Mr. Poimiroo

Cultural Tourism

Cultural Event Marketing: How hotels are profiting from cultural events

By John Poimiroo, Principal, Poimiroo & Partners

Cultural events have long been touted by arts organizations as benefiting hotels. Research studies by the Los Angeles County-based organizations prove the claim.

In the late 1990s and again in the early 2000s, the effectiveness of major art exhibits to attract visitors to Los Angeles County were studied by the Los Angeles County Museum of Art (LACMA) and by The Museum of Contemporary Art (MOCA) as driven by LA Inc.'s (the Convention and Visitors Bureau's) Cultural Tourism Department. Those studies documented not just the economic and social impact of major Vincent Van Gogh and Andy Warhol exhibitions, but proved once and for all time that strong exhibits - effectively promoted - attract out-of-town visitors, sell rooms and can be extremely lucrative to hotels.

Van Gogh

The first of the two studies, conducted by Morey and Associates, Inc., reviewed a Van Gogh exhibition held at LACMA in 1998-99. The exhibit brought 71 Van Gogh masterpieces to LACMA from Amsterdam for a once-in-America opportunity to see them. 821,000 incremental visitors were attracted to the museum, including an increase of first-time, non-resident visitors to the museum (those who do not live in Los Angeles County) from 34% to 52%. 67% of non-resident visitors stayed in hotel accommodations, up from the norm of 44%, generating 81,896 additional room nights.

Attendees at the Van Gogh exhibit spent like crazy, establishing that cultural tourists are among the most lucrative guests to attract. Although residents (again, those living inside L.A. County) outnumbered nonresidents two to one, the nonresidents spent more than 2.4 times more than residents, generating over $48 million in direct and indirect spending. And, it wasn't just hotel rooms and museum tickets they purchased. They bought meals, transportation, fuel, groceries, entertainment and went shopping, spending $196.80 per day on average.

The Beverly Wilshire (famous as the posh Beverly Hills hotel seen in the motion picture "Pretty Woman") "did over $1 million in room bookings on an investment of $40,000," said Robert Barrett who was director of LA Inc.'s Cultural Tourism Department at the time and now is Marketing Manager for the City of Rancho Mirage. "And, that does not take into account their additional revenue from in-room and in-hotel charges," he added.

It wasn't just the sponsoring hotels that benefited. Recognizing that if someone were to travel halfway across the country to see Van Gogh paintings they'd likely stay a little longer to see some of the 13 other Van Gogh masterpieces on display throughout L.A. County, LA Inc. promoted other Van Goghs to be seen at The Getty, Armand Hammer and Norton Simon museums. That approach spread cultural tourist spending broadly. The Van Gogh exhibition stimulated an increase of nearly $80.1 million in output, $25.3 million in personal income, and supported work for 1,752 people, much of which occurred at hotels and in their restaurants and shops.

Andy Warhol

You'd expect a large exhibit of Vincent's impressionistic paintings of flowers and landscapes to attract large numbers of high-spending cultural tourists, but how would a collection of realistic Pop Art paintings of soup cans and movie stars do in comparison? After all, it wasn't that long ago that Andy Warhol's paintings of pop culture were decried for their pedestrian exploitation of commercial icons (Campbell's Soup, Marilyn Monroe, Brillo boxes and Elvis).

In a second study, conducted by Lauren Schlau Consulting (LSC), the Warhol exhibit increased attendance at MOCA by 275%, attracting visitors from 29 states and key international markets. Nearly two-thirds stayed overnight, 44% in hotels. And, they stayed longer than typical... 4.9 nights compared to the normal 3.7 night stay.

Most importantly, LSC found that 30% said the Warhol exhibit was the principal reason they chose to travel to Los Angeles, generating 8,300 room nights, $18.7 million in total economic activity and $8.1 million in direct spending at hotels. And, that was just from those who said Warhol was the reason they visited L.A. The overall impact of all people who visited the Warhol exhibit was $55.8 million in direct and indirect spending, $3.2 million of which was spent in lodging alone, and 28,200 room nights. Results like these demonstrated that strong cultural exhibits, well promoted, benefit hotels. How then do hoteliers accomplish in their locales what Los Angeles did through these two exhibitions?

