11. On the Road: Travel and Tourism

Travel and tourism are two key revenue generators in the economy, adding nearly $1 trillion to United States coffers alone. But more than any other platform, travel and tourism rely on relationship marketing—the good word of others—to generate great results. Marketing professionals must be highly aware of all the factors influencing the consumer’s decision. In a world where one destination is looking increasingly like every other, the approach to this product must be carefully strategized, hitting all the motivating factors.

In this chapter, we examine the key components of marketing to travelers, while examining the wide variety of destinations that draw visitors in droves.

Whatever motivates the choice, travel and tourism—integrated with the hospitality industry—represent an important growth sector for the U.S. economy, so much so that the current administration has thrown considerable resources into launching an initiative to grow this industry, the Task Force on Travel and Competitiveness. The task force, co-chaired by the Secretary of the Interior and the Secretary of Commerce, has published the National Travel & Tourism Strategy. ¹ According to this report

¹ National Travel & Tourism Strategy, Task Force on Travel & Competitiveness, 2012.

The leisure and hospitality sector is the fifth largest employer in the United States and one of six priority sectors likely to drive domestic employment growth over the next 10 years.

In 2011, real travel and tourism spending (adjusted for changes in pricing) grew 3.5%, outpacing the 1.7% growth rate of the economy as a whole.

U.S. and international travelers spent $807 billion, generating $1.2 trillion in total economic activity and supporting 7.6 million American jobs.

The United States received more than 11% of global spending on travel and tourism, with 62 million international visitors who generated travel and tourism exports of $153 billion, lowering the trade deficit by $42.8 billion.

Add the data found in Exhibit 11-1 into the mix, and you have an industry that is not only projected to grow, but could be a key factor in restarting a lagging domestic economy.

But before we all join in on Happy Days Are Here Again, it needs to be noted that travel and tourism pose some intrinsic challenges to marketers, the chief being inconsistency. Bad weather or bad employee attitudes—or, heaven forbid, both—can lead to bad experiences for dream-seeking guests. When you add the rest of the possibilities—strikes, change in the value of the dollar, political upheaval, rise and fall of crime rates—you begin to see the peculiarities of travel and tourism marketing. Good marketing offers the promise of customer satisfaction, but the actual satisfaction must come from the experience itself.

This challenge of inconsistency is the great difference between marketing travel and other types of entertainment, which, barring a sore throat for Lady Gaga or stale popcorn for Iron Man, tends to deliver what you paid for.

In any case, building a successful strategy for destination entertainment requires a specific approach.

But this is a crowded and intensely competitive arena. Remember that you are vying for one thin slice of your customer’s time. Your offering must be better than anything else he or she might choose—including doing nothing. To do this, you must understand the three potential motivators for travel:

The wish to visit someplace exotic or different

Stimulation and the gathering of new knowledge

The pursuit of a hobby

Some destinations strive to meet all of these motivators: Think Walt Disney World, with its parks, golf courses, the foreign allure of EPCOT, the intellectual stimulation of the Disney Institute. But for the most part, creating a strategic plan for a travel destination will find you focusing in on a narrower field of options. And while you and your team are doing that, you’ll have your own set of challenges in creating a plan that works, including

The number of constituencies that must pass judgment on the strategy and tactics, including advertising, PR, and promotions

Subjective evaluation by management with little or no experience in marketing or the ability to judge the merits of effective advertising

The need to react to many external and uncontrollable issues, including economics, crime, poverty, violence, and political instability

Marketing to prospective tourists is an exciting, volatile, creative, and extremely rewarding pursuit that offers enormous financial returns when it is done well. But it does take a careful approach so that your clients secure their share of the vacation pocketbook.

Keep in mind that the final success in this industry is based on the customer’s experience. Marketing professionals must understand the strengths and weaknesses of their product to match the traveler’s expectations with reality. Failing to do so can result in a wildfire of negative word of mouth.

After the motivator most closely associated with the potential consumers of a product or destination is identified, the plan to reach those consumers should be built on the traditional basics: research, strategy, and marketing to desire.

Identifying the lifestyle of the prospective vacationer for the product.

Assessing the discretionary budget required to pay for the trip.

Matching expectations with core advantages.

Recognizing the media considered most frequently by the target customer as credible sources of vacation information.

Defining how destinations deal with travelers of varying abilities, a consumer segment with very special needs.

Simply put, not every traveler wants (or can afford) to spend a week at the Ritz-Carlton. Some may prefer a grass shack at the edge of the beach, where loud Hawaiian shirts are the dress of the day—and night. Your job is to match the destination with the correct client base.

The best research of a destination is done through an actual site visit. One of the perks of the travel and leisure industry is what is known as a fam trip—a familiarization trip, offered to qualified professionals to initiate them into the unique attractions and characteristics of a particular destination. This intra-industry marketing tool—a respected and classic motivation and appreciation reward system—is often offered at no cost to travel agents, travel writers, and marketing professionals. There may occasionally be a small fee attached to weed out those who might be more interested in their own travel than in creating a unique selling proposition for the destination.

One special note: In doing site research on more exotic locations or those where there are potential issues of danger or unpleasant surprises, researchers might want to bring a professional guide or tour leader along to prevent mishaps.

There are many other ways to gather information for communications campaigns and target audience identification. Every sector of the travel and leisure industry has a particular approach to gathering and evaluating data.

Conde Nast does continuing surveys with its readership.

Credit card companies, especially American Express, invest heavily in research and tourism marketing to capture discretionary budgets for vacation travel.

The magazines people read/use for travel information send out reporters to compile editorial and visual content that hopefully qualifies and reinforces the image their advertisers present.

Every hotel, cruise line, travel agency, and time-share company of substance has a visitor survey that gauges customer satisfaction, complaints, and attributes that make for positive or negative reactions.

Advertising agencies use leading research firms to gain insights into the positioning, slogan, and image that best represents an idealized version of the site being sold.

Travel agents, now under pressure to prove their relevance as consumers turn to the Internet for information and travel bookings, rely on the American Society of Travel Agents (ASTA), which has developed proprietary studies over the years.

