OC Business Panelists Review ‘Interesting’ Summer, Look Ahead To 2014 Season

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OCEAN CITY- With the calendar flipping over to October this week, resort business officials began taking stock of the summer season of 2013, and the general assessment is there is still much work to be done to improve for next year.
The Ocean City Economic Development Committee (EDC) met on Wednesday for the first time since the beginning of the summer and the conversation focused on the recently completed 2013 season. EDC Chairman Michael James presided over a discussion with four panelists including Ocean City Tourism Director Donna Abbott, Ocean City Hotel-Motel-Restaurant Association Director Susan Jones, City Councilwoman Mary Knight and D3Corp President John Gehrig, who each weighed in on the early reviews on the season. Jones said the reviews were as diverse as the number and type of businesses in the resort.
“Depending on who you talk to, it was either the worst summer or the best summer ever,” she said. “The reactions have been all over the board. I’ve never seen this much emotion attached to a review of a summer season.”
All agreed the summer season was slowed by the rainy, damp and cool June for the most part, although most businesses made up ground through July and August and even into September with near-perfect weather and numerous special events. Jones said the business cycle trend continued for heavy weekend numbers and slow weekday figures, especially in June.
“June was wet and cold and that definitely didn’t bring tourists,” she said. “However, room tax figures were up but occupancy was down. The demand for weekend travel was extremely high and some took advantage of that and raised their rates, some by as much as $150 per night.”
Jones said a lesson learned for many businesses continues to be the importance of a strong online presence for Internet-savvy consumers. She pointed to an episode of Hotel Impossible featuring the historic Lankford Hotel that aired last week on the Travel Channel as an example.
“Some are doing business the same way they did 50 years ago,” she said. “We saw that last week with the episode of Hotel Impossible. Travelers now have more choices and focusing on what you look like online is very important. Consumers are shopping and they’re shopping online. They want to see what they’re buying.”
Gehrig said anticipation was high for the summer season after a highly successful spring marked by good weather and lots of traffic on the town’s website and individual business websites, but when the summer season rolled around, the same recent trends continued.
“Last spring was so great weather-wise that we got a little spoiled,” he said. “The phones were ringing and the website hits were increasing, then we went back to the way it was two or three years ago with the last-minute bookings. There was a lot of website traffic in advance, but not a lot of booking in advance.”
Gehrig agreed many of the larger properties took advantage of the weekend trend and last-minute bookings by adjusting their rates to meet the demand. As a result, room tax figures were up, while occupancy figures were down in many cases. He said many of the smaller properties didn’t have the flexibility to adjust their rates to match the trends.
“It looks like revenue overall was up,” he said. “Some of the smaller properties were having a difficult time. The bigger places with more staff and more resources have more flexibility with their rates. The smaller properties were setting their rates for the summer and sticking with them.”
Gehrig encouraged properties of all shapes and sizes to adjust their rates to best meet the demand and ultimately get heads in beds.
“Each business has a responsibility for itself,” he said. “You have to make sure your rates are the best they can be because it’s highly competitive. If you’re not booking your rooms, you have to change your strategy.”
Throughout the summer, much of the discussion surrounding the season centered on the town’s advertising budget and marketing plan. Abbott said this offseason, like every previous one, will focus on how the town can get the best bang for its buck with its limited marketing budget.
“We have a $5 million advertising budget and we’re going to look at how things went over the winter and see what markets we need to target,” she said. “We’re going to use the money the best way we can. As you all know, we are outspent by a lot of our competitors. This has been an interesting season, and we’re going to take all the feedback and see where we need to go.”
Going into the 2013, it was widely believed Ocean City would benefit from the condition of the resorts in New Jersey and New York devastated by Super Storm Sandy last October, and that appeared to play out to some degree, however, those resorts got a fiscal shot in the arm from federal relief for advertising and marketing in the wake of the storm and challenged Ocean City for the mid-Atlantic and East Coast consumers, according to Abbott.
“The Jersey Shore got a $22 million budget for tourism marketing from the federal government after Sandy,” she said. “They were in every market we were in.”
Knight said the Mayor and Council is attuned to the results of the summer season and is in the process of reviewing how to make things better in 2014.
“We need to look at who we need to market to and where and what demographics we want to target,” she said. “We’re currently doing strategic planning for the entire town and that will help us make some of those decisions.”
Knight pointed to a handful of high-profile serious crimes, particularly in June, that influenced the public perception of safety in the resort to some degree, but she cautioned perception isn’t always the reality.
“Crime isn’t up, crime is actually down,” she said. “In June, we got some bad publicity from a few incidents that sort of spiraled out of control and the perception is crime had increased. Out of all that came a new crime prevention initiative for next year. We need to work on perception and maybe get Rodney up on the Boardwalk at night.”
In summary, Gehrig said there were many positives that came out of the summer of 2013, but some shortcomings revealed the resort business community has to work harder than ever.
“We have a great community here and things are good, but things are getting tougher,” he said. “We need to work harder when things are tougher.”
Gehrig said it was okay for businesses to adjust their rates to meet the demand, but only if an in-kind emphasis on service and value followed.
“We need to train our staffs to treat every guest like gold,” he said. “You have to keep an eye on value. If you’re going to raise rates, you have to deliver on value. This year was good, not great, but it is sure is finishing great.”
Knight said the vacationing public is savvier than ever and is relying largely on on-line reviews when making their choices. She urged resort business leaders to carefully monitor these reviews.
“You have to really keep up on online review sites like Trip Advisor because consumers are utilizing those more than ever when making decisions,” she said. “I talked to one restaurant owner who was up 35-40 percent and credited positive reviews on Trip Advisor for that. You have to read those and stay on top of it, and respond to negative comments if necessary. It works both ways.”
Abbott agreed Ocean City visitors are relying more than ever on mobile devices to plan their beach vacations and pointed out a statistical anomaly that identified neighboring Salisbury as a hub on Internet traffic.
“One interesting aspect that we didn’t get right away was why Salisbury was in the top five locations in the state for website hits,” she said. “When consumers are in Ocean City using their I-pads, smart phones and lap tops to decide where they want to stay and where they want to eat, it shows Salisbury as the source.”

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