June 13, 2005
Pitching Maine | The state's efforts to promote tourism earn criticism and praise from the industry
By Taylor Smith
The Dunes on the Waterfront, a 70-year-old resort in Ogunquit, got some air time on HBO during the cable channel's recent adaptation of Camden author Richard Russo's Pulitzer Prize-winning novel Empire Falls. The 36-unit "cottage colony" on the tidal inlet of the Ogunquit River did admirable duty standing in for a 1960s Martha's Vineyard beach resort.
But in the six years since Aaron Perkins took the reins of the resort founded by his grandparents in 1935, he's found that he can't rely as much as his grandparents and parents did on the folksy lure of sandy beaches and quaint cabins to attract visitors.
These days, he says, travelers are looking for something else ˆ maybe wireless Internet in each room or easy access to the beach. Perkins has decided that what will distinguish his property are dining and shopping packages that bundle nights of lodging with gift certificates to the nearby Kittery outlets and dinners at local eateries such as the Old Village Inn, Joe Allen and the Ogunquit Lobster Pound. "Guests were asking for it," he says. "It just seemed like the industry was moving more in that direction."
Perkins isn't alone in trying to guess which way the wind blows in Maine's tourism market. In addition to relying on current demand from customers, he and his colleagues increasingly are looking for a read on tourism trends that might translate into more bookings, more dinner reservations and more retail sales. From innkeepers to restaurateurs, many in Maine's tourism industry are shifting their strategies on the fly, hoping to keep ahead of a market that in recent years has had to contend with the post-Sept. 11, recession-fueled tourism slump, the rise of Internet-based vacation planning and the proliferation of increasingly niche-oriented vacationers looking for more than just a hotel room.
In Maine, like most states, the onus of keeping tourism trends on the upswing ˆ from the number of visitors crossing the border to the amount of money they spend ˆ falls on the state Office of Tourism. The office is charged with getting a significant return on its $7.5 million budget through advertising and marketing, and with making sure Maine keeps its Vacationland status. Meanwhile, it also needs to supply people like Perkins with enough industry data to allow them to make well-informed decisions about how best to operate in the changing tourism climate. And according to Steve Lyons, tourism development specialist with MOT, handling all these marketing efforts and research projects has been a lot to shoulder for an understaffed office of four. (Two staffers ˆ the marketing manager and a regional marketer ˆ both recently left the department.) "We have the smallest staff in the country," he says. "We juggle a lot of balls here."
Still, many industry insiders say that the state is doing a good job promoting tourism in Maine ˆ especially given the state's middling budget. "I'm quite pleased," says Maureen McQuade, owner of Inn by the Sea in Cape Elizabeth. "I feel we get what we need from [MOT]." But there also are complaints that the state's resources are too limited to allow the kind of marketing and research a storied vacation destination like Maine deserves.
"Tourism is enormous in Maine, and it hasn't been taken seriously," says Kathryn Hunt, a research associate at the University of Maine's Margaret Chase Smith Center for Public Policy and editor of Maine Policy Review. "We're sitting on a gold mine that has yet to be developed in many parts of the state."
The Colorado lesson
Without question, the economic impact of tourism in Maine is huge: In-state and out-of-state travelers spent a total of $13.4 billion in 2003, according to the most recent report on Maine's tourism market. The report, which the state hires Toronto-based Longwoods International to conduct annually, uses data gleaned from surveys of travelers to study trends in Maine's tourism market, including how many visitors are coming to the state, how long they're staying and why they came. Longwoods reported that in 2003 tourism contributed $549 million to the state's coffers in the form of taxes, and supported more than 173,000 jobs with a total payroll of $3.8 billion.
