…… Letter from the Director Dear Industry Partners, During fiscal year 2011(FY11), the Arizona Office of Tourism (AOT) worked to increase the awareness of Arizona as a premier, vibrant travel destination. From our state’s unforgettable natural beauty to Arizona’s diverse tourist attractions, AOT incorporated Arizona’s exciting offerings into a robust program of work that influenced travel to Arizona and expanded tourism activity across the state. AOT is proud to share the accomplishments of our FY11 program of work with you in the following pages of this annual report. Through the agency’s research‐based advertising plans, AOT reached the state’s target audience encouraging travel to Arizona. Our trade and media relations activities established and maintained key relationships with tour operators and travel agents to ensure Arizona stays top‐of‐mind as a destination choice. The agency collaborated with travel journalists and editors to generate objective third‐party media coverage about our state’s travel options that reached millions of global readers. Additionally, AOT’s community outreach efforts provided marketing tools and resources for statewide communities to enhance the Arizona tourism industry’s local economic impact. The travel and tourism industry matters to Arizona’s economic health and vitality. As one of Arizona’s pillar industries, tourism has been integral to the economic growth and development of the Grand Canyon State shaping it into the amazing destination that it is today. This industry has generated thousands of jobs, billions of dollars in earnings and billions of dollars in tax revenue, all of which contribute to the quality of life for each and every Arizonan. As we move forward with our FY12 marketing efforts, our agency is looking forward to working with our industry partners to ensure that tourism continues to be a key economic driver for Arizona. Sincerely, Sherry Henry Director Arizona Office of Tourism Table of Content AOT’s Mission, Vision, Values, Core Strategies, Goals, Brand Promise 3, 4 Strengthening the Arizona Economy (Arizona Tourism Industry’s Economic Impact by the 5 Numbers) Research 6 Marketing 9 Fulfillment 13 Trade and Media Relations 14 Community Relations 15 Welcome Centers 16 Executive Activity and Agency Projects 17 AOT Mission The Arizona Office of Tourism enhances the state’s economy and the quality of life for all Arizonans by expanding travel activity and increasing related revenues through tourism promotion and development. AOT Vision Lead the way in branding Arizona. AOT Values INTEGRITY. We will always, to the best of our ability, honor our commitments and carry out our work according to the highest personal and professional standards. LEADERSHIP. We will provide leadership and unify the industry in marketing and tourism initiatives to the state. ACCOUNTABILITY. We are responsible to the people of Arizona for the effective, efficient, and appropriate use of our resources. We are committed to being good stewards of these resources. QUALITY. We strive to make every product, service, and interaction the best it can be. CUSTOMER SERVICE. We highly value our customers. We will listen to them, be responsive to their needs and preferences, do our best to provide them with service that exceeds their expectations, and share our passion for Arizona with them. RESPECT. We will demonstrate respect for each other, for our state, its lands and its people. AOT Core Strategies PEOPLE. Recognize, reward and value our people as our key assets. PROMOTION. Market the full Arizona experience through a unified message on a global scale. COMMUNICATION. Communicate clearly and listen effectively to all AOT audiences. INNOVATION. Be on the leading edge of our industry‐using the latest research, marketing techniques and technology. Agency Goals PEOPLE. Foster a work environment that promotes personal and professional growth. Develop a corporate culture that prioritizes the gathering and sharing of market intelligence. Expect all staff members to passionately engage in the vision of the Arizona Office of Tourism and the values that define the Agency. PROMOTION. Strategically market Arizona tourism experiences. COMMUNICATIONS. Strengthen and communicate Arizona’s Brand. Implement an integrated strategy that communicates to all audiences the importance of tourism as a key economic driver. Educate AOT’s constituents through traditional and innovative methodologies to maximize the economic impact of tourism. INNOVATION. Establish a technology platform for all programs of work to extend the Agency’s reach and impact. Create a blueprint for Sustainable Tourism. Lead the way in innovative marketing and tourism initiatives in the state. AOT Brand Promise As the leader in Arizona’s tourism industry, AOT is committed to building the brand architecture that will define the Grand Canyon State as a premier travel destination. Strategic Brand Promise: Inspiring Unforgettable Southwest Moments Strategic Brand Dimensions: Unexpectedly Exhilarating Signature Scenery Rejuvenating Open‐Air Lifestyle Timeless Discoveries Vibrant Variety Travel and Tourism Matters to Arizona Below are results from the 2010 Economic Impact of the Arizona Tourism Industry and Visitation statistics. 