2003-2004
Case Statement & Rationale for Amplifying Durham Visitor Promotion And Marketing

DCVB regularly evaluates what is needed to ensure that the community reaps its full potential from visitor-related economic development.

• SWOTS Analysis of Visitor Product
• Promotion and Marketing Competitiveness
  

  Durham reinvests only 33% of the visitor-paid occupancy tax in visitor marketing and promotion to expand the tax base— half the state's provision. (click to enlarge)

Both analyses indicate a need for increased promotion and marketing based on these 10 conditions:

• Periodic benchmark studies indicate Durham is reinvesting a far smaller proportion of the special “room occupancy and tourism development tax” into promotion and marketing. At 33%, Durham isn’t competitive with the state peer average of 48%, national average of 56%, national peer average of 58%, or the House Finance Guidelines of 67%.
• In North Carolina, Durham currently reinvests $333 per guest room annually, compared to an average of $435 among its peer competitive set. Durham reinvests 56% less than the best-practice county.
• While outperforming with long-distance travelers, when it comes to in-state travel share, Durham draws 47% less than the national average and 54% less than its peer competitive set in N.C. Additional marketing energy can close this gap.
• While nationally acclaimed, Durham museums, performing arts facilities, sports facilities, historic sites, festivals, and other venues are still only at or near 50% capacity. Additional marketing energy will draw additional visitors to help fill this capacity and make the facilities more sustainable.
• While the community’s shopping and dining are far more widely acclaimed than nearby communities’, Durham is missing out on spending from existing travelers because they are drawn off into those communities. Revenue per lodging guest is 11% higher in Durham than in its competitive set, but overall visitor spending per guest room is 26% less. Additional marketing energy can close this 37% gap.
• Using formulas applied by the private sector, Durham has the potential to reap a share of the national traveling public equal to its proportion of the number of guest rooms nationwide. Under this formula, Durham can increase visitation 42% before surpassing its fair market share.
• Business travel nationwide is in a long, slow, inevitable decline due to changes in technology. This means that for Durham just to hold even in visitor impact and taxable spending to fuel the business climate and tax revenues for local government, promotion to leisure segments will need to be amplified 33%.
• Durham is the 4th largest city in North Carolina, shoehorned into the 17th smallest county in land area. The available land for traditional economic development is further limited by the fact that 1/3rd of the County of Durham was set aside in watershed and low density development so Falls Lake could be created to enable North Raleigh to develop. While adaptive use and reuse will enable some “brick and mortar” development to continue, Durham will need to turn more and more to transient economic development such as visitors and health care patients.
• Public opinion research has documented that Durham is forced to overcome 2 major obstacles not encountered by other destinations: the drag of a negative image and convoluted references to its brand. Even after any “causes” are eliminated, Durham will need to use communication, promotion, and marketing to rehabilitate, then maintain, its image and brand.
• Experts like Ernst & Young warn that the paradigm of “build it and they will come” has never been riskier for cities as they evolve as visitor destinations. Promotion and marketing equal to the potential of the destination is always listed as a must along with a holistic approach to destination development.

(click to enlarge)