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HomeMy WebLinkAboutCAO-15-040 - Waterloo Regional Tourism Marketing Corporation Funding 2016-2012 Staff Report KiTMENFR CA0 Office www1itahener ra REPORT TO: Finance and Corporate Services DATE OF MEETING: December 7, 2015 SUBMITTED BY: Jeff Willmer, CAO, (519) 741-2200 ext 7350 PREPARED BY: Rod Regier, Executive Director, (519 741-2200 ext 7506 WARD (S) INVOLVED: ALL DATE OF REPORT: November 5, 2015 REPORT NO.: CAO-15-040 SUBJECT: Waterloo Regional Tourism Marketing Corporation Funding 2016-2020 RECOMMENDATION: That $90,000 in annual funding for the Waterloo Regional Tourism Marketing Corporation be approved for 2016-2020 from the Economic Development operating budget for five additional years to continue this region-wide shared services approach for Tourism. BACKGROUND: Waterloo Regional Tourism Marketing Corporation (WMRTC) is a regional centralized body representing Waterloo Region. It aims to increase visitors to Waterloo Region by promoting the region and its attractions to high-potential markets. WMRTC coordinates efforts across all tourism sectors, allowing for a great focus on marketing the region as a whole. The Waterloo Regional Tourism Marketing Corporation (WRTMC) has been funded by both municipal and private partners since its inception in 2007. WRMTC allows a coordinated approach to marketing Waterloo Region to outside visitors. The mandate of WMRTC is to market tourism opportunities in Waterloo Region to potential visitors from outside the region — encouraging more people to visit the area, to spend more, and to stay longer. An evaluation of WRTMC was conducted in 2011 and each of the municipal councils agreed to continue to provide funding and support. A follow-up evaluation is due in 2015. ***This information is available in accessible formats upon request. *** Please call 519-741-2345 or TTY 1-866-969-9994 for assistance. 2 - 1 REPORT: Economic impact of tourism According to the Ontario Ministry of Tourism, Culture and Sport, there were 142 million visits to Ontario in 2012. This number is expected to grow to 156 million by 2017. This translates to approximately $1.1 billion spent by visitors in Ontario. Local tourism events have substantial economic impact to Waterloo Region. These include: Oktoberfest - $21 million (2013), Big Music Fest - $7 million (2014) and Ontario Volleyball Championships - $4.4 million (2015). Funding model Since its inception in 2007, WMRTC has been and continues to be funded by the Region of Waterloo, the Cities of Cambridge, Kitchener and Waterloo, the Townships of Wilmot, Woolwich, Wellesley and North Dumfries, and private sector tourism businesses. In the past five years, public sector support has contributed 61-70% of WMRTC's total revenue budget. One of WRTMC's strategic plan goals is to grow private sector contributions to match its municipal support and sustain the corporation overtime. The City of Kitchener has contributed $90,000 each year for the past five years. Our normal practice is to adjust such annual contributions each year for inflation; however, WRTMC has been experience modest operating surpluses. Partnerships In addition to local municipal and private sector partnerships, the WMRTC is also actively working with the Regional Tourism Organization 4 (RTO4), Communitech, CTT and WREDC, Creative Enterprise Initiative, municipal BIAs, and the local universities and college. These partnerships are an initiative to develop and grow relationships both in and out of the Waterloo Region in order to nurture visitation. This is a great example of a successful shared service delivery model within our community. Services and successes • Manage explorewaterlooregion.ca — tourism website for the region — an important marketing tool • Increased the number of unique visitors to this page by 40% since 2013 • Planned upgrades include making it mobile friendly and responsive, in addition to adding more video and content • Produce Waterloo Region Travel Guide — key marketing tool for visitors, conference and sport groups, ensures each community is equally represented on the cover 2 - 2 • Decreased print production from 120,000 copies in 2013 to 30,000 in 2016 • Eliminates need for individual municipalities and townships to produce their own • Develop sport tourism program in partnership with the RTO4, Cities of Cambridge, Guelph, Kitchener, and Waterloo • Allows coordinated bid opportunities • Increased awareness of Waterloo Region to provincial and national sport organization • Bid development • Supports and initiates bids for a number of events • Coordinates accommodations for large events • Have secured Ontario Volleyball Association Provincial Championships until 2018 • Conduct site and familiarization tours o Hosted sport familiarization tour with six provincial sport organizations • Represent the region at trade shows and conferences • Attract media attention to