Santa Monica Convention and Visitors Bureau (CVB), the City’s marketing organization, released the results of its 2004 Economic Impact Report late last week.
The update, conducted by Lauren Schlau Consulting and CIC Research Inc., focuses on visitor volume and economic impact on Santa Monica by visitors.
Domestic and international travel volume show continued annual increases since the dip in volume that began in 2000. Overall visitor volume has increased from its peak in 2000, from 3.8 million to 4.7 million visitors annually.
Spending is up significantly to $840.6 million for 2004 with individual daily visitor spending averaging $110.50. Revenues from the transient occupancy tax (TOT), which is now 14 percent per night, have also increased.
The rebound of business and international travelers, who accounted for much of the increased spending, now accounts for more overnight hotel bookings.
“This crucial research shows the importance of domestic and international overnight hotel guests who spend more – $198.20 per day – compared to the day visitor spending of $73.47,” said Misti Kerns, CVB president and CEO. “While overnight hotel visitors comprise only 11 percent of the total number of Santa Monica’s visitors, they contribute nearly half of the total spending.”
In 2004-05, the city realized $23.8 million in TOT, approximately 35 percent of the city’s total general fund revenues. “Overnight hotel visitors to Santa Monica affect the city in many positive ways,” Kerns continued. “The TOT, a strong factor in the overall growth and forward motion of the city’s revenues, has grown by $11 million in the last four years or 13 percent annually over the four year period…”
“Santa Monica’s tourism industry directly supported 9,380 jobs in 2004. We anticipate that both industry supported employment and TOT will continue to climb in 2005.”
“Hotel guests are spending more and walking or using our public transportation system,” said Tim Kittleson, chairman of the Santa Monica CVB board of directors, “a perfect formula for this destination. Strategically targeting this market segment has been a solid formula for Santa Monica CVB since its inception 23 years ago, ensuring that the destination is balanced and competitive in the tourism industry.”
In 2004, 85 percent of the total visitor volume to Santa Monica was in the form of day visitors, remaining steady since 2003.
“Although the majority of marketing efforts by Santa Monica CVB target international and overnight visitors, we recognize the importance of day visitors to Santa Monica as well,” Debbie Lee-Nguyen, vice president of business development for CVB, pointed out. “We support day visitors by providing tools such as maps and visitor guides at any of our three visitor information locations.”
With the TOT increase (to 14 percent) in January 2005, CVB forecasts that 2005 TOT income will push $27 million.
Key findings from the 2004 Economic Impact study include the following estimates: total visitor volume: 4.74 million (up 1.2 percent from 2003); total visitor spending: $840.6 million (up 8.3 percent from 2003 and well ahead of the previous record of $787.93 million in 2000); the breakdown of total spending by major spending categories: shopping (28.9%); meals out (23.3%); lodging (22.4%); daily visitor spending in 2004 was estimated at $110.50 (up 6.8 percent from 2003); average daily hotel visitor spending increased 11 percent from 2003 ($186.76) to 2004 ($198.20); while the majority of visitors to Santa Monica were day visitors, hotel guests accounted for 11 percent, generating 49 percent of the total spending and home visitors accounted for four percent of overall visitor volume and 16 percent of total spending; and international visitor volume is slowly and steadily returning to Santa Monica, comprising 47 percent of total visitor volume. These visitors spend more than domestic visitors, accounting for 58 percent of total visitor spending. A one-page fact sheet of the 2004 Economic Impact Update is available at no charge from Santa Monica CVB and a study summary can be purchased for $100. To purchase a bound copy, available mid-July, contact Mindy Lansing at (310) 319-6263 or email [email protected]
The City allocates $2 million a year to Santa Monica Convention & Visitors Bureau, a non-profit, non-membership corporation.
Lauren Schlau Consulting (LSC) was the primary consultant, led by Lauren Schlau, Principal. In addition, Skip Hull, an economist and Vice President of CIC Research Inc., performed the economic estimates.