The Pre-Covid Setup

In ordinary times, the role of a DMO is to generate demand for tourism from key source markets by building their destinations brands and raising traveler awareness about their respective destination offerings.

With the travel industry enjoying nearly a decade of unfettered growth, DMOs had been increasingly taking on additional roles. Skift Megatrends 2019 discussed how progressive DMOs were already developing new partnerships with local organizations to improve the destination experience, based on trends reshaping consumer expectations in the global visitor economy. So much so, that many destination leaders started calling themselves DMMOs Destination Marketing and Management Organizations.

Our survey data confirmed these expanded responsibilities. According to our data, 75% of respondents said their organizations were responsible for stakeholder engagement in 2019 while 80% of them said that their organizations were focusing on tourism research and data in 2019, along with concentrating on their core job of destination branding and marketing.

EXHIBIT 4: DESTINATION TOURISM MARKETING AND BRANDING REMAINED THE CORE DMO FUNCTIONS PRE-COVID

As regards to funding, DMOs usually raised funds via public channels but they could also be funded privately. Among public channels, the most common way for DMOs to secure funding is via hotel occupancy tax and therefore local governments. In addition, DMOs could accrue government grants, membership dues, advertising revenue, marketplace revenue and other forms of public & private funding.

Our survey results validated that hotel transient tax was the dominant funding source preCovid while state/city government funding and private firm partnerships/sponsorships were ranked as the other major sources of funding.

EXHIBIT 5: HOTEL TRANSIENT TAX WAS THE DOMINANT FUNDING SOURCE FOR DMOS PRE-COVID

More than half of the survey respondents said that their organizations focused more on domestic tourism pre-Covid and around 37% said that business travel was a major component of overall tourism to their destination before Covid hit. It should be noted that our survey sample majorly consists of regional and local level DMOs and hence their focus might be skewed more towards domestic tourism.

EXHIBIT 6: BASED ON THE SURVEY RESPONSES, DOMESTIC TOURISM AND BUSINESS TRAVEL WERE THE FOCUS AREAS FOR DMOS PRE-COVID

Even before the pandemic hit, DMOs were evolved enough to be using a wide range of marketing channels. Our survey results showed that more than 85% of the respondents said that their organizations were using almost all relevant channels.

EXHIBIT 7: DMOS USED A WIDE RANGE OF MARKETING CHANNELS IN THE PRE-COVID PHASE

engine optimization were marked as very effective marketing channels pre-Covid.

EXHIBIT 8: DIGITAL MARKETING WAS THE MOST EFFECTIVE FORM OF MARKETING PRECOVID