This is a very strategic approach to the age old problem of how to reduce reliance on promotional sales (moving away from a high/low pric...
One of the key pillars of Australia’s Northern Territory economy, and its biggest employer, is the tourism trade. Yet visitation in the last five years has slumped: In 2012, the territory reported a 12 per cent year-on-year drop in visitors to a record low of 263,000 people, nearly half the number that visited in 2001.
To arrest the decline, the government is ramping up its international marketing budget to $15 million this year and has tasked promotional agency, Tourism NT, and its CMO, Adam Coward, with putting the funds to good use. The boost is part of a strategic objective to deliver $2.2bn in annual visitor spending to the NT economy by attracting 1.7 million visitors annually by 2020.
Coward joined Tourism NT as executive director of marketing 12 months ago and swiftly embarked on a restructure of the way his team interacts with customers and trade partners. The key weapons in his arsenal are stronger conversion tactics, targeted digital and social channel engagement, better partner ties, technology improvements, and an agile and open leadership directive.
While the high Australian dollar, geographic accessibility and global economic downturn all impact visitation, a major internal issue for Tourism NT was to overcome the imbalance of branding/positioning and conversion elements, Coward said.
“The fundamentals stopping people coming to the NT weren’t being addressed,” he told CMO. “We were an inspiration business but not so good at motivating potential visitors to come here, right now.
“We still need to keep up our awareness efforts, but balance that inspiration with a conversion strategy.”
Years of budget cuts hadn’t helped either, and Coward claimed a clear correlation between fewer dollars and fewer visitors. The NT Government’s $15 million investment into international tourism, double the amount invested in previous years, will go a long way to bringing the numbers back up as it flows through later this year. Minister for tourism and major events, Matt Conlan, has stated the funding will help build NT’s profile in Western markets, strengthen its presence in growing Asian markets, conduct market research, build a better social media engagement strategy, and broaden its digital advertising campaign efforts.
But even before the extra budget dollars come through, Coward claims his team has made big changes that will lead the way to bigger rewards. One such example is the emphasis on below-the-line activities such as working with trade partners and international reps, to understand what people do when they come to Australia, and book an NT holiday. Coward cited double-digital results from trade partners internationally in the last quarter.
“Recent survey data we undertook also shows positive signs from the new strategy even in the very short term,” he added.
Brisbane-born Coward puts his ability to juggle Tourism NT’s vast partner and stakeholder network down to an entrepreneurial spirit and diverse background. After completing a combined marketing/HR/commerce degree, he joined the Colorado Group internationally as a marketing analyst and e-commerce strategist. Coward then moved into a digital marketing position at airline Virgin Blue (now Virgin Australia), a role he says which gave him new category experience on a challenger brand.
After 18 months running his own events business, seven years operating an inner sole supply business based out of China, and a senior marketing role at Westfield, Coward worked for franchise business, Mr Rental.
“Tourism NT requires both a diverse council understanding, as well as the ability to maintain relationships with suppliers and retail,” Coward said. “The agency wanted to become outcome focused, not tourism focused. My experience working in franchising is also important because we have 400 operators working with Tourism NT and we want to build a leadership position with them.”
Tourism NT also has 10 in-market teams covering regions such as Asia, Europe and the US. One of the ways Coward has simplified managing the network is to treat Australia with a common set of principles as those other countries, but still allow flexibility in market-to-market approaches.
“The difference between a product sector and destination marketer in a pure sense is that you don’t have full control of that crucial ‘product’ in the four ‘Ps’ of marketing,” Coward said. “The silver lining is that it brings you a lot closer to your suppliers. You also have to understand the destination so much more in order to work with it.
“In the past, the strategy would have been to build the biggest website you can possibly think of and get everyone to come to your site. The future is decentralised and about an ecosystem of information. Our goal is to look at our top 10 touch points where people come to us from around the world, and improve those one by one.”
Tourism NT is now working with each touch point to improve websites, search engine strategies, links, and content production. “When we do make that connection with a trade player, we leave a bigger and better footprint than before – and it stays there,” he said. “Where we have started to meet those challenges, we’ve seen the increases and results from it.