Waterloo Region • Since 2011, leveraged over 39 million media impressions with an estimated value of$4.5 million • Arranged for CTV's Canada AM to broadcast live for three hours from St Jacobs Farmers' Market Future Plans WRMTC is shifting away from a destination marketing organization to a destination marketing and management organization to become more of a destination developer, and to help partners deliver an outstanding visitor experience. Examples of this shift include: • Working with Regional Tourism Organizations 1, 3, and 4 to develop and improve facilities on the Grand River • Working with Grand Experiences and St. Jacobs to develop an Ontario signature experience cycling product • Working with the Region of Waterloo, the Cities of Cambridge, Kitchener and Waterloo and the Townships of Woolwich and Wilmot to develop a cycling strategy to tie cycling events, attractions and recreation cycling together. It is recommended that council approve the continuation of $90,000 in annual funding for the Waterloo Regional Tourism Marketing Corporation for five additional years (2016-2020). The appended summary provides additional detail on the operation of the WRTMC. 2 - 3 ALIGNMENT WITH CITY OF KITCHENER STRATEGIC PLAN: The Waterloo Regional Tourism Marketing Corporation is critical to the success of Kitchener's Economic Development Strategy: Make it Kitchener; in particular, the promotion of Kitchener's cultural, entertainment and festival product to external audiences. FINANCIAL IMPLICATIONS: The $90,000 commitment has been built into the Operating Budget for 2016. COMMUNITY ENGAGEMENT: INFORM — This report has been posted to the City's website with the agenda in advance of the council / committee meeting. CONSULT — Support for the development of a successful tourism industry in Kitchener and the Waterloo Region was articulated by stakeholders in the consultations for Make it Kitchener. COLLABORATE — The City of Kitchener collaborates with the WRTMC in the marketing of Festivals and Events. ENTRUST — The City of Kitchener entrusts WRTMC with the responsibility of marketing our community and working with local business and community partners to develop destinations. ACKNOWLEDGED BY: Jeff Willmer, CAO 2 - 4 Evaluation of the Waterloo Regional Tourism Marketing Corporation (2011—2015) In Support of Continued Funding of the Waterloo Regional Tourism Marketing Corporation 1.0 BACKGROUND Creation of WRTMC WRTMC was established in zoo7 with funding provided by the Region of Waterloo,the Cities of Cambridge, Kitchener and Waterloo,the Townships of Wilmot, Woolwich, Wellesley and North Dumfries and private sector tourism businesses. The initiative was undertaken when it was recognized that tourism was a significant industry in Waterloo Region and that Waterloo Region was lagging behind comparable municipalities such as London and Hamilton. There had previously been no central body to develop partnerships and participate in provincial initiatives—three cities and two townships were providing individual tourism- related services. Coming together under one organization—a municipal, industry and community partnership allowed greater focus on marketing the area as a region and coordination of efforts across all tourism sectors. Mandate and Mission Statement The mandate of WRTMC has been and continues to be to market tourism opportunities in Waterloo Region to potential visitors from outside the region—encouraging more people to visit the area,to spend more and to stay longer. o Our mission is to increase visitors to the Waterloo Region by focusing resources on promoting the Region and its attractions to high-potential markets. Focus The focus of WRTMC has been to build image and awareness of Waterloo Region through a variety of marketing activities undertaken in partnership with tourism industry members and RT04 (Regional Tourism Organization 4). WRTMC's focus has been to remain abreast of the rapidly changing market by conducting research and continuing to adjust our strategies to ensure that WRTMC is relevant and offering value to our members and stakeholders. Our efforts in the market have focused on undertaking co-operative marketing programs with our partners, direct sales at industry trade shows and conferences, creation and distribution of visitor information in print and digital format and working with the media to build image and awareness of the Waterloo Region. Visitor Services continues to be supported by WRTMC through the provision of the Explore Waterloo Region annual travel guide publication, however the Visitor Centres continue to be operated and funded by local municipalities. They offer a core level of services including literature distribution and over-the-counter counseling. WRTMC is exploring new applications to reach visitors digitally with 2 - 5 information (web, mobile etc)while they are in the Region. This is an opportunity to encourage visitors to