Who does what? Tourism operations at local and regional levels. In many regional centres there can be confusion about who does what in tourism.

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1 Who does what? Tourism operations at local and regional levels In many regional centres there can be confusion about who does what in tourism. Some perceive tourism as just being about product or visitor servicing. Some think tourism is only local. Some think tourism only concerns businesses like accommodation providers, attractions operators and hospitality outlets. Many in both the private sector and Councils are unsure of the role of local government in tourism. Some believe that product is the most important factor while others feel destination marketing is more important. This paper addresses these and other issues and puts tourism operations in the right perspective. With the compliments of Norm White, Director Advance Tourism Information age consultancy in strategy, business planning and operations management for tourism organisations and businesses Mt Waverley Victoria Ph. (03) Mob May, 2005 Please feel free to make this paper available in full or in part to others who may be interested in a more successful tourism industry. If published, please provide acknowledgment to Advance Tourism.

2 Who does what? Tourism operations at local and regional levels Regional Australia has seen magnificent tourism growth over recent years. It has delivered many benefits for regional communities but there is confusion in some areas about various functions such as the divisions of responsibility between the private and public sectors the different roles between state, regional and local tourism organisations the responsibility of Councils and the private sector with destination marketing and product development. These and other important issues are addressed below. Then there is a diagram to illustrate how the industry operates. Also shown as an attachment is a more detailed explanation of the functions of various tourism organisations and Councils. BROAD OVERVIEW Using best practice at many successful regional destinations as a guide, the following explains how the industry operates successfully at many local and regional destinations. Private sector The private sector comprises individual tourism enterprises that operate in a competitive, commercial environment using a business ethos and private sector capital. Uppermost at all times is the need to trade profitably. The private sector is usually best equipped with its industry skills, industry expertise and business acumen to manage destination marketing programs, industry development programs. The private sector operates the Regional Tourism Organisations (RTOs) and Local Tourism Organisations (LTOs). They are membership based and are, in affect, consortiums or cooperatives of private sector industry businesses. As an example, Limestone Coast Tourism RTO in SA includes members from Mt Gambier, Millicent, Naracoorte, Robe and six other locations in its region. RTOs and LTOs operate on behalf of individual tourism businesses to achieve a unified industry approach to deliver successful destination marketing strategies. These activities have the express aim of driving customers into local businesses whether they may be accommodation providers, attractions etc or tourismrelated businesses like retailers, hotels, restaurants, sporting facilities, etc. With destination marketing today, RTOs are now the spearhead for most regions. They are able to bring together the resources of the region to produce effective programs that deliver business to industry stakeholders. LTOs dovetail into RTO strategies. As an example, Tourism Queensland does not undertake state campaigns. Instead it supports regional Public sector The public sector comprises the State Tourism Organisation (STO) and Councils that operate in a bureaucratic process which gives Australia good democratic government. Funding is provided by taxpayers and ratepayers. A principle role for both the STO and Councils is destination development in terms of product and infrastructure. Each STO also has a role to market its State interstate, overseas and within the State. Each STO works with RTOs for destination marketing activities and development of the private sector of the industry. STOs work through Councils with regard to product and infrastructure development. STOs also work closely with RTOs to assist their regional marketing strategies for markets interstate, overseas and within the state. An aim of governments at all levels is to assist the private sector to grow and prosper in many industries and tourism is no exception. In tourism, this usually means the private and public sectors working together in partnership jointly. In many regional areas where the tourism industry private sector is too small to manage and develop the local tourism industry, Councils work together with the private sector to grow the industry for the community. Advance Tourism 1

3 campaigns developed and managed by RTOs. Tourism Queensland works with the regions and contributes resources for major campaigns. Each campaign has a strong regional theme which complements the Where else but Queensland theme. A few large local centres currently prefer to maintain a market presence but progressively this number is reducing as it is recognised that RTOs have the most success at destination marketing. Local Tourism Organisations usually maintain strategies for marketing their location within their own and neighbouring regions as well as on approach routes but now defer to their RTO to use the resources of the region and industry partners to produces the best results for their location and the region.. In South Australia, because regional tourism groups are small throughout the State, South Australian Tourism Commission (SATC) provides each region with a Marketing Manager employed by SATC. This appointment works closely with the private sector to deliver successful tourism programs for regional communities. This arrangement has been a great success with Murraylands Tourism winning a national tourism award twice. Councils in SA provide support for tourism at the local level. COUNCIL ECONOMIC DEVELOPMENT UNITS Council Economic Development Units have a very different function to tourism. Their primary role is to attract investors and to secure such business enterprises for the LGA from a wide variety of industries. With tourism, the priority is destination marketing which means competing in consumer markets, targeting the travel industry and formulating cooperative marketing programs with tourism industry stakeholders. Techniques used to win investment by investors are vastly different to the techniques used to target leisure travel consumers and the travel industry. With smaller Councils where resources are limited and the tourism industry is small, the best compromise is often to have the Economic Development Unit foster development of the local tourism industry. VISITOR INFORMATION CENTRES When tourism first started to emerge as an industry with promise, Tourist Information Centres were established by Councils to supply visitors with local information. Today the primary role of Visitor Information Centres has changed to be an important contributor to the local economy. It is now an integral part of destination marketing. Many Councils now recognise that separating Visitor Information Centres from destination marketing activities only impedes better results. For this reason, there is a trend to place Visitor Information Centre operations and destination marketing under the one management. MANAGERS In some centres, the tourism industry has grown so much that the Visitor Information Centre Manager or Supervisor reports to a Tourism Manager who acts in the role of Chief Executive. With some Councils that believe destination marketing is not a function of local government, the Tourism Manager and Visitor Information Centre operation provided by Council is placed under the direction of a Tourism Board of private sector stakeholders who are responsible for destination marketing and visitor servicing. Councils like Wollongong and Eurobodalla Coast in NSW and Bendigo and Ballarat in Victoria have been very successful with this structure. LOCAL GOVERNMENT Councils are important partners for tourism success in regions. Their role is explained on the last page. Originally Councils were very involved in tourism operations to help the fledgling industry but increasingly Councils are themselves recognising that tourism s commercial operations are not part of local government activities and are now looking to the private sector to assume this responsibility. Advance Tourism 2

