Q124: Where are the bridges between tourism and economic development?

March 8th, 2019

Pittsburgh, Pennsylvania

Pittsburgh, Pennsylvania

If we have a tech event here in Pittsburgh, how do we make sure that knowledge capital stays in Pittsburgh?
— Jerad Bacher, Visit Pittsburgh

In the realm of local government, various groups work toward promoting a town or city to external investors. Destination marketers engage individuals and event planners to come and stay for a while. Economic developers engage entrepreneurs and enterprises to hopefully stay for a longer while. Where should these two camps intersect in terms of message and function?

On this episode, I speak with Jared Bacher Executive Vice President at Visit Pittsburgh, to better understand the various layers of local government, and how different interests can - or even should - work together to promote destinations to both visitors and business entities. Jerad says it has a lot to do with brand and how local stakeholders align messaging and marketing to engage distinct audiences.


Transcripts

Luke:  

Hi everybody and welcome back to another episode of QuestCast, where we ask the big questions and talk to the experts about recent trends shaping the future of how we live, work, and play. My name is Luke Bujarski your host thanks, for tuning in.

In the realm of local government, you're going to find various groups working towards promoting a city, town, or region to external investors. Some of those stakeholders work on the tourism side i.e. destination marketers. These entities actively engage individuals and groups to come spend time there. Other groups i.e. investment promotion agencies and economic development authorities work to attract investors into the region.

So where are the bridges between tourism and economic development? Well, according to today's guest, a lot of times it's about brand and how local stakeholders align their messaging to engage different audiences.

Introduction

On this episode, I speak with Jerad Bacher who is the executive vice president at Visit Pittsburgh, to better understand the various layers of government and how these different interests can or even should work together to promote destinations to both visitors and investors.

So Jerad, thanks so much for coming on the show. Why don't you kick it off and tell us a little bit about Visit Pittsburgh.

Jared:

Visit Pittsburgh is a development agency on behalf of Allegheny County so it's not just Pittsburgh the city, but also all of the surrounding areas within Allegheny County. Tourism is an important part of the economy. It contributes 8.3 billion dollars to the local economy every year. It’s still a small portion of the total economy - roughly 3 or 4%, but that's mainly because we’re [tourism] dwarfed by legacy sectors.

Finance and education is massively successful. We have universities such as Carnegie Mellon, University of Pittsburgh which are our major employers in the region. Energy, technology, and advanced manufacturing also play a role in that diversification of the economy. Tourism has a critical role, beyond just in terms of direct and indirect economic impact but also in terms branding the destination. There are a lot of outputs that come from tourism including investment into infrastructure, accommodation, restaurants and leisure activities and sporting events - all of that of course builds quality of life that helps us generate interest in these other economic sectors.

Balancing messaging between tourism and economic development

Luke:

How do you guys balance your messaging between Pittsburgh being a great place to do business versus a great place to visit?

Jared:

A lot of destinations in the United States depend a lot on drive markets. Pittsburgh is certainly one of those destinations that depend on drive markets from a tourism perspective, and also from an economic standpoint. A lot of trade partners and companies that are doing business in the region aren't necessarily in our central business district, so having easy access from a drivability standpoint is important, but you cannot underestimate the value of having good airport infrastructure to help serve people from outside the drive. Pittsburgh they're putting in a close to a billion dollars into the modernization plan for the airport. That means that their modernizing the terminals to make sure that the passenger experience in Pittsburgh is second to none.  

I think that every destination that I've ever worked in, both here in the U.S. as well as abroad, has put large investment into their airports because it makes strategic sense, both from a tourism standpoint so that passengers can easily get in and out of the airport - since it is your first impression that you get of a particular destination - but also from a cargo and logistics standpoint.

Making sure that the rest of the economy continues to prosper by making sure that we have a strong logistics hub at the airport is part of that. When I was overseas in the last destination that I was working for which was Bahrain, there again at that time there was a billion dollars going into that airport. Before that I was in Dubai. The biggest strategic investment for city like Dubai is investment into their aviation sector.

Luke:

What's the overall Pittsburgh pitch in light of what the overall visitor profile looks like?

