On the heels of the DestinationNEXT Phase 1 report, we sat down with Anita Mendiratta, one of the most respected global strategic advisors in Tourism & Economic Development, to get her take on the findings and implications for the industry.
As the DMO's role evolves, so must its business model. How important do you think it is for DMOs to collaborate more with the private sector and form public/private partnerships to market and manage a destination?
Within any tourism economy there are, naturally, two powerful forces: the Public Sector and the Private Sector. These two forces have the ability to achieve greatness.
The Public Sector, that being government acts as the architect of a nation’s core identity, policy and legacy. With a clear mandate of national growth and development, efforts and energies of officials and institutions seek to advance society, the economy and the environment for the well-being of all people – present and future. Success is generally defined qualitatively. Design is everything.
The Private Sector, effectively the business community, shares the desire for future growth and development of the nation, however with a different set of goals, metrics, expectations and end accountabilities. With firm business plans, objectives, investment allocations, accountabilities and targets for returns, success is generally defined quantitatively. Delivery is everything.
Through it all, ‘stakeholders’ – people and entities all connected to the industry through their connection to the traveller experience, even if not technically a tourism department or business, are at work.
Working separately, which is most often the case, each is able to mobilise their respective resources towards goal individual fulfilment.
More often than not, however, these forces are in opposition. Differing priorities, timelines and processes result in differences of opinion that cause different paths to be taken. The net effect: underutilisation of critical resources, under-appreciation of respective contributions to industry development and underachievement of destination potential.
However, working synergistically with stakeholders through the tourism experience chain, cross-sectorally for development of the tourism economy in a way that truly leveraged their respective areas of experience and expertise, the value could be exponential.
Whether formal PPPs – Public-Private Partnerships - a vehicle was created by government to bring together the public and private sector entities, from any economic sector for the achievement of shared objectives - or through structured Stakeholder Alignment (ie through creating working groups, associations, whatever may be the most effective vehicle for philosophical and operational cooperation) around common goals and opportunities in the tourism, connecting interdependencies with trust, maturity and a shared vision of the long-term of the destination creates invaluable.
DMOs traditionally have used industry transactional measures such as room nights to measure success. How do you see this changing, and what do you consider the measurements of success for destination organizations in the future?
Tourism, once viewed as an industry based on play, pleasure and passionate patriotism, has finally established profile, respect and credibility around the globe as a powerful driver of the economic engine of nations. Currently generating over 9.5% of global GDP, tourism is a proven, solid source of revenues, investment, trade and jobs. No other industry can yield such high levels of economic impact with so little initial capital investment requirement.
Of critical importance, the people of the nation have the opportunity to play a part in the growth and development of their home. Each and every individual has the ability to touch, and be touched, by tourism. Globally, there is no faster growing sector of employment (1 in 11 jobs worldwide, 266 million in 2013), unlocking hope and opportunities for the future of the people who call the destination ‘home’.
But evolution is not only about the numbers – arrivals, hotel occupancies, revenues, length of stay, dispersion, repeat visitation and all of the other metrics that the industry uses to quantitatively measure performance.
Growth is also fuelled by the importance of travel & tourism at four core levels:
Economic: The travel & tourism sector has become a phenomenal earner of revenues for destinations. In addition to the money, which travellers directly inject into the places to which they travel, the sector has proven its ability to be a powerful attractor of investment.
Political: The travel & tourism sector has become a valuable driver of the strengthening of the focus, fabric and future advancement of nations. Governments across the globe have recognised the importance of the sector in the unification and development of both the economic and social dimensions of the nation.
Social: Flowing directly from the above, the travel & tourism sector has proven to be invaluable in bringing together people of the destination around a shared national identity and invitation to the world, regardless of age, race, religion, profession, personality and political point of view. The low barriers of entry to the sector make it possible for all people of the destination to play a role in the tourism community and economy.
Psychological: Over the past decade, as the world has flattened and perspectives have broadened, travel has become a core psychological need for both individuals and companies alike. Travel is no longer about movement from logistical A to B. It is about social movement, economic movement, spiritual movement, and the movement of cultures closer to one another.
These are the metrics that matter when it comes to tourism development, and the pillars for measurement for DMO’s seeking to make a positive impact on destination growth, development, identity and competitiveness.