The DMO's Business Model May Be Its Biggest Strategic Risk
What Happens When the Way You're Funded No Longer Matches the Work You're Expected to Do? During my years as a destination marketing organization (DMO) CEO, I spent considerable time thinking about budgets, revenue projections, hotel occupancy, and the financial health of the organization. That's part of the job. But looking back, I believe DMO leadership should pay more attention to a larger financial question: Is the way we're funded still appropriate for the work we're being asked to do? For many DMOs, the business model is relatively straightforward. Lodging-related tax revenues, membership dues, and other tourism-generated income support an organization primarily responsible for attracting visitors. When hotel rooms are occupied and visitors spend money, the organization benefits. When tourism slows, revenues decline. But something important has changed. The responsibilities of destination organizations have expanded considerably, while many of their funding ...