Even the smallest of locations, once they have identified the type of tourist that is attracted to their location, might do some rough, inexpensive focus group research to gain responses to proposed ads and radio commercials. There are also numerous travel consultants, usually former convention bureau executives or marketing directors for destinations, airlines, and hotel chains, who offer their services to prepare research.

In addition, there are academic journals that offer thoughtful approaches to researching the needs and wants of the potential consumer. The Journal of Travel Research and the more recently established Journal of Vacation Marketing (JVM), from Henry Stewart Publications in London, provide considerable support for travel research methodology. Some of the research papers presented in JVM include “Evaluating Vacation Destinations Brochure Images,” by Annette Pritchard and Nigel Morgan; “How to Develop a Strong Hotel Branding Strategy with a Weak Branding Budget,” by Hugh Taylor; and “Methods Used by Airlines to Determine Ticket Prices,” by Janice Chapman. The JVM is available online at http://jvm.sagepub.com/.

Travel destinations fall into one of three basic images: positive, negative, or neutral. Many locations enjoy positive positioning due to movies and the media consistently celebrating their positive attributes—think Paris or Rome. Others might not be so fortunate; travel packages to the Middle East are a tough sell in the early part of the twenty-first century. Subjective as these images may be, it is important to consider them when preparing a marketing plan, for if the image is basically negative, no amount of expensive marketing strategies will be cost-effective. Unfortunately, the image might never be resolved or improved, even if it is due to a misperception or some perceived flaw.

If, on the other hand, the image is neutral, the game is wide open. This blank slate offers a huge opportunity to build on. For years, the island of Aruba and the city of Philadelphia had little or no image. Marketing their strengths and adding to their infrastructure enabled them to become destinations of choice. Aruba became known for rain-free holidays and easy access to casinos. Philadelphia created events like “The Book and The Cook,” 10 days of best-of-show house tours, and an expanded promotion of the most successful flower show outside of Chelsea Gardens, England.

The ever-evolving tastes of travelers have helped many far-away places become hot boutique destinations. Environmentalism brought us eco-tourism, which in turn brought cross-promotion with National Geographic, which now offers green vacations to Brazil, Kenya, and Belize, among other exotic locations. The rise of extreme sports created demand for heli-skiing and extreme surfing.

A great example of this is Las Vegas. Once known as “Sin City,” Las Vegas actually used the lingering whiff of adult-oriented entertainment to build itself into one of the primary convention markets in the country. However, its mid-1990s effort to broaden its base by promoting itself as a center of family entertainment almost backfired, when adults started to avoid the locations on the Strip that offered child-oriented activities. Las Vegas not-so-quietly returned to its roots with its “What Happens in Vegas, Stays in Vegas” approach, refocusing on its image as a theme park for adults. By the way, what’s played in Vegas also stays in Vegas. Sales tax, hotel tax, casino gaming, and restaurant and bar taxes all have a local component that goes directly to support the marketing effort of the city, all adding up to a sizable number: $115 million in 2012.²

² “Tourism Marketing and Management,” Houston Chronicle, http://smallbusiness.chron.com/tourism-marketing-management-43669.html.

The integration of an umbrella image and individual tactical outreach—with individual emotional motivators—might not have an immediate impact, but they help to implant an image for future planning. Advertising, direct marketing travel agent communications, PR, booklets, brochures, contests, and hospitality messages must be consistent, utilizing repetition to build a strong message. It is then that delivery on the promise is important. To sustain tourism growth, the destination must also market the program internally as well as externally. Buy-in from the client is critical. If the store clerks, hotel staff, restaurant waiters, tour guides, and thousands of locals who derive their income from tourism are resentful, feel put upon, dislike meeting and greeting visitors, or are sending out negative interchanges based on culture, politics, race, or religion, the marketing plan is doomed.

But these agencies know how to overcome the problems of crime, corruption, anti-Americanism, terrorism, typhoons, monsoons, and government instability. Advertising and marketing budgets may be cut or eliminated for a period of time until the new government cabinet or long-suffering local business community decides to run a “come back to Paradise” campaign. Then the PR machinery begins to spin stories about the reduction of the pre-existing problem and how peace and safety have returned.

Though it might sometimes seem difficult to be truly innovative in the marketing of travel—the “beauty shots” of sand, sea, and sky all seem to look like one another—the professionals who populate this sector occasionally find intriguing ways to do so. Those best equipped to do so often come from the travel industry or have trained at universities specializing in the practice like the Cornell University Hotel Management School and the Culinary Institute of America (CIA) in upstate New York, which are both accredited schools in the industry. In addition, some agencies sponsor client research, analyze, and evaluate the results and make intelligent recommendations. Most notable are several agencies in Florida, including Crispin Porter + Bogusky and YPartnership (formerly known as Yesawich, Pepperdine, Brown & Russell).

It’s best to update your scorecard on the players and their professional communications agencies in any given season frequently, as moves are made as often as government cabinets change and marketing directors are replaced. No new broom sweeps cleaner than the tourism advertising business.

Here again, external factors can wreak havoc on long-standing identities. If you said the words “New Orleans” prior to 2005, your mind might fill with images of Bourbon Street, the French Quarter, Mardi Gras, and great Cajun and Creole food. Post Katrina, the city was left with shots of grief, despair and chaos from the Superdome to the Ninth Ward. But it was tourism—aided by pictures of happy travelers in an intact French Quarter—that helped bring the city back, actually breaking records in 2011.³

³ “New Orleans Tourism Breaks record in 2011,” New Orleans Times Picayune, March 27, 2012.

Destinations with a successful tourist trade almost always share certain attributes:

Extensive and varied lodging accommodations

A variety of dining choices, including a unique regional cuisine

Shopping

Wide selection of activities for all ages

Architectural wonders and/or cultural destinations (museums, for example)

But above all is at least one identifying characteristic that makes the destination—big or small—worth a trip: its own unique personality. The challenge to the travel and leisure marketing professional is to find that voice and then shout it to the world through product branding, market positioning, and delivering on guests’ expectations.

Following are a few examples of destinations that have successfully marketed their unique personalities.

