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3 Reasons Why The DMO Will Not Survive

Written by on Aug 27, 2012 | 25 Comments
3 Reasons Why The DMO Will Not Survive

The past ten years are littered with unprecedented change. Consumers, technology, travel patterns, airlines and yes, even destinations.

Sometimes for the better, sometimes for the worse.

This change has been the source of numerous (Travel 2.0) clients. They have seen the change happening and need guidance in how to cope. For the last several years, our guidance has tiptoed around a subtle, yet ominous threat for the DMO.

The consumer is changing, you need to change with them.

And up until now, we have not be able to pinpoint the issues causing this stress. But our recent post, Fight or Focus changed that.

It focused our thinking.

Our destination peers are aware that adaptation will be required over the next several years, but most do not understand why. Sure, pundits and prognosticators, con men and consultants have all claimed a rationale…typically related to the scary specter that is social…but few have articulated the cause and potential effect of these changes.

This is our working theory. Factors that are behind the change we all speak of. 3 reasons why the destination marketing organization will not be around in 5 years.

The marketplace is now focused on direct relationships, controlled by the consumer.

The marketplace in which we operate has fundamentally shifted toward the consumer.

20 years ago, companies controlled nearly every part and piece of the purchasing process. They told us what to buy, when to buy it and what to think about it. Due to a lack of information, we simply followed along, believing that Tide really made whites whiter, because, well, the man in the ad said so.

But as we are all keenly aware, that marketplace no longer exists for nearly every consumer good, category or industry.

The transition from a product-focus to a consumer-focus has been rapid, expanding word-of-mouth from small and insignificant to viral and potentially harmful.

Just ask .

The challenge with this new consumer economy is the focus on the relationship between the consumer and the product. It is no longer indirect, but rather an intimate bond, perpetuated by brands and accepted when useful by the consumer.

For destinations, which do not truly own any of the products they represent, the impact is significant. Without ownership of the product our relevancy in the relationship is void.

Yet we continue to push ourselves into the communication channels, often in the form of a tweet or wall post, only to find that our voice does not carry weight with either the business or the consumer.

Destinations are a middleman at a time when the consumer is actively ignoring the middleman.

Local businesses don’t need a collective brand.

There are 4 million brand pages on Facebook. And beyond the Fortune 500, many of those belong to a small business owner. The same small business owner that destinations have relied upon as the primary foundation for the DMO.

A group of common businesses, joining together to promote themselves as a region because their collective reach was stronger than their individual reach.

The challenges that oppressed the ability of the small business to promote effectively, and therefore require a larger organization to promote on their collective behalf, are systematically being destroyed by organizations such as Google, Facebook and GroupOn.

What was once considered a reasonable membership fee is now more than enough budget to run a comprehensive Adwords campaign. And you know what? Adwords provides direct, bottom-line, ROI results.

For a small business, in this current economic climate, would you rather spend $500 with a guaranteed ROI or $500 for a DMO membership that provides access to a once per year, rubber chicken dinner?

Now, certainly education is still the greatest hurdle to the conversion of the small business into a full fledged marketing machine. But considering the expansion of just the Google sales force, that degree in small biz marketing is clearly within reach.

Small businesses are looking to other marketing channels to promote their offerings to potential tourists.

Tourists expect more information than we can provide.

We have known this for a while. Even in meeting rooms filled with our peers, rarely does a hand go up in acknowledgement of planning with a CVB or DMO.

Information is abundant. Technology is connective. And social provides the personal touch of your own concierge.

Prior to that iPhone in your pocket, local knowledge about a town was restricted to guide books and memories, both of which required curation by a central source…likely the DMO.

Today, we can do everything from translate Dutch to board a plane with just a phone.

Yes, destinations can offer digital versions of listings and information, but the industry is facing incredible competition from the very same organizations that are slowly usurping the local ad dollars.

But what about adoption…people still love guidebooks and brochures. True, they do. But do not underestimate the penetration of technology into our daily lives.

As , he once worked in an office that employed a woman whose sole job was to make copies…apparently to prevent the loss of your hand in the complex device that was the 1982 copy machine.

But good technology will propagate throughout our society. We can all make copies, and soon, we will all be able to navigate our phone like a Millennial.

The consumer now has the ability to find unbiased information about anything on the planet.


