The New Rules for Budget Planning
Report forecasts 2010 planning as anything but typical
Every year about this time, marketers of destinations, resorts and tourism attractions that operate on a calendar year begin working on their annual marketing plans and budgets (at least they should be). Typically, this involved reviewing what was done in the past year, making minor adjustments to the plan and updating the budget to reflect modest cost increases or reduction mandates. But according to The Wanderlust Report, for many destination marketers, planning for 2010 will be characterized as anything but typical.
Wanderlust, a travel marketing and destination branding agency, suggests in a recent issue of their online newsletter that it's time for destination brands to reevaluate and refine their marketing strategies. President Mark D. Shipley commented, 'Late 2008 and 2009 have been described as devastating to the travel industry.' As of this writing, Smith Travel Research is projecting 2009 occupancy to end down 8.4 percent, RevPAR to have declined 17.1 percent and demand to have fallen 5.5 percent. While demand is projected to grow again in 2010, forecasts are for occupancy and RevPAR to continue sliding, although less dramatically so.
Why is this happening to us? Shipley says 'it's been called the travel industry's perfect storm. There are many contributing factors, just a few of which include the economic recession, flu outbreaks, changes in the way consumers plan travel, increased competition, the distractions of social media, diminishing faith in advertising, a lack of integration, deep discounting, and the failure to anticipate, plan and act accordingly.'
Shipley believes these factors are causing travel marketers to take decisive action. 'There are a few destinations out there taking advantage of this unusual opportunity, by taking stock, adapting their strategy and being proactive,' he said. 'Those with deep pockets and an abundance of patience are cutting their losses, hunkering down, waiting for the worst to be over. The long-term viability of the remaining weaker players is being called into question. Some operators have already called it quits.
'It reads like the disclosure statement from the mutual funds in your deeply discounted 401k - 'Past history is no indication of future performance.' Just because people have chosen your destination in the past doesn't mean they will continue to do so. Change is inevitable, and in 2010, it's even more so,' Shipley projects.
Where do we go from here? 'The travel business-as-usual is no more,' said Shipley. '2010 is the year to pause, take a deep breath, gather your senses and gain some perspective. For many travel and destination marketers, it's time to evaluate, refine and improve the results of their marketing programs. At Wanderlust, we call it The Baggage Check. But whatever you call it, it's time to take decisive action - time to reexamine your customer base, your competition, your strategies - and begin at the beginning.'
Read more of 'The New Rules For Planning & Budgeting' in the Wanderlust Report, Volume 1, Number 7.
About Wanderlust
Wanderlust provides marketing, branding and management consulting to destinations, resorts and tourism attractions. We are experts at uncovering what drives people to choose where they go and building integrated marketing programs to attract them - using the internet, social networks, direct marketing and mass media.