What the late George Kirkland, then head of LA Inc., did was leverage his destination marketing organization's (DMO's) ability to generate large pools of cooperative advertising funds to help the museums gain national exposure (desired by them) and attract major underwriters in return for blocks of tickets assigned to the hotels that funded the national advertising effort. Additionally, the DMO had the connections to interest such national firms as American Airlines and American Express. In return for contributing nearly a million dollars in direct and indirect marketing investment, for example, the American Express card was the only credit card that could be used to buy exhibit ticket packages.

Consignment of tickets to the hotels was critical. LA Inc. worked with Ticketmaster and the hotels so that when a customer called, the hotel knew exactly what its ticket inventory was. 48-hours ahead, unsold tickets were released and immediately snapped up. It took one call to "book a room and get tickets," whereas for those shopping only for exhibit tickets, found them to be scarce. Because the tickets were in such high demand is why it worked.

Barrett cautioned that this kind of success can only happen when an event is predicted to sell out. He explained, "Big moments, like King Tut, do not happen often. "In my time with LA Inc., I saw it happen four times... the Lion King, Van Gogh, Warhol and the 15oth Anniversary Smithsonian Traveling Exhibit. "Unless you've got a blockbuster," Barrett advised, "forget it. Because, if it's easy to buy tickets, visitors will find a way to do so without staying at a hotel that's underwritten the advertising investment."

To gain the agreement of the museum to consign tickets to hotels, "it helped that I came from the arts community," said Barrett. "Arts leaders saw me as their representative at LA Inc., so I could speak with them with a level of pre-established trust that would be difficult for someone without those ties to have. But, our success would never had happened were it not for George Kirkland's drive to do big things." Barrett credited Kirkland's focus on grand ideas. Kirkland disliked the popular portrayal of L.A. as a cultural-second to any city in America. He understood the awesome cultural strengths of his city (as exemplified by The Getty and, later, the Walt Disney Concert Hall) and hired Barrett to identify and market events that were equal in scope, admonishing him to always think big.

Because Kirkland and Barrett promoted the exhibitions as sellouts, they convinced hoteliers to invest heavily to advertise exhibit hotel packages, in return for exclusive, reserved ticket blocks. "Hotel execs want to be able to deliver tickets to the most-desired events, to their most-favored guests." Barrett said, "They want to be able to say, 'Yes, we have them for you.' The last thing they want to say is, 'Sorry, there are no ticket to be had' or that they'll need to get them from a scalper. By arranging the promotion as we did, the museums guaranteed blocks of tickets for sale in packages to the hotels which underwrote significant portions of the advertising effort."

The DMO also brought to the museum something they valued even more... a major exhibit underwriter. In the case of Van Gogh, it was Washington Mutual. For Warhol, it was Merrill Lynch. The tipping point for these underwriters was the advertising investment organized by LA Inc. and funded by its hotels. It meant they got guaranteed, widespread exposure among many of the most influential investors in the nation. An advertorial was mailed to 120,000 American Express card members in key Los Angeles feeder markets, display and classified ads appeared in varied local media and national print advertising in ArtScene, Tennis & Golf, The New York Times, The New Yorker, Travel Holiday, Travel & Leisure, Vanity Fair and Museums magazine. There were street banners, 60 billboards, print advertising in all the local entertainment and tourism guides, and over 100 million impressions were generated through publicity in newspapers, magazines and on local and national television.

Resulting awareness was astounding. Fifty-nine percent of visitors said they were aware of the exhibit before they traveled to Los Angeles and 72% decided to attend the exhibit before arriving in L.A. Further, just over one in four international visitors knew of the exhibit prior to their trip.

If the Los Angeles examples described here prove any point, it is that hotels have much to profit from working closely with cultural venues to develop and finance exhibits, concerts and performances of extraordinary appeal. The return from promoting such events can far outweigh their costs when trust and understanding between the cultural venue and the destination marketing organization occur and you think big.

John Poimiroo has had a 30-years in travel and tourism marketing and public policy. He directed marketing and public relations programs at ski areas, attractions, national and state parks, hotel companies and destinations. He was California's tourism director in the 1990s. He is credited for conceiving the California Tourism Marketing Act and helping shape the law authorizing California Welcome Centers. He assisted the chair of the President's Advisory Council on Historic Preservation in establishing the California Cultural Heritage Tourism Council and continues as an advisor. Mr. Poimiroo can be contacted at 916-933-8860 or john@poimiroo.com Extended Bio...

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