California Tourism Braces for Cuts

A month after California lawmakers slashed $7 million in state funds for promoting tourism and shifted the Division of Tourism to the authority of a new agency, the state’s tourism promotional organization is reorganizing.

California Travel, the marketing effort that joined the state and the private sector, will now rely exclusively on an industry-approved assessment to fund a budget that is half of what it used to be.

Jennifer Jasper, deputy director of the California Travel and Tourism Commission, the privately funded arm of California Travel, talked recently with TravelAge West about the changes and challenges ahead. Following are excerpts from that discussion.

How are the budget cuts going to impact the state’s ability to promote tourism?

Obviously, when your budget gets cut in half there will be some reductions. But none of our core programs are being eliminated. Everything is continuing with just a few reductions and changes.

We have five international offices for the travel trade, and those all remain open. We have three international PR offices. All of those remain open.

We still will be actively pursuing the press. We will continue to have outreach programs and fam trips. Our Web site is still up and running and still provides a lot of information.

We also have the California welcome center and that program still remains. We have a variety of co-op programs Shop California, Dine California, Golf California all of those remain intact. We have our rural tourism program and that remains intact, but with some changes and cuts.

One thing that will have the biggest cuts that people will notice is our advertising.

We are still going to be doing our advertising programs, but it is going to be between $1 million and $1.4 million. In the past it was at least double that. Advertising will be taking the biggest hit.

How exactly will the cuts affect your advertising campaign?

Everybody knows that advertising is extremely expensive. And we are right now just in the planning stages for our 2004 campaign.

We will have a print advertising campaign and hopefully a TV campaign, but at this point we don’t know the specifics. It will be in the Western U.S. primarily.

We’re seeing how we can do some more co-oping to see how we can extend our advertising dollars.

We’ll still be doing some of our co-op advertising; we have a winter co-op that will be coming out in November. We’ll be doing another one like that in the spring.

Will the cuts narrow your focus to certain markets?

I don’t think we’ll be changing any of our markets, but we won’t be able to add new markets. The Western states are important. On the international side, Mexico, the United Kingdom, Japan and Germany, those remain strong. As long as our numbers remain solid, they’ll still be our core markets.

How has the state’s division of tourism been shuffled around?

We have maintained seven and a half positions with the state and those are primarily for the assessment, research and the welcome centers. That’s pretty much for managing the collections and the operations of the commission as far as the collecting of the funds. So, that will remain, but the marketing, the advertising and the programs, all of those functions have moved over to the commission, the private side.

The Division of Tourism used to be under California Technology, Trade and Commerce Agency and that agency is slated for closure January 1, 2004.

So between now and 2004 the operations are going to be moved to a new agency called the Business Transportation and Housing Agency.

Has the recall election complicated things?

We don’t expect any problems. Any type of legislature or government that is pro-economic development works for our industry and us. We’ve been lucky in the past. Gray Davis, the governor, did help us with the tourism recovery act in 2001 for our “We’re Californians” campaign.

We’re hoping that in the future when the state budget situation rebounds that we’ll go back and have some more state funding.

What are the most difficult changes that will be made?

Though we’ve had to reevaluate all of our programs, we luckily haven’t had to cut many of them. But we’ve had to change the way some of the things operate. We’ve had to reduce some of our trade show participation and cut back on some of the advertising.

How will you reduce trade show participation?

We’re still going to go to all of the main shows. Pow Wow in ‘04 will be in Los Angeles. We will have a strong presence. We are also going to be assisting with some of the funding for that event. So we’ll help as much as we can.

We’ll still be going to all the international shows, WTM, ITB, as well as the ones here in the U.S. But we probably won’t be able to do quite as many of the second-tier shows.

We’re going to have to cut back on some of the new shows or some of the special shows we were doing before.

Will the state cut back on the fam trips?

We have never cut back on fams and I don’t expect we will this year as well. We may have to make some reductions as far as accommodations and air. We’re obviously not going to have as much for those types of details, but we certainly will encourage and help with as many fam trips as we can.

Do you have any projections on how the cuts will impact market share?

What we are hoping for this coming year is that our market share stays flat. Of course I would love to say that we’d like it to grow we always want it to grow. But I think, realistically, we are hoping to stay flat.