Along with the traditional methods of destination marketing, Nashville has a strong showcase in the Country Music Awards, which give the viewer a great sense of the attractions in the city. Additionally, the Country Music Association (CMA), which markets country music stars as an important ingredient in contemporary brand promotions, sponsorships, and licensing arrangements, sponsors a three-day conference every year in Nashville for opinion leaders and marketing professionals. A great mid-sized convention center lures business travelers happy to take part in a little down-home atmosphere.

Nashville also realized that tourists visiting music destinations want to hear great music, from blues, to country, to gospel. There are several U.S. cities where this can happen. In the spirit of co-opetition—in which natural competitors draw strength from one another by creating mass to drive visitation—Nashville joined New Orleans and Memphis to form a marketing package called The U.S. Music Trail Tour.

Also included in that partnership is a tiny town in Missouri: Branson.

Branson is an example of the primacy of proper targeting of age, religion, race, and socio-economic demographics. Every single week, 10 months per year, buses, vans, and shuttles arrive with visitors who fall into the following demographic categories: average age of 60 plus, retired, high school education, mostly blue collar occupations, generally white Christians who enjoy packaged vacations. They purchase five or six nights of relatively inexpensive tickets, head to the all-you-can-eat buffets, target the discount shopping, and revel in the chance to talk to the performers whose names light up the marquees of Branson.

These entertainers either own their own multimillion state-of-the-art theaters or have naming and exclusive performance rights with long-term contracts. Once primarily focused on Andy Williams, Jim Stafford, Tony Orlando, Bobby Vinton, John Davidson, Kenny Rogers, Yakov Smirnoff, Wayne Newton, and Charlie Pride, Branson now features many of those same entertainers, along with everything from the Acrobats of China to a Titanic Museum.

Tourism revenue from Illinois, Minnesota, Nebraska, the Dakotas, and other distant locations gets to Branson due to its marketing success. The fleet of huge, 40-ton buses parked discretely at the edge of each theater represents access for well over 65% of the visitors. For 30 years, the bus companies have actively marketed in their own geographic areas and are definitely responsible for the origins of the early visitors and today’s long-distance audience.

Branson is a terrific example of the power of marketing. The roots of this entertainment phenomenon are in a local theme park, Silver Dollar City. As the park developed its following and people became familiar with Branson, the entertainment offering increased, taking advantage of a visitor population that was left with little to do after theme park closing hours. As the selection of venues grew, the city leadership decided to form a Branson Marketing Committee, operating separately from the Chamber of Commerce. They named an experienced marketing executive as the Director of the Marketing Committee to work with all the theater, motel, restaurant, and themed attractions. He in turn hired an experienced PR professional. The PR plan was to get a major story about this unique location placed nationally. In 1990, the town was featured on 20/20—primetime television—and the rest was music, and marketing, history.

Greater Austin, with a population of slightly under a million people, is driven chiefly by a large university (University of Texas), a large community college (Austin Community College), and software and hardware manufacturers like Dell Computer, Motorola, IBM, and Advanced Micro Devices.

The average Austin resident and business visitor is young, educated, and ready to be entertained, and Austin’s Sixth Street is the place he or she heads. Much like Bourbon Street in New Orleans, this area is a strip of music nightclubs and restaurants featuring jazz, rock, blues, country, and other varied forms of entertainment. The several hundred venues range from open-mike bars to bookstores/coffee shops, full-scale nightclubs specializing in blues, rock, and country, to huge venues featuring national and international roadshows. The city’s daily newspaper, The Austin American Statesman, has a regular Thursday insert, Xlent, that covers nothing but entertainment, particularly live music.

Each year, the city celebrates its self-proclaimed status by hosting a week-long music festival, South by Southwest (SXSW). The festival brings thousands of visitors to the city and presents an opportunity for performers to be discovered by agents and producers. In the synergistic tradition discussed throughout this book, this entertainment event spawned a sister SXSW film festival, growing in importance and popularity each year.

And that was the perplexing part of the Los Angeles brand. In the words of Dorothy Parker, when it came to this major destination, there was no “there” there—at least the “there” so many visitors seem to expect. Visitors to Los Angeles often left disappointed, especially when searching for a movie mecca. An ambitious “Hollywood and Highland” project was launched years ago, but the only feature of any note is the Dolby Theater, where the Oscars are held every year. The surrounding area still has little else other than some shops, a wax museum, and down the street, Mann’s Chinese Theater. Other than that, it quickly shifts into less than interesting surroundings.

Los Angeles finally turned to its most important business, using entertainment to renovate and upgrade the city’s image. LA Live, a multiplatform entertainment destination, was built adjacent to the Staples Center, reinvigorating the entire area. The 27-acre site features bars, restaurants, a multiplex cinema, concert theater, ESPN Zone and studio, apartments, condos, and a Ritz Carlton hotel. The Grove, a retail/entertainment development adjacent to the historic Farmers Market at Third and Fairfax, gave tourists a destination shopping area other than tony Rodeo Drive. And of course the studios, with back-lot tours and Universal’s CityWalk, have upped the amperage for fun.

Sports remain an important draw, with the Lakers and Clippers and the Dodgers. Soccer enthusiasts have the LA Galaxy. The city is also actively seeking the return of an NFL football team.

In a fabulously successful clean-up campaign in the last decade of the twentieth century, Times Square took a 180-degree turn back toward glamour. Developers razed porno shops and refitted theaters that had drifted to XXX films. Disney bought the New Amsterdam Theater, once the home of Florenz Ziegfield’s reviews (and in the roof garden, notorious parties) and did a stunning renovation, building a home for their theater division. The entire area became a key tourist destination that actually reflected the glitz tourists were looking for.

The city’s constant exposure through various forms of media and entertainment continues to drive tourism. Many New Yorkers (and not all of them happy, by the way) point to this clean-up as the genesis of New York’s grime- and crime-reduction, which has brought a new verve to the city, with rock-star chefs creating empires of extended brands, newly renovated museums, sports teams in all major leagues and—well, just all that is New York, the most Some and the biggest Where in world.

