Destination Marketers Must Evolve in 2022 in These 5 Areas

The scope of work for destination marketing organizations (DMOs) broadened massively to keep up with the changing trends and patterns owing to the pandemic. In this report we examine the pre-Covid setup of DMOs, how DMOs evolved during the pandemic and how they make sense of what the future holds. The overall goal of the report is to highlight the lessons learned through battling the crisis and the fundamental areas that can contribute to a sustainable recovery and growth.

We conducted a survey in December 2021 of about 100 professionals from destination management organizations (including convention visitors bureaus) globally to analyze the functioning of DMOs across five key facets: funding, revenue, expenses, staffing levels, and marketing. For each of the facets we have assessed the trend from the pre-Covid to the post-Covid phase.

We found that funding, revenue and expenses are expected to increase in 2022 compared to the last two years, in line with the macro-travel recovery trend. However, at this point it is crucial for DMOs to diversify their funding and revenue sources along with allocating their expenses in a targeted manner. Staffing levels are expected to more or less reach 2019 levels in 2022. Digital marketing is expected to remain the dominant marketing channel going forward, although marketing approaches like partnership marketing, cross-DMO collaborations and community marketing are expected to show better results in the near future.

As DMOs continue to find their footing in the new travel landscape, DMO functions are expected to broaden even more with increased emphasis on sustainability initiatives, airport route development, and stakeholder engagement. 

Furthermore, we interviewed executives from seven key DMOs. Through our survey and discussions with industry stakeholders we gauged the recovery timeline of the traveler volume and discussed the pace of recovery by origin and purpose. Consensus is that full recovery is expected only after 2024.

We published our latest Skift Research report on January 12. Below, we share a snippet of the report.

DMO Roles on The Backburner Come to the Forefront 

DMOs will continue to find their footing in the new travel landscape. The chart below shows how some of the DMO functions are expected to broaden massively to keep up with the changing trends and patterns owing to the pandemic. 

Exhibit 26: DMOs continue to find their footing in the new travel landscape

Increased Emphasis on Sustainability Initiatives

In the post-Covid world, we found that sustainability initiatives are at the top of destination professionals’ minds. While only 34 percent stated their organizations worked on sustainability initiatives in 2019, 74 percent said their organizations will work on them post-Covid. 

Eighty-three percent of the respondents feel that there is a need to provide eco-conscious travel options given the focus on climate change and sustainability issues post Covid. And among the travel products offered by various travel providers, destination professionals believe eco-conscious products and services offered by hotels and food & beverage outlets will be the most attractive to travelers. 

Exhibit 27: Destination professionals believe eco-conscious products and services offered by hotels will be the most attractive to travelers

Furthermore, 50 percent of the respondents said that their organization started working on developing methods and advocating for regulations that can prevent over-tourism and/or managing its negative multi-facet effects for the purposes of advanced sustainable development as a result of Covid. As one respondent shared, “Emphasis will be on sustainable practices with dispersal of tourists so that the threshold hold capacity of a tourist destination does not cross its limit.”

However, industry experts believe that although sustainability practices are being included in their strategic agenda on a theoretical basis, for now it has been put on the backburner as the need of the hour is to get tourism going by any means possible. Dougan from Tourism Australia commented, “Undoubtedly, sustainability and tourism go hand in hand, however, currently we need cash in the industry to survive and to remain competitive. Labour shortage and the ability to service demand are the things the industry should be much worried about.” 

Key DMO Functions: Airport Route Development and Stakeholder Engagement

While only 25 percent said that their organization focused on airport route development in 2019, 40% said that their organization will focus on it going forward. 

Dougan at Tourism Australia, told Skift: “We will have to focus on more support areas – from our core function of marketing to a much higher degree of aviation engagement, distribution engagement, industry engagement as well. We have set up programs to help the industry become more competitive, to help industry stakeholders do the right marketing. We also have been very active in talking to airlines in keeping them informed of what is happening in Australia. Trade and Aviation are crucial to keep it going.”

Increased emphasis on economic development, and crisis management is expected to continue. Over and above the functions mentioned in the chart above, respondents listed policy development, political advocacy, increased accessibility with round the clock communication options for visitors and residents as other functions that are expected to become important post Covid.

Heavy Investment in Data

Tourism research and data was already of significant importance to DMOs before the pandemic, with 80 percent respondents mentioning it as a key function of their organization. In the post-pandemic phase, 90 percent of the respondents voted it as a key function. As we have already mentioned above, budget restraints due to Covid have made it essential for DMOs to take a more targeted approach with respect to internal business practices and their overall strategy to efficiently utilize the budgets available. As Heywood at NYC and Company said, “We are as good as our data.”

Survey results show that Google and social media analytics are used ubiquitously by DMOs. At the same time, internal data sources from stakeholders and the government are also being used to make informed decisions.

The Roadmap for Tourism’s Reimagining and Recovery document published by NYC & Company in July 2020 shows how they track essential data to define their success metrics. A few of the metrics tracked by them are measuring changes in search terms, site traffic, social media engagement, social listening, custom/proprietary traveler sentiment surveys. The DMO even tracks indices like the performance of hotels, shopping trends and regional mobility.

Exhibit 28: Google and social media analytics are used ubiquitously by DMOs along with direct stakeholder data sources

Destination Marketing Outlook 2022

Skift Research conducted its survey in December 2021 to know how Covid impacted the working of Destination Marketing Organizations (DMOs). In addition, we interviewed executives from seven key DMOs to get additional insights from the ground.

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