So many destinations have evolved how they market themselves and how they speak to different segments within the market that we're trying to attract. From a leisure standpoint there are certain USPs that we put forward. For business travel there are certain USPs that we put forward. From our business events standpoint there's a lot that we put forward in how we market to event owners.

All of it is very bespoke and we need to be that way in order for us to effectively sell Pittsburgh as dynamic and diverse. One area which ties buys back to your original question about bridging economic development with tourism development is our business events segment, which is of course the conventions and exhibitions that we host here. That sector is particularly important in bridging our economic development with tourism.

When we host an oil and gas convention or a tech convention or an exhibition that is related to advanced manufacturing - for example - all those events have a direct impact on the destination. They bring IP and knowledge capital into the local market, which helps increase our local workforce. They bring potential investors in into the market for those events. We need to make sure that we continue to bring events and support the economic verticals that our counterparts in economic development are working on. That’s where we need to align.

Local Policy Dynamics

Luke:

What about on the ground in terms of policy, partnerships and key players in Pittsburgh from both camps?

Jared:

In any economy there are a lot of different agencies public or private or NGOs that have a vested interest in economic growth. So here, we have a semi-formalized and soon to be formalized advocacy network that we've developed. Some of our primary partners here are the airport authority. We cannot do our job without having a strong partner in the airport. Our local business community within our tourism sector our hotel partners and restaurants they collectively have a voice in everything that we do and how we put together our messaging in our programs. You have the county's economic development office that we met with recently to align event promotion strategy with county development goals. Same thing with the mayor's office. Of course, we want to align ourselves with the development authority, so there are a lot of players that have a vested interest in making sure that economic development [generally speaking] continues to move forward.

This is not unique to Pittsburgh. It's the same thing in pretty much every destination in the world. There is a lot of vested interest in economic development both on the private and public sector side, so we have to make sure as an agency that we have a strong advocacy program to where we're strategically and methodically reaching out to all these organizations.

Luke:

So would you say that across these different layers of government, would you describe it as cooperation, collaboration, coo-petition?

Jared:

We take it from the viewpoint of collaboration. We've got good collaboration across these different agencies. We’re fortunate here when it comes to that. We all have focus areas. From an economic development standpoint, you probably see more overlap here from a city and county standpoint. They work very well together but some sometimes there's a little bit of gray area in terms of where the county comes in to drive benefit for the investor and where the city comes in. We focus on tourism specifically.

Luke:

Is there one big annual event that takes place or everybody kind of gets together and talks about all of the key economic development issues how does this collaboration typically look like?

Jerad:

Yes, there are the annual meetings but where we see the most benefit is when we get into smaller groups and, actually have individual representatives from all these organizations at the table and actually have a conversation. The big events are important but it's the small groups where the information sharing and work really gets done. It’s an opportunity to bring these individuals from these different agencies around the table and that's where the collaboration really starts to mean something.

Luke:

What about on the private sector side?

Jared:

The majority of our funding comes through the hotel tax. We are also structured as a membership based nonprofit so members and partners but a lion's share of our [Visit Pittsburgh] revenue comes from hotel tax which is collected obviously from visitors that are coming to Allegany County.

Digital Strategies in Tourism and Economic Development 

Luke:

Let’s talk a bit about the digital side of the equation. Do you think there's an opportunity to align messaging across these different partnerships? Whose role is it to take the initiative and get everybody aligned?

That's another great question. There are as many destination brands within any destination as there are players. You know, when it comes to messaging and branding that a city does, that a county does, that an economic development organization does [that isn't part of the governmental body], that the tourism authority does… you can't say enough about how important it is to make sure that brand is consistent across all of these different agencies.

What I mean by that is that most destinations around the world struggle to find a way to get a common brand or messaging across all their different economic development organizations - whether it's an investment promotion board, whether it's a tourism authority, and other players within the market. They struggle to get one consensus on brand, and that's mainly because everybody is so focused on maximizing on their mandate that they're trying to deliver on, to make sure that they're doing their job and contributing to that whatever part of their economy is.

That's the same thing in the city like Pittsburgh. We have a lot of organizations that are doing a lot of great work, but we don't necessarily have a unified brand across these organizations. We're all talking about how great Pittsburgh is in different ways, but if we can get a common brand across all of these different organizations, we would be able to maximize the impact of that brand in a much bigger way.