36.9 Million* Total domestic and international Visitation to Arizona in 2010 $17.7 Billion** Total direct visitor spending in Arizona in 2010 80%** Non‐Arizona residents produced 80% of travel and tourism spending in 2010 which represents new money imported into Arizona’s economy $48 Million Daily contribution to Arizona’s economy because of the travel and tourism industry in 2010 152,200 Jobs** Direct traveler spending generated 152,200 jobs in Arizona for 2010 $4.7 Billion** Direct traveler spending generated $4.7 billion in earnings in 2010 $2.5 Billion** Visitor spending generated $2.5 billion in local, state and federal tax revenues in 2010, which equates to $1,040 per Arizona household For a more detailed look into the economic impact of the Arizona travel and tourism industry, please refer to the full Economic Impact of the Travel Industry in Arizona report available in the Research and Statics section of www.AZOT.gov. *Sources: Tourism Economics, 2007‐08 Mexican Visitors to Arizona, US Department of Commerce – Office of Travel & Tourism Industries, and Statistics Canada **Source: Dean Runyan Associates Research Throughout FY11, AOT conducted various research surveys with industry partner Northern Arizona University Arizona Hospitality Research & Resource Center (AHRRC). From industry surveys to community assessments, these research projects generated insight into Arizona active tourism industry. Wine Industry Survey In FY11, AOT commissioned AHRRC to conduct a survey of Arizona’s emerging wine industry. The developing industry has become a substantial tourism attraction for Arizona’s rural communities, significantly impacting local economies. The resulting report, Arizona’s Wine Tourism Industry Survey, provided market research including visitor demographics, travel patterns, satisfaction perceptions of the Arizona wine experience and spending patterns. Currently, there are more than 45 licensed wineries within the state of Arizona, with 10 licensed tasting rooms. More than 650 acres of vines are located throughout the Grand Canyon State, which produce 66,000 gallons and 21,000 cases of both red and white wine per year. Wineries in Arizona are located in two distinct areas in the southeast and north‐central parts of the state. The southeast wineries, the oldest and most established, are located in the Santa Cruz County communities of Sonoita and Elgin, and in Cochise Country near Dragoon and Willcox. The northern wineries are a newer phenomenon, developing over the last decade in the Verde Valley of Yavapai County, where wineries are concentrated in the communities of Page Springs, Cottonwood and Jerome. In addition to the industry research conducted by AOT, the agency collaborates with statewide, national and international partners to monitor tourism industry indicators. Data gained from tracking these indicators support statewide marketing plans and emphasizes how the travel industry benefits the state’s economy. Below is a listing of what the agency routinely tracks. Annual Research    Economic Impact Domestic Visitation International Visitation Monthly and Quarterly Research       Lodging Performance National Park Visitation State Park Visitation Airport Passenger Traffic Gross Sales & Tourism Taxes Arizona Welcome Center Results of on‐going and special research studies are available in the Research and Statistics section of www.AZOT.gov. The survey collected more than 500 surveys from the state’s three wine growing regions in Santa Cruz, Cochise and Yavapai Counties, over a four‐month period from February through May 2011. Key findings from the survey include:         Wine visitors have a higher annual income ($88, 149) than Arizona visitors on average ($76,000) 60% of visitors are from in‐state on day trips and are mostly from Maricopa (55%) and Pima (33%) counties 40% are from out‐of‐state 83% said the experience was “better than expected” and are highly satisfied with the Arizona wine experience Among the top reasons to visit Arizona’s wine country, visitors want to enjoy tasting wine, socializing with friends and experience the beauty of rural Arizona 70% make purchases at the winery they visit, spending an average on $70 on three bottles The industry generates $6 million in state and local