But for the state that touts itself as Vacationland, a tourism budget of $7.2 million for the 2003-2004 fiscal year was well below the national average of $11.9 million, according to the Washington, D.C.-based Travel Industry Association of America. (The state's tourism budget this year is $7.5 million.) TIA, which annually tracks state-by-state tourism spending, ranked Maine tops among the four New England states that reported data to TIA (Connecticut was the lone holdout). However, Maine ranked 30th in the nation. "We'd like to see more money, as would everybody who has a budget," says Lyons. "But one thing we have in our favor is that our tourism promotion brought in $384 million in taxes [from out-of-state visitors in 2003]. How much would there be without tourism promotion?"
Advertising spending is a big driver of tourism revenue, according to Lyons, and he notes that some states have tried to slash tourism budgets with disastrous results. Colorado, for example, spent much of the 1990s as the only state without a tourism budget after voters did away with a state tax on tourism-related purchases. The result: The state in 1997 alone lost $2.4 billion in tourism revenue and $134 million in tax revenue thanks to a prolonged 30% drop in Colorado's regional tourism market share, according to Longwoods, which was hired by the state in 1999 to develop a strategic marketing plan.
Since then, the state has consistently boosted its annual tourism budget. According to TIA figures, Colorado's 2003-2004 fiscal year tourism budget rose 81% from the previous year, to $14.1 million, putting it at 11th in the nation. And starting in 2002, Longwoods tracked the impact of the state's first tourism marketing campaign in a decade and concluded that Colorado recouped $13 for every one dollar spent on advertising.
Closer to home, MOT this year has earmarked $3 million-$4 million for marketing, says Lyons, with nearly $1.5 million being spent on the current spring/summer advertising campaign that includes television, print and Internet advertising. (New York-based Warren Kremer Paino in 2002 won MOT's advertising contract.)
Mark Brodeur, director of operations for the Rhode Island Tourism Division, says Maine's marketing campaigns have garnered respect in the region, and calls the ads' messages "compelling." From an insider's perspective, Maureen McQuade says she gives a thumbs up to the state's advertising efforts, even though she's not always a fan of the ads' typically pastoral themes. "I love what Warren Kremer Paino is doing, but sometimes I want to get away from the lighthouses and lobsters thing," she says. "But that's the perception out there of what Maine is. That's what sells."
Lyons says that although MOT this year is expanding its advertising into markets such as Baltimore, Philadelphia and Washington, D.C., Maine's real draw is among residents of New England, New York and points north. "We're really a drive destination," he says. "It's pretty easy for someone to pop into a car in Boston and be up here in a few hours, or pop down from Montreal or up from New York. We're an attractive drive destination."
Reaction time
Beyond advertising and marketing, an important MOT function is the research it provides to business owners like McQuade and Perkins. Lyons says MOT this year is spending roughly $285,000 for research from Longwoods. And last September, MOT chose Kennebunk-based Davidson-Peterson Associates, a division of market research firm Digital Research, to study ˆ for the first time ˆ visitor data from the state's tourism website, visitmaine.com, in an effort to quantify how successful the online marketing effort has been. (Davidson-Peterson will wrap up its year-long study this fall, and Lyons says the results will likely be available in early winter.)
According to many in the industry, the Longwoods report still is the best tool for getting a handle on Maine's tourism market. Aaron Perkins says he's been able to react quickly to certain tourism trends reported in the study, such as the emergence of shorter booking cycles. Instead of vacationers booking a stay at The Dunes three or four months ahead of time, Perkins says many travelers these days book reservations just three or four weeks ahead of time. As a result, during the past few years Perkins has changed the way he pitches potential vacationers on The Dunes. Two years ago, Perkins began e-mailing upcoming lodging specials to more than 1,200 potential customers ˆ a strategy he says often results in an immediate spike in business. "We'll typically get three or four reservations right away," he says.
Charles Colgan, professor of public policy and management at the University of Southern Maine's Muskie School of Public Service, says the Longwoods data, which the state has used since 1996, has been the first meaningful investment in researching what makes tourism tick in Maine. But many people familiar with Maine's tourism issues say that while the Longwoods research is a good start, the state doesn't necessarily get the best bang for its research buck. "The survey does a lot of things," says Colgan, "but it has its limitations."
