1. Increasing Funding Through Research March 23, 2007

2. UTAH OFFICE OF TOURISM The Situation in 2003

3. The Division’s total budget will fall to $4.0 million in FY 2004 after several consecutive years of one-time appropriations. Since 1990, the Division’s total budget will have declined by 23% in real terms by FY 2004.

4. State Tourism Office Budget Comparisons FY 2004 budget half the Western Average and one-third of the U.S. Average

5. Utah’s Market Share is Declining Source: D.K. Shifflet and Associates (DKSA); Tourism Industry Association of America (TIA)

6. Difference of 1.08% between SLC and Western City Average. Difference of 0.07% between SLC and Western City Average. Tax Rate Comparisons Among Major Western Cities

7. Revenue sources are balanced and broad-based Proposed Funding Sources – SB 243

8. Real Impact of Tourism Tax Rate Increases… $85 Room Rate +0.5% TRT = +43¢ on room price $5.00 Big Mac Value Meal $100 Steak Dinner +0.25% RT = +1¢ = +25¢

9. OTHER IDEAS EXPLORED  Redistribution 1/64 th Olympic Sales Tax Gasoline Tax (Utah’s 1 st Dedicated Tourism Tax) TRT and/or TRCC  Additional Taxes Restaurant Tax expanded to include convenience stores and in- store delis Gasoline Tax Additional Car Rental Tax Tourism Sales Tax

10. NFO Plog Research About one in five travelers in 12 Western states has been to Utah in the past three years. They spend about $589 per trip. Among residents in 11 Western states, Utah’s image is similar to competitive status on most attributes, but is deficient on: –Beautiful/ scenic –Great getaway –Lots to do –Dining/ entertainment However, if Utah can entice tourists to come, they like what they find. Among residents of 11 Western states, over 80 percent of Utah visitors were satisfied with their visit.

11. NFO Plog Research Two in five recall Utah’s advertising, lowest among the competitive states. By market, results are: 53 percent in Los Angeles, 60 percent in Las Vegas and 32 percent in Dallas. Correspondingly, Utah’s advertising impact is the lowest among competitive states. Further promotion of Utah and development of a more accurate image is essential to not only attracting greater tourism, but even maintaining the current level. Why? Because advertising works. Meanwhile, competitive states constantly seek to “raise the bar” in competing for tourists’ dollars. If Utah makes no change, it will lose ground vis-à-vis nearby competitive destinations.

12. NFO Plog Research Fewer than one in five (17%) respondents expect (extremely/ very likely) to visit Utah in the future. The ratio is higher among past visitors and slightly higher among those aware of the advertising. Currently, using the conservative estimate, the Utah Travel council impacts over $30 million of tax revenue, returning $8.64 on each advertising dollar spent.

13. New Legislative Assistance Senators Jenkins and Walker study the research and become convinced –Tourism is High-Velocity Economic Development Senator Jenkins orders the industry to come together –He becomes personally involved

14. Utah Tourism Industry Came Together Utah Division of Travel Development Utah Tourism Industry Coalition Gubernatorial candidates Legislators Utah Association of Counties Utah Restaurant Association Utah Hotel & Lodging Association

15. The Situation in 2004-05

16. HOW MUCH DO WE NEED? $10 MILLION SEED REQUEST  For program of advertising, marketing, and branding as approved by the Board of Travel Development  In addition to the ongoing general fund appropriation of the Utah Travel Council’s (UTC) base operating budget

17. WHERE TO GET THE MONEY? Tourism Performance Marketing Fund

18. Tourism Marketing Performance Fund: An Opportunity for Utah Tourism $10 million seed request Identifies sales tax revenue generated by specific businesses that serve travelers, a small percentage of the GROWTH in tax revenue from those businesses dedicated to statewide advertising & marketing This revenue is then reinvested in more tourism marketing. Fund limited to $3 million new growth Sunset clause added Coop Marketing Program UTC Board changes from advisory to policy-making

19. How the Tourism Marketing Performance Fund (TMPF) works:  Assume that sales tax revenues from each of those industries will grow by at least 3% each year (sales tax revenues from two and three years prior to the year of allocation are compared to each other)  The TMPF receives ½ of the GROWTH in sales tax revenue above the 3% level each year (performance-based increase)  Current year performance-based increase + prior year’s performance based portion + reduced general fund allocation = total amount in the TMPF each year  If the growth fails to exceed the 3% level, the agency receives the same total amount as the previous year  The performance-based increase in the TMPF cannot grow by more than $3 million in any single year

20. How the Tourism Marketing Performance Fund (TMPF) works:

21. HOW TO USE $10 MILLION… 1.More Statewide Branding to emphasize activities and experiences, new UTC Board will determine how the money is spent 2.Additional reach and frequency in key markets and new markets By investing $10 million in tourism: Ads would reach 121,296,000 adults Target market would see the ads 5.8 times (frequency)