⁴ “2012 Social Media and Tourism Industry Statistics,” Stacey Santos for Stikky Media. Ms. Santos cites her sources as: The World Travel Market (WTM) Industry Report and Global Trends Report; Nielsen: Global Consumers’ Trust in ‘Earned’ Advertising Grows in Importance; Lab42: Techie Traveler; Facebook Key Facts; TripAdvisor Fact Sheet.

29% of travelers have used mobile apps to find flight deals

30% have used mobile apps to find hotel deals

15% have downloaded mobile apps specific to upcoming vacations

85% of leisure travelers use their smartphones while abroad

72% post vacation photos on a social network while still on vacation

46% check in to a location (for example, Facebook and FourSquare) while on vacation

70% update their Facebook status while on vacation

Use map features

Search restaurants

Search activities and attractions

Check in prior to flight

70% of global consumers say online consumer reviews are the second most trusted form of advertising, an increase of 15% in four years.

Only 47% of consumers around the world say they trust paid television, magazine, and newspaper ads, and confidence has declined by 24%, 20%, and 25% respectively since 2009.

Despite these numbers, the majority of ad dollars are still spent on traditional or paid media.

40% post activity/attraction reviews

40% post restaurant reviews

76% post vacation photos to a social network

55% “liked” Facebook pages specific to a vacation

33% changed their hotels

10% switched resorts

10% changed agents/operators/websites

7% vacationed in a different country

5% switched airlines

More than 60 million travel reviews and opinions from travelers around the world.

More than 90% of topics posted in the TripAdvisor forums are replied to within 24 hours.

Destinations around the world now sport TripAdvisor decals and ask guests to review them. In turn, TripAdvisor encourages contributors to keep right on commenting, awarding “badges” and assigning status levels, a very seductive way to get travelers to build the site and app.

In addition, social media has allowed individual businesses—small and large resorts, bed and breakfasts, tour operators—to present themselves to an ever-widening group of travelers, presenting photographs, rates, room layouts—nearly anything the inquiring traveler might need to make a decision. With social media, Il Cardo Resort, a lovely Tuscan inn near Anghiari, Italy, can reach potential customers across the globe. The Pelham Hotel, a fabulous boutique hotel in London, is now visible to potential clients who might never have known of its existence. In travel and tourism, the consumer is king, and the Internet is the key to the kingdom.

However, as we have warned in every chapter, social networking can be both a boon and a bust. Good news may travel fast, but bad news spreads like lightning. When you add the warp speed of the Internet, the need to carefully integrate marketing with reality becomes ever more apparent. If all the reviews feature words like “terrific” or “fabulous,” the guest isn’t likely to expect rude or dilapidated. In the relationship-heavy travel and tourism sector, image—and delivery—are everything.

Back in the old days—about a decade ago, although it feels as if we might be talking about Mad Men time—travel agencies were important partners to airlines, railroads, bus companies, cruise lines, hotels, resorts, and theme parks. A travel agent was a sole-source supplier for the American dream of going on the road. Housed in offices across the country, the agents of American Express, Carlson Wagonlit, Ask Mr. Foster, and Liberty Travel created dream packages for the adventure-bound.

A free service for the traveler, agencies collected their revenue from the modes of travel and destinations themselves. Their marketing campaigns—full-color spreads in the Sunday travel sections, complete with photos of sandy beaches and international landmarks—helped fuel the desires of the traveling public and were an important part of the overall marketing of the industry. The packages the agencies offered—so many nights of hotel rooms, cheap airfares, and meal plans—made travel affordable for the general public.

However, as the economics of travel began to change, so did the travel agency industry. The deregulation of the airlines, which fueled price-cutting wars, began to erode the profit margins of airlines. One cost-cutting measure was to decrease the fees paid to the agencies. Agents tightened their belts, sat down at their computers, and continued to price out the best packages they could for their clients—little knowing, in the mid1990s, that they were staring straight into the screen of the enemy: the computer.

First SABRE, the online booking site for airlines, began to allow consumer access. Then came Orbitz, Travelocity, Expedia, Travel Advisor, and Kayak—any number of online offerings. Airlines and hotels began allowing booking online. September 11, 2001, put a huge crimp in the travel industry, as did the economic downturn of the mid-2000s. Mobile apps delivered one last roundhouse punch right to the side of the industry’s jaw.

You would think travel agents would be down for the count—but not so. According to Questex Media/Travel Group—publishers of travel magazines and conference providers to the industry—travel agents are still responsible for 77% of all cruise bookings, 73% of all package travel bookings, and 55% of all airline travel bookings.⁵ They may not be making as much money, but they are still providing a service for those travelers—including busy business people who either don’t want to spend their time figuring out their travel or would prefer to have an expert make the suggestions for anything more than a quick flight to visit Aunt Helen. Who better to plan a multidestination travel package, including flights, transfers, hotels, tours, and all the assorted details—than a travel agent? After all, the final success in this industry is based on the customer’s experience with the product, and a travel agent can help that be a positive one.

⁵ “Impact of Technology on the Travel Agency Business,” Houston Chronicle, http://smallbusiness.chron.com/impact-technology-travel-agency-business-57750.html.

The show exhibits thousands of suppliers of merchandise and travel services, representing the service categories of more than 60 countries. Representatives of major hotel chains, accredited tour operators, and travel companies specializing in incentive travel, chambers of commerce, and individual resorts—all of these can be found at IT&ME, which attracts potential decision-makers in the field of incentive travel. With a strong educational component—workshops and lectures—shows such as IT&ME are also an excellent place for novices in the travel and leisure industry to get a handle on how the industry markets itself.

Each of these associations also publishes its own newsletters and magazines, available not only to the industry, but to the traveling public.

With airlines, it may be a free flight; an upgrade to first class; free baggage check-in; or a trip to the airline club, where stranded passengers loll about in relative comfort while everyone else is knocking knees in crowded seating areas next to the gate. Hotels offer upgrades to suites or special discounted rates. But a real motivator in these programs seems to be status. The 2009 George Clooney movie Up in the Air let the cat out of the bag: There really are black-card VIP programs out there, which allow the most loyal customers the best services, and frequent travelers—the real road warriors—want them.