stay longer and to offer an incentive for them to return for a future visit. Governance WRTMC was incorporated as a not-for-profit membership based organization governed by a Board of Directors. The Board of Directors has 14 seats—eight tourism industry members (representative of each of 5 tourism industry sectors and geographically from across Waterloo Region) and six ex-officio members representing the Region of Waterloo and area municipalities (CAO or designate of the Region, Cambridge, Kitchener, Waterloo, Wilmot and Woolwich). The current(2015) Board of Directors are; Vanessa Stevenson, Homewood Suites by Hilton— President David Brenneman, CAO, Township of Woolwich —Vice President Tim Anderson, CAO, City of Waterloo—Treasurer Lucille Bish, Director of Community Services, Region of Waterloo Bob Harris, Chicopee Tube Park Shuker Ismail, General Manager, Homewood Suites St. Jacobs Steven Karcher, Executive Director, Drayton Entertainment Kent McVittie, Commissioner of Community Services, City of Cambridge Salim Mukadam, General Manager, Holiday Inn Kitchener Jenny Shantz, St. Jacobs Country Paul Sutton, Operations Manager, Palm Holdings Grant Whittington, CAO, Township of Wilmot Jeff Willmer, CAO, City of Kitchener 2.0 IMPORTANCE OF TOURISM TO THE ECONOMY Ontario Economic Contribution * In 2012,tourism totaled an estimated $28 billion in receipts—more than the agriculture, forestry and mining industries combined. * Tourism currently represents over 149,00o businesses, employs more than 359,00o people and is responsible for 40/0 of Ontario's GDP. * There were 142 million visits to Ontario in 2012—expected to grow to 156 million by 2017. * The Ontario Ministry of Tourism, Culture and Sport reports visitation in 2012 as 11.5 million, with almost 3 million staying overnight, 8.5 million are making day visits. * 2.8 million visit for leisure * 1.3 million visit for business * Total visitor spend is s1.1 billion, s800k of that spent by visitors from Ontario. * The economic impact of events on Waterloo Region is substantial, * TD Kitchener Blues Fest - $3.8 million (2013 number) * Oktoberfest - $21 million (2013 number) * Big Music Fest- $7 million (2014 number) * ON Volleyball Championships - $4.2 million (2011 number) * LPGA- $20 million (per year est.) 2 - 6 3.0 ACCOMPLISHMENTS OF WRTMC (IN THE LAST 4 YEARS) Success to Date Since 2013, WRTMC has increased the number of unique visitors to our website by over 40%. This is primarily thanks to an upgrade to the site itself, increase in social media promotion and a call to action on all promotional materials to our website. We continue to see growth from both inside and outside the region and our partners are enjoying referral visitation to their sites at a higher degree. WRTMC began tracking the number of leads and room night business generated for hotel partners from meetings and sport business in 2014. Since that time, we have booked 19 sporting events and 20 corporate meetings representing almost 30,00o room nights. Waterloo has been the location for the OVA Provincial Championships since 2oo8 and every two or three years we have to bid for future years. Working in partnership with the City of Waterloo, we have supported the bids for the 2015—2o16 and 2017—2o18 events. We have successfully 'secured the business for 2015— 2o18. This tournament has grown exponentially—increasing the economic impact from $4.2 million in 2011 to $6.7 in 2015. We have learned that it is important to pursue new business, but it is even more critical to maintain the business that we have. As a result, we are working with our partners to ensure the return of Canadian Cheer(The Aud, Kitchener), Watchtower(The Aud, Kitchener), Home Hardware (St. Jacobs) on an annual or semi-annual basis. Sadly we were unable to convince Skills ON to stay, but this was a result of tremendous growth which no longer could be accommodated in Waterloo Region. We continue our work in attracting media attention as we have since the inception of WRTMC. Since toss, we have leveraged over 39 million media impressions at an estimated value of$4.5 million. This activity has been achieved through efforts with travel media—meeting them at conferences and inviting them to Waterloo Region to visit and write about their experiences. In October 2014 we welcomed CTV's Canada AM to the St. Jacobs Farmers' Market for a 3 hour live broadcast that was seen across Canada. Partners in this venture were the Ontario Tourism Marketing Partnership and RTO4. This coverage was valued at $293,000. 