22. HOW TO USE $10 MILLION… 3. 20% of Fund used for Co-operative Promotion…  Leverage promotion efforts of cities, counties, and non-profit destination marketing organizations  Voluntary participation  Common Markets and Objectives  Unified Messaging

23. The anticipated impact of a $10 million tourism investment after 18-24 months:  Additional 4.6 million visitors annually would spend additional $1.08 billion each year with Utah businesses!  Additional $86.4 million of tax revenue annually! State Tax Revenues: $63.6 million Local Tax Revenues: $22.8 million  Program returns $8.64 in tax revenue for every $1 invested! ROI = $8.64:$1  Utah would also increase its market share Source: Utah Travel Council

24. WHO BENEFITS? Utah Citizens  Reduced annual tax burden of an additional $105 per housing unit (in addition to the $420 in reduced taxes per housing unit that tourism is already providing)  Statewide distribution of an additional 13,333 jobs would be created (in addition to 108,000 jobs already existing due to tourism)  $8.64:$1 ROI of the citizens’ tax dollars State Government  Additional $63.6 million in tax revenues annually for transportation, education, and other General Fund needs  High velocity economic development  Enhanced reputation for high quality of life could also lead to new businesses re-locating here

25. WHO BENEFITS?  Local Government  Additional $22.8 million in annual tax revenues for local needs  Revenue generation without significantly expanded services  Diversified economic base  Enhanced community pride  Utah Tourism Industry  Increased traveler spending by $1.08 billion annually (compared to current traveler spending amounts)  Increased ROI  Branding Message Complements Destination Marketing  Improve Workforce Quality  Reduce Seasonal Fluctuations

26. “Take-Aways”  With an ROI of $8.64:$1, tourism is a fantastic investment!  Focus on the objective – the state should invest in tourism because it’s high-velocity economic development  Supporting this legislation won’t require a tax increase, and it will ultimately generate an additional $63.6 million annually for the General Fund. This money can help pay for education, roads, and other necessary programs

27. Performance-Based Funding Supportive Organizations Utah Tourism Industry Coalition Utah Dept. of Community & Economic Development Utah Hotel & Lodging Association Utah Association of Counties Utah Travel Regions Association Utah Small Cities, Inc. Utah Campground Owners Association Utah Guides & Outfitters Governor’s Rural Partnership Board Moab Area Travel Council Rural Development Legislative Liaison Committee St. George Area Convention & Visitors Bureau Salt Lake Area Chamber of Commerce Salt Lake Valley Lodging Association Heber Valley Chamber of Commerce Ogden-Weber Convention & Visitors Bureau Marriott International Box Elder County Economic Development & Tourism Cedar City-Brian Head Tourism & Convention Bureau St. George Area Chamber of Commerce Davis Area Convention & Visitors Bureau Utah Travel Council Utah Ski & Snowboard Association Utah Restaurant Association Utah Sports Commission Utah Tour Guide Association Utah Air Travel Commission Utah State Chamber of Commerce Workforce Services/Economic Development Interim Legislative Committee Grand County Council Salt Lake Convention & Visitors Bureau Salt Lake Department of Airports Park City Chamber/Bureau Golden Spike Empire Travel Region Garfield County Travel Council Institute for Outdoor Recreation & Tourism (USU) Four Corners School of Outdoor Education Wayne County Travel Council Price Small Business Development Center Kane County Office of Tourism & Film Commission Carbon County Travel Bureau Utah Shakespearean Festival Source: Utah Tourism Industry Coalition

28. We need your help! *Grass Roots support from tourism oriented businesses and local elected officials *Contact your state legislator and encourage them to support Performance Based Funding for the statewide advertising & promotion of Utah tourism *Get involved and be a part of the solution to this budget crises – we need additional funding to advertise and market Utah as a tourism destination.

29. Utah Tourism Industry Coalition 135 East Main Street Torrey, UT 84775 435-425-3997 www.utahtourism.org info@utahtourism.org

30. Image Study by Strategic Marketing and Research Inc. Background and Objectives Assess overall image and level of familiarity with Utah; Compare attitudes/perceptions surrounding Utah as a destination; Measure top-of-mind and image perceptions of Utah; Define prevailing market position, or positioning profile, of the area; Investigate the competitive situation: Identify key motivators of visitation to Utah; Determine key differences between visitors and non-visitors; and Forward conclusions and recommendations relative to the research findings.