A new marketplace, smarter local business and connected consumers, three trends that form that foundation for change.

The prelude to the removal of the DMO as we know it. Make no mistake, change is coming…to every industry…but these factors impact our industry in such fundamental ways that the destinations very existence is in question.

Everyone talks about change. We need to change, grow, expand, think outside the box. The problem is, you have no idea what is in the damn box to begin with.

Cheap quips and tweetable sayings are not going to prevent the collapse of your tourism organization. Acknowledge and recognize the challenges that are facing the DMO, understand the perceptions of your stakeholders and consider the shift in travel planning personified by Google.

As a consultancy that makes our living from advising DMOs, we are not trying to accelerate the demise of these organizations. We take no joy is seeing a defunded DMO. And our goal is not writing for the sake of comments.

Our desire is to create a dialogue of critical thinking and consideration.

To provide an opinion based upon our experience.

Asking tough questions now, rather than recounting the way things were.

Can the DMO survive? We think so.

But that is another story.

  • Chris Cavanaugh

    A thought-provoking post. I look forward to hearing more.

    It got me thinking that DMOs that are membership-based may actually get the message and make a necessary transition much faster than those which have a dedicated source of tax funding and do not have members. The pressure that comes from a loss of member revenue can be motivating. That’s not to say non-member DMOs can’t make the jump, as they will ultimately face the same kinds of pressure from their savvier stakeholders.

    • / Troy Thompson

      Hey Chris,

      Thanks for the comment, appreciated.

      Interesting point about about membership v. taxes, I would agree. The pressure from losing revenue is a heck of a motivator.

      As to the future posts, they are in draft mode as we speak…including a few solutions on staying relevant.

      More to come.

      - Troy

  • Jeff Webster

    Great post as always, Troy. I think DMOs can still have a hand in the future, but if thehy haven’t already venture down the road, it may be too late.

    • / Troy Thompson

      Thanks Jeff, appreciate the comment.

      Your comment is well taken, and unfortunately, true for some of (not all) our DMO peers. That is the trick. The places where they could provide value mean a dramatic shift in their business plan. Which could mean less funding, staff cuts, etc.

      Painful stuff.

      No one wants to see those things, but enjoying short-term comfort in the face of long-term stability seems foolish.

      - Troy

  • Jeroen Beelen

    Great post Troy. As you say: it’s all about being relevant. Lots of DMO’s we talk to still mention that they want more likes/followers. They are beginners in the ‘social arena’ and have no idea that likes/followers are not equal to being social and being relevant. Now you’ve very eloquently stated your case (to which I agree), I’m looking forward to discussing solutions. Kind regards!

    • / Troy Thompson

      Thanks Jeroen, great comment.

      Completely agree. During a keynote earlier this year I asked the audience what happens if they actually get 50,000, 500,000 or 5 million followers / fans / friends?

      The assumption is that more fans equals more relevancy, but we are starting to see the opposite effect. More fans means less time per fan, less of a relationship, less communication.

      Assuming that people actually want to communicate with the destination.

      Not sure.

      But we are working on it.

      - Troy

  • Alex Kaufman

    This seems so parallel to the newspaper business. When there was one place to get your news, the newspapers were king. More sources = less reliance on single sources. As direct and useful information sources proliferate (including in travel) the grand gatekeepers of the previous era are left with plenty of column inches to fill, but dwindling relevancy, eyeball marketshare and member dues.

    Get a real voice, or a few of them. Aggregating is not a business model (well it is, just not yours). The most interesting shit wins, folks. How often does that need to be proven? You still have megaphones (budgets, followers, websites and press). Use them to communicate ideas and truths that cut through the noise and set you apart. Try things. Be willing to fail a little. Go down with a fight. Or stick to the status quo yelling vanilla catch all slogans and see where it gets you. That’s surely the safer bet. Tough spot. Tough call.

    • / Troy Thompson

      Well said, thanks Alex.

      - Troy

  • iVisitorGuide

    Hi Troy, your article resonates loudly with the situation surrounding UK DMOs currently. In fact someone has posted a direct reference to it on the LinkedIn discussion group “A New Model for Destination Marketing”. I applaud the bravery of your direct approach and trust that DMOs do not feel threatened by the views expressed but instead recognise that there are genuine attempts by many to help DMOs become more relevant and less entrenched in old idealogies.