taxes, as well as generates more than 400 jobs. Total economic impact from the Arizona wine industry is an estimated $38 million in the state’s economy. Sustainability Tourism Practices: Arizona Benchmark Study On behalf of AOT, AHRRC completed a survey in FY11 of the Arizona tourism industry and its sustainable practices. The intended purpose was to collect baseline data on current sustainable progress by the industry and establish benchmarks for future research. AOT and the AHRRC created an e‐survey which was sent to thousands of practitioners across industry sectors – lodging, restaurants/bars, attractions, travel and tour providers, and destination marketing organizations. In general, the study found that Arizona’s tourism industry is doing a great deal to build a more sustainable future. A large percentage of this industry is knowledgeable about sustainability issues, and is responding to community and customer concerns. The majority of organizations are recycling, reducing waste, conserving water and energy, and are celebrating local cultures and sourcing local products. Top line results of the study for Arizona’s tourism organizations are outline below. The complete survey is available on www.AZOT.gov:   About three‐fourths of respondents had a working knowledge of sustainability issues – 40% actively seek information and 34% follow news stories on the subject; one‐fourth do not (26%). A majority already has (32%) or is in the process of creating (28%) a comprehensive sustainability strategy, while 40% have no such plan.          The top three factors driving sustainable practices are: community environmental concerns (68%), corporate image/brand reputation (65%), and employee interests (41%). Two‐thirds (68%) are currently implementing water conservation measures; one‐third are not. Four of five (80%) are currently implementing energy reduction measures; 20% are not. Half currently monitor energy and water consumption (48%), while half do not (52%). Three‐fourths are not currently implementing air quality measures (76%), while one fourth (24% are doing so. Majorities of Restaurant and food service properties: o Recycle cardboard (86%) o Use Energy Star certified appliances (54%) o Recycle cooking oil (54%). Majorities of Destination Marketing Organizations (DMOs) have: o Sustainable programs and activities (62%)  specifically:  Cultural and heritage programs (82%)  Art or historic walks (79%)  Bird and wildlife watching (68%)  Historic preservation programs (62%)  Farmers Markets (56%). Most DMOs do not, however, have specific funds allocated to market or promote their activities (74%); 26% do have earmarked funds. One‐third (36%) of DMOs rate their destination as good or very good in implementing sustainable tourism programs; 55% say they are neither good/nor bad; 9% admit they are bad/very bad. Community Surveys AOT conducts annual community visitor surveys with AHRRC. AHRRC worked alongside representatives in each of the communities to assist in gathering visitor data. Once completed, the final reports provide AOT as well as the communities with vital information on where their visitors are coming from, when they are coming, how long they are staying and what they are doing while visiting the area. The data allows tourism officials to identify areas of marketing opportunity, develop highly‐targeted marketing initiatives and provide key‐decision makers with concrete research on the economic importance of tourism to their communities. The communities selected for FY11 were:   Yuma Kingman Area including the Grand Canyon West/Hualapai. The complete surveys are available on www.AZOT.gov Marketing AOT implements research‐based, multi‐layered advertising campaigns to stimulate interest and encourage potential travelers in selected markets and visitor segments to select Arizona as a travel destination. This marketing activity reflects the agency’s overall mission, which is to increase travel activity and visitor spending throughout Arizona. Target Cities Campaign In FY11, AOT developed the state’s new target cities advertising campaign, In One Word‐Arizona. The ads built upon the state’s established brand and featured some of Arizona’s most recognizable attributes and visitor attractions such as the Grand Canyon National Park, Monument Valley Tribal Park, Sedona, and Saguaro National Park. Several more statewide travel destinations were featured throughout the duration of the campaign. Accompanying each distinctive image was one single word inspiring visitors to discover more about Arizona. The result produced engaging campaign imagery that showcased the diverse and unforgettable Arizona landscape. Viewers of the campaign were encouraged to visit AOT’s consumer travel Website www.arizonaguide.com