City Doing The Right Thing With Destination Marketing

Sedona, AZ —

4/26/23, 8:42 AM City Doing The Right Thing With Destination Marketing Sedona.biz

Research proves many of these are opinion based, not factual pertaining to the Sedona Chamber and the City of Sedona. Headlines such as “Sedona must repeal the 0.5% bed tax if no plans to spend on marketing” have created knee-jerk emotional reactions. There are different sources of these types of headlines feeding the misinformation campaign.

For any of you who know me, I’m not too fond of confusion, details matter, and misinformation hurts our community.  When in doubt I research it and for that reason I repurposed DonnaJoys.com.

Research proves that Destination Marketing is much more than marketing — it’s destination management. This complex issue has many moving parts including planning, infrastructure, environment, education, and much more.

So what is Fact or Fiction in regard to Destination Marketing?

What is a Destination Marketing Organization (DMO), and who is supposed to be the DMO?

• Under state law Destination Marketing Organizations activity must be owned by a governmental agency (city or county).
• The DMO (Destination Marketing Organization) status is with the city or county.  The city or county can then contract with others to provide DMO services.
• For Sedona, the Official Destination or DMO is the City of Sedona.  The City of Sedona then contracted with the Sedona Chamber to represent the City of Sedona in Destination Marketing.
• The City of Sedona is the customer and the Chamber is a vendor.

Is the Sedona Chamber a good Destination Marketing vendor?

• In the January 2022 retreat, the Sedona City Council agreed to take a deep dive into the Chamber structure, programs, and funding. The workgroup of councilors was Ploog, Kinsella, and Lamkin.
• As a result of the “Deep Dive”, the City Council increased its understanding of the Chamber structure and membership.
• It was revealed that the Sedona Chamber was only marketing for its membership.  That membership includes businesses throughout the State of Arizona and only 39% of Sedona tourism businesses.  In some cases, the Chamber is advertising for the outside competition of tourism businesses including other destinations.
• This was viewed as an issue by some on Sedona City Council, because the funding was city money, so all city tourism businesses should benefit.
• Some on the Council saw this as a conflict of interest. They had repeated discussions with the Chamber to find a way to separate the Chamber activities (member-based) from the Tourism Bureau activities (representing all Sedona Tourism businesses).
• Retaining the combined Chamber/Tourism Bureau structure disqualifies the Chamber from being a government model DMO, Tourism, or Visitor Bureau. 71% of the members aren’t in Tourism and or in the tourism tax area.

Action taken by the City Council and the Chamber:

• The City Council notified the Sedona Chamber on January 11th, 2023 in the annual joint meeting between the City of Sedona and the Chamber of Commerce that the City would be moving to a “Fee for Service Contract” with the Chamber. That means the Chamber would no longer be managing the DMO; the City would. If the service matched the City’s needs, the city may hire the Chamber for those tasks. The current DMO contract with Chamber would not be renewed.
• On April 5, the Chamber informed the City that they would not be pursuing a new contract with the City.
• On April 12th, the City Council voted to officially establish the City as the DMO with the Arizona Office of Tourism (AOT).  AOT is the Official Office of Tourism for the State of Arizona.

Benchmarking peer cities shows that cities similar to Sedona are self-managing the DMO, outsourcing by “fee for service” items as needed – exactly what the City Council agreed to in the April 12th meeting.

What did the Chamber get out of this long-term relationship?

• Records show that over the last ten years, the Sedona Chamber of Commerce has received in excess of $20 million dollars of public funding, along with other city services, as the City’s acting DMO.
• According to the Sedona Chamber’s 2020 tax return 89% of revenue came from the City of Sedona. The Chamber membership dues are less than $300K. The estimated City licensed Chamber members are only 15% of all businesses.
• The Chambers websites, Visitor’s Center, and assets were paid with public dollars through the City of Sedona. Those will all be retained by the Chamber.

What more does the Chamber want?

• The Chamber has requested the City of Sedona to rescind the 0.5% city bed tax (the 0.5% was increased in 2014, and the current estimate of annual revenue generated by the 0.5% is $1.28 million). Their position is that money belongs to the businesses and is basically a pass-through tax.
• The City Attorney, Kurt Christianson, explained that based upon ARS 9-500.06 law, it is a City Tax, not a pass-through tax. The Council has all rights to keep it in place.

The City Council agreed to move forward with a proper, fair, balanced, and transparent tourism policy. So why are we hearing so much misinformation and why is the Chamber keeping all the assets paid for by the public? The Chamber built its army and holdings from public dollars and that is well documented.

A headline like “City Joins Chamber in Promoting Tourism” is very misleading. With so much misinformation floating around we don’t know what the Chamber members really understand. Are they assuming false narratives?

It is time for the Sedona Community to move forward.  Let’s collaborate, share knowledge, network, stop the drama, and be thankful for a new positive tourism policy and program.  I’m grateful to the Sedona City Council; they are doing the right thing, what we elected them to do.

I am a neighbor and an unpaid community volunteer. Please visit my website DonnaJoys.com. The website has references, sources, documents, data, and benchmarks of peer cities’ tourism programs. Feel free to share and ask questions. Let’s move forward.