The Challenge

The beautiful Napa Valley. Images of sprawling vineyards, relaxed days of wine-tasting, and the scent of freshly pressed grapes spring to mind. Harvest season in Napa Valley is by far the busiest time of year, bringing flocks of tourists to experience “Crush”. The challenge for Napa Valley tourism arose during the remaining months of the year. Napa Valley had struggled with destination marketing for many years. Various organizations worked to increase awareness of the Valley as a tourism destination but were stymied by a lack of funding. These struggles made the Valley an excellent candidate to form and greatly benefit from a tourism improvement district.

The Innovation

By creating a tourism improvement district (TID), assessment funds could be spent to provide specific benefits directly to the payors. These privileges and benefits would include budget categories for valley wide sales and marketing, as well as individual destination marketing. The TID would include all lodging businesses, approximately 115+ hotels, located within the boundaries of the cities of American Canyon, Calistoga, Napa, and St. Helena, the town of Yountville, and the unincorporated area of the County of Napa. In 2010, the Napa Valley Tourism Improvement District (NVTID) was created.

The Results

The NVTID was originally projected to provide $4 million per year in marketing funds. Over time, that amount has increased by 150% – without an increase in the assessment rate. The NVTID now provides $6.5 million per year dedicated to increasing room night sales for the benefit of assessed businesses.

NVTID funds have been used to implement a variety of programs to increase room night sales. A new website and mobile app was launched, both featuring a booking engine and driving room night sales directly to assessed businesses. A variety of ads were placed in all forms of media
and public relations activities were engaged to produce key opinion leader endorsements. Marketing sponsorships of multi-day events helped to drive overnight stays and build awareness. Additionally, a robust sales team has been put in place to drive overnight group business to the Napa Valley in the form of corporate and association meetings, as well as incentive trip gatherings.

The efforts of the NVTID lodging business owners have paid off. Lodging revenue has continued to grow every year since the district was formed, by at least 11% and up to 15.7%. Average daily room rates have gone up, as have occupancy rates during mid-week and the shoulder seasons. The NVTID results set an impressive example of the efficacy of tourism improvement districts.