Saturday, February 28, 2009

LTVA ready to change its ways

unedited 1/09 Tahoe Mt. News:

By Kathryn Reed

Lake Tahoe is about to be promoted in a whole new way. What exactly that will look like is yet to be determined.
Mering & Associates, the Sacramento firm that has been the ad agency for Lake Tahoe Visitors Authority since March 2003, is going away. The summer promotional campaign will be the last the agency does for the South Shore.
LTVA expects to hire a firm this spring. Reno and Bay Area companies have been submitting proposals. LTVA’s marketing committee will pick two or three to make detailed pitches to the board.
Mering introduced the original $2.5 million “Blue World” ad campaign that was met locally with mixed reviews.
The campaign revolutionized how the South Shore was marketed. It was suddenly about branding, using the Lake as the central theme. No longer was it strictly about losing money at casinos or schussing down ski slopes.
The destination visitor was the target audience. National magazines featured slick, glossy ads. Target marketing went by the wayside.

A little history

Things certainly have changed in the last six years. In a February 2003 Sacramento Business Journal article, David Mering said, “Our goal is to make Tahoe a little less dependent on Northern California [for tourism dollars] and more of a national and international destination market.”
Bill Chernock was head of LTVA at the time and was a leading figure in trying to make South Shore a destination resort. The previous fall the two Marriott properties had opened. Two years before that Heavenly’s gondola started up.
Some began referring to South Shore as a company town, with those interests reigning supreme and the locals left in the dust with no say about the future.
Vail Resorts owns Heavenly. Two other out of town entities each own two of the four big casinos.
Today, Vail’s stock, like most, is in the toilet.
The parent company of MontBleu and Horizon is in bankruptcy. The land owner, Park Cattle of Minden, is likely to take over the Horizon when the lease expires. This will allow for more flexibility as Park develops a hotel-condo project at Edgewood Tahoe Golf Course which is behind the casino.
Harrah’s Entertainment, which owns Harrah’s and Harveys at Stateline, was acquired by affiliates of private-equity firms TPG Capital and Apollo Global Management in January 2008. The Tahoe Mountain News has been told the financial situation is scary at the Las Vegas-based company and its South Shore casinos are in trouble.
Just a handful of years ago, the South Shore was all about high-end tourists. A few weeks ago vacancy signs dominated the landscape during what’s supposed to be the two busiest weeks of the year.
No one sought input from locals about how they wanted their town promoted. It wasn’t long ago that marketing gurus said buy-in from locals wasn’t important. The Blue World campaign rolled on without explaining it to anyone outside an LTVA or chamber meeting.
Suddenly the bread and butter of Tahoe – the Bay Area and Sacramento regions – played second fiddle to people living in Dallas, Atlanta and Florida.
During the Patrick Kaler years at LTVA and Tahoe Douglas Visitors Authority the message was convoluted with the casinos wanting to attract a young party crowd, others trying to promote the outdoors, and the whole country being the advertising target.
Carol Chaplin, who has been running the tourism agency since last summer, is one of the forces behind the change in ad firms. With a marketing background rooted in Lake Tahoe, she is firing-up LTVA’s marketing committee so it will be a critical component in what goes on here.