But how about the rest of us? How important are the loyalty programs? The jury is still out when it comes to the not-so-frequent traveler, the people who don’t use the programs often enough to see any impact. To build those numbers, airlines now offer branded credit cards that allow nonfliers to accumulate the same points they might earn if they were flying, even if they’re just buying groceries. Although it takes a lot of groceries to add up the baseline 25,000 miles for a free trip, many consumers seem to believe the investment (the cards typically have a fee) is worth it.

Within the provider side of the industry, the current conversation is focusing on how to better use the data being collected, for that’s the real prize in these programs. When you sign up for a card, you’re sharing your preferences with the brand by allowing them to track you through all of your stays. The question is, will the providers actually use the data to create a better benefit, one that will actually create true loyalty? The answer remains to be seen.

One thing we do know about customer loyalty programs is that if the provider makes a promise, it needs to stick with it. Ending programs without paying off or changing the rules midway leaves a bad taste in the consumer’s mouth, and risks customer flight.

The desire to stamp “you are special/we are unique” on these establishments has resulted in design-friendly room decor and high levels of services, including Wi-Fi, branded amenities in the bathroom, and luxury linens on the bed. Westin, the hotel chain now owned by Starwood, started a revolution in the industry with its Heavenly Bed program. Westin wisely honed in on the fact that the main thing most travelers do in a hotel room is sleep, and the better the sleep, the happier the customer. Westin invested millions of dollars in upgrading all the mattresses and linens in their rooms to something often far better than what the traveler had at home, and the result was skyrocketing retention—and imitation by all its major competitors. But Westin didn’t stop there; it built a side business on the Heavenly Bed, offering all of it—mattress, linens, duvet, pillows—in catalogs placed in the room and a special website. Now its brand recognition extends to Pottery Barn marketing, where the Heavenly Bed is prominently offered.

Hotel chains have stretched their brands in all directions. Starwood offers something for everyone, from the super-plush St. Regis and Le Meridien to the dorm-room setting of the aLoft brand, with Sheraton, W, Element, and Westin in between. For the boutique hotel fancier, Starwood chains offers the Luxury Collection, a group of high-end one-off hotels around the world. Industry giant Marriott offers the Ritz Carlton on the top end, with JW Marriott, Marriott, Courtyard, Springhill Suites, and Fairfield Inn, among several other brands, capturing nearly every niche possible. This is just a sampling; there are literally hundreds of hotel chains around the world, and each of them has its own focus on building a bigger brand.

Even Disney and Universal, who, for a period of time were willing to place visitors to their entertainment parks in other properties, hired leading architects to fashion hotels that reflect popular themes, appeal to their primarily family audiences, support their major brands, and enhance the total experience of being in Orlando, Anaheim, Paris, or Tokyo.

On the technology side, hotel chains have launched new efforts to offer better choice to consumers. Choice Hotels International, Hilton Worldwide, Hyatt Hotels, InterContinental Hotels, Marriott International, and Wyndham Hotel Group have joined together in launching a search site called Room Key, which will allow travelers to search across all brands and price points. In addition, the site will offer—you guessed it—social networking, allowing customers the chance to share their plans and opinions with friends, family, and complete strangers.

Along with social media, hotel chains use websites, mobile applications, and constant repetition of newspaper ads in travel sections throughout the country. The variety of travel channels now available via cable gives hotels a great niche in which to run TV commercials reinforcing the ambiance of the brand and the romance factor. Chains also carefully market to travel agents, with glossy, expensive booklets and brochures, window posters, and familiarization trips for high-sales producers.

In the early 1980s, two former Quebec street performers, Guy Laliberté and Gilles Ste-Croix, formed Cirque du Soleil as a modern version of this ancient entertainment. Using a theatrical, character-driven approach and a synthesis of circus styles from around the world, Cirque took the world by storm. The company now has 19 shows in 21 cities, with permanent performance venues in many locations. Nearly 15 million people have experienced a Cirque show,⁶ generating over $7 billion⁷ in revenue. Las Vegas alone houses six Cirque shows in six of the major casinos.

⁶ Cirque du Soleil website, www.cirquedusoleil.com.

⁷ “Run Away to the Circus? No Need. It’s Staying Here,” New York Times, April 28, 2009.

However, that presence in Vegas—a microcosm of the extended Cirque brand—makes one wonder how much further that brand can be stretched. Cirque is dependent on its unique flavor, its special appeal. Key components of “special” are limitation and exclusivity. At what point does enough turn into too much? A recent Cirque offering, set to run at Radio City in New York for three years (with an option for five), was cancelled after two. Could the balancing act be teetering?

Hard to say. For the time being, they’re still one of the greatest shows on earth.

Not such a great outlook, right? The cruise industry didn’t think so either. They encouraged CLIA to do research and then followed the recommendations. Today, the cruise industry sports these statistics:

Twenty million people cruised in 2012.⁸

⁸ CLIA.

The average age has dropped to 48.⁹

⁹ Cruise Industry Overview 2012, Florida-Caribbean Cruise Association.

The median income is $97,000.¹⁰

¹⁰ Ibid.

Twenty percent of the U.S. population has taken a cruise.¹¹

¹¹ CLIA.

First-time cruisers frequently report exceeded expectations for food, entertainment, accommodations, and overall quality of their vacation.¹²

¹² CLIA.

In short, a marketing miracle: The industry took the pulse of potential passengers, created a product that would appeal to them, and got the message to the masses. This charge was originally led by Carnival Cruise Line, the first in the cruise industry to utilize the powers of marketing and audience identification for their company. Carnival’s in-residence marketing wizard, Robert Dickerson, engineered a change in the demographics of the cruise customer from 100% senior citizen retirees to a mix of couples with children, young single adults, and empty nesters, all with time and disposable income.

The industry now offers a wide variety of ship choices, from luxury lines with less than 300 passengers to what appear to be floating cities, carrying over 4,000 people. Ships now offer surf pools, planetariums, on-deck LED movie screens, golf simulators, water parks, demonstration kitchens, self-leveling billiard tables, multiroom villas with private pools and in-suite Jacuzzis, ice skating rinks, rock climbing walls, bungee drops, and trampolines.¹³

¹³ Cruise Industry Overview 2012, Florida-Caribbean Cruise Association.

