The Agenda. Where we have been. Where we are today. Where we can go

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The Agenda

• Where we have been

• Where we are today

• Where we can go

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The Early Years

Steady Funding Declines in Promotion Budget

2001 - $8 million

2002 - $7.4 million

2003 - $6.4 million

2004 - $5.7 million

2005 - $5.7 million

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Weak, Undefined Brand

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2005: Rock Bottom

• Doing less every year, due to budget cuts

• Demoralized, fragmented private sector

• Business declines in middle of decade-long

Michigan recession

• Ranked 50

th

_{in hotel occupancy rate}

• One bright spot: first advertising

return-on-investment results for 2004

(Longwoods)

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First ROI Data (2004)

• Spent $3.5 million on summer, out-of-state

advertising

• Generated 990,000 trips to Michigan

• Those visitors spent $164 million at Michigan

businesses

• They paid $11.5 million in Michigan taxes

(primarily sales tax)

• The state got $3.27 back for each $ spent

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Industry Rallied with ROI Data

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In 2006, we created a new brand

for Michigan

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Pure Michigan Budget/Markets

•

2005 - $5.7 million – Chicago, Indy, Cleveland

• 2006/07 - $13.2 million – launch Pure Michigan, add Milwaukee, Cincinnati, & Ontario, Canada

• 2008 - $17.5 million – add Columbus, Dayton & St. Louis, national golf promotion

• 2009 - $28 million – add winter, hunting, fishing, & first-ever national cable TV buy

• 2010 - $17 million – national spring/summer, but cut regional for winter, spring/summer and fall • 2011-2013 - $25 million – national spring/summer,

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Forbes (2009): All-time Ten Best

Tourism Promotion Campaigns

1. Las Vegas (“what happens here, stays here”)

2. Incredible India

3. New Zealand

4. Australia (Paul Hogan, 1980s)

5. Jamaica

6. Pure Michigan

7. Alaska (B4UDIE billboards, 2005)

8. Canada

9. Oregon

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Industry Rallied for Pure Michigan

Dear George,

We are pleased to announce that the Senate Appropriations Committee will hold hearings on establishing permanent funding for the award-winning "Pure Michigan" campaign.

Those hearings have been set to take place during the Michigan Tourism Industry Legislative

Conference set for Tuesday, September 23rd at the Radisson Hotel in downtown Lansing. The cost of registration is just $60 per person.

The commitment to hold hearings came as a result of an in-district lunch with Appropriations

Committee Chairman Ron Jelinek yesterday in St Joseph. Carrying our industry's message

during that luncheon were MACVB President, Millicent Huminsky, MRA Board member Larry Schuler, MRA staff person Andy Deloney, MHSA lobbyist Bret Marr and myself.

The Legislative Conference program will be necessarily revamped. However, George Zimmermann will still present the latest results of the ROI analysis of the "Pure Michigan" campaign by

Longwoods International. Legislative Conference attendees will be fully briefed on the issues at

hand, how to respond to legislator questions and how to best position SB 690 for passage. Establishing a permanent funding mechanism to take the "Pure Michigan" campaign nationwide is by far, the most important initiative our industry has ever undertaken. As such it's critically important that we respond with our biggest crowd, and best effort ever.

As was the case this past spring, the bigger the crowd, the better our chances will be. See you at the

Radisson on the 23rd! Click on the link below to register your support!

Sincerely,

Steve Yencich, CAE Michigan Lodging and Tourism Association

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Pure Michigan Results 2013

• $13 million in out-of-state spring/summer advertising • Motivated 4 million trips to Michigan

• 2.4 million from the region (IL, IN, OH, WI, MO, Ontario)

• 1.6 million from outside the region

• Those visitors spent $1.2 billion at Michigan businesses • Those visitors paid $87 million in Michigan sales tax • The state made $6.66 for each dollar spent on Pure

Michigan spring/summer advertising in 2013

• Every data point is a new record

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Pure Michigan Results 2006 – 2013

• Generated 18.3 million out-of-state trips to Michigan

• Those visitors spent $5.3 billion at Michigan businesses • And they paid $374 million in Michigan taxes on those trips, primarily sales tax

