INDUSTRY CONFIDENTIAL

There is an old saying, “he who owns the gold makes the rules.” A rule that seemingly has governed the outcomes and evaluation for success in tourism performance for many years. Business Improvement Districts (BID) first surfaced in Toronto, Canada in 1970 as a new funding mechanism alternative to blanket tax assessments, levied against businesses in an area to improve the environment of a business district. Often BID funds were used for services such as cleaning and maintenance, marketing, promotion, beautification, and capital investments. The fund’s financed services enhanced existing city services rather than replace them. The United States first established BID is often traced back to the Downtown Development District of New Orleans in 1974. Today in America, there are well over 1,000 such districts scattered around large and small cities. The success of BID’s led to a more specific single-purpose business improvement district where the funding was aimed at attracting overnight visitors and would become a funding source for a community’s tourism development and marketing programs. Often a public-private partnership, the programming, and administration of these funds generally run through a Convention and Visitors’ Bureau or similar destination marketing organizations. The programs delivered were originally aimed at providing a source of funds to be used specifically for marketing, sponsorship, promotions and special events to attract overnight visitors to a destination. In many cases, this funding replaced the annual funding by the municipality out of the general service’s budget. Over time, the use of these annual proceeds has expanded to include capital improvements in destinations that will lead to long-term sustainable revenue-producing events, yielding revenue to the market. The primary source of this revenue is often generated from a daily hotel-room surcharge to overnight visitors from the lodging industry. As a result of this specific funding mechanism, many destinations primary funding shifted away from the general service’s budget in their municipality. This siloed the DMO’s effort away from working with other municipal functions and the lack of interactions began to cultivate a disconnect between DMO leaders and municipal departments. An unintended consequence that may work against the interaction of these departments in building an integrated and cohesive economic development plan for the community. Thus, the gold was generated by lodging stays and managed by a board that included hoteliers aimed at increasing local visitation to the destinations and increased overnight stays. A unique and very productive mechanism to steadily increase tourism marketing dollars which have worked very well. The definition for evaluating success centered on “heads in beds” and became the standard measurement metric for success for destinations. Additionally, the second metric for DMO’s definition

“HE W HO OW NS THE GOLD MAKES THE RULES”

of success falls under the complex metric of valuing media use and their viewing or listening habits. These media evaluation criteria have existed for years where the evaluation of the value of media comes from sampling surveys of listeners and viewership from extrapolating against a market segment and size. This process arrives at information that is at best “a slightly informed estimate of the audience and their habits.” Now enter the Sports Commissions and Right Holders who are a subset of the destination tourism plan. Many DMO’s sports sales departments have rebranded their work under the Sports Commission banner which informs the industry partners of the type of work, services, and expertise they have. In the early days, since the DMO Sports departments fell under the control and management of the DMO, “heads in beds” were the only measurement used to determine their success. Those that worked in the sports world quickly found out that they were required to have ground services to support the sports event that was coming to town that was not as valued by DMO management as hitting their “heads in beds” quotas the sports sales team was assigned. That became the first distinctive disconnect between the world of DMO services and those of the sports tourism world. As time progressed, the sports tourism world grew in volume, scope and economic impact for communities of all shapes and sizes. Those working in the sports events and tourism field quickly found that their work and events were a source of great community engagement and pride. Resident sentiment from those events and their impact on the community quickly became a topic of discussion. Politicians loved attending sports facilities openings, a large national tournament that came into town or one of the marquee events from the professional and collegiate teams. In addition, larger marquee events often left legacy funds for the community that hosted their events to use and deploy to the benefit of the community. Forward-thinking markets like Cleveland, are conducting longitudinal research to measure the community impact and goodwill created by such legacy funds left to their community. Conversation in cities began to center on how sports events and tourism were becoming more of a community asset that builds community goodwill and excitement as a result of the events they brought into town and serviced. Add to that several communities began building a portfolio of community events that were owned and operated by the local sports tourism organization. Many communities including the Richmond Backers and Kansas City now own and operate several community events including running, cycling, active oriented events, recognition banquets and youth sports camps and clinics all year round. These owned and operated activities serve the community in a variety of ways. They generate great community pride, add revenue to the organization to provide additional services and programs to the community, bring in tourism dollars from visitors who attend such events and is creating a narrative to aid local company’s employee recruiting efforts by letting them know the great things taking place for their kids in the community. Many communities are adding sports recognition events for Hall of Fames, athlete recognition, women in sports initiatives, youth clinics, military sports support, and recognition banquets to honor all that is good about sports, sportsmanship and community pride. These inspirational events in Houston, Columbus, Cleveland, Kansas City, Seattle, St. Louis, Phoenix, Los Angeles, and others are often televised and are first-class local productions. This local community pride generated by the sports tourism teams and resident sentiment towards the value of those events has begun to enhance the definition of success for the use of tourism dollars through sports. There is a case building to include the refinement of current economic evaluations with that to the community benefit generated by events in the sports events and tourism industry. The lodging industry which is interested in the return on their investment, coupled with the impact, value, and importance of community pride and resident sentiment begin to broaden success for markets. After all, the ones who care most about the value of resident sentiment and pride are the community leaders, politicians, and business owners. It is time for the sports tourism leaders to be sitting at the table discussing the importance and their role in building this community asset and pride while adding to the economic development for their destinations.

Discover natural peace and your perfect battleground. With top-notch facilities and expert support staff, Tallahassee is the perfect destination to host your next athletic event. In-between competitions, dine at world-class restaurants, take in some live music or explore one of our many local adventures.

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