One great example of that is the “Great” campaign that came out of the United Kingdom a few years ago. Everything that is promoted for Great Britain from the UK has this “great” tag line, and they were able to apply that across tourism, to investment promotion, to export promotion to the arts etc.

I think that was a healthy way to roll out a program that maximizes the destination’s brand. It can be a difficult thing to do just because every other organization feels like they need to control that brand and to control that messaging so they can maximize under mandate.

Luke:

When you worked overseas, would you say that it's easier or harder in terms of the way that things are organized abroad versus the way that they were organized here in the United States?

Jerad:

Yeah, I don’t know if it’s easier or harder. I think every destination has its own unique set of situations. I think it can be done. At least from a Pittsburgh context, there is a willingness to collaborate. That approach [unified brand] needs to make sense for the local market. I personally believe that aligned branding makes a lot of sense. Whenever you can condense a message down to a certain core message a certain brand, I think the impact of that is much bigger both nationally and internationally.

When you boil it down, every tourism destination in the world is doing the same thing. We're all trying to get visitors to come to our cities. The same thing from an investment standpoint. Every investment promotion board is trying to do the same thing. We're trying to bring investment into the local market. We’re trying to make sure that we are growing the economy in a diversified and sustainable manner.

Fundamentally we're doing the same thing, but there are a lot of variances when it comes to different destinations. Attraction speaks to the abilities and capabilities of the local workforce - do they have the skill sets to attract some of these investments? Ease of access is also important. How easy is it for people and goods to get in and out of the market? Budget is important. Overseas, markets like Dubai have very healthy tourism promotion budgets. A lot of destinations in the United States don't have anywhere close to those kinds of budgets. All those variables play into how we do our jobs but we're all still basically doing the same thing.

Changing Technology Landscape

Luke:

And in terms of the changing technology landscape, is there anything that sticks out in terms of marketing that may or help align brand messaging across these different partnerships?

Jerad:

Yeah, there are technology solutions. So much more of what we do certainly in tourism, but in other parts of economic development is the digital space, because we're so visible and accessible. It does make it a little bit easier to align our brand across all of these different organizations. Dialing that down into a tourism conversation, tech has such a big impact not just in terms of how we engage and reach our consumers, but also in terms of how our visitors move.  

Tech specifically in the tourism sector I think is having more of an effect on how people move rather than how we are marketing to them. Even though the marketing site has changed, how you research book and consume travel today compared to how it was consumed 10-15 years ago is completely different. Anything that we do now is moving to the palm of our hands. It's easier for us to make a travel decision while we're sitting in a taxi. It's very easy for us to do that so we have to make sure that as marketers, we continue to find where consumers are researching selecting travel options.

This is something that we will continue to focus on as destination markers. It's not always easy to do but there are certainly some approaches. I think destination marketing organizations like visit Pittsburgh have gotten a lot better at telling that story.

Looking Ahead

Luke:

What gets you excited for the year ahead?

Jared:

I think it's the unknown that keeps me excited. And some of your previous podcasts especially in your last podcast, we're talking about brand positioning for luxury brands. There's an interesting thing that happens when it comes to how destinations speak to travelers. We've moved on from product to experience. Everything that we’ve talked about comes down to, how do we create a better experience?

We talked about the airport. That's a huge investment in terms of improving our consumer experience when people arrive and depart from Pittsburg. When they're in the city, how do we make sure that we continue to develop products and services that enhance our consumers’ experience in our local market.

The same goes for our event sectors. In the past we’ve marketed destinations like Pittsburg from a standpoint of this is our product, this is our airport, this is our hotel product, this is our venue. The conversation has moved much more to experience. What kind of an experience does an event create both from a consumer perspective but also from an organizer perspective? What kind of a legacy effect is that going to have on a destination?

When we have a tech event, how do we make sure that that knowledge capital stays here? If we have a conference in AI, how do we make sure that those students that are studying AI at local universities are exposed to that information? How do we make sure that technology stays here in the community? I think that's very exciting. Making sure that the conversation goes beyond tourism is very exciting.