Expanding the research
Kathryn Hunt believes the state should be making better use of the data collected by Longwoods, supplementing the company's findings with more state- and region-specific research. "We pay a lot of money for that research, but we don't have access to [the raw data] to fully utilize it," says Hunt. "We could dig a whole lot deeper into who's coming to Maine and why, and we don't know anything about who's not coming to Maine and why."
In light of the need to expand that data ˆ and the need for a single repository of tourism information ˆ the University of Maine System in January approved the formation of the Center for Tourism Research and Outreach. The center, dubbed CenTRO, is scheduled to start operations July 1 and already has a full slate of research projects, according to Colgan, who is serving as its associate director. Though much of the center's funding is still being worked out ˆ Colgan says CenTRO needs between $200,000 and $250,000 ˆ some research projects already are off the ground. One UMaine professor has had classes look at marketing-related issues within the industry, and Colgan is exploring additional funding for a study evaluating southern Maine's beach tourism market.
Colgan also expects this year to choose a community in Maine to use as a tourism case study, creating an inventory of the town's recreational and scenic opportunities that could be promoted as tourist attractions. Colgan says he and executive director Kevin Boyle, a University of Maine professor of resource economics, have met a handful of times with the advisory committee, a group of 28 innkeepers, restaurateurs and other industry insiders, to hammer out the center's mission and set up a work plan for the first year of operation.
Among CenTRO's main purposes is to provide research where none existed. Colgan says CenTRO will allow researchers to tap into information beyond the Longwoods data, including vast amounts of data collected by various state agencies on a seasonal basis that goes unnoticed, including sales tax records and coastal tourism patterns. (Colgan is confident that CenTRO will be able to strike a deal with Longwoods to get access to its Maine-specific data, but admits that it might take some prodding on the part of the Department of Economic and Community Development, which runs the Office of Tourism.)
Other data, says Colgan, could lend significant insight into the inner workings of Maine's tourism industry. For example, he suggests parsing seasonal traffic numbers to forecast tourism patterns. "There's a whole rich load of data about tourism that's regularly collected, but not analyzed by anyone because no one has the time," he says. "We've had 'Vacationland' on our license plates since the 1930s, but we've never devoted the time and the money to tourism the way we have [with] other industries."
But in the six years since Aaron Perkins took the reins of the resort founded by his grandparents in 1935, he's found that he can't rely as much as his grandparents and parents did on the folksy lure of sandy beaches and quaint cabins to attract visitors.
These days, he says, travelers are looking for something else ˆ maybe wireless Internet in each room or easy access to the beach. Perkins has decided that what will distinguish his property are dining and shopping packages that bundle nights of lodging with gift certificates to the nearby Kittery outlets and dinners at local eateries such as the Old Village Inn, Joe Allen and the Ogunquit Lobster Pound. "Guests were asking for it," he says. "It just seemed like the industry was moving more in that direction."
Perkins isn't alone in trying to guess which way the wind blows in Maine's tourism market. In addition to relying on current demand from customers, he and his colleagues increasingly are looking for a read on tourism trends that might translate into more bookings, more dinner reservations and more retail sales. From innkeepers to restaurateurs, many in Maine's tourism industry are shifting their strategies on the fly, hoping to keep ahead of a market that in recent years has had to contend with the post-Sept. 11, recession-fueled tourism slump, the rise of Internet-based vacation planning and the proliferation of increasingly niche-oriented vacationers looking for more than just a hotel room.
In Maine, like most states, the onus of keeping tourism trends on the upswing ˆ from the number of visitors crossing the border to the amount of money they spend ˆ falls on the state Office of Tourism. The office is charged with getting a significant return on its $7.5 million budget through advertising and marketing, and with making sure Maine keeps its Vacationland status. Meanwhile, it also needs to supply people like Perkins with enough industry data to allow them to make well-informed decisions about how best to operate in the changing tourism climate. And according to Steve Lyons, tourism development specialist with MOT, handling all these marketing efforts and research projects has been a lot to shoulder for an understaffed office of four. (Two staffers ˆ the marketing manager and a regional marketer ˆ both recently left the department.) "We have the smallest staff in the country," he says. "We juggle a lot of balls here."
