An 11-member non-profit board with an executive marketing director
will be created to run the program, under the purview of the
Department of Commerce, and the group is expected to reach out to
the ad community for help.
"There will be ample opportunity for folks in the advertising
industry to contribute to this program," said Geoff Freeman, senior
VP-public affairs for the Washington-based U.S. Travel Association,
the lobbying group for the $740 billion U.S. travel industry. "This
corporation will seek advice from the best minds inside and out of
the travel community on how to market the United States."
It's not yet determined whether it will put the account up for
review for ad agencies.
Unlike many other countries, the U.S. does not have a dedicated
agency to market itself abroad, leaving that to individual states,
cities and tourist attractions such as New York, Las Vegas or Walt
Disney World. That, in part, has contributed to lost tourism
revenue. An independent analysis by Oxford Economics entitled "The
Lost Decade" showed a 23% increase in the growth of international
travel, but a 10% decrease in international travel to the U.S. from
2000-2009. Each traveler spends more than $4,000 per visit.
The new program is estimated to create 40,000 U.S. jobs and
drive $4 billion in new consumer spending, according to Oxford
Economics, and reduce the federal budget deficit by $425 million in
the next 10 years, according to the Congressional Budget
According to the World Travel Organization, Greece spends more
than $151 million to promote the travel industry. Spain sends
nearly $120 million, Australia over $113 million and the United
Kingdom more than $89 million. The United States spends
approximately $6 million.
The U.S. Travel Association will present a strategic plan to
Commerce Secretary Gary Locke next week that includes suggestions
for board members, fundraising and marketing ideas.
The marketing budget will be provided by a matching program of
private sector contributions and a $10 fee levied on foreign
travelers from 35 countries, mostly in Europe, where $131 for a
visa to enter the U.S. is waived. The fee will be collected once
every two years in conjunction with the Department of Homeland
Security's Electronic System for Travel Authorization.
"If the travel industry only raises one dollar, we only get one
dollar" from the fee program, said Roger Dow, CEO of the U.S.
Travel Association. "We've done the math, and a $10 charge every
two years per person would raise $100 million a year. The industry
must come up with the matching funds, but if it does, that's a $200
The ad budget is capped at $200 million per year, no matter how
much money the visa fee raises.
It is estimated it will take anywhere from five months to a year
to implement the program and begin advertising travel to the U.S.
in foreign markets. When it does start, it is expected to be a
comprehensive campaign, including TV, print, radio, online and
social media. "The experts will come together and say what the most
effective way to get the word out it is," Mr. Dow said. "But
e-marketing is extremely effective, and I'm certain that's going to
be a good-sized component of what's done. But, again, that's up to
the people on the board."
The House passed the bill in October 2009, and President Barack
Obama has already said he will sign it into law.
Jim DeMint, R-S.C., was one of 18 senators, all Republicans, who
voted "no" on the Travel Promotion Act.
Writing in an op-ed piece in the Washington Post, Mr. DeMint
said: "The advertising fund would be controlled by leaders of
America's tourism industry -- giant corporations such as Disney,
Loews and Marriott. Keep in mind, those companies are not in
distress -- they're thriving. Disney, for instance, posted profits
of $4.4 billion (in 2008) and bought Marvel Entertainment for $4
billion (in 2009). The American travel industry already spends
billions every year on advertising, with tens of millions focused
on international marketing. The purpose of the Travel Promotion Act
is to subsidize that advertising. No thanks."