    • / Troy Thompson

      Hey Martyn, appreciate the comment, thanks…I will head over to the LinkedIn discussion.

      Exactly right. We all want the DMO to survive, but only in a role that is relevant and can be sustained. Clutching at old ideas and existing budgets is not the path toward survival.

      - Troy

  • JEBworks

    Thought provoking article, Troy. Nothing new on that front, I might add.

    My take is that a great many DMOs will indeed be gone from the scene within five years or so and they won’t be missed by the traveling public. If they were, then they wouldn’t have disappeared, if you get my drift….

    This opinion is based on my involvement in the travel industry for longer than most people here are alive and as a DMO executive for a quarter century around the globe. I’m not mentioning this here to gather glory, but to nip in the bud any comments from DMO insiders who think this is just consultant speak.

    The quest for relevancy has been around for more than two decades and even before the radical changes technology available to anyone had been introduced by and large since the beginning of this millennium. There have always been too many layers of organizations involved and a majority never had obtained legitimacy by the customer but more by the stakeholders. That inside out v. outside in approach and focus is one of the factors why change comes so slowly to the DMO world.

    To be truly customer centric – even more than just customer focused – just naturally creates a different mindset and generates a serious discussion about relevancy and legitimacy in the overall marketplace much quicker.

    Another neglected area is a focus on what is happening outside the DMO world, or in fact outside tourism to get inspired by vision and develop strategies from it. What we have seen over the past half decade or so since the first talk about social is the exact opposite, a focus on tactical tools and the minutiae of Facebook and Twitter followers before examining the big picture. As long as this remains largely the case, I for one will not be surprised at the result. More lights going out at DMOs.

    • / Troy Thompson

      Hey Joe,

      Thanks, as always, for the comment. Your perspective is truly appreciated…both informative and reassuring for my own selfish reasons.

      You are right, relevancy is not a new topic, but I think there are new influences on the topic that are accelerating the evolution of the DMO. Technology, social, economics, government budgets, taxes, small business marketing opportunities, etc.

      As you mentioned, the internal stakeholders…members, businesses, etc…have held the DMO together even if the consumer was unaware of the organization. But I sense that relationship is changing.

      From an information perspective, we are moving from big, broad topics…in advertising, marketing, communications…to niche segments.

      Just look at Google alone…they receive 200 million unique queries per day ().

      The consumer is not looking for broad, general information, rather specific, relevant information.

      If the consumer is telling us they want specific information, as a business owner, it makes more sense (in theory) to spend my $500 membership fee on a unique campaign…rather than with a DMO.

      Without membership, government or tax support, where does that leave the DMO?

      Your comment about becoming customer-centric is well taken, and actually, the second part of this theory. But I think DMOs need to change our definition of the customer.

      More on that later.

      Great comment.

      - Troy

      • JEBworks

        Agree with your arguments entirely. Because of all these fundamental changes happening at an accelerating speed and the response by a great many DMOs is exactly why I give those who don’t understand that it’s the end of business as usual and adapt or die, very little chance of survival.

  • Nicole Davis

    But … (of course you knew I would start with a “but”) can’t we still be stronger together than as individual businesses trying to attract the same tourist? I’m not a DMO pro, per se, but it seems to me that communicating one image about our destination/community is better than each individual piece communicating it’s own message, thus risking confusing the tourist/visitor/investor/potential resident . Of course that means that all the players … DMO, Chamber, municipal government, Main Street, whatever … need to be on the same page with how to attract the visitor. Thanks for giving me something to ponder! Great post!

    • / Troy Thompson

      Hey Nicole, thanks for the comment.

      But…heh…I think that is one of the changes that DMOs are struggling to understand. 10, 20 years ago, yes, those businesses were going after the same general tourist, but today, the tourist…the individual…is becoming more unique.

      Perhaps not more unique in terms of their personality, but more unique in what we know about that personality.

      For example…

      If I am Visit California, there is a big difference between the tourist who is coming to California to take a Hollywood star tour and one who is coming for Yosemite.

      Part of the issue is geographic…DMOs usually cover a large land mass…but the main issue is that simply knowing those two tourists share an interest in California is no longer enough.

      And I am not sure the DMO is prepared, or needs to provide, that level of specificity.

      As you said, something to ponder.

      Thanks for adding to the conversation.

