Here’s How to Win California’s Burgeoning Tourism Account

State's $26 million budget could triple in size

Needless to say, California as a destination sells itself. But with growing competition from other sunny vacation rivals, America's No. 1 tourism spot has in recent years been enlisting advertising help from high-profile residents like Arnold Schwarzenegger, David Beckham, Rob Lowe, Kim Kardashian and Betty White to entice travelers. It's been one of the industry's most-high profile tourism accounts—fun, inspirational and moneyed. In the current agency review, the state plans to spend up to $26 million a year on marketing.

That amount could increase if the California Travel and Tourism Commission receives a requested increase in funds that could double its annual operating budget to $100 million. (The state wants to make a decision by early February, and a new agency contract runs 16 months from March 1, 2015 through June 30, 2016. Visit California's RFP dangled an unexpected carrot to agencies in saying, "Moving forward the budget for this contract could potentially scale to $80 million annually over the next two years.")

Celebrity and aspirational dreams aside, tourism is serious business in the Golden State. "The way we measure our performance is the economic impact of tourism," said Lynn Carpenter, vp, marketing, Visit California. "California is our product. We’re kind of an anomaly, and we hope (agency) people will understand the importance of this industry within our economy. When people are here, they spend money. The destination category is not a well-understood space."

Native Californian Pilar Guzmán, editor-in-chief, Conde Nast Traveler, said that while in the past the state didn’t have to try very hard to win over visitors, it has increasingly faced competition from locales like Costa Rica, the Dominican Republic, Puerto Rico and newly-aggressive U.S. marketers such as Orlando and Las Vegas. However, she notes California has become a much broader tourism attraction, beyond Los Angeles and San Francisco. From Napa Valley down the Central Coast to San Diego, she said, the state is attracting visitors to places previously missing from their itinerary. Not the least of which is Silicon Valley.

"The tourism industry has changed. It’s not just things like the sleepy San Francisco Fisherman’s Wharf; it’s not so one-dimensional anymore," she said. "The travel industry out there has changed. It’s not just about going to Hollywood because movies are made out there. It’s about making dreams come true, and for entrepreneurs the focus has turned to Silicon Valley, away from New York, as the focus of everything."

For agencies going forward with account proposals, due Dec. 5, here are a few things to remember in pitching the business:

  • Understand the huge importance of tourism as an economic engine in California. Last year visitors spent $110 billion, and the industry is the state’s fifth-largest employer.
  • In considering the state’s target visitors, you can’t just think about Americans who want to visit Mickey at Disneyland. California’s visitors are international, with just over 50 percent of the state's 243 million visitors last year coming from outside the U.S. International travelers stay longer and spend more on hotels, restaurants and retail. Last year, they ponied up $24 billion, up 9 percent from 2012. Canada and Mexico are the biggest international markets for California tourists, although the U.K. and Australia are also important.
  • You better understand China: It is a huge growth market for California tourism, with over 800 percent growth in visitors since 2006, and that increase shows no sign of slowing. President Obama and the U.S. government have made it easier for the Chinese to get travel visas, and California represents the land of dreams to aspirational consumers in China. The state is now in its second year of an advertising campaign in China, which runs online and in broadcast.
  • Come up with some new ideas for California's "Dream Big" positioning, which was rolled out in 2013. That brand platform included the introduction of a new consumer tagline and launch of a new umbrella TV commercial, "Dreamers." Review contenders need to demonstrate how they will evolve "Dream Big" for a global audience and keep the messaging fresh.
  • This is the media strategy to date: It’s been focused on national cable the last six years with two flights in the fall, focused on the holidays and winter, and spring. This year California went back to a single broadcast flight in the spring and national TV for morning shows.
  • You don’t have to have an office in California, but it helps to have the state’s DNA in your culture. Working in the destination space is a plus but not if you work for one of California’s major competitors (Florida or Nevada), all of which are considered conflict accounts.