Still, many industry insiders say that the state is doing a good job promoting tourism in Maine ˆ especially given the state's middling budget. "I'm quite pleased," says Maureen McQuade, owner of Inn by the Sea in Cape Elizabeth. "I feel we get what we need from [MOT]." But there also are complaints that the state's resources are too limited to allow the kind of marketing and research a storied vacation destination like Maine deserves.
"Tourism is enormous in Maine, and it hasn't been taken seriously," says Kathryn Hunt, a research associate at the University of Maine's Margaret Chase Smith Center for Public Policy and editor of Maine Policy Review. "We're sitting on a gold mine that has yet to be developed in many parts of the state."
The Colorado lesson
Without question, the economic impact of tourism in Maine is huge: In-state and out-of-state travelers spent a total of $13.4 billion in 2003, according to the most recent report on Maine's tourism market. The report, which the state hires Toronto-based Longwoods International to conduct annually, uses data gleaned from surveys of travelers to study trends in Maine's tourism market, including how many visitors are coming to the state, how long they're staying and why they came. Longwoods reported that in 2003 tourism contributed $549 million to the state's coffers in the form of taxes, and supported more than 173,000 jobs with a total payroll of $3.8 billion.
But for the state that touts itself as Vacationland, a tourism budget of $7.2 million for the 2003-2004 fiscal year was well below the national average of $11.9 million, according to the Washington, D.C.-based Travel Industry Association of America. (The state's tourism budget this year is $7.5 million.) TIA, which annually tracks state-by-state tourism spending, ranked Maine tops among the four New England states that reported data to TIA (Connecticut was the lone holdout). However, Maine ranked 30th in the nation. "We'd like to see more money, as would everybody who has a budget," says Lyons. "But one thing we have in our favor is that our tourism promotion brought in $384 million in taxes [from out-of-state visitors in 2003]. How much would there be without tourism promotion?"
Advertising spending is a big driver of tourism revenue, according to Lyons, and he notes that some states have tried to slash tourism budgets with disastrous results. Colorado, for example, spent much of the 1990s as the only state without a tourism budget after voters did away with a state tax on tourism-related purchases. The result: The state in 1997 alone lost $2.4 billion in tourism revenue and $134 million in tax revenue thanks to a prolonged 30% drop in Colorado's regional tourism market share, according to Longwoods, which was hired by the state in 1999 to develop a strategic marketing plan.
Since then, the state has consistently boosted its annual tourism budget. According to TIA figures, Colorado's 2003-2004 fiscal year tourism budget rose 81% from the previous year, to $14.1 million, putting it at 11th in the nation. And starting in 2002, Longwoods tracked the impact of the state's first tourism marketing campaign in a decade and concluded that Colorado recouped $13 for every one dollar spent on advertising.
Closer to home, MOT this year has earmarked $3 million-$4 million for marketing, says Lyons, with nearly $1.5 million being spent on the current spring/summer advertising campaign that includes television, print and Internet advertising. (New York-based Warren Kremer Paino in 2002 won MOT's advertising contract.)
Mark Brodeur, director of operations for the Rhode Island Tourism Division, says Maine's marketing campaigns have garnered respect in the region, and calls the ads' messages "compelling." From an insider's perspective, Maureen McQuade says she gives a thumbs up to the state's advertising efforts, even though she's not always a fan of the ads' typically pastoral themes. "I love what Warren Kremer Paino is doing, but sometimes I want to get away from the lighthouses and lobsters thing," she says. "But that's the perception out there of what Maine is. That's what sells."
Lyons says that although MOT this year is expanding its advertising into markets such as Baltimore, Philadelphia and Washington, D.C., Maine's real draw is among residents of New England, New York and points north. "We're really a drive destination," he says. "It's pretty easy for someone to pop into a car in Boston and be up here in a few hours, or pop down from Montreal or up from New York. We're an attractive drive destination."
