I love Colorado. I always have. It’s not just the mountains, or the western slope mesas, or the urban landscapes. It’s all of the above. People are drawn to Colorado, which makes this state such a great place to live. People want to live here, and people want to visit here.
Few states match Colorado’s aspirational status; people want to come here to visit (or to live). Colorado ranks near the top of aspirational destinations for visitors (just after California, Florida, New York, and Hawaii).
Tourism is big business in Colorado, and we’re fortunate to have the Colorado Tourism Office (CTO) promoting our state through the award-winning ‘Come to Life’ campaign. Strategic Marketing & Research Insights (SMARI) found that CTO’s decision to move campaign resources from spot markets to national outlets generated nearly 2.1 million additional trips by travelers who experienced the campaign, compared with 1.3 million influenced trips in 2014. SMARI also reported that every dollar spent on paid media during the spring/summer campaign generated $490 in traveler spending, a 42 percent increase over the previous year.
SMARI, a national research firm contracted to analyze the financial impact of travel in Colorado, found the campaign generated a 44 percent increase in spending among influenced travelers, inspiring $2.6 billion additional spending, compared with $1.3 billion in spring/summer of 2014. The campaign’s success is attributable to a variety of factors, including the move to a national adverting campaign focused on cable and satellite interactive TV, a highly targetable medium and strong creative executions.
According to those surveyed, the Colorado travel opportunities that both inspired the largest number of visits and were listed as the top reasons for travel included scenic drives, state and national parks, historic sites, hiking and backpacking.
The spring/summer 2015 SMARI results are an indicator that Colorado is on track for another record-setting year of visitor volume, visitor expenditures and tax volume. In 2014, Colorado set all-time records welcoming 71.3 million visitors to the state who spent $18.6 billion and generated $1.1 billion in tax revenue (2015 data to be released in June of 2016).
Building an understanding with our state legislators that tourism is big business for Colorado that can be marketed and grown like any other consumer product remains a goal of groups such as the Tourism Industry Association of Colorado. Convincing decision makers (and Colorado residents) that significantly increasing tourism marketing dollars is a sound investment that will help generate a billion dollars in state and local taxes annually is slightly more complicated.
The fact is, tourism promotion at the state level makes sense. Every dollar invested by the state in tourism promotion returned $361 in visitor spending, with total visitor spending of $18.6 billion (up 7.4%). This generates higher tax revenues for the state, with a total of $1.1 billion in state and local taxes created in 2014 from visitor spending, surpassing the billion-dollar mark for the first time ever. The tourism industry is also a leading employer in Colorado with more than 155,300 jobs with earnings (wages and salaries) of $5.1 billion generated by 2014 visitor spending. Source: Dean Runyon Associates.
Yet despite all these fantastic results, Colorado’s tourism promotion efforts only reach 37% of domestic households. Colorado has the second largest “Opportunity Gap” of any “Aspirational Destination” (Of the 25% of people in 2014 who said they wanted to visit Colorado, only 9% actually visited).
Why do we reach only 37% of the potential audience to invite them to visit? It’s because Colorado ranks 31st among 47 U.S. states for the proportion of visitor taxes reinvested in state tourism marketing. The Colorado Tourism Office budget makes up just 0.5% of Colorado’s State and Local Tourism Tax receipts, while on average, states commit 1.2% of visitor tax revenue back into state tourism marketing, which is more than double that of Colorado.
To capitalize on Colorado’s position as a leading “Aspirational Destination”, our state legislators should consider an Expansion Strategy by adding $4.7 million to Colorado Tourism marketing. Based on the SMARI research, adding $4.7 million to our state marketing efforts would help implement programs allowing the CTO to capitalize on the opportunity Colorado has as one of the most “aspirational destinations” in the United States. Moreover, an additional $4.7M would conservatively create an additional $602M in visitor spending.
Tourism is big business, and businesses require investment in order to succeed. The ROI on tourism spending is there – we just need the capital and support from our elected officials in Denver. An investment in state tourism promotion is an investment in Colorado and pays big dividends for the state and our residents.
Chris Romer is president & CEO of Vail Valley Partnership