LTVA’s future

“You can’t have an effective marketing organization without community support and community outreach,” said John Wagnon, LTVA marketing committee chairman. “We can’t move forward until we have community support. We have to earn that. I think that will come as they see a consistent rollout of an effective marketing campaign. Our goal is to regain that confidence and put the Lake Tahoe Visitors Authority right back in the front where it was years ago.”
He doesn’t want to repeat the Blue World fiasco, at least as defined by average locals. That group still doesn’t understand the Blue World, so it is hard to call it an effective ad campaign.
Blue World licensing agreements went nowhere. At one time Wells Fargo talked about issuing “blue dollars”. As the Blue World fades away we’re left with a sputtering bus system called BlueGo and a casino named MontBleu that is in financial turmoil.
Wagnon wants a community outreach plan in place by mid-year. He wants a forum for people to provide input and ask questions. He wants people who represent attractions, retail, restaurants and other components of the tourism industry to be part of LTVA’s planning process.
LTVA could also help its local image by creating a more diverse board of directors.
First, though, Wagnon’s priority is hiring an ad agency.
Wagnon envisions a consistent brand to market the area. He wants to identify the elements that make the South Shore unique and weave them into the brand platform.
“A lot of places struggle to figure out why they are unique. We need to put a stake in the ground and say this is who we are,” Wagnon said.
He doesn’t think it’s just one thing. It’s the outdoors, skiing, casinos, nightlife and the Lake.
Wagnon has resurrected the dormant public relations subcommittee, an arm of the marketing committee. Weidinger Public Relations will still write the press releases, but instead of working solely with the executive director of LTVA, the Stateline agency will have more people to bounce ideas off.
Something else different in the Chaplin era is that an 18-month strategic calendar is being developed. This will get people to look beyond the current season.
Promoting the shoulder seasons is a topic of discussion; with events at the top of the list.
The need for an ad campaign that allows for the message to be changed on short notice is likely to be a component in the next ad agency’s contract. This means instead of promoting skiing at Thanksgiving when the snow isn’t here, ads could go out boasting about great late fall hiking, cycling and hues of autumn still visible.
LTVA’s budget was adopted late last year with 20 percent or $250,000 less to spend than the previous year. Chaplin said with room taxes declining, the chunk of cash LTVA gets from the Tourism Improvement District and TDVA is expected to be much less.
To cut costs, LTVA opted for upgrades to its website instead of a complete redesign. Because the convention center is on hold indefinitely the group sales team at LTVA has been thinned. Special events may be cutback or axed. Money has been saved by changing insurance carriers.
The board voted that any “extra” money will be used on advertising.
The board is made up of two lodging people, two from gaming, one from retail, one representing attractions (Edgewood is the current rep), one from skiing and one at-large rep. The latter is an employee of Sierra-Northstar ski resorts.

Tahoe’s summer campaign

Mering was supposed to unveil its full summer campaign at a Jan. 5 meeting. That meeting has been rescheduled to Jan. 30 At the LTVA board meeting in December a loose concept of Mering’s summer ideas was presented.
“The plan they presented was a blend of TV, print and online advertising in the drive market and closer-in destination market,” Wagnon said. “We haven’t seen any creative concepts.”
The summer campaign will be launched in late May or early June and go through August, including a Labor Day push.
People are booking rooms two weeks out, so the message needs to hit in that time frame. Plus, the drive-up market gets a dose of “retail” advertising instead of just “image” like the destination visitor gets.
Lodging packages, concerts and other events are part of that retail message. Pricing and details are more accurate the closer it is to the date of travel so that’s what will be delivered in the summer ad campaign.

A few facts

More people visit California than any other state. And it’s mostly Californians (85 percent) who are the tourists in the state. That’s why LTVA knows it’s important to keep getting the message out to the drive market. This is even more imperative when places like Monterey and Napa are competing for those same visitors.
However, because the Bay Area-Sacramento regions have a limited number of people, the destination guest will not be forgotten. The way marketing people see it, the only way to increase the number of heads in beds is to bring in the destination guest.
But economics is sabotaging that scenario. People aren’t flying as much. They aren’t spending as much. They are staying closer to home.
“What happens is as budgets change or economies or consumer behavior, you have to adjust your marketing strategy accordingly,” Wagnon said. “We are fortunate to have such a big drive market. We can shift our focus and turn up the energy on the Bay Area to get a bigger share of that drive-up market.”
Wagnon is vice president of the California tourism agency’s marketing committee and president of Ski Lake Tahoe. His day job is overseeing the marketing department at Heavenly Mountain Resort.
The California Travel and Tourism Commission says more than 300 million Americans and 7 million foreigners visit the state each year.
“While 2009 travel trends predict percentage of travel, disposable income and most aspects of travel to see reductions in 2009, the last quarter of 2009 shows an upswing in travel,” according to studies performed by Travel Industry Association and U.S. Department of Commerce.
A growing trend is green travel. PGAV Destination Consulting, a planning and design firm in the international entertainment, tourism and hospitality industries, did a survey that revealed that about 75 percent of people between 18 and 34 are “more likely to visit an attraction that is pursuing environmentally friendly practices.”
It went on to say, “Almost 60 percent of people under age 35 expect to pay more for green attractions, and they will pay over 10 percent more. Most of these consumers [nearly 65 percent] expect their spending on green products to increase over the next 12 months.”
The only South Shore lodging property claiming to be eco-friendly is 968 Park Spa Resort near Stateline. Lake Tahoe Community College has an Introduction to Eco-tourism class this quarter as well as Principles of Green Marketing class.
Time will tell if LTVA sees green beyond the dollars it spends and the greenbacks it hopes to bring to the community.

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