to receive more information about travel opportunities throughout the state. The campaign ran from November 2010 to May 2011 and appeared primarily in the Chicago and Los Angeles markets. AOT’s research determined that these cities are proven to be among Arizona’s top feeder markets for prospective visitors. The In One Word‐Arizona campaign appeared in traditional media such as print, radio, TV, outdoor, video‐on‐demand and digital outlets to help extend the campaign beyond the two primary target cities. Print ad placements included:         Audubon Budget Travel National Geographic Traveler Chicago Magazine Chicago Tribune Los Angeles Magazine Los Angeles Times Southwest Spirit Television spot networks included:        CNBC CNN ESPN Golf Channel History Channel MSNBC ABC Digital/Online media placements included:      Mobile Sponsorships Banner Advertising Interactive Map Social Media Efforts Pay‐Per‐Click Programs To complement the traditional and digital advertising efforts, the agency executed “non‐ traditional” marketing tactics. AOT placed “wallscapes” on buildings throughout Chicago and Los Angeles to showcase the campaign images, a first for the agency. Additionally, versions of the ads appeared on the online boarding passes of several major airline carriers throughout the nation. Overall, AOT’s In One Word‐Arizona advertising campaign generated a state tax return on investment (ROI) of $5 for every $1 dollar invested. Chicago Wallscape Los Angeles Wallscape RESULTS The In One Word – Arizona campaign was measured by incoming phone calls, requests/downloads for the Arizona Offical State Visitor’s Guide (OSVG), and traffic to AOT’s consumer Website www.arizonaguide.com.    During the campaign run, there were more then 5,000 inbound calls, peaking during the months of January through March. Beginning with 683 calls in November, call volume grew month over month, ending with more then 1,300 calls in March. o Call volume increased 70 percent in Chicago and 83 percent in Los Angeles. Inquires for the OSVG were more then 75,000 for the campaign period. Website traffice increased during the campaign run. Overall site visitation increased six percent, while visits from Chicago increased by 30 percent and visitors from Los Angeles increased by 13 percent. In‐State Campaign In FY11, AOT launched the in‐state summer campaign, ValueAZ. The meaning of ValueAZ is threefold: Value Arizona as an exciting vacation destination; Value the great summer package deals available throughout the state; and Value the economic impact of Arizona’s travel and tourism industry. The campaign was geared toward Arizona residents to remind them of the variety of travel destinations that can be found throughout Arizona and encourage in‐state travel. The campaign was supported by www.ValueAZ.com, which provided a one‐stop‐ shop of great travel deals available around the state. Industry partners were highly encouraged to participate in this campaign by submitting their destination’s travel deals online at www.ValueAZ.com. Ads appeared in several media outlets including: newspapers, magazines, radio, cinema and complimented by an online sweepstakes. RESULTS    For the campaign duration (May‐August) ValueAZ.com's site traffic reached more than 18,000 (a 111 percent increase from FY10). More than 2,500 sweepstakes entries were received (a 92 percent increase from FY10). Top performers in the online space were YumaSun.com, AZStar.net and Yelp.com. Social Media Social Media has become an essential component to AOT’s overall marketing efforts. Currently, AOT is using several social media sites, including Facebook, Twitter, YouTube, and Flickr to connect with travelers and encourage them to visit Arizona. This strategy takes the agency’s advertising messaging beyond www.arizonaguide.com and reached key audiences when they are spending time online. AOT’s social media strategy positions AOT as a reliable resource for Arizona information within social media / networking sites, while reaching the agency’s targeted demographics. RESULTS   Nearly 40,000 Facebook fans More than 12,000 followers on Twitter Mobile Website In FY11, AOT launched the mobile version of its consumer Website, www.arizonaguide.com. Mobile‐ savvy travel consumers can now access Arizona visitor information at mobi.arizonaguide.com on DROID and iPhone mobile devices. The mobile Website offers the same valuable Arizona travel information such as statewide attractions, events and travel deals that can be found on AOT’s key consumer marketing resource, www.arizonaguide.com. The mobile Website has been strategically integrated within AOT’s overall marketing efforts and plays a key role along with the agency’s traditional and digital advertising initiatives, social media activities, and the Official State Visitor’s Guide. Fulfillment AOT fulfills visitor requests for travel planning assistance, provides travel planning materials, disseminates regular email correspondence for “opt‐in” consumers and maintains comprehensive, informative Websites to encourage extended visits to Arizona. RESULTS     129,302 Official State Visitor’s Guide distributed. o Top states requesting visitor’s guides include Arizona (11,705), California (11,188), Illinois (8,848), Texas (8,583) and New York (6,082). o 18,831 international (Mexico, Canada, Germany, Japan, France and the United Kingdom) visitor’s guides were distributed. 