May 29, 2013

Meghan Risch

Mayor Emanuel and Choose Chicago today announced that Chicago's regional advertising campaign promoting leisure travel to Chicago during the winter season contributed to record hotel performance and significant new tax revenues during the first four months of 2013. Early last week, Choose Chicago launched an 11-week campaign in seven markets to help drive visitation to Chicago during the summer season. This is the second consecutive year that Choose Chicago has implemented such a campaign to drive visitation from key drive markets to Chicago during the winter and summer seasons.

Visitors from five targeted drive markets, including Detroit, Grand Rapids, Indianapolis, Milwaukee and St. Louis generated nearly 247,000 incremental visits, up from 142,000 during the same period in 2012. The eight-week broadcast and digital campaign, at a cost of $725,000, delivered more than $208 million in additional spending between January and April 2013, up from $119 million the previous year and 412,000 hotel room nights, up from 190,000 in 2012, according to analysis conducted by Strategic Marketing & Research, Inc (SMARI). The campaign delivered $288 for every $1 in media spending, up from $165 in the winter of 2012.

The winter campaign drove increased tax revenues as well, in particular the city and state generated $6.9 million in incremental hotel tax revenue from the campaign or a tax ROI of $9.49 for every $1 invested in media spending, more than double what was generated in 2012.

The campaign was a cooperative effort with five of the city's major attractions for the winter season, including Blue Man Group, Chicago Flower & Garden Show, Museum of Science and Industry, Navy Pier and Shedd Aquarium.

"These incredibly positive results reflect a strategy that is clearly working to bring more visitors to our city," said Mayor Rahm Emanuel. "I remain focused on the goals established for Choose Chicago to help elevate visitation to our city, which will ultimately create new jobs and tax revenues."

Smith Travel Research (STR) data for the period further supports that the winter campaign significantly influenced travel to Chicago. Leisure Occupancy and RevPAR set historic highs at 42.3% and $65.50, up 2.7% and 7.3% respectively during the same period in 2012. ADR experienced the best performance in five years during the campaign period at $154.96, a 4.5% increase over the same period last year. "Increased visitation to Chicago, especially during the first quarter, delivers immediate value for the city's overall economic. According to STR, revenue generated by leisure tourism hit an all time high of $275.1 million for the period.

"Increased visitation to Chicago, especially during the first quarter, delivers immediate value for the city's overall economic development efforts," said Don Welsh, Choose Chicago President and CEO. "The incredible response to our aggressive marketing efforts is further evidence that a well-developed and flawlessly executed campaign drives increased visitor spending and new tax revenues,"

"The exceptional results from this year's campaign were due in large part of the modifications we made to the creative elements as well as adjustments to market and media selections based on learning's from our 2012 winter and summer efforts," said Warren R. Wilkinson, Choose Chicago Chief Marketing Officer. "I am pleased that Chicago is benefiting from this thoughtful and purposeful approach to driving increased leisure visitation"

"We experienced a positive impact as a result of this terrific winter campaign," said Pierre-Louis Giacotto, General Manager, Radisson Blu Aqua Hotel, Chicago. "Leisure room nights increased 33 percent against the same four months of 2012, generating a similar increase in leisure revenue. Overall, we experienced a better performance than anticipated."

SMARI methodology was developed to measure the impact of influenced travel and as such this research measures the economic impact of only incremental travel. SMARI conducted interviews throughout the five key markets exploring actual visitation to Chicago, as well as the motivators and specific details of those trips. Based on more than 2,000 interviews, research revealed the campaign was most effective in Detroit, delivering 92,652 influenced trips, up from 69,571 incremental trips in 2012, followed by Indianapolis with 58,409 influenced trips. The average trip length was 2.4 nights and average trip expenditure
resulted in $845. Key motivators for trips were the variety of activities the city offered during the winter season - a message that was reinforced by the advertising.

On May 20, 2013, Choose Chicago launched an 11-week summer campaign in seven markets, including: Detroit, Des Moines, Grand Rapids, Indianapolis, Louisville, Milwaukee and Toronto. This $1.4 million broadcast television, Cable and digital effort is similar to the winter campaign as it is a cooperative effort with Blue Man Group, Chicago Tall Ships, Museum of Science and Industry, Navy Pier and Shedd Aquarium.

At the current rate of 43.6 million visitors annually, Chicago's visitor industry is an economic engine directly responsible for 128,000 jobs, $725 million in tax revenue and $12 billion in direct spending**. Projected at a rate of 50 million visitors annually, a key goal for the team at Choose Chicago, the direct impact could increase to 155,000-165,000 jobs, $1.2 - $1.3 billion per year in tax revenue and $14.7 billion in direct spending.

** Based on 2011 visitor volume
Sources: Strategic Marketing and Research, Inc, Smith Travel Research