Like hotels, some cruise lines offer extension and differentiation within their own brands. Carnival, the largest of the lines, owns AIDA Cruises (Germany), Carnival Cruise Lines (U.S.), Costa Cruises (Italy), Cunard Line (United Kingdom), Holland America Line (U.S.), Ibero Cruises (Spain), P&O Cruises (United Kingdom), P&O Cruises Australia (Australia), Princess Cruises (U.S.), and Seabourn Cruise Line (U.S.).

In addition, cruising offers a wide variety of specialty trips for all manner of interests. There are jazz cruises, literary cruises, celebrity cruises featuring radio talk show hosts, gourmet cruises. Olivia offers cruises for gay women, catering to less affluent cruisers on large (2,000+ passengers) Caribbean trips as well as a more moneyed clientele on smaller (200+) cruises in the Mediterranean or the rivers of Europe.

As a final note, possibly the best example of the importance of branding in cruising was the arrival of the Disney Cruise Line. Investing over a billion dollars in two brand-new ships and their very own island, Disney’s Castaway Cay, all purpose-built for the mantra of a “seamless guest experience,” Disney’s venture into cruising has been an unqualified success, luring not only families with children, but senior citizens and singles as well. The Disney fleet has now expanded to four ships and sails to Alaska, the Bahamas, the California Coast, the Caribbean, Europe, the Panama Canal, and Transatlantic crossings.

Consumers who align themselves with the Disney brand have high expectations that they will have a comfortable, safe, entertainment-filled experience, and Disney has parlayed this brand equity into a business that is actually pulling from the first-time cruiser demographic.

Part of Disney’s success in the market was a strategy that called for creating specific spaces and programs for children. Given that Disney recognized that childless couples and singles would think of Disney Cruise Line as a floating playroom, the company created a revolutionary program that draws children to their own cruising experience, while creating a level of guilt-free comfort for their parents—and a restful experience for childless travelers. Disney’s Oceaneer Adventure, custom tailored to specific age groups, has been successful in meeting the goals of the company and the expectations of all its cruising guests.

The marketing concept was simple and eminently successful: “One price for a complete vacation for the whole family.” There were always several young, attractive male or female general organizers (GOs), who were in charge of the sports activities during the day and the entertainment in the evening. These adult camps or clubs were usually accessible by car or train.

This is a far cry from today’s modern Club Med. Under the same management, but with a new generation of marketing executives, today’s Club Med serves up a streamlined and upscale offering in handsome, comfortable bungalows, with hotel-style cuisine, and state-of-the-art sports equipment, managed by the always helpful GO. Club Med can now be found at exclusive beach locations all over the world, accessible by plane and then car, bus, or van.

The marketing proposition is still the same, appealing to a similar family-oriented, budget-conscious consumer. The advertising presents $949 and up for plane, accommodations, all meals, beer and wine, and most sports. The closing promise or positioning line is “The World Is On Sale.” In addition to making a persuasive marketing offer, the facilities deliver exactly what is promised and expected, resulting in a firm relationship with a great number of loyalists and returnees.

However, in a period of sales downturn, Club Med discovered through research that the Club had gotten a reputation as a “swinger’s paradise,” with nude sunbathing and licentious behavior as the main attractions. Management quickly changed whatever was driving that perception, given the desire was to stick with a family-oriented business, a much more sustainable and attractive model.

But one man’s pain is another’s pleasure. In this case, the latter man was an entrepreneur and appliance retailer named Butch Stewart, who gave birth to the next level of “all-inclusive,” the beach resort: Sandals, on the Caribbean island of Jamaica. His offer of plane, luxury hotel, gourmet meals, cocktails, and sports all for one fixed fee per person (with couples prices at a promotional offering during off-season periods) brought capacity crowds from major metropolitan cities. The chain expanded to other islands in the Caribbean and was imitated by the Hedonism chain; soon, other all-inclusive resorts followed as it became a vacation rage. These resorts have even managed to avoid the liability of real or perceived dangers from local crime, due to their nature of being self-contained and secure worlds. Clearly, in this case, an industry was reinvented by a marketing idea, supported by the needs it fulfilled for the target audience: conveyance, one price, quality, and reliability.

In a discussion of place and relationship marketing, this was a low-class sale at its most highly skilled, with glossy booklets, special deals for early confirmations, and unique financing at exorbitant rates. All this was under the stewardship of commissioned salespeople applying high-pressure tactics, weaving stories of the opportunity and nature of the units, without a twinge of conscience or moral restraint—Glengarry Glen Ross in Bermuda shorts.

The major selling point was the “exchange privilege”—the thrill of being able to trade two weeks in Orlando for another destination like California, Arizona, New Orleans, or even New York. Unfortunately, in the early years of this marketing concept, exchanges were difficult, cumbersome, and often unrealized. Because the concept grew rapidly and unsuspecting purchasers became a large group, the complaints became thunderous. The Attorney General stepped in, along with many state officials responsible for preventing consumer abuse.

Fast forward to the present, where we see a remarkable change in the timeshare environment. Leading hotel brands have entered the field, providing credibility and a reassurance that previously did not exist. Unfortunately, the marketing executives assigned to rebuild the image first had to wipe out 20 years of bad press and wholesale bilking of the public. The worst challenge in marketing is to reverse a negative or shady image. The best opportunity is when there is no image—not even a positive halo effect—in this case, the brand can be built from the ground up in a guided process.

Marriott, Hyatt, Disney, Sheraton, and Westin have all entered the time-share market and have named this special hospitality product the Vacation Club. This time period has also seen the development of two major exchange companies, Interval International and RCI, which handle the time-share exchange process. Both exchange companies issue books with small photos of possible exchange properties all over the world. The books list and display about 1,200 to 1,300 properties in many U.S. vacation spots, with as many as five or ten in locations such as Orlando or Southern California. There is roughly a $123 ($199 for international) charge for making an exchange, which covers administrative costs.

