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Tourism Marketing – 5 Reasons CVBs Should Rely on Research to Overcome Hotel Occupancy Tax (HOT) Squabbles


According to the Texas Hotel and Lodging Association, hotel occupancy tax (HOT) must be used for one of 9 purposes, including: “Paying for advertising, solicitations, and promotions that attract tourists and convention delegates to the city or its vicinity.” But, for many cities and towns, exactly how that money should be spent is a matter of endless debate.

If your job is to help bolster your city’s tourism business, certainly you are no stranger to internal debates and arguments about how to best use HOT dollars. When it comes to making tourism marketing decisions, most cities and towns rely on input from three sources:

1. the CVB director
3. the city council
3. the marketing committee

While all involved parties no doubt have the city’s greater good at heart, each of these entities has its own motivations, opinions and goals for the budgeting process. You have probably witnessed or even been part of heated debates about HOT dollar usage that end up going nowhere. Often, the only solution that cities find to these debates is for all parties to make compromises that nobody is really happy with. The result: a tactically-driven marketing effort that lacks true vision, direction and strategic focus.

Fortunately, there is a reliable way to move beyond the internal debates and squabbles around hotel occupancy tax (HOT) dollar usage for the promotion of city tourism: by relying on research and data to light the way forward.

Here are 5 reasons CVBs and DMOs should rely on research and data to overcome HOT tax dollar squabbles:

1. Lends objectivity to the decision-making process: Hiring a third-party research consultant to build a “best visitor profile” of your historical visitors allows you to transcend subjective, “he said, she said”-type opinions.

With such a report in hand, your team has an objective, reliable, third-party resource for making decisions about how to message to your best tourism prospects and find out where they live. The report will also provide a wealth of marketing recommendations on which channels or modalities (like TV, radio, online/digital, and more) to leverage most effectively.

2. Considers the needs of your city or town as a whole: Research shines a light on the way forward because it leverages what we can find out about historical visitors to your city. The research doesn’t look at just one influential hotel, restaurant or attraction for direction. Rather, it takes everybody’s input into account by leveraging their historical visitor/customer lists to build a robust segmentation profile of your best visitors.

3. Based on historical data: Many CVBs try to merely guess or imagine what their best tourism visitors look like – who they are, how they think, where they live, etc. On the other hand, research-based persona development is based on your actual historical visitors – not those you think about anecdotally or hope you are getting.

4. Provides a strategy that guides tactical moves: With a marketing plan that is rooted in solid research, you have the ability to put together a true strategic vision and focus that guides all of your individual, tactical marketing activities. The new-found integration and direction will carry you forward with renewed focus.

5. Produces more effective, high-ROI tourism marketing: What matters most is this: research-oriented marketing produces better results. Because it helps you focus on the right “WHOM” you are targeting, you can focus on the right “HOW” to most effectively find, reach out to and attract your best visitors.

Whether you are on the CVB directory, a member of the city council, or a member of the marketing committee, consider investing in a best visitor profiling report that is rooted in your own historical data. It could well help you get past the internal squabbles about HOT budget usage and get down the road toward high-ROI marketing.