Ottawa’s tourism industry will benefit from a major infusion of marketing dollars in 2014 thanks to the revival of a levy on most area hotel rooms to promote the capital to potential visitors.
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Dick Brown is the president of the Ottawa Gatineau Hotel Association.
The return of the program, known in the industry as the destination marketing fee, averts what could have been a disaster for the city’s tourism players.
Funding to promote the city has been in flux since 2010, when the introduction of the harmonized sales tax brought to an end a similar program that raised money from the city’s tourism sector to pay for advertising.
For two years the city’s main promotional body, Ottawa Tourism, received bridge funding from the province. But that funding expired in spring 2013, forcing tourism officials to find an alternative.
The association that represents area hoteliers, the Ottawa Gatineau Hotel Association, had initially agreed to a levy in 2012. However, it was suspended for several months while the province looked at other funding options, said Dick Brown, president of the OGHA.
The current version of the program calls for participating hotels – 42 of the 48 OGHA members are taking part, according to Mr. Brown – to remit three per cent of their revenues from room fees to Ottawa Tourism.
Hotels will have the choice of either paying that out of their own revenues or of passing the increased cost on to guests, said John Cosentino, the chair of Ottawa Tourism’s board and the general manager of the Best Western Victoria Park Suites.
It will be up to individual hotels to decide what to do if guests don’t want to pay the fee, but Mr. Cosentino said his hotel hasn’t had any issues of that nature so far.
Mr. Brown said the return of the destination marketing fee in June of last year will be a boon to those looking to fill restaurants, taxi cabs and hotel rooms with tourists.
He expects the program will generate about $8 million in revenue. This will combine with about $3.5 million in continued funding from the province to push Ottawa Tourism’s budget from the $7.5 million of previous years to about $12 million this year.
He said this increase in funding will allow the city to establish “broader and deeper” campaigns to attract visitors.
Mr. Cosentino pointed to the advertising that Ottawa Tourism is doing in places such as China and the United States as an example. He said it would have been difficult for the body to continue these campaigns without the money provided by the new fee.
“If we didn’t have these funds, we wouldn’t be able to spend a dime on China,” he said.
Despite the infusion of cash, Mr. Brown is cautioning that the city’s tourism industry will need to continue to expand the amount of money it spends in order to compete with other markets around the world.
“It sounds like a lot of money, but as you know that really isn’t when you’re looking to provide comprehensive marketing nationally, provincially, internationally, both in North America and in emerging markets,” he said.