Consumers might still have some difficulty getting exactly the exchange they want, but flexibility, certain special marketing bonuses, and trading in points earned with hotel partners enable owners to take advantage of the program. Time-sharing has overcome its past and become a vacation marketing miracle. In fact, many resort developers are now creating properties especially designed for time-share purposes—they then rent out any excess “inventory” as condos.

A final note to affirm that brands are important in every part of the travel and tourism industry: The Four Seasons, Ritz-Carlton, and the St. Regis, three of the premier hotel chains in America, now offer residences—whole ownership of a residence within the hotel or resort. The marketing is careful, complex, and includes branding reassurance, along with access to all or most of the services at existing Four Seasons, Ritz Carlton, and St. Regis properties. As these leading chains expand to Europe, wealthy patrons will be able to have homes in many destinations without the responsibility of caretaking. These chains also offer fractional ownership, which allows for a one-twelfth ownership of a residence.

Walt Disney’s first attempts to establish his dream were initially laughed at, frowned upon, and refused financing. In an interesting twist of fate that would come full circle decades later when the Walt Disney Company would purchase the broadcasting network, ABC, which backed his idea, giving him the funds needed to create Disneyland, the first in the empire that now includes Walt Disney World in Orlando, Euro Disney, Tokyo Disneyland, Disney Hong Kong, and soon, Disney Shanghai. The Disney theme park empire has been an engine of revenue for all other Disney ventures and has always been a target of synergy between the businesses: give them a taste of Disney elsewhere, but get them to the parks.

The parks are a destination for a wide swath of the international public, offering a vacation the entire family can enjoy. But more than that, they are a self-propelled marketing machine. Visitors to Disney properties spend their days and nights completely enfolded in the brand, interacting with story lines and characters and being led out of each attraction through a retail outlet, packed with Disney merchandise to remind them of their trip. In a perfect example of synergy, new releases from the Disney studios become attractions at the parks, driving visitation; the park experience drives trust in the Disney brand, promoting future releases in all sectors of the company’s business.

Furthermore, Disney has also perfected the concept of synergy partners, including other major brands through various deals in which the company shares in revenue while offering the halo effect of their own brand’s goodwill. In the Innoventions pavilion in Epcot, where brands such as Taylor-Morrison Homes, Microsoft, and Honda demonstrate new technologies, Disney brings consumers face to face with products aplenty. However, families are happy to be a part of the promotion process, as Disney’s world-famous eye for operational detail assures them of a safe, memory-filled experience.

Technology is playing a huge role at Walt Disney World. Starting in the spring of 2013, guests will be offered the use of a vacation management system called MyMagic+, in the form of a bracelet that allows them to bypass turnstiles and leave credit cards at home: Simply wave the bracelet in front of a reader, and you’re done. Although Disney believes that this will promote a better guest experience—the holy grail of all places Disney—it will also allow them to collect scads of data on actual guest interaction with the park: where they go and what they buy.

Although Disneyland and Walt Disney World are paeans to the most famous animated characters in the world, Universal Studios pays homage to the movies—Universal movies. Located in Los Angeles, Orlando, Japan, and Singapore, Universal Studios is another example of synergy between the silver screen and the entertainment-hungry consumer. When sitting in a seat in a dark room with 300 strangers isn’t enough, Universal offers you the opportunity to sit in a specially designed tram, surrounded by animatronics, and get tossed around with 16 strangers in a motion-based simulator—don’t just see the movie, ride it. And while you’re at it, stay in a hotel on the property, visit the retail shops, and eat in the restaurants.

The recent addition of the Wizarding World of Harry Potter—a multiacre recreation of everything from Hogwarts to the Hogwart’s Express—has brought visitors by the millions.

These two park concepts have spawned an entire industry of attractions that can best be described as amusement parks on steroids. With their cousins—Six Flags, Paramount Parks, Dollywood, Silver Dollar City, and the rest—theme parks offer a day’s or week’s-worth of entertainment to a public that wants to do more than just ride a roller coaster.

As an industry, theme parks are one of the largest employers in the country and are rapidly spreading throughout the world. The main association for the industry, the International Association of Amusement Parks and Attractions (IAAPA), holds a yearly show that covers over one million square feet of exhibit hall space, drawing over 50,000 attendees over a four-day period.

B2C marketing for the industry is accomplished through the use of all forms of media; B2B marketing is accomplished through yearly trade events such as IAAPA, as well as websites and applications—over 100, offering everything from tickets to weather information. In addition, IAAPA publishes an excellent trade magazine, Fun World.

Vegas is possibly the greatest theme park for adults ever created, with reproductions of Paris, New York, Venice, and Monte Carlo—all in the form of casino resorts—and a newly retro return to the days of the Rat Pack with luxury offerings such as Wynn, Encore, and the Cosmopolitan. When you add the gourmet food—nearly every major chef in the world has his or her own five star restaurant here—and the top-name entertainers, you’re talking a very good time, indeed. Good news for the millions of conventioneers who flow through town every year.

But the heart of Vegas is gaming. Vegas is the best known of the casino towns, which include Atlantic City, Reno, Lake Tahoe—and locations in 33 other states.

Yes, you read that right. Casino gambling, once limited to a few very specific locations in the U.S., has now spread across the country. In an era of shallower tax bases and tightening budgets, states across the nation have jumped on the casino bandwagon, taking is as much as 55% of the slot machines “hold”—the money dumped in that isn’t returned to gamblers in the form of winnings. Iowa has 17 casinos. Mississippi’s Gulf Coast has 12, with more on the way. Maryland has a $1 billion casino on the boards, which would be built about 10 miles from Washington, D.C.

In addition to these commercial casinos are the Indian casinos. The Indian Gaming Regulatory Act, passed by Congress in 1988, first permitted legal gambling by Indian tribes in their home states. By 1993, the National Indian Gaming Commission had finalized rules for the casino, bingo, and/or other gambling venues available at about one-third of the 557 federally recognized Native American reservations. The need for revenue first drove the formation of such locations, and a test case in Florida in 1979, when the Seminole tribe had a prize that exceeded the state lottery total, paved the way. Success stories from Minnesota to Connecticut helped increase the number of Class III facilities (those able to offer the full array of casino games). There are now over 450 Indian casinos across the country.¹⁴

¹⁴ “Foxwoods Is Fighting for Its Life,” New York Times, March 14, 2012.