“The new world of brand is that you have to set it free. The old world approach was to control and conquer, but today you have to focus on influencing to make the outcomes as consistent as possible. And that’s about the people who make up brands – whether it’s the customer or the people working for it, they all have a vision of the brand.”
Another unique aspect to marketing a destination is the concept of borders, Coward said. While these might be clear on a map, visitors to Australia and to the Northern Territory are focused on having a holiday or key sights to see and are often unaware of where things are located.
“We need to understand what is impacting us as a destination and what those potential pathways mean,” Coward said. “It’s also about the in-between journey, which could be a three-hour drive. How do you sell that drive as being part of the experience? The reward always outweighs the effort but sometimes the effort is part of the reward.”
As a way of measuring the success of its projects, Tourism NT has implemented the NT360 program, which looks at three key areas: Visitor growth, spend growth and industry sentiment/capacity growth. The research team has also been put under Coward’s jurisdiction, giving it a more customer-facing set of KPIs.
“Around that, we have spend we put into different streams such as awareness, positioning, intense retailing and conversion, or online booking, trade training, and on-the-ground where we work with other tourism organisations to ensure the visitor here is making the most of their time and that the operators and partners maximise that,” Coward said.
“Each of those streams has activities underneath it and money being spent. We look at things like share of total trade sales across all key partners, if that has or hasn’t grown during a campaign, plus our website and owned channels and if they are getting growth.
“We then have a market track happening domestically and internationally, which not only measures what those levels of awareness and intention are, but also asks why. We’ve put these measures in place to firstly ensure we don’t miss anything and secondly, to act on it.”
Just like other modern marketers, Coward recognises the role technology plays in enabling strategy and as a customer communications platform. One of his first international initiatives was to launch in-language, in-market social pages globally.
The next step is to launch a new CRM platform allowing the team to connect social and the information shared with people engaging through its owned Web properties, in order to conduct more comprehensive re-targeting projects. This will also provide an ROI framework around social activities.
“All of our social work is about building great audiences and letting them get through to points where we can tag their preferences. Our new CRM will let us do that and serve that customer better with better information, marketing that helps them,” Coward said.
“As part of that, we will activate a digital marketing program at an industry level in our next budget. We want digital coaches to help the industry get going and progress into a sustainable situation where they can capitalise on the digital world, whether that’s for distribution, marketing, retargeting or even getting analytics into their websites.
“Ultimately I’m looking for NT to become just as sought after an online destination as we are offline. Who know what the future holds? If you don’t have that online destination working as well as offline, you might be missing out on some piece of the pie in the future.”
Unlike the big campaign mentality of the past, Coward’s team is taking a “zigzag” approach to marketing and chalking up better net results. “By taking small steps we can capitalise on what is happening around us and it gets us to our end game much quicker than if we’d taken big steps and had to make big platform changes,” he added.
Other initiatives on Coward’s list are to better embrace mobile connectivity, as well as mine its data sets to better target potential visitors digitally. The agency is also undertaking research to better understand latent demand in different markets.
“In the past we would have prioritised who visited previously, what sort of things they did, the kind of customer they are and who is like that customer,” he explained. “What we haven’t done yet is add in the idea of latent demand. That requires us to ask more forward focused questions in each of the markets.”
A new kind of leadership
While Coward admits to giving things a big shake, the years of decline have ensured most team members want change. “They are energised by the idea that the risk of doing the same thing is higher than the risk of doing something new,” he claimed.
The modern CMO need to be willing to embrace change and look to the edge of their organisation to find new ideas and innovate, Coward continued. “There is a new world in leadership, which I will always be a student of rather than an expert, which focuses on simplification, new technologies, understanding the global world and always being connected.
“People need to see a leader as someone who is prepared to take them into new worlds. The model I use is emotional/intellectual/social. Emotional reflects things like self-awareness, empathy and courage. Intellectually, it’s about creativity, systems, patterns and having a world view. The social point of view is the idea of followership; the ecosystem and community we’re all members of is important.
“It’s also about utilising new talent pools. In the past, people would have given all the respect to experience and while that is always going to be an incredibly important part of the process, respect for the new has come through. I ask new team members big questions because you get a very different view of the world, and that’s where leadership sometimes has to go to get its edge.”