While Hawaii’s core North American market will continue to carry state tourism in 2015, the Hawaii Tourism Authority plans to spend more money on marketing in individual countries as part of a global diversification strategy designed to create a more balanced industry while growing visitor spending.
David Uchiyama, vice president of brand management for HTA, said Friday the state’s marketing agency plans to add another $1.2 million to $1.3 million starting in January to supplement the budgets of HTA’s international contractors, which totaled about $12.1 million in fiscal year 2013.
“We also have a $1.5 million budget set aside to work with Brand USA and our own direct initiatives like search engines, websites and social media to get more Hawaii images out to the international markets,” Uchiyama said. “We think this will be very effective because of the heightened use of technology in many of our international markets.”
Later next year, Uchiyama said HTA will also budget additional international marketing funds to hire contractors to represent Hawaii’s tourism interests in Hong Kong and in a yet to be named city in Southeast Asia.
“We are taking the money from our market development fund and from the savings that we occurred across the board in 2014,” Uchiyama said. “Growing international markets helps us diversify and takes into perspective the carrying capacity of Hawaii and the desire to continue to grow expenditures over arrivals. Further expansion into Hong Kong and Southeast Asia will help round out our exposure, especially into the Asia-Pacific.”
International expansion is cost effective since marketing to these visitors tends to cost less and yield more first-time visitors and greater daily spending, Uchiyama said.
“It costs us about $5.48 in marketing to bring a North American visitor to Hawaii and about $5.10 to bring an international visitor here,” he said. “Also, international visitors tend to spend more on a daily basis than their North American counterparts. For instance, in 2013 North American visitors spent $171.10 per day, while our international visitors spent $267.10.”
Uchiyama said the additional international marketing support returns marketing money that HTA redeployed to North America during the 2008 and 2009 downturn and is timed to assist international carriers, who are expanding flights between Hawaii and their nations.
“There’s a lot of opportunity. You see it in the acquisition of long-haul aircraft by many international carriers. We are also seeing more diverse offerings with a lot of low-cost carriers expressing interest in the destination,” he said.
While there’s a lot of industry excitement over the coming international expansion, Uchiyama said marketing decisions do not discount the importance of its bread-and-butter North American markets, which received about $29.7 million in marketing funding in fiscal year 2013.
“North America remains a very important market for us,” Uchiyama said. “It’s really the foundation that allows us to build on all other markets. We are looking right now at a proposal from the Hawaii Visitors and Convention Bureau to add about the same amount of incremental funding to that (the North America)market, too.”
Jay Talwar, senior vice president of marketing for the Hawaii Visitors and Convention Bureau, said there’s still plenty of opportunity in North America.
“The good news from North America is that demand is strong and growing and that’s led to great lift — it’s at an all-time high and the dispersion across the state is in better balance than a few years ago,” Talwar said. “Our focus is on those folks who fit the profile and have yet to select our destination.”
The Hawaii Tourism Authority is ramping up marketing dollars and resources in international markets, which offer greater opportunity to bring more first-time visitors and big spenders.
HTA’s major market targets for 2015
Marketing Per-Person Per-Day Spending
U.S. West $163.70
U.S. East $203.80
Latin America $229.80
Source: HTA Major Market Outlook ___