OCEAN CITY – A marketing consultant may have come down on city officials too hard this week but was simply stating the truth in what he found by examining the town’s tourism and marketing.
OCG President and founder Joe Lathrop was hired by the Tourism Advisory Board (TAB) as a marketing consultant. He has worked with at least 120 destination marketing organizations (DMOs) and this week he presented the board and town officials with his findings on Ocean City.
“There is a remarkable lack of trust here … between the industry, the tourism marketing, and the city government,” Lathrop said. “It’s remarkable how polarized things are.”
During the meeting, tourism officials expressed their grievances and what led to hiring outside help in order to get to the bottom of underlying issues.
“I know that all of us together are probably duplicating a lot of efforts,” TAB Chair Melanie Pursel said. “The city needs things more in alignment and getting that entity or individual to steer the ship, pull it all together and have that partnership, that synergy, cooperation and trust that we need.”
Ocean City Hotel-Motel-Restaurant Association (OCHMRA) Executive Director Susan Jones added that TAB’s whole point is there is no leader taking charge to make sure that there is a plan to sell Ocean City.
In gathering data, Lathrop interviewed key constituents including the Mayor and City Council, department heads, leading business owners and the town’s advertising firm, MGH.
“You have too many hands in the fire here,” he said. “Marketing by committee is bad marketing.”
Lathrop referred to Ocean City as convoluted, due to the fact that there are a number of different entities including, the council, department of tourism, special events, parks and recreation, convention center, the OCHMRA, city communications departments, MGH and TAB, and they all have some sort of marketing function in Ocean City.
“That’s a lot of stuff and by convoluted I mean it was hard for me to understand … where the responsibilities were,” Lathrop said.
Lathrop went through a number of key items that led to a successful DMO and where Ocean City currently falls.
One of the items is being apolitical.
“There is clearly governmental influence here and elected officials that are involved in marketing,” he said.
Lathrop explained that it becomes difficult for a leading tourism role to receive direction from the industry as well as the government.
“When those things conflict, I wouldn’t want to be in the middle of it,” he said. “Not only that but where is the accountability.”
Another key item to success is the DMO works cooperatively with the community and industry partners.
“I saw no evidence of that … you all are not working together and that’s a missed opportunity,” Lathrop said. “When you bundle, you are more impactful in market segments and in strategies.”
DMOs are successful when all marketing functions are fully integrated. Lathrop explained that it’s hard when all marketing functions are housed under one roof but when they are spread out through different departments as in Ocean City it becomes really difficult to properly function.
“There is no leader here in this tourism industry,” he said.
Lathrop added that Ocean City’s DMO does not function like a business in which it should be in being successful.
“It is hard for any organization to function like a business when it is being influenced by so many people,” he said.
In conclusion, Lathrop presented three structural options for TAB to “wrestle with”.
The first was privatization, which is the city contracting a profit business to cover the marketing. About three percent of destinations around the country privatize.
The next option was to become a 501c6. According to the Internal Revenue Service, a 501c6 organization is a business league devoted to the improvement of business conditions of one or more lines of business. It is not engaged in any regular business typically carried on by for-profits. Lathrop said about 75 percent of DMOs are structured this way.
The last option is an internal realignment, which is addressing structural issues within the frame work of the city. About 14 percent of DMOs in the nation conduct in this manner.
“It doesn’t change the structure, it just changes how it works on the inside,” Lathrop said.
Pursel said now that the options have come forward there is going to have to be further “workshops” involving board members and department heads in order to come up with a structure before making a recommendation to the Mayor and City Council.
Council President Jim Hall said the marketing is currently working but he agrees it is convoluted.
“I have a feeling that internal realignment is where we need to be,” he said. “It sounds to me in the end you’re going to end up with a super tourism director and everybody is going to have to go through that department.”
Councilman Joe Hall preferred to structure a 501c6 where the organization can fall under a contract with the town.
Councilwoman Mary Knight disagreed because a 501c6 would be able to operate with no accountability. She explained that if a 501c6 were to come up with a faulty marketing plan then the taxpayers would have to make up for their mistake.
“They are not accountable to anybody is my point, where the seven of us are accountable to everybody,” she said.
TAB member John Gehrig reiterated the biggest problem currently is trust but pointed out that for the first time all the players involved with the town’s tourism and marketing are now communicating.
“We are all sitting around the table for the first time just firing out ideas,” he said. “This is what needs to happen. We are off to a good start.”