What is a CVB? Why are CVB Services Free?
What is a DMO or CVB?
A Destination Marketing Organization (DMO) or a Convention and Visitors Bureau (CVB) is a not for profit organization charged with representing a specific destination and most are largely funded by hotel occupancy taxes. CVBs give planners access to a wide range of services within their destinations, including but not limited to, arranging site inspections, checking hotel and meeting space availability, and linking planners to expert local service providers. CVBs and their destination experts serve as extensions of your planning team.
“I marvel that there are still planners out there that don’t work with CVBs,” says Gregg B. Balko, executive director of the Society for the Advancement of Material and Process Engineering. “If you are not using a CVB’s offerings, then you are failing to take advantage of an additional resource for your members.”
“I really have no idea how I would begin to replace the services CVBs provide,” admits Jeannie Shaughnessy Hodges, executive director of PTNPA (Peanut & Tree Nut Processors Association). “I know there are other representatives from different sources that might assist, but they are not “experts” when it comes to true local knowledge in a particular geographic location. For that and so much more, I depend on the CVB.”
Many meeting planners see great value in working with convention & visitors bureaus (CVBs), and depend upon the knowledge, services, and leverage they provide. If you don’t fully understand the purpose and structure of the CVB, the fact that they are free of charge may seem too good to be true: where do CVBs get their money?
It Shouldn’t Be a Mystery . . .Where the Money Comes from
Here are the facts about exactly who pays for all the services you receive.
All CVBs are not-for-profit organizations primarily funded by their local governments, usually through a portion of hotel occupancy taxes. Their mission is to promote the long-term development and marketing of a destination, focusing on convention sales, tourism marketing, and service. As the tourism marketing arm of the destination, the CVB is responsible for creating public awareness about their destination and, ultimately, booking the meeting and event business that feeds the economic engine of the region.
Ultimately, travel and tourism enhances the quality of life for a local community by
- providing jobs,
- bringing in tax dollars for improvement of services and infrastructure, and
- attracting facilities like restaurants, shops, festivals, and cultural and sporting venues that cater to both visitors and locals.
No wonder local governments and businesses are willing to fund the CVB’s efforts!
Member vs Non-Member
Approximately 50% of all CVBs have dues-paying members – hotels, restaurants, attractions, and other businesses that benefit from tourism – and the other 50% are completely government funded. Regardless, the first-and-foremost goal of either a membership-based or non-membership CVB is to market the entire destination by providing expert assistance, education and guidance to you, the client.
As a planner, should you prefer to work with a non-membership based CVB over a bureau that collects dues from participating members? Is there a different level of service and product representation? The answer is an emphatic NO! Regardless of organizational structure, every CVB’s goal is the same: to successfully market the destination by satisfying the needs and desires of the customer. Here’s a little insight on how each structure works.
Membership-based bureaus are funded by a combination of lodging taxes and annual membership dues from the hotels, convention facilities, and local businesses within their destinations; there may be additional sources of revenue, such as public or private funding as well. Typically, hotel bed taxes comprise approximately 79 percent of their total revenues, while membership dues fund a much smaller portion.
Like any CVB, membership-funded bureaus will only send leads to the members that meet a planner’s criteria. CVBs are evaluated by their stakeholders on a range of return on investment (ROI) metrics, including confirmed meetings -- not on how many different properties or vendors receive leads. Therefore, “membership bureaus are not obligated to send your request for proposal (RFP) to every single member,” says Amy Long, vice president of marketing and membership for the Colorado Springs Convention and Visitors Bureau. “We definitely don’t send RFPs to every member, as that would be a waste of their time and a waste of the planner’s time,” says Long. The philosophy? Quality trumps quantity every time.
But are CVBs with membership communities biased toward their members over non-members? “Of course we’re going to be a little biased, since our members invest in our overall mission,” says Nikki Moon, vice president of sales for the New Orleans Convention & Visitors Bureau. She notes that CVB members are typically the businesses that are vested in the meetings market; they tend to be a cohesive, interconnected community focused on serving their destination’s customers. “Whether it’s a restaurant, a hotel or a DMC, 90 percent of the time the members who support us are normally the ones the customer would want to work with anyway, as they are the primary, best-known, best service providers in the city. So are we biased? Yes, but rightfully so!”
However, “if we get a question about a company that’s not a member, we’d give the planner as much info as we have but also provide information about a member company,” says Moon. “We certainly wouldn’t hold back any information from a client asking about a non-member company, we’d just encourage them to go with a company that supports our industry and is going to be a lot more knowledgeable because they are engaged and involved in making the destination meeting-friendly.”
Non-member bureaus are totally funded by their local governments, much like the fire department, police department, and education. But unlike those non-revenue producing departments, the local government’s investment in the CVB is offset by the revenue the CVB generates and which help to underwrite the cost of the community’s firemen, police, and teachers.
Although the non-member bureau represents all businesses equally within their destination, they are not required to distribute your lead or RFP to all parties. Like all CVBs, their first step in building trust with the meeting planner is to jointly determine which hotels, facilities, attractions, and activities are the best fit for the program, then conserve everyone’s time and energy by reaching out only to those suppliers.
“Planners mainly should be assured that regardless of the model of the CVB, their RFPs will get to the right properties, they’ll get proposals back from properties that meet their most basic and important requirements,” emphasizes Long.
It’s All about You
Whether the CVB is membership-based or non-member, the number one priority is always serving the meeting planner. Jim Morgan, president of Let’s Meet, Inc., makes it simple. “I have used CVB staff for over 30 years. This has always been a primary go-to resource for me. All CVB’s are in the business of helping to bring business to their city.”
In the words of Destination Marketing Association International, the association for CVBs, We are the visitor’s and meeting professional’s trusted partner—the heart, soul and energy of our destinations. We drive economic success and enhance the quality of life in our communities.
Mystery solved! We hope you feel confident in reaching out to your destination expert as your first contact. . . and that we have your best interest at heart.