• The state’s cumulative Pure Michigan ROI is $4.50

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Awareness of 2010 Pure Michigan

Campaign

Source: Longwoods International

Regional Market National Market

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Awareness of 2011 Pure Michigan

Campaign

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Awareness of 2012 Pure Michigan

Campaign

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Awareness of 2013 Pure Michigan

Campaign

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Impact of 2013 Pure Michigan Ads on

State’s National Image

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Impact of 2013 Michigan Trips

on State’s National Image

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2012 Michigan Final Data

• Total Visitor Spending: $18.1 billion • Business Travel: $4.7 billion

• Leisure Travel: $13.3 billion (largest ever) • Employment: 200,000 statewide

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2013 Michigan Hotel Data

Occupancy: 57.5%, up 1.7% over 2012

Average Daily Rate (ADR): $87.40, up 4.5%

Revenue Per Available Room (RevPAR): $50.29, up 6.3% All metrics at record levels since data available in 2004. Michigan has moved from 50th_{in occupancy in 2005 to}

to 33rd_{in 2013}

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An Industry View

“I watched and participated in the Pure Michigan campaign from the start, as a deployed Michigan

vacation rental owner (four times Army) in Afghanistan and Iraq. Our own marketing got the bookings, but

without question, it was the Pure Michigan campaign that drove tourists and new business to our doorstep. There is no metric to measure the quality of life

enhancements your team added to Michigan in one of its darkest economies.”

Ray and Mary Jo Draeger

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2014 Budget

Governor Snyder

proposed and the

Legislature approved

increasing the Pure

Michigan promotion

budget from $25 million to

$29 million in 2014 to boost international

marketing.

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Pure Michigan 2014

$29 million budget:

• $1.7 million regional winter buy Dec/Jan

• $13 million national TV spring/summer

buy ($3 million from partners)

• $3.6 million for regional spring/summer buy

• $1.7 million for regional fall buy

• $4 million international ($2 million in Canada)

• All other marketing (PR, publications, social

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National Television Buy

• In 2014, $13 million national TV buy (including $500,000 each from Ann Arbor, Grand Rapids,

Great Lakes Bay Region, Mackinac Island,

The Henry Ford, Traverse City)

• Approximately 5000 airings of Pure Michigan TV commercials nationally March 17 through June

• First-ever national tourism advertising for Michigan was in 2009, a $10 million cable TV buy

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$11 Million National Cable Buy

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$2 Million National Network Buy (first)

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2014 Advertising Partners

44 advertising partners in 2014,

investing $5.7 million in Pure Michigan ads

New partners for 2014: Cheboygan,

Escanaba, Keweenaw Peninsula,

Mackinaw City, Petoskey, South Haven

$5.5 million from 42 partners in 2013

$3.9 million in 2012

$3.1 million in 2011

Program started with 2 partners @ $235,000

in 2002

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Marquette

Sault Ste Marie

St. Ignace

Mackinac Island

Sunrise Coast Alpena

Great Lakes Bay Region Frankenmuth Blue Water Area

The Henry Ford Lansing Detroit Holland Ann Arbor Gaylord Coldwater Country Kalamazoo Grand Rapids Muskegon Beachtowns

Silver Lake Sand Dunes Ludington

Cadillac

Traverse City Charlevoix

Mt. Pleasant Michigan Apple Committee

Michigan Wine Council Michigan Ag Council

Michigan Snowsports Industry Association

Flint & Genesee County Statewide Partnerships

Kalamazoo Air Zoo

Michigan Adventure Department of Natural Resources Battle Creek Mount Bohemia Tecumseh Manistee

2014 Partner Program Participants

Escanaba South Haven Keweenaw Cheboygan Petoskey Mackinaw City

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Pure Michigan Budget vs. Other States

(2013)

1. Hawaii -- $75 million

2. New York -- $60 million (tripled in 2013)

3. Florida - $56 million

4. Illinois -- $55 million

5. California -- $50 million

6. Texas -- $37 million

7. Michigan -- $25 million ($29 million in

2014, Governor has proposed $31 million

for 2015)

Avg. state tourism budget $14.9 million

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Top Ten U.S. Advertisers

1. P&G $2.8 billion 2. Comcast $1.7 billion 3. GM $1.6 billion 4. AT&T $1.6 billion 5. L’Oreal $1.5 billion 6. Verizon $1.4 billion

