The federal budget, the CTC and Canada’s tourism industry.

In the budget delivered by the federal government on January 27^th, the CTC received a one-time increase of $40 million over the next two years to be divided equally between a domestic advertising program and the development of priority international markets. In this Q&A, CTC President and CEO Michele McKenzie talks about the allocation – and what it means for the tourism industry.

What is the purpose of the funding increase?

This strategic investment by the federal government recognizes that tourism is one of the fastest growing industries in the world and that further expansion of Canada’s tourism brand can increase tourism export revenues at home and provide stimulus to the economy at a critical time. Even in a turbulent year like 2008, tourism’s contribution to Canada’s GDP reached an estimated $30.7 billion, a 7.3% increase over 2007, and generated $22.2 billion in government revenues, up 5.7% over the previous year.

With Canada in recession and the global economy in uncharted territory, it is more important than ever that the CTC be nimble and opportunistic in seeking the maximum return on this welcome investment.

What is the CTC’s strategy for priority international markets?

The stimulus package has provided us with an important economic opportunity to expand investment into high-growth emerging markets like India and Brazil. These countries, both with a rapidly growing middle-class, booming economies and outward-bound potential, have grown at an impressive rate. Since 1995, India has grown on average 5.6% and Brazil at 4.6% compared to CTC’s overseas core markets at 0.5%. It’s critical that we do not become overly reliant on mature tourism markets with slowing growth. Entry into these markets is aligned with the CTC’s corporate strategy to inspire high-yield customers to visit Canada, to focus on markets of highest return on investment and to respond quickly to changing market dynamics.

And, we’re well-positioned to leverage our expertise to generate success in emerging economies due to Canada’s highly successful tourism brand, strong research capabilities, excellent strategies, and marketing and sales tools. Our tourism marketing has already had significant success in emerging markets such as Mexico and China and they now represent two of the potentially strongest growth markets in the CTC’s portfolio. For now at least, we will not open offices in India or Brazil, but will operate online and through local partners.

We also plan to expand the meetings, conventions and incentive travel (MC&IT) program globally, modeling our successful U.S. strategy that focuses on partnership development and on leveraging existing relationships with professional associations and organizations.

And we’ll enhance development of the U.S. Leisure market by pursuing a stimulus “getaway" strategy similar to our successful post-9/11 approach

We also look at mining the untapped potential in both our China and Mexico markets.

Why is a domestic campaign part of the strategy?

This is a wonderful opportunity to share with Canadians the Canada: Keep Exploring brand that has resonated so successfully in global markets.

The stimulus funding will be used for a national advertising campaign to promote the entire country, rather than favouring specific regions. We will work with partners who have a national reach - such as hotels, car rental organizations, airlines, Parks Canada – to create an overarching national framework. CTC will continue to work through OMD, the media purchasing division of our agency of record DDB, to identify appropriate opportunities. And of course the CTC will be able to maximize its existing assets such as the global platform, the brand and EQ™. Destination and private sector partners will be welcome to leverage this opportunity with parallel media investments within the scope of the national campaign.

Our goal is to inspire Canadians to explore their own country and make them aware of the truly extraordinary experiences, festivals and events that are available right on their doorstep – and to consider Canada first before planning a trip abroad. Keeping dollars at home will stimulate our tourism industry, especially benefiting SMEs.

Is any of the new funding going towards the Games?

Leading up to 2010, everything that the CTC does is informed by the Games. For example, the national advertising campaign will provide another opportunity to underscore that the 2010 Winter Games are indeed “Canada’s Games.”

Will CTC increase its contribution to partnered programs?

The budget allocation was specifically framed around economic stimulus - to create new opportunities, open new markets, and encourage Canadians to explore Canada. It is not intended to increase CTC contributions to existing programs.

What are the next steps?

A comprehensive round of consultations with industry is already underway to discuss the most effective tactics to complement the CTC’s strategy in domestic and international markets. Once this revised 2009-2013 corporate plan has final government approval, we will hold an industry-wide WebEx.

We also plan to hold back 2% of the stimulus funding until the end of the second quarter when we will look at performance and review future business cases.

In the meantime, I welcome your comments and questions as we seek to make the most of this exceptional opportunity to move Canada’s brand to a new level.

Keep Exploring

Michele McKenzie

Tags:

economy

Comments

Post a comment

Footer Links CW EN

Email alerts