4.0 FINANCIAL ANALYSIS Revenues—Industry participation Year Public Private Total Revenue % Public Sector Sector Sector support funding funding toss $595,500 $258,772 $854,272 70% 2012 $572,400 $287,987 $860,387 66% 2013 $597,250 $197,266 $794,111 75% 2014 $605,150 $257,809 $862,959 70% 2015 $605,150 $269,000 $874,150 69% (Budget) 2 - 7 WRTMC spending on outbound activities accounts for approximately 6o%of our budget. WRTMC receives 30%of revenues (based on 2014)from private sector partners. In order to growthis contribution by any significant amount, we will need to implement a destination marketing program (DMP or DMF—destination marketing fee) in Waterloo Region. The implementation of a DMP has been considered by local hotel and attraction partners for the past several years, but has yet to gain significant support. The Waterloo Region Hotel Association members are continuing discussions amongst hotel owner and managers but there is not yet a plan in place to move forward. Implementation of such a program would add approximately $700,000 to our bottom line and allow us to compete on a more even playing field with neighbouring DMOs with a DMP in place (London is very close to implementing and Stratford has had a DMP in place for over 3 years). This would improve the portion of private sector support of total revenue. Local political support for the implementation of a DMP would help to move the process ahead. A meeting between political leaders and hotel and attraction ownership representatives to discuss the benefits of a DMP and how incremental funds could be invested to increase business with the continued support from public sector partners is an option that is recommended. 5.0 GOING FORWARD Destination Marketing Organizations shift focus As the world around us is changing, so must our DMO model. The new recognized edition is a DMMO (Destination Marketing and Management Organization). For DMOs,this transition means becoming a destination management organization instead of just a destination marketing organization. In this regard, DMOs are becoming more prominent as "destination developers" by acting as catalysts and facilitators for the realization of tourism developments. The role of WRTMC is not simply as a destination marketing organization. In order to develop and support a brand for Waterloo Region, we need to ensure that we can help our partners deliver an outstanding visitor experience. Examples include, but are not limited to, • Work with RT04, RT03 and RTOs to identify, develop and improve facilities on the Grand River and further develop this natural asset as a tourism destination, • Work with Grand Experiences and St. Jacobs to develop an Ontario Signature Experience cycling product in Mennonite Country; • Collaborate with the Region of Waterloo,the Cities of Cambridge, Kitchener and Waterloo and the Townships of Woolwich and Wilmot to build a cycling strategy for the region tying together events (Tour de Waterloo, Grand, Steaming Nostril etc.), attractions (Grand River Trail, Hydrocut and Guelph to Goderich Trail) and recreational cycling. In order to fund our efforts, sustainable renewable resources need to be in place. Continued partnership with RT04 will help, but we will need to engage our municipalities and communities too. The cycling project is an excellent example. 2 - 8 - Municipal support for signage, road repairs or closures for events are already part of the Transportation Master Plans in several jurisdictions. -A cycling map of the Region is being created and printed through the cooperation of the municipal partners -WRTMC has partnered with Transportation Options/Ontario by Bike to deliver workshops in the Region on becoming a bike friendly' business and to date 13 businesses have been certified. More to come. -A working group of recreational cycling enthusiasts, municipal and regional staff, Active Transportation Advisory Group members and WRTMC has been formed to collaborate on cycling initiatives for both visitors and residents of Waterloo Region. -A cohesive plan for this market should be implemented across all partner municipalities. Strategic Plan Updates WRTMC objectives set the foundation for the updated Strategic Plan and some of these remain unchanged since our last iteration of the plan. Action priorities and performance measures have been updated based on strategic planning sessions held with the WRTMC Board of Directors and two stakeholder meetings held in 2014. During our sessions, we identified the strengths, weaknesses, opportunities and threats to WRTMC in a traditional workshop session. Once identified, we were able to determine our objectives based on the activities that WRTMC is capable of influencing or have contingencies for and plan our strategy. The objectives are: • Create a business model for the Corporation that can be sustained over time and grow private sector contribution to match municipal support; • Establish WRTMC as the authoritative source in Waterloo Region for tourism marketing, • Focus on establishing and enhancing the brand for Waterloo Region in partnership with WREDC,the Region of Waterloo and municipal partners; • Capitalize on social media and smart technology to engage and access residents, industry and markets. Specific Action Priorities are derived from each of the above objectives