Metric Centric Vs. Strategy Centric. Are DMOs Missing the Forest from the Trees?

Below is an excerpt from Carl Ribaudo's new book "Strategy and Creativity Matter; Notes from the Road," a collection of his most recent articles on tourism strategy. Available on Amazon.

"What we see depends mainly on what we look for."

                                                                               John Lubbock

Let's face it. DMOs have become incredibly data-centric over the last 25 years. Years ago, only the most considerable DMOs and state tourism agencies could afford marketing research consistently or regularly.

Most DMOs were relegated to information requests, phone calls, counting coupons, or business replies to cards inserted into magazines. Metrics were few and far between, and for some DMOs, it was challenging at funding time for that rare City Council person or county supervisor who asked how we knew what you were doing works.

DMOs have developed an appetite for metrics because they continually need accountability to justify their funding and, in some cases, their existence.

But has this culture of accountability come at the expense of focusing on organizational and competitive strategy? 

The arrival of the Internet meant that websites became the central marketing tool because they provided DMOs with a new way to reach the marketplace. As importantly, the Internet provided DMOs with something they had never had: a low-cost way to count things. Gone were tracking phone calls, coupons, and business replies to cards, replaced by website visitors and impressions.

Fast forward to today, and DMOs have more metrics than ever, everything from lodging performance, information on website use, search engine optimization, economic impact, transient occupancy tax, and even how many people open a newsletter. With all this data, it was natural that the Key Performance Indicator or "KPI" was developed, enabling DMOs to develop dozens of KPIs for even more metrics.

Big data has also entered the DMO metric space, with companies like Zartico, Symphony, and Placer offering AI and more. These organizations provide a comprehensive way to store and manage data. DMOs and their creative agencies, be it advertising, digital, or public relations, are all well-versed in KPIs for the projects they're working on.

The industry has oriented itself around metrics. Everybody wants to be data-driven, and there is nothing wrong with that. Since DMOs have so many metrics at their disposal and many use outside agencies to supplement their staff, they have lost their focus and concentrated too much on being metric-centric at the expense of developing effective strategies. Many DMOs have outsourced what they think is a competitive strategy to outside strategic planning firms and ad agencies happy to drive KPIs.

What is wrong with being metric-centric?

Have we reached a point of overreliance on analytic tools that are better suited to understanding the current situation and context and less influential in shaping an organization's future strategy and direction?

In many cases, metric-centric organizations often lose sight of the real goal.

The goal is not to benchmark yourself with other DMOs but to develop a competitive advantage and win a place on a competitive chess board.

The goal is not to focus on how many impressions, website users, and likes at the expense of asking more fundamental questions:

• Where should we compete as an organization?

• How should we compete as an organization?

• Do we have the capabilities to compete as an organization?

• And do we have the management systems to be effective?

Developing strategy is more art than analytics; it is a creative process. The insightful strategist Kenichi Ohmae put it nicely.

"Insight is the key to this process because it is creative, partly intuitive, and often disruptive of the status quo; the resulting plans might not hold water from the traditional analyst's view. It is the creative element and the drive and will of the mind that conceived them, giving strategies their extraordinary competitive impact."

Ohmae suggests that an overreliance on metrics and analytics at the expense of the intuitive, creative strategy development process can limit a DMO and its competitiveness—something to consider if you are a CEO.

We reached this point because advertising and promotion with DMOs shifted from traditional marketing channels and platforms to more technology-oriented opportunities. Additionally, social media has exploded in a way nobody could have imagined.

Everything can be counted, every click can be quantified and analyzed, and metrics are tangible; it is something that DMO staff can put their hands around and understand. It is reassuring.

Strategy, in contrast, is messy and intangible. When an organization implements a strategy, success is not guaranteed.

When focusing on metrics, the creativeness and insight to develop a strategy to win on the playing field are missing. Most DMOs focus on creating communication channels and developing content for those channels, and very little time is spent figuring out how to win against their competitors.

Have DMOs created a metric strategy gap? Has pursuing metrics completely overtaken organizations to the point where DMOs are less competitive than they should be because they have limited the creative process and instead focused on the endless collection of metrics?

As DMOs emerge in a post-COVID environment with a wholly changed market, strategy is more critical than ever.

Strategy is everything.