a unique destination experience that seems authentic to the destination brand that was promoted presents serious challenges to tourism marketers. A strong image of the destination therefore ensures that the consumers have a clear picture of the destination product, contrary to having disappointments on arrival due to the incongruity of the promoted and the actual product, as highlighted by Cox & Wray (2011). Tourism Australia has a well-planned marketing strategy in Australia. The ‘So where the bloody hell are you’ campaign, a brand-positioning campaign organized by Tourism Australia in 2006 and created by M&C Saatchi, however proved otherwise. This particular advertisement featured Australians as preparing to receive visitors, alcohol theme, nature and Lara Bingle (a model) coming from the ocean asking, "So where the bloody hell are you?” Despite costing approximately 180 million Australian dollars and receiving massive press coverage, The use of Lara Bingle to shoot the advertisement was highly criticized and considered as ‘idiotic’ and failing the local creative in Australia. This advertisement lacked innovation as the same themes used in previous advertisements, such as beaches, were continuously recycled for the ensuing advertisements. Unlike the previous campaign, 'There’s nothing like Australia' global marketing campaign was detailed with new advertising creativeness. The campaign targeted key consumers by showcasing Australia’s unique and distinct features, including the presence of some of the world’s finest and distinctive high quality tourism products and experiences in Australia. The iconic experiences included Uluru, the Sydney Harbour, Kangaroo Island, Melbourne, The Kimberly, the Great Barrier Reef, The GoldCost, the Blue Mountain, the Great Ocean Road and Tasmania. By using examples of the Australia’s best, this campaign created a great ‘halo’ effect to the Australian tourism. The campaign additionally presented the uniqueness of Australia in terms of the contemporary cities, the globally renowned wine and food, and the superb natural wonders. While consistent with Weaver & Lawton’s (2010) suggestions, the creative showed Australia as more energetic, classy and inspiring, hence presenting a stronger image with reference to quality experiences that were available to its customers on their holiday visit (Tourism Australia, 2013). While some common elements existed during the campaign’s execution, there have been some slight variations for the various markets supported by the customer research. This particular campaign is designed in a manner that supports its relevancy in the market over along period of time, with flexibility for occasional updating to remain a highly relevant advertisement in the wake of the constantly changing competitive global tourism. The brand ‘There’s nothing like Australia’ has thus been marketed effectively by Tourism Australia using integrated as well as multi-channel campaign including the social media campaigns, interactive tablet apps, online video/short films, Australia.com, and posters. The stories, encompassed in the digital and interactive Australian map, also offered visitors globally the opportunity to view and imagine what a holiday in Australia was like. The map is argued by Tourism Australia to have significantly increased monthly tourist arrivals to over a million new tourists (Tourism Australia, 2013). Tourist Arrivals Source: ABS (2013). The short-term visitor arrivals in March 2013(529,100) indicated an increase by 0.1% in comparison with the February 2013’s movement (528,700). This actually follows the monthly increments of 0.2% during the month of January and 0.1% during the month of February. Currently, trend‘s estimates arrival to be 5.0% higher in comparison to March 2012.In terms of accommodation taking, the trend of total accommodation taking was estimated to have increased by 0.2% ($2252.6 million) in December 2012 in comparison to September 2012. Likewise, in the very period, the seasonally adjusted estimate indicated a 0.1% overall increase ($2251.0 million) where Northern Territory recorded the highest increase in the accommodation takings (7.4%), as indicated by ABS (2013). Conclusion It wouldn’t be enough for a country to just posses potentials only for it to become a covetable destination to tourists. To turn the possibility into a reality, marketing remains a precondition. To get a greater opportunity in the global tourism markets therefore, Australia must maximize on the available advantages presented by the Destination Marketing Organizations such as Tourism Australia. Tourism Australia, through its promotional activities, has been a major force behind the current success of Australian tourism industry. Despite the 2006 ‘So where the bloody hell are you’ campaign being a controversial project that ignited serious reactions globally, the current ‘There’s Nothing like Australia' campaign yielding better returns. This highlights the impact of targeting, market research, and unique product presentation in the effective marketing of Australia Tourism. On the other hand, while Tourism Australia emphasizes on tapping the opportunities presented by the global tourism markets, neglecting the potentials in the sector’s domestic markets will only further imbalance and a consequent reduction in domestic tourism. References Bornhorst, T. et al. (2009). 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