Thursday, June 21, 2018
Opinion

Column: Visit Florida is critical to the state's economy

The replacement this month of Visit Florida's CEO over "Pitbull-gate" has led some state leaders to question the necessity of the state's tourism marketing program. That's a mistake. Fortunately, any reasonable scrutiny will only prove that Visit Florida is one of the best investments made by the Sunshine State.

It goes without saying that an industry that generates more than $89 billion in spending at Florida businesses, directly employs 1.2 million Floridians, and contributes $5.3 billion in tax revenue is vitally important to the state's economy. Simply put, tourism is the engine that drives Florida's economy.

While Florida is blessed with some of the world's most beautiful beaches, exciting cities and top attractions, in today's fiercely competitive global travel market no state lives in a "if we do nothing, they will come" world. Today's travelers have more choices than ever — and it's hardly a foregone conclusion that they'll pick Miami over Maui, St. Pete over Santa Barbara, or Naples over Napa.

Like any other product that has to compete for customers, effective travel destinations must invest in marketing to distinguish their advantages, advertise their uniqueness, build brand awareness and create excitement in the marketplace. The only organization that takes on this responsibility for the entire state is Visit Florida.

As Gov. Rick Scott recently wrote, anyone who argues the state doesn't need "Visit Florida's advertising to promote tourism here simply does not understand the business world or the nature of our economy.

In fact, few, if any, other investments of public dollars generate such a positive return. For every $1 that Florida spends in destination marketing, the state gets $3.20 in increased tax revenue. Revenues generated from travel taxes are enough to pay for nearly 26 percent of Florida's education budget. Losing that return on investment would mean other taxes would have to increase to maintain a consistent level. And residents should consider that they do not pay a state income tax to cover many of these services, thanks largely to the contributions paid by a robust visitor industry.

If that's not enough to demonstrate Visit Florida's value, there are ample case studies that highlight the risks of skimping on travel promotion programs.

According to a report by Longwoods International, after Colorado eliminated promotion funding, it fell from first to 17th place among summer resort destinations. In the process, leisure travel to the state fell 30 percent, costing the state $134 million in lost revenue. Having learned its lesson, the state reversed course.

Other states followed the same path, with the same disastrous results. After cutting tourism marketing investments, Pennsylvania lost $3.60 in tax revenue for every dollar it "saved." In 2013, San Diego lost $63 million in hotel room revenues, and the regional economy lost $560 million after cutting travel promotion.

Sure, the private sector invests in advertising to lure customers. My own company, Loews Hotels, has resort properties in Miami Beach and Orlando, and we market them aggressively. But these dollars are targeted to promote our brand, not the entire state. In fact, it's doubtful Loews would have invested so heavily in Florida if Visit Florida weren't investing to attract both domestic and international travelers to the Sunshine State.

Visit Florida also steps up when specific areas of the state need support. After Hurricane Matthew, for example, Visit Florida produced a video aimed at marketing Flagler County and reviving its tourist trade, an investment that no single county or no single company could have made on its own. I've seen firsthand how destinations, including those where Loews has a presence in Florida, have benefited from Visit Florida's efforts to promote travel and tourism. Their work makes a convincing case for why people should choose Florida over other destinations for a vacation or business travel. And, as experience in other states shows, it only takes a small number of visitors who decide not to come to wipe out any "gains" from cutting investments in travel promotion.

We're entering a potential golden age for travel and tourism for America, and for Florida especially. With the help of Visit Florida, the state welcomed a record 105 million visitors in 2015, and that growth continued into 2016. The Pitbull controversy may result in greater transparency and scrutiny of tourism marketing spending, which is all for the good, but it shouldn't diminish Visit Florida's real and vital contribution to making Florida one of the world's leading travel destinations.

Jonathan Tisch is chairman and CEO of Loews Hotels and chairman emeritus of the U.S. Travel Association. He wrote this exclusively for the Tampa Bay Times.

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