DE on Tap Archives

Tourism groups optimistic while hotels eye growing supply, lower demand

Peter Osborne January 8, 2020

Tourism is a vital part of Delaware, accounting for $3.4B in GDP, without it each Delaware household would pay an additional $1,468 in taxes annually.

0 Comment 2011 Views

Premier Digital Partners

Economic Forecast: Hospitality & Tourism

For Bill Sullivan, the math is simple: More supply makes it more difficult to gain market share and higher guest room rates. Sullivan, the managing director of the Courtyard by Marriott Newark at the University of Delaware and a past chairman of the Delaware Hotel & Lodging Association, has some pretty simple metrics that define how he "“ and many of his fellow hoteliers "“ are doing. The basic goal is to either sell more rooms (raise your occupancy rate) or get more per room. He looks for a growth rate for his average daily rate (ADR) and increases in revenue per available room (RevPAR).

"In terms of occupancy rates, 65% normally means break even and 50% means you're in trouble," Sullivan said. There are a few key indicators for hotel owners and managers throughout the state. Sullivan said there's been a greater push toward analytics, particularly since there are new properties are hitting the street at a time when demand is flat or down. "Youth sports is the steadiest market we have, and you're seeing hotels and shopping go up across the street from some of those facilities and there was also a great deal of excitement downstate in December with the return of Slam Dunk to the Beach in Sussex County," Sullivan said. In recent months, the industry has been talking a lot about regulation and legislation keeping up with the shared economy. Expect more discussion in the General Assembly about taxes, with a renewed focus on including Airbnb guests among accommodations where visitors are lodging. But the specter of how new construction will impact local hotels remains top of mind for Sullivan. Developers are looking for the next hot place to build, but he said there's one place that gets a lot of buzz may not be that next hot spot. "I've seen reports and talked to people who say there's no justification for more properties at the STAR campus," he said. "Most of their traffic is local and the demand for travel is down there." But when it comes down to it, local tourism groups are the primary drivers "“ along with business travel "“ or success for the Delaware hotel industry.

The statewide perspective

For Liz Keller, director of the Delaware Tourism Office, 2019 was marked with an "amazing and empowering" partnership with the Delaware Restaurant Association on the Women in Hospitality conference and the first-ever Visit Delaware shuttle between hotels across the state and the Firefly concert in Dover. [caption id="attachment_171889" align="alignleft" width="411"]

Firefly Music Festival main stage. | Photo c/o Firefly Music Festival.[/caption] The mission of the Delaware Tourism Office is to attract out-of-state visitors to Delaware. Tourism is a vital part of Delaware's economy, accounting for $3.4 billion in gross domestic product. The industry employs more than 43,000 people, making it the state's fourth largest private employment sector. Without tourism, the office says, each Delaware household would pay an additional $1,468 in taxes annually. Keller said the state tourism office has only touched "the tip of the iceberg" in terms of attracting visitors. While it's difficult to quantify the economic impact in a timely manner, the office's Endless Discoveries campaign continues to grow. The digital, print and television campaign, which included a new TV commercial, generated more than 16 million impressions in 2018. "We plan to continue to drive Endless Discoveries," she said. "Between that campaign and our Delaware on Tap mobile application, we hope to reach new markets of younger travelers beyond the Firefly audience." DE on Tap continued to grow from its original 10 breweries and other craft beverage makers to the current 36. DE on Tap sponsored the 50th anniversary races at Dover International Speedway and Keller's team increased the number of out-of-state events it attended to promote DE on Tap, including the Philly All-Star Craft Beer, Wine and Cocktail Festival and the Philly Craft Beer Festival. Keller's team also worked with other state agencies and the Firefly Music Festival to provide safe transportation for festival attendees from hotels in northern and southern Delaware. They also partnered with Carvertise to wrap Uber and Lyft vehicles with Delaware tourism imagery for visitors to the New York Times Travel Show. That campaign received 1.1 million impressions. Keller said her team is data-driven, focusing on conducting surveys of current and prospective visitors about what makes them decide to travel. The results help drive the content they create to raise the state's visibility. As in 2019, when the tourism office sponsored workshops with representatives from Trip Advisor and Google, she expects to do more of that in 2020. In particular, the Google visit paid off. Designed to help small businesses and nonprofits such as museums update their Google listings with enhanced photos that have been viewed more than 525,000 times since last January.

Kent County gets a big win

For Pete Bradley, president of Kent County Tourism (Delaware's Quaint Villages) in Dover, the biggest success of 2019 was winning the bid to host the 2020 Mid-Atlantic Tourism Public Relations Alliance (MATPRA) Media Marketplace conference. "The MATPRA organization is comprised of Destination Marketing Organizations (DMOs) in the Mid-Atlantic region at Dover Downs in September," Bradley said, noting it was last held in Delaware over nine years ago. "The great thing about this is that we will host more than 50 well-vetted travel writers along with representatives from all the Mid-Atlantic DMOs to showcase what Kent County and the entire state of Delaware has to offer. We will offer nine familiarization tours to showcase Kent County offerings during the conference." Bradley said the Delaware industry's biggest challenge is for the tourism dollar. "The customer has so many choices," he said, adding that success in 2020 involves continuing a positive trend in overall hotel occupancy and room-night growth. "We need to continue to market that Kent County is a great place to visit [and do that with a] chip on our shoulder so we can compete for that Mid-Atlantic customer."

The View from Sussex County

For Scott Thomas, executive director of Southern Delaware Tourism, two metrics for 2019 jumped out to him for initiatives created by the Sussex County organization "“ 20,891 hotel searches in Sussex County and $2.4 million in publicity value for travel to Sussex County. "The biggest challenge we faced in 2019 was a limited budget compared to our regional competition," Thomas said. "We are focused on measuring our advertising in regional markets and how it provokes consumer to travel to southern Delaware." Thomas says success for Southern Delaware Tourism in 2020 will focus on steadily increasing year-round hotel occupancy in Sussex County and helping southern Delaware be known as The Culinary Coast. That, he said, requires greater investment in tourism promotion. By Peter Osborne Editor

Premier Digital Partners

Newsletter Signup

ABOUT

NEWS INDUSTRY

SUBSCRIBE

FOLLOW US

Premier Digital Partners

Economic Forecast: Hospitality & Tourism

The statewide perspective

Kent County gets a big win

The View from Sussex County

Type to search

Premier Digital Partners

Newsletter Signup

ABOUT

NEWS INDUSTRY

SUBSCRIBE

FOLLOW US

Premier Digital Partners

Economic Forecast: Hospitality & Tourism

The statewide perspective

Kent County gets a big win

The View from Sussex County