4 INDUSTRY STRUCTURE DESTINATION MARKETING Roles PRODUCT DEVELOPMENT Roles Market their business to attract customers Operate a profitable business Support destination marketing Private sector local tourism organisation Industry development and visitor service standards Support destination marketing Link between industry businesses and RTO Peak private sector tourism organisation for region Regional destination marketing initiatives Strategic planning at regional level Focussed on securing business for industry Link between region and State Tourism Organisation Peak tourism body for the State (Government) State destination marketing initiatives Strategic planning at State level Industry development Not involved in pursuing business. This is undertaken by RTOs and Convention Bureaux ** INDIVIDUAL BUSINESSES LOCAL ORGANISATIONS REGIONAL ORGANISATION STATE ORGANISATION Council roles are destination and product development facilitating industry development particularly with support for destination marketing Destination marketing is not a role of local government RTOs have no involvement in product development beyond identifying gaps and opportunities STOs have a primary responsibility for product development Marketing Australia as a destination in overseas markets Domestic marketing campaigns AUSTRALIA No involvement in product development beyond identifying gaps and opportunities ** Exceptions being package holiday programs operated by Northern Territory, Queensland, South Australia and Tasmania. Advance Tourism 3

5 Advance Tourism 4

6 ROLES AND FUNCTIONS ATTACHMENT State Tourism Organisations Main function is to facilitate development of a growing, prosperous statewide tourism industry Peak government body for the state Achieve greater awareness and demand for the state Strategies to produce business (visitors) for the whole state Raise competitive performance Assist RTOs to develop regional destination marketing Product development across the state Industry development across the state Package holiday programs operated by Northern Territory, Queensland, South Australia and Tasmania. State Tourism Organisations facilitate State Government policies designed to create a vibrant statewide private sector tourism industry. The main functions are destination marketing strategies for the state, development of product including attracting private sector investment and industry development initiatives. Regional Tourism Organisations Main function is to have an external focus and generate increased business for the region Peak private sector body for region Strategies to bring in business (visitors) Raise demand through greater awareness Raise competitive performance Assist LTAs to develop Regional Tourism Organisations (RTOs) are coordinating marketing bodies responsible for marketing the region to target markets on behalf of Local Tourism Associations, tourism operations, local government and communities of the region. As the umbrella organisation, the Regional Tourism Organisation has the responsibility to assist in the management, leadership and development of tourism in the region and to achieve increased business (visitation) through effective destination marketing. Regional Tourism Organisations stay abreast of industry trends and the competitive environment, an important function. RTOs coordinate regional strategies and resources with Local Tourism Associations, tourism operators, external funding sources and cooperative partners. Local Tourism Organisations Main function is to have a local focus with marketing and support industry development Peak private sector body for sub-regions and local destinations Visitor servicing Targeted local marketing Product development Industry development Local Tourism Organisations (LTOs) are an integral part of the success of the region s tourism industry. A Local Tourism Organisation is primarily about attracting visitors to their local area through effective marketing, industry development (assisting stakeholders with business information and skills development), product development initiatives and working with local government to improve facilities. External marketing and industry development is undertaken in conjunction with the RTO. Targeted local marketing entails maximising the spend of visitors while in the area. This is achieved by a high standard of service in the Visitor Information Centre, ensuring local promotions directed at visiting Advance Tourism 5

7 customers are professional and effective, cross selling by operators is a standard practice and customers are given every opportunity to know about what there is to enjoy. Local Government Councils have two main tourism functions, destination development and industry development Destination development includes assisting investors with product developments Infrastructure development Industry development including financial assistance for destination marketing so that the location can be competitive Council activities interface with private sector operations and assist development as follows Destination development Industry development This entails attracting private sector investment providing assistance to developers and investors with information and development assistance infrastructure development. The main avenue for assisting development of this new industry for regional communities is to provide financial and other assistance to augment private sector resources for effective destination marketing programs. A major change over recent years has been the transfer of Visitor Information Centre operations to the Local Tourism Organisation or Regional Tourism Organisation. Visitor Information Centre operations have now become an integral part of successful destination marketing because of the need to service customers who are contemplating making a visit and the need to keep destination websites up-to-date with accurate information. Automated reservations services are now also being based at Visitor Information Centres. Successful destinations recognise that destination marketing programs can not fully deliver the results sought while external activities are not linked to the call to action centre at the destination. Divided operations never prove to be as successful as a unified approach whether it be in business, sport or politics. Smaller centres In smaller centres where there is a limit on the number of tourism businesses with the capacity to manage a Local Tourism Organisation and Visitor Information Centre on their own, often Councils establish a working partnership with the private sector. Together they develop plans which make the destination more appealing to travellers and work with the RTO to build both awareness and demand for that location. Advance Tourism 6

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