The Arizona Tourism Board That Fired Its Destination
25.08.2023 - 13:47
/ skift.com
/ Dawit Habtemariam
/ Jackson Hole
The Sedona Chamber of Commerce & Tourism Bureau recently ended its tourism partnership with the City of Sedona because the local government wouldn’t allow it to restart destination marketing. The move came in the wake of a November election that saw a mayor and council member voted out and that was seen as a referendum on resident attitudes toward tourism.
“It got to the point where somebody had to make a bold decision,” said city councilman Peter Furman. “The chamber pulled the trigger first.”
The non-renewal of the contract for the next fiscal year represents a broader tale of many places rethinking their spending on tourism promotion. Sedona’s tourism bureau is one of a growing list of entities put under greater pressure from legislators and constituents to redirect funds toward destination management and other community goals. A recent Skift megatrend noted that residents in many parts of the world no longer want to be spectators in tourism.
Two years ago, the Sedona City Council revised its contract with the tourism bureau, stopping the bureau from spending money on destination marketing.
Before the pause, the tourism bureau spent between $500,000 and $600,000 a year on marketing and advertising per year to attract affluent, longer-staying visitors, said Michelle Conway, CEO and president of Sedona Chamber of Commerce & Tourism Bureau. The promotion expenses were only a minority of its expenditure, with destination management the bulk. Yet for the past two years, it only spent money on destination management.
Not everyone’s happy about the move.
Sedona benefited from a surge in tourism in 2021. But last year, business flagged.
Like other rural destinations, Sedona — a hiking and mountain biking destination — is facing wider competition now that the pandemic is over, international travel is open, and cities are attractive again to tourists.
In 2022, Sedona saw a decline in tourist traffic year over year. Meanwhile, direct competitors like Jackson Hole and Napa Valley haven’t seen the same drop and are eating away at Sedona’s share, Conway said.
Many hoteliers are concerned. Occupancy is now down 6.5 percent from its pre-pandemic level. Average daily rates have been dropping.
Hoteliers had been one of the most active stakeholders years ago in pushing for a 0.5 percent addition to the city’s 3 percent bed tax. The 0.5 percent was originally earmarked specifically for tourism promotion.
Businesses — 60 percent of which are tourism-oriented — are now “suffering” and “asking for help,” Conway said. Some have seen double-digit drops in revenue. On top of lost visitor spending, business operations costs are above pre-Covid levels.
The tourism bureau thought it was time to restart destination marketing.