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Why Canada doesn’t waste its time or money on marketing in the U.S.

@SamShankman

May 09, 2013 2:21 am

Skift Take

Canada’s decision to pull leisure marketing from its poorest performing markets is an interesting tactic, but one that gives individual destinations an opportunity to stand out without competing against the more influential country brand.

— Samantha Shankman

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Canada’s national tourism marketing firm doesn’t want to compete for U.S. tourists any more.

In 2012, the Canadian Tourism Commission stopped all media relations, public relations, and social media work in the U.S. after finding little return on the money they laid for expensive marketing campaigns. American visitors spent an average of $518 per trip in Canada last year, the lowest amount spent by an international visitor group.

The exit was part of a strategic shift at the organization aimed at getting the greatest bang for their buck, so to speak. The 2012 annual report from the Canadian Tourism Commission, “Delivering Value for Canada’s Tourism Businesses Through Innovation and Efficiency,” succinctly explains the organization’s decision as follows:

Given our strategy to invest where the Canada brand can lead, to ensure the highest possible return, we determined that our limited resources prevented us from having
an adequately strong impact in the US Leisure market. Furthermore, redirecting those dollars to focus on higher yielding international markets could generate measurable gains. Overall, this shift enabled us to demonstrate our leadership position with a solid and unified Canada brand in markets of highest return.

The CTC is now directing those dollars on higher yielding markets including Australia, France, Germany and the UK; four countries that account for almost 60 percent of overseas tourism revenue.

The CTC remains active in the U.S. market by promoting meetings and convention travel to Canada and hosting its annual Canada Media Marketplace event. Booked business events from all markets brought an estimated $44 million into the Canadian economy in 2012.

Outward focused

CTC gives the responsibility of encouraging its citizens to explore other parts of the country to provincial and territorial partners. It views domestic tourism, which only generates an estimated $256 per person per trip, as a limited space to focus for growth given the finite number of potential tourists.

Our strategy, therefore, focuses on revenue. Generating revenue from the international traveller helps alleviate the long-term reliance on the domestic market for tourism growth.

The basis of CTC argument is the they want to “deliver returns on the taxpayer dollars invested in [the] organization” by assessing the effectiveness of campaigns and attributing their work into tangible economic impacts.

CTC estimates that its campaigns are directly responsible for bringing in $687 million to Canada. The annual report highlights that this is “new money being injected into the Canadian economy, not domestic spending.”

The 2012 per trip expenditure and arrivals of the Canada’s ten largest overseas markets plus the U.S. and Canada are shown below:

Market Per trip expenditure 2012 2012 Arrivals (000s)
Canada $265 x
US $518 235
India $952 171
UK $1253 599
France $1289 421
Mexico $1399 133
Germany $1555 290
Japan $1588 203
South Korea $1609 130
China $1670 288
Australia $1781 235
Brazil $1874 81

The 2012 annual report from the Canadian Tourism Commission, Delivering Value for Canada’s Tourism Businesses Through Innovation and Efficiency, is below:

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