Reaction time
Beyond advertising and marketing, an important MOT function is the research it provides to business owners like McQuade and Perkins. Lyons says MOT this year is spending roughly $285,000 for research from Longwoods. And last September, MOT chose Kennebunk-based Davidson-Peterson Associates, a division of market research firm Digital Research, to study ˆ for the first time ˆ visitor data from the state's tourism website, visitmaine.com, in an effort to quantify how successful the online marketing effort has been. (Davidson-Peterson will wrap up its year-long study this fall, and Lyons says the results will likely be available in early winter.)
According to many in the industry, the Longwoods report still is the best tool for getting a handle on Maine's tourism market. Aaron Perkins says he's been able to react quickly to certain tourism trends reported in the study, such as the emergence of shorter booking cycles. Instead of vacationers booking a stay at The Dunes three or four months ahead of time, Perkins says many travelers these days book reservations just three or four weeks ahead of time. As a result, during the past few years Perkins has changed the way he pitches potential vacationers on The Dunes. Two years ago, Perkins began e-mailing upcoming lodging specials to more than 1,200 potential customers ˆ a strategy he says often results in an immediate spike in business. "We'll typically get three or four reservations right away," he says.
Charles Colgan, professor of public policy and management at the University of Southern Maine's Muskie School of Public Service, says the Longwoods data, which the state has used since 1996, has been the first meaningful investment in researching what makes tourism tick in Maine. But many people familiar with Maine's tourism issues say that while the Longwoods research is a good start, the state doesn't necessarily get the best bang for its research buck. "The survey does a lot of things," says Colgan, "but it has its limitations."
Expanding the research
Kathryn Hunt believes the state should be making better use of the data collected by Longwoods, supplementing the company's findings with more state- and region-specific research. "We pay a lot of money for that research, but we don't have access to [the raw data] to fully utilize it," says Hunt. "We could dig a whole lot deeper into who's coming to Maine and why, and we don't know anything about who's not coming to Maine and why."
In light of the need to expand that data ˆ and the need for a single repository of tourism information ˆ the University of Maine System in January approved the formation of the Center for Tourism Research and Outreach. The center, dubbed CenTRO, is scheduled to start operations July 1 and already has a full slate of research projects, according to Colgan, who is serving as its associate director. Though much of the center's funding is still being worked out ˆ Colgan says CenTRO needs between $200,000 and $250,000 ˆ some research projects already are off the ground. One UMaine professor has had classes look at marketing-related issues within the industry, and Colgan is exploring additional funding for a study evaluating southern Maine's beach tourism market.
Colgan also expects this year to choose a community in Maine to use as a tourism case study, creating an inventory of the town's recreational and scenic opportunities that could be promoted as tourist attractions. Colgan says he and executive director Kevin Boyle, a University of Maine professor of resource economics, have met a handful of times with the advisory committee, a group of 28 innkeepers, restaurateurs and other industry insiders, to hammer out the center's mission and set up a work plan for the first year of operation.
Among CenTRO's main purposes is to provide research where none existed. Colgan says CenTRO will allow researchers to tap into information beyond the Longwoods data, including vast amounts of data collected by various state agencies on a seasonal basis that goes unnoticed, including sales tax records and coastal tourism patterns. (Colgan is confident that CenTRO will be able to strike a deal with Longwoods to get access to its Maine-specific data, but admits that it might take some prodding on the part of the Department of Economic and Community Development, which runs the Office of Tourism.)
Other data, says Colgan, could lend significant insight into the inner workings of Maine's tourism industry. For example, he suggests parsing seasonal traffic numbers to forecast tourism patterns. "There's a whole rich load of data about tourism that's regularly collected, but not analyzed by anyone because no one has the time," he says. "We've had 'Vacationland' on our license plates since the 1930s, but we've never devoted the time and the money to tourism the way we have [with] other industries."
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