      - Troy

  • Jeremy Fairley

    I know this is probably part of a future series of post, but whats the solution, short and long term? Although I don’t have a definite answer, I think the answer to this is rooted in technology, and making sure that we move at the speed of it as well of the speed of our consumer. Unfortunately our portion of the industry tends to lag behind others in terms of moving anywhere, especially on the technology side. So unfortunately we may have to come face to face with our own extinction before we realize that.

    Having said that do we work harder to build better tools on our own sites and focus on new methods of acquisition to find the consumer? Do we work on better technology related integrations/partnerships with the Google’s and TripAdvisors of the world? It seems we have become the middle man per se, but its unrealistic to think we can best or even compete with the level of distribution that those entities have.

    One way to combat this (in my humble opinion) is at the local level. Meaning we do a better job of working those in the community that actually have that tangible product and do a better job of communicating that product to the masses (regardless of traditional membership structure).

    Better database management is also key. When I look at the Google and Facebooks of the world, I don’t see “oh that looks like some cool shit that Google Voice can transcribe my voicemail, or Facebook updated my timeline.” I see the massive amounts of data they have on us and how (albeit some do it better than others) they can deliver a message to me when its most relevant. Think we can do a better job of simply being in that conversation when a consumer is looking to travel. Facebook knows more about me than my mother does!

    Don’t think there is a simple answer, or even a short term one, as a change that we have suggested in this post requires a monumental shift in the way cvb’s think & act. Or I could be way off base with all of this. I’m sleepy now and going to bed…

    • / Troy Thompson

      Hey Jeremy,

      Thanks for the comment…for a late-night entry, really well done.

      Your first paragraphs are the basis for the next article. Short-term v. long-term? Build or buy? Compete or cooperate?

      Honestly, questions I have been considering still starting this blog…but I feel like I am closer than ever to truly explaining that long-term strategy…to both myself and our DMO peers.

      As for the local, yes, completely agree. Database, same thing. Both are on my short-list in the solution column.

      There is not a simple answer. Or better yet, there is not an easy answer. The answer will be painful.

      But change usually is.

      - Troy

  • Steve Wille

    Here’s the real truth about the demise of DMO’s.

    DMO’s are usually formed for jurisdictions that do not make up a unique product serving a unique customer. They are taxing entities, mish mashes of political tradeoffs that cannot tell the “insider truth” about a destination because “stay away from our boring downtown but our wineries are great” is not an approvable message. A pity since that is exactly the kind of information the consumer is looking for. In the old days, ads would attract respondents seeking the destination book. The DMO, as owner of the respondent relationship and list, had unique value. With the internet and the wide availability of destination information, the DMO’s value quickly dissipated from keepers of the largest list of known prospects to an entity whose main activity is to grasp at straws to try to prove relevance. This usually takes the form of chasing every new “trend” to seem “out front” to constituents, with elaborate Pinterest strategies and ridiculous metrics of Facebook “Likes” and the like (sic). The ONLY justifiable role for today’s DMO is to compile all possible resources and drive pure awareness campaigns of unique products to unique groups of consumers. Ideally, any good DMO would only have 2 or 3 employees coordinating the work of several digital, traditional and pr agencies. The bulk of staff at DMO’s are necessary to justify things to constituents. Any destination that wants a competitive advantage, should get rid of the boards and committees which would allow for far fewer staff and put the money into pure awareness. As suggested in other posts here, let all the individual businesses then use the plethora of new tools to themselves connect with their niches far more meaningfully than the DMO can. There may be enough money left over to get something going in that boring downtown.

    • / Troy Thompson

      That is the way to leave your first comment. Kudos Steve.

      Your thoughts have added some great talking points to the idea of broad to narrow. As you mention, in the old days, a DMO or CVB could get away with a broad message, but that is what has changed in the last 10 years.

      Not social, not the internet, not Facebook.

      It was caused, in part, by those developments, but the central change has been one of broad to narrow.

      We have thousands of tourism organizations around the world advertising a broad message to an audience that wants narrow information.

      And few can understand why it no longer works.

      Great stuff Steve, thank you for taking the time to comment.

