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Sunday, Apr 20, 2014
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To take advantage of tourism revival, money needed for marketing

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The mood was upbeat among the 100 or so industry participants attending the Hillsborough County Hotel & Motel Association’s annual forecasting forum earlier this month — and for good reason.

There was plentiful news about new conference bookings and additional flights serving Tampa International Airport and cautious optimism that the economy has begun to improve. And Tennessee travel research consultant STR reported the Tampa market was back to mid-2007, pre-recession hotel and motel occupancy rates of about 70 percent.

But the discussion turned somber when the topic turned to marketing funds available to capitalize on the tourism and travel recovery.

“Funding for Visit Tampa Bay needs to be addressed quickly ,” said Lou Plasencia, chairman and Chief Executive Officer of The Plasencia Group, a North American hospitality investment consultant, and Hillsborough Tourist Development Council member. “We are going to be left in the dust.”

Hillsborough County’s visitors bureau, renamed Visit Tampa Bay earlier this year under a new administration headed by longtime Tampa city official Santiago Corrada, ranked 10th in Florida in overall visitors bureau budgets at $10.7 million, based on 2012 data.

That’s behind top-ranked Orlando at $50.1 million, third-ranked Fort Myers/Sanibel at $22.7 million and ninth-ranked Naples at $12.5 million.

Hillsborough’s marketing budget has long been bleak. While comparisons of marketing expenditures can be similar to comparing apples to oranges, Visit Tampa Bay spends about $1 million annually, compared with Pinellas County’s combination of traditional and electronic advertising contracts of $11.6 million.

“It’s no secret, we are at a handicap with funding,” Corrada said. “We are pretty limited on TV productions compared with other markets. Digital media is huge. Radio in some markets is important. “

Funding issues east of Tampa Bay extend to the Tampa Convention Center.

The week following the trends and forecasting forum, Rick Hamilton, convention center and tourism director at the Tampa Convention Center, told the county’s Tourist Development Council — which apportions the county’s 5 percent hotel bed tax revenue to Visit Tampa Bay, various regional attractions and debt on sports facilities — that the center needed $2.5 million for refurbishments.

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It was not the first time Hamilton addressed the council, comprised of elected and industry officials who are an advisory board to the county commission, regarding imminent needs for the building that opened in 1990.

“The convention center is in its 23rd year of operation and maintained to the highest standards possible,” Hamilton said. “Due to continued aging, a capital improvement program is being proposed to keep the center in excellent condition.”

The proposed convention center five-year capital improvement plan for fiscal 2014 through fiscal 2018 totals $13.5 million, with requests between $2.6 million and $2.8 million in each of the five years.

The largest expenditure is $2.2 million requested for 2014 to upgrade and replace escalators and elevators. Another $905,000 would be required between 2015 and 2017.

The budget also includes $1.5 million from 2014 through 2016 for an interior walkover over Platt Street to improve pedestrian safety; $1.4 million for furniture and fixtures, $1.25 million for restroom upgrades from 2015 through 2018; $1.1 million to upgrade doors and add an electronic badge system; and $660,000 for building coating and covering improvements from 2014 through 2018.

Hamilton presented the plan to the Tourist Development Council during its last funding cycle, and it was rejected. However, the council at its last meeting unanimously approved a motion to support the capital program over five years.

Although bed tax revenue appears to be increasing with the better economy, just how the council’s budget balloon will be squeezed to fund improvements is yet to be determined.

“The Convention Center staff will be meeting with Hillsborough County officials in the coming weeks to finalize the program for approval at the council’s next meeting in November,” Hamilton said.

The outlook is even less resolved for Visit Tampa Bay’s needs, whose new administration is upbeat after recruiting the The Bollywood Oscars — the International Indian Film Academy’s Weekend & Awards — that’s scheduled to come to Tampa next June. Visit Tampa Bay also has exceeded its goals for the number of meetings booked. It recruited eight major meetings events between January and June, led by the Outback Bowl football game that provided nearly 20,000 of 215,469 meetings room nights booked over six months.

Another nine major events were scheduled for the rest of 2013, topped by the United Youth Football League 2013 National Championship with 16,000 of the 262,415 additional room nights booked this year.

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But in addition to increasing the marketing budget, the bureau faces an unsettling trend with competitors offering major discounts for contracts to recruit meetings and conferences.

Those details generally are closely held, competitive business secrets that can involve free or heavily discounted convention center rentals — in hopes of filling hotel rooms and drawing food and other expenditures — and free or discounted parking for visitors.

“You’ve got incentives in all sizes and shapes and you have to make sure that investment is worth it,” Corrada said. “But you have to start looking for a pot of dollars to provide the opportunity to bring a massive convention here.”

The private sector can help defray costs, as was the case with the non-partisan host committee for the Republican National Convention raising more than $55 million to stage events. A University of Tampa report said Tampa Bay gained $214 million in direct spending from the convention.

Visit Tampa Bay gets $2 million from membership fees to augment its bed tax allocation, along with sponsoring a golf tournament and finding other creative ways to boost its budget.

Just how the pot for additional tourism marketing funds might be increased is both a politically and business sensitive issue.

Unlike other destinations, Hillsborough County has no additional food and beverage tax, nor are rental cars tapped for additional local funding, but new taxes of any kind are certain to raise arguments.

The pitch for any new funding options is that money spent on marketing is money returned to the community in terms of business for small and large firms, said Jim Dean, president of Busch Gardens Tampa Bay and a member of the Tourist Development Council.

“More funding is a priority,” Dean said of the Tourist Development Council’s focus on the issue. “It’s on top of the list.”

tjackovics@tampatrib.com

(813) 259-7817

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