and provide a menu'of actionable work from which an annual operational and marketing plan is built. Marketing Plan The WRTMC Marketing Plan is developed in partnership with key partners (RT04 and OTMPC) and members while at the same time aligning efforts with market research available to us through a number of sources. We have determined that our key target markets include sport, meetings and conferences,travel trade and leisure. Our focus on sport and partnership with RT04 and the City of Guelph in the market are relatively new although the Cities of Kitchener and Waterloo have long recognized our opportunities in this area. Our target is primarily Ontario minor sport, although we have seen some success in attracting larger events (Volleyball Canada)through our relationships with Ontario sport 2 - 9 groups. We plan to intensify our efforts in this segment in the upcoming years because we can measure our success and we have the infrastructure that can support and attract this market. Corporate meetings and conferences are again a target for WRTMC. We have several hotels and unique venues that make Waterloo Region a suitable choice for hosting Ontario based group events. We are targeting Ontario based associations and Waterloo Region based corporations in an effort to secure more of this business. Again,this is measurable and we intend to increase ourjoint efforts with our partners in this area. Waterloo Region has long been a stop'for tour bus traffic enroute to Stratford or Niagara Falls. We are working with our partners to extend the stay of these tour operators by showing them the wealth of attractions on offer.We are beginning to see the fruits of our labour and will continue to pursue tour operators based in Ontario, Quebec and beyond. In the leisure market, we have shifted our focus to using our strength to attract visitors to extend their stay in our region. We are known for festivals and events and we are using this awareness to attract visitors. We continue to pursue the family and couples segments throughout the year, but are more targeted in our approach. Social media (Facebook, Instagram, Twitter and blogs) makes it much less expensive to target potential visitors and we continue to grow our efforts to reach these groups. ExploreWR.ca Website The astronomic growth of connectivity by our target markets and the world in general has necessitated continuous upgrading and tweaking to our website. In the next four months, we will initiate another major overhaul to the site making it mobile friendly and responsive as well as adding more video and content.We recognize that ExploreWR.ca is one of our most important tools in marketing Waterloo Region and our team is focusing on keeping it current and relevant. Explore Waterloo Region Travel Guide Although the demand for printed material has diminished significantly(WRTMC produced 120,000 travel guides in 2013 and plan to reduce production to 30,000 for 2016),the annual travel guide remains an important tool that is requested by individual visitors, conference and sporting groups throughout the year. We plan to continue to print and distribute the guide for the foreseeable future while keeping an eye on demand to ensure our investment in production is well spent. Each city and township within Waterloo Region is profiled in the travel guide annually. The cover is dedicated to a significant anniversary or event (2014 was the 20th anniversary of the Grand River's designation as a Heritage River, 2015 was the 15th anniversary of the TD Kitchener Blues Festival). In addition to that, WRTMC tries to ensure that each community is equally represented on the cover. 6.o ADVANTAGES OF A REGION-WIDE DMO One of the compelling reasons for creating a Regional DMO in zoo7 was that our partners recognized that there were "no borders"when it comes to tourism. Out-of-towners don't know and don't care if they have crossed from Cambridge into Kitchener, but what they do care about is, "is there enough to do in this localized vicinity to keep me here overnight?" 2 - 10 From the tourist's perspective, as well as from a marketing perspective, promoting the Region as a whole rather than each municipality on its own is ultimately about marketing. It is a more convincing story. Period. -Annual Travel Guide Prior to the creation of WRTMC, each municipality and several townships created their own visitor guide. The Explore Waterloo Region Travel Guide, which is produced on an annual basis has taken the place of the smaller publications and saved both staff time and money for partners. -Trade Shows & Conference Representation WRTMC collaborates with our partners to represent Waterloo Region at tourism related events targeting meetings, conference travel trade, media and sport business. Taking the lead and ensuring continued presence under one banner helps to eliminate brand confusion in the marketplace and save time and money for our