NAPA — Clay Gregory, president and chief executive officer of the Napa Valley Destination Council, said tourism and hospitality this year has been steadily increasing, a trend he expects to continue, but not without its challenges.
The region, like virtually all tourism destinations, suffered mightily following the Great Recession, as consumers halted travel amid a teetering economic landscape. But while uncertainty remains, Mr. Gregory said early evidence suggests Napa Valley is poised to return to stability.
Last year, the Destination Council helped pass a two percent assessment on visitors’ hotel rooms, which is expected to generate as much as $4 million annually for tourism promotion efforts, compared to its previous budget of $437,000.
The Destination Council, Napa County’s official tourism promotional arm, has grown from three to 10 employees in the first half of this year, and has significantly stepped up efforts to promote the Napa Valley.
Mr. Gregory, who will be speaking at the Business Journal’s Impact Napa conference, recently shared some of his thoughts on the tourism and hospitality industries in the Napa Valley,
Business Journal: What is your sense of the overall health of the industry, both locally and more regionally?
Mr. Gregory: Our data from Smith Travel Research shows, and anecdotal feedback from the majority of our lodging partners indicates, that the Napa Valley has experienced a significant upswing in occupancy and revenue over the last year. The first half of calendar year 2011 shows an increase of almost 7 percent in occupancy and 13 percent in revenue. We also have a data point from TripAdvisor that unique visitor traffic to Napa Valley pages increased by 26 percent this July over last year. Very encouraging.
All of this should be taken with the caveat that economic uncertainty tends to make consumers more conservative, so my optimism is balanced with caution.
The uncertain economic environment, including the recent dramatic swings in the stock market, in the U.S. is by far the biggest challenge for the travel industry.
Business Journal: The tourism improvement district seems to have had success early on. What sort of impact has it had throughout the Napa County?
Mr. Gregory: The TID has definitely had a positive impact on the Valley, and its benefit has multiple facets and layers. First, our marketing investment has already delivered good results that positively impact more than 195 industries in Napa County that directly benefit from tourism spending.
Transient Occupancy Taxes and sales tax are both up significantly, which helps the towns’ and County’s operating budgets. And the best thing that has happened, from a long-term benefit viewpoint, is that there are new connections happening among groups that previously didn’t associate. It’s a spirit of collaboration that is growing, and we’re very excited to be a part of it.
Business Journal: What are some examples of the TID at work?
Mr. Gregory: The programs we’ve built, and that will continue this year, are: Legendary Napa Valley Cabernet Season (Nov. – April), Napa Valley Restaurant Month (January), Legendary Napa Valley Getaways (February and March), and Arts in April.
Additionally, we are partnering in the development of Flavor! Napa Valley, a signature wine and food festival launching Nov. 17-20. We are helping to market the Napa Valley Film Festival, sponsoring the welcome dinner of the first U.S. Wine Tourism Conference on Nov.16, and we’re supporting a number of other events with marketing and public relations activities. The new Napa Valley Welcome Center is an exciting outcome of the TID investment.
Business Journal: With the increased marketing capacity from the TID funds, what are some of the marketing strategies of the Destination Council?
Mr. Gregory: We began receiving the TID funding last November, and we’ve been running ever since to build programs that support our mission of protecting, promoting and enhancing the Napa Valley’s position as the premier wine, food, arts and wellness capital. Our strategy is to do this through the development and implementation of marketing programs that are focused on our targeted audience (high-value, low-impact consumers) to build overnight tourism during the low-occupancy periods of November – April, and primarily Sunday – Thursday nights.
Business Journal: How is the Destination Council dealing with technological changes impacting the tourism industry?
Mr. Gregory: We’re aggressively pursuing digital marketing channels through website and visit mobile application enhancements, the development of direct-to-consumer digital marketing capabilities, etc. When we were designing our new Napa Valley Welcome Center, it was important to us to incorporate new technologies because our second-priority core consumer group is engaged in this way. We have a table with six ipads that have our Visit Napa Valley app and our website on them, and we have more plans to enhance ways consumers can interact digitally while they plan their visit in the Napa Valley. Social media is another way we’re engaging and you’ll see a lot of development in this area in the future.
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