Promoting tourism and travel is very different from that of a product, service, restaurant, or action figures made from peanuts. I’ve promoted them all. The key differences within destination marketing are that the promotion is tied to a multitude of untrackable experiences, and the customer doesn’t make a direct transaction with the DMO. So, it’s a lot harder to measure tourism marketing ROI than many others (even peanut action figures).
It’s hard, but not impossible. With the right planning and availability of data, you can track performance and ROI against benchmarks that matter to the growth of the community. Here is a step-by-step approach.
Start with measurable, attainable goals.
One of the longest parts of our in-person strategy sessions is helping destinations define their goals. In many cases, the goals I encounter are vague and not based on reality. A goal of “increasing airlift by 30% by year-end” without understanding the resources needed to get there is only setting the DMO up for disappointment.
Go beyond SMART goal-setting to define the steps that will put the goal within reach. This involves resource allocation, historical data, and a buffer to account for the inevitable hiccups that like to derail our plans. If the team is so inclined, also set a stretch goal (one that exceeds the initial goal) to inspire the team to aim higher. Meeting these are truly a cause for celebration.
Set well-defined, significant KPIs.
One of our more popular articles is the one I wrote about KPIs. Relevant KPIs (key performance indicators) will help marketing avoid the good ol’ “spray and pray” approach that never materializes in any real growth. Evaluate your current strategies against these general KPIs:
- Increase/decrease of returning website visitors (a sign of higher intent than first-timers).
- Email marketing list growth and click-through rate.
- Event or festival registrations, year-over-year.
- Transient occupancy (or hotel) taxes, year-over-year.
There are many more but this isn’t an article about all of the things that should be tracked, so let’s move on. KPIs should also be tied directly to the goals you set, tracked often, and relate to revenue for reinvestment.
Create a data dashboard.
If it happens online, it can be measured. It can also be easy to get carried away with data when all that matters are the KPIs. I’ve found that a data dashboard is the best approach to consolidating what matters. One of my favorites is Databox, an online platform that allows you to pull in feeds from ad platforms, Google Analytics, social channels, email marketing platforms and almost any other API you can think of. This data can all be displayed on one dashboard (what they call “databoards”) like this one.
A dashboard will allow your team to limit distractions, speed up reporting time, and increase the odds of tracking KPIs often.
Set up attribution modeling.
Attribu-what?
An attribution model is simply a way of tracking ROI throughout the year through specific touchpoints along the visitor journey. This allows marketers to understand the contribution of each marketing channel or campaign to the final outcome. I could really geek out on this by talking about this recent paper but I’ll keep it light.
The best attribution models are omnichannel and with modern analytics, GPS data and more, each step of the journey from awareness to advocacy can be tracked if the activity happens on one mobile device. The data is viewable in aggregate and an assigned value can be tied to each step in the journey (ad clicks, email signups, in-person visits, repeat visits, etc.).
See: Arrivalist, Placer.ai
Assign UTM parameters to your online campaigns.
We often find ourselves in situations where there is more than one campaign running per channel at a time. When that happens, it can be tough to assign credit to each campaign, especially if the campaign is just dropping the visitor off on the homepage (tip: don’t run ads that drop the visitor off on the home page).
Urchin Tracking Modules (UTM codes) allow marketers to quickly identify the specific sources of traffic and conversions, enabling better tracking and analysis of ROI for each marketing channel or campaign. There’s an article over at AgencyAnalytics that does a great job of breaking down what they are and how to use them.
Conduct surveys and solicit feedback.
I have my own complicated perspective on community surveys. Most are only sent out to help justify something the surveying group already wants to do, so the questions are structured in such a way as to obtain the desired result. However, for those that truly want to get the unvarnished perspective of visitors and the community, they can be very helpful if performed correctly. I wrote about how to conduct a community survey in a past article over there.
For visitor feedback, it’s best to catch your audience when they’re stationary and waiting on something—like at a restaurant, a bus/subway stop, or a hotel check-in counter. QR codes are so commonplace nowadays that they can be a great prompt to let visitors speak their minds. Ask visitors how they discovered your destination and whether your marketing efforts influenced their decision. This qualitative data can complement quantitative analytics.
Conduct periodic economic impact studies.
Typically performed every 5-7 years, an economic impact study is a collaborative effort between local stakeholders, economic development authorities, and tourism boards to gather data on the community’s strengths, areas of opportunity, and general economic standing. These studies estimate the economic benefits generated by tourism in your destination and can provide an overview of the broader tourism marketing ROI.
An economic impact study process should always be led by a third-party research firm; not a marketing agency, commercial development firm, or any business that would have a reason for the numbers to look a certain way, either intentionally of otherwise. Being a third party allows them to bring past experience with them to help set benchmarks and best practices. If you’re looking for a good research firm, check out Camoin Associates—they’re one of the most commonly used.
Track costs and maintain a budget.
A return on investment can’t be measured without the whole “investment” part, right? Keep track of all marketing expenses, including advertising costs, agency fees, content creation, and promotional materials. By comparing the costs with the generated results, you can calculate ROI for specific campaigns or overall marketing efforts.
Check these expenses against the annual budget each month. I know a lot of DMOs that create a budget, have it approved and don’t look at it until it’s time to write the next one. By that point, the whole idea of writing the thing is lost.
Conduct a comparative analysis each quarter.
Goals are best set and KPIs are best tracked if they’re tied to historical data. Benchmark your DMO’s performance against previous periods and industry standards (we can help with that) to make sure that you’re within a good range and moving in the right direction. This analysis helps identify trends, strengths, and areas for improvement in the marketing strategy.
Regularly report on KPIs.
Create regular reports that summarize the key performance metrics, ROI calculations, and insights gained from tracking efforts. A monthly report to stakeholders and decision-makers can help the entire marketing program stay on course. The dashboard idea helps with this. Simply screenshot the dashboard, attach it to the KPI benchmarks set at the beginning of the year, and you’ll have a complete view of what’s working, what’s struggling, and where the strategy needs to change. If you’ve gone so far as to set attribution models, the entire marketing program can be linked to potential revenue, giving you your tourism marketing ROI in near real-time.
Conclusion
As I said, measuring ROI for a destination isn’t impossible; it just takes setting the right goals, tying KPIs that actually matter, and knowing where to pool and read the data. By employing these strategies and techniques, a DMO can effectively track and evaluate the ROI of their marketing campaigns, enabling data-driven decision-making and optimization of marketing efforts.