partners. - Sport Tourism The partnership with RT04 and the City of Guelph has allowed WRTMC to represent the region as a single destination for the first time. In a market that in the past had been pursued by the Cities of Kitchener and Waterloo and hotel partners independently, a cohesive representation not only saves staff time and resources, but also reduces confusion in the market for our destination. This partnership has been in the discussion stages since the Cities of Waterloo and Kitchener jointly funded a study on the best ways to approach the sport market in 2oo8. Finally, we have a partnership to reach this critical market that allows us to compete more effectively with neighbouring communities in Ontario. Although we have only recently created this partnership, we have already seen a number of events confirmed for Waterloo Region including Mudderella (the first in Canada and returning in 2o16), Cdn Fencing University Cup Championships, ON Pickleball Championships and the Eastern National Pickleball Championships. Working together with our neighbouring communities makes it possible for us to bid for larger sport events—even as large as Canada Summer Games. - Special Events Bidding on and hosting large events would be very difficult or even impossible without a regional organization. There are a number of special events that Waterloo Region is capable of hosting—all we need is buy in from partners, some sponsorship and a region-wide coordinating body to pull together the bid. Think of Memorial Cup,the Juno Awards, Canadian Country Music Awards. Events of this magnitude bring business to the Region and raise our profile across Canada. - Site and Fam visits As a single organisation representing all of Waterloo Region,the staff is able to cross borders seamlessly between municipalities when potential clients or media visit. 2011—2015 Initiatives&Partnerships 2 - 11 We have worked hard to develop and grow relationships with organizations both in and out of Waterloo Region in order to grow visitation. WRTMC has a limited budget and small team, so leveraging our efforts allows us to do more with less. Current and future partnerships include; -Communitech We want to grow tech tourism' in our Region building on the recognized success of Waterloo Region with Blackberry, Open Text, Sandvine, Google and more. We are working with Communitech to further develop ideas for opening the doors to visitors for this industry. - CTT and WREDC Working synergistically, we can grow the brand of Waterloo Region, further develop the region as an attractive destination to visit, live, learn and do business. Although our goals are different,they do align and we need to ensure that we are working together to deliver the same brand message to our target markets. -Creative Enterprise Initiative (CEI) The development of arts and culture product not only attracts visitors to the region but also raises the quality of life for residents. Further collaboration and integration with CEI will enhance our ability to attract visitors. Visitor spending helps support a broader and higher quality set of local amenities than an area could otherwise sustain. The cultural, entertainment, culinary, and retail attractions that visitors support make a place more attractive to investors.' Working with CEI, we can take these products (including festivals)to market. This partnership must be nurtured and grown—if we are able to help budding artists to be operationally and financially stable, we will have a community that can attract not only visitors, but also residents and businesses. There is tremendous potential is this partnership that is as of yet untapped. -RTO4 RTOs were created by the Ontario government in 2009 to be a conduit for DMOs to work with the OTMPC (ON Tourism Marketing Partnership Corp). And OTMPC prefers working with DMOs that represent more than one entity. WRTMC has worked to develop a partnership with RTO4 and we intend to continue to work with them in areas that serve to grow our DMO and business to Waterloo Region. The RSTO (Regional Sport Tourism Office) is a great example of cooperation across the region and will continue. - Municipal BIAS We have worked with these groups in the past, but we want to further develop and nourish the relationships to engage smaller businesses to recognize and benefit from tourism traffic. - Universities and Conestoga College Destination Promotion:An Engine of Economic Development(DMAI 2035) 2 - 12 The sport initiative has opened doors with our university partners and we continue to explore ways to capitalize on the visiting parents and families as well as the meetings opportunities that exist through the many academic based organizations connects through faculty and staff. 7.0 CONCLUSION High performing organization; meeting needs of municipalities and tourism industry; tourism partners value the organization; revenues are growing October g,2015' 2 - 13