7. News Corp $1.3 billion

8. Toyota $1.2 billion

9. Berkshire Hathaway $1.2 billion

10. Chrysler $1.1 billion

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International Marketing

International travel is booming worldwide

Up 4% in 2012 to 1.035 billion trips,

U.S. inbound travel up 6.2% in 2012

Overseas visitors spend $4300 per trip, stay

17 nights on U.S. trips

Need to invest to capture market share

Sources: World Tourism Organization, U.S. Dept. of Commerce, U.S. Travel Association

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Top Ten International Markets to U.S.

2012

1. Canada 22.7 million, up 6% 2. Mexico 14.5 million, up 8%

3. U.K. 3.8 million, down 2%

4. Japan 3.7 million, up 14% 5. Germany 1.9 million, up 3% 6. Brazil 1.8 million, up 19% 7. China 1.5 million, up 35% 8. France 1.5 million, down 3% 9. South Korea 1.3 million, up 9% 10. Australia 1.1 million, up 8%

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International Marketing

2014 program with $4 million funding increase

• Expand Ontario advertising to include Toronto • Expand promotion in the UK and Germany

– MI contracts with Cellet in UK, TMR in Germany – Continue partnership with Great Lakes USA

• Enter new market in Asia: China

– RFP for Rep firm in China – Partner with Brand USA, Delta

• Maximize IPW (Pow Wow) in Chicago, April 5-9

– Branding – Fams

• Brand USA opportunities

– Global Guide

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Canadian Visitation to Michigan

MI Rank Visitors Spending (millions) (millions) 2012 4 1.61 $427 2011 4 1.54 $423 2010 5 1.40 $336 2009 4 1.29 $295 2008 4 1.42 $301 2007 4 1.41 $305 2006 4 1.32 $273 2005 4 1.24 $208 2004 4 1.14 $166

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2014 Canada Media Plan

• Ontario including Toronto plus all-Canada

cable

• April 7 through July 20

• $2.5 million budget (with Brand USA)

• TV, pre-roll video, radio, digital & outdoor

• First significant effort in Toronto

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Pure Michigan Social Media

Skift.com rated our program in the top ten

of 400 destinations worldwide

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Pure Michigan Public Relations

Awarded “Best in Show” by HSMAI for

“Street Style Detroit” story, among other

awards, in February

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michigan.org

Most popular state tourism web site in U.S.

in 2013, seventh year in a row

1. michigan.org 5.68% market share

2. Virginia 5.21% 3. Florida 5.00% 4. Arkansas 4.86% 5. Hawaii 4.56% 6. Oklahoma 3.63% 7. North Carolina 3.42% 8. Alaska 3.37% 9. Colorado 3.32% 10. Minnesota 2.84%

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Pure Michigan 400

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Four Keys to Pure Michigan

• A powerful brand that inspires confidence and

produces results

• Data that proves the effectiveness of the

campaign

• Industry leadership and unity supporting the

data and the brand

• Sufficient budget to promote the brand

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What’s Next for Pure Michigan?

Goal: Grow visitor spending from $18 billion per

year to $25 billion for Michigan businesses, more

jobs, more tax revenue. How?

• Double national advertising buy for

spring/summer, add fall and winter

• Expand international marketing, do more in

current markets, add markets

Pure Michigan budget goals:

• $50 million by 2017 (Strategic Plan)

• $75 million by 2020

• $100 million by 2023

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Outstanding Achievement in

Tourism Award

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Outstanding Achievement in

Tourism Award

Travel Michigan Team

Maggie Cox Abbey Neerken

Bonnie Fink Robin Peebles

Michelle Grinnell Gary Platte

Dave Lorenz Carol Royce

Regina McCloud Marilyn Schneider

Karen McCumber Chad Wiebesick

Maria Mendez Kelly Wolgamott

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Outstanding Achievement in

Tourism Award

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Outstanding Achievement in

Tourism Award

McCann Erickson

Kim Almonroeder

Kaitlin Freer

Mark Canavan

Bridget Lynn

Christine Cowan

Stacie Maurer

Josh Threm

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Thank You

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