      - Troy

  • Vuyelwa Mantyi

    For destinations a bit behind the curve in terms of digital adoption DMOs can still play a significant role. They still need to do some hand-holding for tourism businesses and bring them up to speed on platforms and tools to market their services better. I agree fully with the notion of serving niche content. The great thing about being behind the curve is that DMOs in say, Africa, can execute proven strategies that deliver results first time. So in my neck of the woods social media strategy can safely avoid the “likes” metric trap and use were here right off the bat.

    The unfortunate part is that very few DMOs even here in South Africa fully understand the impact of digital on tourism in order to fully leverage the advantage we have.

    This is a great post Troy that future forward executives in tourism should see. I’ll be sure to forward to some I know.

    • / Troy Thompson

      Hey Vuyelwa, thank you for the comment. Really enjoying the international perspective on this article. Thought-provoking.

      You are on the right track. Education of members, small businesses and independent tourism operators is a huge opportunity for the DMO…and one that can not only help the DMO, but the entire tourism community.

      Good thoughts.

      - Troy

  • Joe Vargo

    I really disagree with your second point. Local business are definitely in need of a city-wide brand if they’re at all concerned with the visitor market. (Good) DMOs provide that, and use a city-wide pool of resources to promote that brand to potential visitors in the markets most likely to come and visit. When you don’t have a city-wide brand, and no reputation – you do not stand out from the crowd in any way when consumers are making travel decisions. Few local businesses are strong enough draws on their own to get a visitor to come on just for that one experience.

    I do agree that the membership model is on the way out – more dedicated bed tax and local government contributions seem like the smart way to go to replace membership revenue.

    • / Troy Thompson

      Hey Joe,

      Thanks for the comment…and being brave enough to disagree.

      Honestly, I think many of our CVB / DMO peers are too close to their own brands to understand the member and consumer perspective. Not you specifically, just in general. We have drank the Kool-Aid.

      I am not saying that DMO brands are bad, simply that there are new promotional opportunities (beyond the DMO) available to local business that are easier, cheaper and provide better ROI.

      Yes, yes, a rising tide lifts all boats…but if the DMO boat has a hole in it, I am jumping off.

      We need the DMO to manage the brand, but do we need them to market the brand?


      - Troy

      • Joe Vargo

        Call me Lionheart, I guess ;)

        I think the opposite is true: Most communities have no idea what their brand is. In Columbus, the CVB is part of a broad, collaborative group that is working on the long process of branding a city that is 1000 kinds of awesome, but has basically no identity. We’re finally getting there, and it’s having an effect. I think there is an absolute necessity for there to be at least one organization that markets the brand. We focus on the visitor audience. Other groups focus on business leaders, other still education audiences. It helps immensely that we’re playing from the same game-plan – because those audiences overlap immensely.

        Without a DMO, who would market a whole destination? Who would ensure social, advertising, PR, trade groups, etc. were hearing and beginning to believe those messages that we know to be true, authentic and motivating about our city? No one.

        • / Troy Thompson

          Hey Joe,

          Oh, don’t tell Betsy, that will quickly become a new nickname.

          Place branding, destination branding, tourism branding…call it what you want…is such a vicious cycle. A city brand is an oxymoron.

          Everyone starts with good intentions, attempting to create a brand that highlights the true unique qualities of the destination, but somewhere along the way this niche idea grows and swells into a broad, toothless monster. More bloat than brand.

          An answer to quell the demands of the local stakeholders.

          Promote everything, communicate nothing.

          Honestly, destination branding has 3 answers: quaint small towns, vibrant urban centers or unspoiled nature.

          Add verbs as needed to differentiate your city or region.

          The folks at someecards sum it up nicely:

          Let’s look at this a different way. You said “there is an absolute necessity for there to be at least one organization that markets the brand.” That was true when the only means of communicating the brand was TV, radio or print.

          What I am saying is this: “there is an absolute necessity for every small business to market certain aspects of the brand.”

          Not one, but all.

          Considering the individualism created by our digital and social revolution, how can an entire city brand be conceived and marketed by a single organization?

          Why are we telling just one story when we could be telling thousands?

          How can we expect support from everyone in our city when their perspectives are different from ours?

          How do you sum up a city like Columbus…let alone NYC…in just a logo and a tagline?

          Why are we fighting to keep the brand locked under the grip of a few when it could be shared by the community?

          This is the answer to your question: who will market the whole destination?


          (Great conversation Joe, don’t take those questions above personally. I am really asking the other readers, not just yourself.)

          - Troy