Tourism improvement districts go by many names – tourism business improvement district, tourism marketing district, even hotel marketing district. But no matter its called, a tourism improvement district is a revolutionary way to fund destination marketing programs. In recent years, the tourism improvement district model has evolved from hotel districts, to restaurant districts, to winery and brewery districts.
Civitas is a full-service firm specializing in tourism improvement districts. Whether you have one and need help, would like to create one, or are just curious – feel free to contact us to learn more today.
Tourism Improvement Districts
Each year, more than 160 tourism improvement districts throughout the United States raise nearly $350 million for destination marketing. These districts usually include all hotels in a city or county (or in some cases, multiple cities and the county). They place a charge on all hotels, which is typically a percentage of room night sales or a fixed dollar amount per night. Rates are usually 1-2 percent or dollars per night, but can be as high as 4-5 percent or dollars per night.
The charge is usually passed on to the customer and funds raised are typically collected by the local government in the same manner as bed taxes. However, unlike bed taxes they cannot be spent on general programs by the local government. Instead, they are directed to a destination marketing organization, and must be used on programs that put more heads in beds.
The services funded by a tourism improvement district typically include marketing, sales, promotions, website and Internet presence, and group sales. Sometimes, they even include capital improvements or other projects designed to make the destination more appealing to potential visitors.
The term of a tourism improvement district varies. It can be an annual levy, a 5-10 year term, or even longer in some places. A 2016 survey of tourism districts revealed that the majority of districts took between 6-12 months to form.
Sports Marketing District
A sports marketing district is a highly customized tourism improvement district. Sports marketing districts are formed and operate in the same manner as tourism improvement districts – they place an assessment on hotels, which is collected by the local government and managed by a nonprofit. In addition to hotels, sports marketing districts can include sports facilities.
The key difference between a sports marketing district and a traditional tourism improvement district is that sports districts focus on sports marketing, rather than destination marketing. Programs revolve around attracting overnight groups to local sports attractions – golf courses, regional aquatic centers, youth soccer facilities, and the like. Hotels in cities that are not traditional tourist destinations can greatly benefit from the targeted marketing provided by a sports district, which utilizes existing sports facilities to drive room night sales.
To learn more about how sports marketing districts function, read the section above on tourism improvement districts.