31. Familiarity with Competitive States

32. Percentage of Recent Qualified Trips

33. Likelihood to Visit in Next Two Years (Rated 4 or 5)

34. Ratings Of Competitive States

35. Images Associated Most Strongly With Utah Skeleton Zion National Park

36. Image Associations

37. Three Remaining Pictures

38. Brand Creation Process Review of the product/process Listening tour of our internal clients – 14 cities –Vernal – Aug. 30 –Ogden – Sept. 9 –Logan – Sept. 9 –Salt Lake – Sept. 12 –Provo – Sept. 13 –Park City – Sept. 13 –Richfield – Sept. 15 –Price – Sept. 16 –Moab – Sept. 16 –Cedar City – Sept. 22 –St. George – Sept. 23 –Kanab – Sept. 23 –Salt Lake City – Sept. 26

39. Brand Creation Process Analysis of our external clients through research post Olympics & post 9/11 Creation of brand hierarchy Creation of the promise of brand essence Consideration of the reach (cultural heritage, art, state parks, and economic development) Legacy (creative capability going forward)

40. Brand Development Timeline OctoberCreative Development Nov. 14-18World Travel Market, London Nov. 15London Focus Group Nov. 28-Dec. 2Focus Groups in New York, Chicago, Dallas, Los Angeles Dec. 8Focus Group in Salt Lake City Dec. 5-12Analyze research data, finalize creative campaign Dec. 12-31Creative campaign/marketing plan Jan. 6Present draft of media/marketing plan to Tourism Board

41. Brand Development Timeline Jan. 9-12Update creative campaign/elements to tourism partners Feb. 12 nd Funding Cycle for Co-op Marketing Feb. 8Anniversary of 2002 Olympics/Unveil creative campaign, to legislature, public, press Mar 3Board approves brand platform April 5Brand Launch April 7Brand creative approved by Board April 25Board Marketing Retreat May 5Board will consider media buy

42. Cooperative Marketing Program FY 05-06, 06-07 Deaflympics Ogden-Weber CVB American West Heritage Center Cache, Box Elder, Rich Counties Ogden Union Station Davis Area CVB Utah Valley CVB Thanksgiving Point Ski Utah Town of Alta Alta Resort Association Pioneer Theater Company Clark Planetarium, Utah Museum of Fine Arts, Thanksgiving Point Institute, Red Butte Garden Rotary International Bear River AOG Ogden Valley Business Association Sportsmen for Habitat Downtown Alliance Utah Festival Opera American Dream Foundation West Valley City SLC Airport

43. Cooperative Marketing Program FY 05-06, 06-07 Park City Chamber/Bureau Heber Valley Railroad Heber Valley Chamber – Golf Wasatch, Snowmobiling Park City Jazz Foundation, IAJE Kimball Arts Center Daggett County Dinosaurland Travel Board Utah Symphony and Opera (Deer Valley Music Festival) Ski Utah Wasatch Western Heritage Park City Performing Arts Foundation Underdog Foundation – Park City Culinary Wine & Ski Classic

44. Cooperative Marketing Program FY 05-06, 06-07 Sevier County CVB City of Green River Carbon County Travel Bureau Mt. Pleasant / Heritage Highway 89 Castle Country Travel Region Historic District Improvement Company (Manti) Carbon County Fairgrounds and Exhibition/Events Center Castle Country Visitor’s Guide Juab Travel Council

45. Cooperative Marketing Program – FY 05-06, 06-07 Wayne County Zion and Bryce Garfield County Utah Shakespearean Festival St. George Area CVB SUU Outdoors Kane County Piute County Zion Canyon Art & Flute Festival Ski Utah City of St. George – Community Arts & Exhibits Division SunParks, Inc. Huntsman World Senior Games Panguitch Main Street, Inc. Olde World Historical Council / Dickens’ Christmas Festival Red Rock Golf Trail

46. Cooperative Marketing Program – FY 05-06, 06-07 Moab Music Festival Moab CVB Canyonlands Field Institute Friends of the Moab Folk Festival Moab Arts Council Moab Area Travel Council Canyonlands USA Four Corners Heritage Council SunParks, Inc.

47. Travel-Related Spending (Millions of Dollars) Source: Utah Governor’s Office of Planning & Budget, using figures provided by the former Utah Department of Community & Economic Development, the Utah Department of Workforce Services, and the Utah State Tax Commission; National Park Service, Ski Utah Travel-Related Employment (Thousands of Jobs) Hotel Room Rents (Millions of Dollars) National Park & Skier Visits (Millions)

48. Transient Room Tax Revenue Source: Utah State Tax Commission Municipality Transient Room Tax Revenue Resort Communities Tax Revenue Tourism, Recreation, Cultural, & Convention Tax Revenue

49. Key Points Let the industry and government officials know you are committed to obtaining professional research Work with your industry trade organization – they can pull in all facets of the industry Find champions in the legislature who will take the time to understand the impact tourism can have Get support from the Governor Present results to those providing the funding and the industry

50. The Situation in 2006-07