OCEAN CITY – Each year, Ocean City shells out $5.5 million in order to advertise to the masses. While some may oppose the approach, criticizing a few of the target markets or even the town’s unofficial spokesman “Rodney the Lifeguard,” the results continue to trend positive.
A recent report presented to the Ocean City Mayor and Council by the town’s advertising agency, MGH, shows that the resort is faring far better than most of its competitors and other statistics, such as the 22-percent increase in room tax revenue and a 36-percent increase in food tax revenue for the month of September, shows Ocean City not only weathered the storm of the recession but is now starting to hit its full stride as it keeps pace with the economic recovery.
We spoke with Malis this week to learn about the high stakes world of advertising and find out how he and his company are working to keep the campaign messaging as fresh as it is relevant and appealing to millions of the resort’s potential and returning guests.
Q: This is a solid report. Highlight some of the big talking points and take home numbers.
A: I think one of the main things that is exciting is that each year the room tax continues to increase. Over the last seven years, there has been a cumulative 30-percent increase and that leads to additional budget so we can continue to spend a little more each year to keep pace with the ever-fragmented world of advertising where it’s very tough to get through to people these days because they have so many choices in entertainment. There’s radio, television and the Internet. So, the fact that the town was very forward thinking a number of years ago when it tied the room tax to the advertising budget was a very smart move. That also gave us the funds to market in what is the most expensive market in the country and that’s the New York/New Jersey area, followed closely behind by the Philadelphia/New Jersey area.
Everyone, I think, has seen the benefits of that, as we have many more people in town coming from New York, New Jersey and Pennsylvania than we used to. Those are also people whose schools typically start later, so it has helped at the end of summer when more and more schools are starting as early as the beginning of August, which in my opinion is a shame. But, that’s been a tremendous help I think in the town’s success.
Q: I remember, years ago, when MGH first brought the idea to expand the target demographic to New York and New Jersey markets. That was a bit controversial at the time. Are we starting to see the yield from that advertising strategy now, as our numbers, in pretty much every category are growing? Is that strategy starting to show the fruits of the labor?
A: I do believe the increased interest in Ocean City from those areas, where those folks may be a little less price sensitive than close-in consumers are, has helped. When you look at those numbers you pointed out, the occupancy has been up pretty consistently year over year, the Average Daily Rate and the Revenue Per Available Room are not only up 2-percent and almost 5-percent year over year, but all three categories are higher than any of our competitors. That speaks to demand.
There have been people in the past who have said that our ADR is high because the hoteliers keep raising their prices. Well, what I learned in Economics 101 is that if you raise your prices and people are willing to pay it, then you are charging the right price. We’ve also been up against some pretty strong forces. The Internet has changed the way people travel. They are looking for great deals, and they are not afraid to get on a plane in the summer and go to the Caribbean or go on a cruise, which years ago was unheard of to go to a hot weather destination in the summer. But, because of the Internet and the price competition, we are competing with everyone now, not just our close competitive set, and they are very aggressive. So, we need to be as aggressive as we’ve been, and luckily we have the infrastructure in place in terms of the marketing budget to do that.
Q: One of the numbers in the report that jumped out was looking at and quantifying the visits to the town’s website, ococean.com, by particular device. MGH has been the city’s ad agency for 13 years, but now, people checking the town’s website on their phones make up half of how people are clicking onto the website: 50% mobile, 35% desktop, 15% tablet. Mobile visits are up 64% year on year. What does that tell us, not only in the way the town’s website is set up, but also about how other businesses in the town should be targeting their advertising?
A: Everything is changing at such a pace it’s mind boggling. When you think about some of the changes in the world today, with Uber and Air BNB, and the way that digital advertising has grown like crazy, one of the biggest changes that’s been happening over the past few years is that there’s less and less dependence and sales of the traditional desktop computer. So, consumers are used to finding the information they need on their mobile device or their tablet. A couple of years ago, we made some changes on the site so it would be responsive to whatever kind of device someone came to ococean.com from. So if someone came from a desktop or a mobile, or a tablet, they would be rendered a version of the site that would be easily readable.
I’m glad we did that a couple years ago, because we are seeing that more and more people are just used to using their phone. For any business to not have a mobile rendered site is really hurting themselves.
Q: Let’s talk about Rodney the Lifeguard for a moment. Again, when the character was unveiled a number of years ago, some people liked the idea of Rodney and some didn’t. His role has changed over the years, and there have been other corresponding ad campaigns, such as the Vacation Days advertisements that were very successful. How do you think Rodney will play in future years when it comes to being the “face” of the town?
A: Well, without giving away too much, I can tell you that we have new commercials that will be broadcast this spring and Rodney will be back in a little larger role than he was last year. In the “Vacation Days” spot, he was just more of a spokesperson at the end of the spot, but in the new ones, he will be coming back and really showing off the town and a lot of the amenities and the attractions in a big way.
Rodney is for some people polarizing. Some people don’t like him, and others think he’s great. I was at dinner a few weeks ago with another client from New York and we were talking about advertising and mentioned Ocean City and the gentlemen said ‘you guys do those Rodney commercials, I hate them.’ I said, ‘I’m sorry to hear that, but they work.’ He said, ‘well, that’s all that I care about, if they work then they are great.’ But, I think everyone will be happy with what Rodney is doing this coming year. People in town will be happy that he is showing off the town, so I expect they will be very well received this year.
Q: Ocean City over its various networks on social media, there are almost 900,000 fans and followers. If you look at other competing resorts, Ocean City’s numbers dwarf the competition. But how do you actually quantify positive results?
A: Yeah, it’s a very tough thing to do because we are not directly selling anything through the social media properties so we can’t count the dollars received. I can tell you one of the things it does for us, which isn’t as quantifiable but it’s still very important, is that it allows us to promote what is going on in the town to the most interested people in the most inexpensive way. What I do know is that it’s a cost of venturing out. If you don’t have a good, strong social media presence for your destination, you are not doing the basics.
Q: If you look at how the millions of dollars dedicated to advertising the town of Ocean City, as those numbers rise, and more money gets dedicated for you to do your job, how much does the pressure to deliver numbers like you did last week to the Mayor and City Council also rise?
A: I think it’s no different than if the numbers didn’t rise. We are held accountable because we serve at the whim of the council, and we have enjoyed an incredible relationship over a number of years and it’s really been teamwork. The one that has been consistent since we started is the desire to standout and the understanding that if you don’t standout, you don’t look different and you don’t have a different point of view in your marketing then it does just fall into the background.
That takes a real team effort and, of course, when you have success that gives you confidence and it gives the town confidence that we know what we are doing and that we are helping. But, there’s pressure every year. If numbers go down and it’s not a result of the economy or weather, we have to really look at what we are doing and what we aren’t doing right. But so far, we have been lucky that things have worked out, and things are moving forward.