The biggest winner in gambling revenue? You might say Nevada (Las Vegas, Reno)—but you’d be wrong. It’s Pennsylvania, which in 2010 collected $1.3 billion from slots and table-game revenue from the state’s 10 casinos,¹⁵ owing to its 55% take of the hold. (Most other states are in the 25% range; credit the Pennsylvania state government with some great wheeler-dealing.

¹⁵ “Foxwoods Is Fighting for Its Life,” New York Times, March 14, 2012.

This increase in gambling destinations has had a huge impact on many of the traditional gambling meccas. The math is pretty simple: More casinos means fewer people traveling to get their fix. Many casinos are suffering from casino-overload in their marketing areas, and with new states legalizing gaming, it isn’t going to get better. A case in point is the Foxwoods Resort and Casino in Ledyard, CT, operated by the Mashantucket-Pequot tribe, which was one of the first to offer the kind of glitz available at the Nevada or Atlantic City casinos. Foxwoods is the largest resort casino in the U.S., built at a time when the future seemed great. The facilities include a $225 million, state of the art museum that honors the history of the tribe. But that same tribe has recently had to negotiate terms on $2.3 billion in debt, mostly due to recession and over-building.

What this means, of course, is that the marketing techniques used to draw gamblers are more important than ever. You’re never going to get repeat Vegas visitation from the guy who’d just as soon go to the local “racino”—race track/casino, such as Aqueduct in New York—the big casinos still shoot for the “whales”—the big fish that casinos carefully cultivate through complimentary (“comped”) rooms, flights, and food. But you don’t have to spend that big to be comped—not at one sitting anyway. Casinos are happy to comp those loyal guests who come regularly and spend often.

Guests hungry for this kind of recognition typically sign up for the “slot clubs” that are a part of every casino. Members are issued cards that are used at the slots (where 70% of casino revenue is derived), so the casino keeps track of their activity. The Luxor in Las Vegas, as an example, has a block of 300 rooms set aside for comping on weekdays and as many as 500 rooms it can comp on a weekend. Those rooms aren’t filled with millionaires. The Luxor also uses direct mail campaigns in addition to advertising to obtain regulars. In addition, the casino employs casino hosts, each of whom is responsible for 250 regular customers. Every guest at the Luxor gets a letter within three days of his or her visit; a host is responsible for keeping in touch with each of his or her 250 regulars at least once every three months. For instance, if a player hits a jackpot, the player also receives an Egyptian good luck pin. All of this attention and communication go toward maintaining a customer base, and the goal is to make them feel needed and wanted.¹⁶

¹⁶ For more detail, see the thorough coverage in: Rudd, Denis P. and Lincoln H. Marshall, Introduction to Casino & Gaming Operations, 2/E (Englewood Cliffs, NJ: Prentice Hall, 2000).

Resort casinos also use other strategies to bring in customers. In Vegas, Caesar’s built Celine Dion her very own theater, which has since housed Bette Midler as well as Elton John while Celine took a world tour. Gourmet food is also a draw. In addition, large resort casinos often offer luxury shopping.

Most marketers understand that getting new customers is more expensive than retaining repeat ones. This is certainly true for casinos. The needs, wants, and desires of people drawn to a gambling environment must be motivated by more than an attractive price on an airline ticket to get there. The marketing mix must reflect the fundamental components of product, price, and distribution. The casinos themselves systematically market to audiences through the use of clubs, tournaments, headliner acts, and other special events. Like much of the hospitality industry, gaming operations are people-oriented businesses; they require strong communications from PR departments and promotional support from the entire company.

In theory, brands establish an identity by association with meaningful ideas, values, and a quality position that people can readily understand. In other words, “I know it, I trust it, and it fits my particular take on life.” During the evolution of branding, to fully entice the consumer, differentiation was key: Create unique selling propositions that would translate into immediate benefits for the customer—“If I put that stuff in my hair, I’ll be the sexiest man alive; if I use the other brand, I’ll just look greasy.”

Traditionally, marketing professionals would then march the brand out to the public through the use of print or broadcast advertising—utilizing actors, spokespeople, or clever copy to lock the brand into the consumer’s consciousness. The message was delivered through the traditional media outlets appropriate to the campaign. Finally, the brand was then attached to as many products as possible.

As technology has expanded, more media can be utilized to promote a brand. Consumers are now bombarded with thousands of messages per day. How to cut through the clutter? Create an experience of the brand. Bring the brand to life so that consumers can connect with it, claim it as part of their lifestyle. To do this, marketers tie the brand to an entertainment-driven experience—one that creates a pleasant memory or educational offering.

Experiential marketing helps brands connect with the consumer as human—not just as product user. It takes the core values of the brand and introduces them into an actual environment—one that gives the visitor a visceral experience of what the brand means and offers. Experiential branding is the intersection of entertainment and marketing.

The concept first hit the retail side of branding with individual brands. Manufacturers such as Nike (with Niketown) discovered the power of exhibiting their product in environments that included merchandise combined with museum-like exhibits, state-of-the-art audio-visual technology, online interfaces, and themed decor to support—but not define or overpower—the brand image. Niketown offers products for sale, but it does not necessarily compete with other retail partners in the area that also offer their merchandise; instead, these brand facilities act as yet another marketing effort for local retailers, by promoting the brand image.

Other manifestations of experiential marketing are found in corporate heritage centers, which took the place of plant tours in the late twentieth century, due to liability, and sometimes espionage, concerns. In retail, “pop-up” stores bring the brand to town like an old-fashioned carnival, appearing for a few days, weeks or maybe months, before disappearing like a Ray Bradbury character, leaving just a whiff of marketing behind. The same is true of traveling road shows, such as the NFL Experience, which allow wannabee footballers to immerse themselves in their iconic brand.

High-touch sensory experiences are often seen as the leading edge of a “brand narrative” that speaks over many channels. Today, marketing strategies are designed as a sophisticated choir of environmental, online, print, and broadcast voices.

Pike, Stephen, Destination Marketing, Elsevier Inc., 2008.