11,242 calls were managed by AOT’s travel information call center. 350,000 subscribers were sent AOT’s monthly consumer eNewsletter. 1,904,739 visitors to www.arizonaguide.com. 2011 Arizona Official State Visitor’s Guide AOT’s Consumer Website, www.arizonaguide.com AOT’s Consumer eNewsletters Trade and Media Relations AOT works proactively with the travel trade industry (tour operators, wholesalers, travel agents, airlines, etc.) through Tradeshows and Sales Missions in both domestic and international markets. Additionally, the agency works with travel media (newspapers, magazines, broadcasts, online, etc.) throughout the United States as well as in the agency’s top international markets (Canada, Mexico, Germany, France, and the United Kingdom) providing them with unique article ideas about Arizona’s travel experiences to gain positive third‐party editorial exposure. RESULTS       Produced 2,108 articles (online/print) and broadcasts Generated $24,691,150 in advertising equivalency value published articles about Arizona Reached 3,103,773,680 global readers through Arizona travel articles Hosted 128 domestic and international travel journalists, tour operators and travel agents Visited 60 Arizona communities and attractions Certified 225 travel agents as Arizona Specialists through AOT’s Arizona Accreditation Program (AZAP) Publication = Voyages d’ Affaires Print Ad Value = $534,490 Print Circulation = 61,000 Community Relations AOT collaborates with statewide industry partners to strengthen Arizona’s tourism offerings for visitors. Through outreach programs and technical assistance opportunities, AOT provides statewide tourism organizations and Tribal tourism entities valuable marketing information and customer service skills to boost their visitor offerings and provide Arizona travelers with a high‐quality experience. Arizona Tourism University Workshops In FY11, more than 450 representatives from statewide community organizations attended one of AOT’s community outreach programs and presentations.   AOT works closely with all 22 federally recognized American Indian Tribes located throughout Arizona to ensure Tribal tourism opportunities are incorporated into the agency’s overall marketing efforts. Throughout the FY11 Annual Report, you will find examples of our collaborative tribal tourism development efforts. However, below is a snapshot of standout projects for FY11.   ATU Workshops:  Tribal Tourism Development Arizona Centennial – Two workshops were held in Green Valley and Show Low. AOT also hosted a webinar. Crisis Communications – Two workshops were held in Flagstaff and Tucson. AOT also hosted a webinar. Customer Service – Three workshops were held in Cottonwood, Tuba City and Tucson. AOT also hosted a webinar. All past ATU presentations and webinars can be found on www.AZOT.gov.   New York Media Marketplace with Chef Freddie Bitsoe AOT on the Road: Native American Community Outreach White Mountain Apache Tribe Local Visitor Information Center 2011 American Indian Alaskan Native Tourism Association (AIANTA) Conference AOT on the Road Workshops In FY11, AOT offered an additional workshop series, AOT on the Road, to statewide communities. Last conducted in 2006, AOT on the Road is an outreach program that focuses on building important dialogue between regional community representatives and tourism industry leaders. Communities visited in FY11 include: Apache Junction; Camp Verde; Holbrook; Lake Havasu City; Nogales; and Prescott. Welcome Centers and Local Visitor Information Centers Painted Cliffs Welcome Center ‐ AOT’s Painted Cliffs Welcome Center and Local Visitor Information Centers welcomed more than 1 million visitors to Arizona in FY11. Located on Interstate 40 westbound near the Arizona/New Mexico border, the Painted Cliffs Welcome Center is available for travelers seeking information on what to see and do in Arizona. Visitors to the center have access to thousands of brochures, maps, and additional information on nearly every community in Arizona. RESULTS  In FY11, the Painted Cliffs Welcome Center greeted 119,357 visitors. Painted Cliffs Welcome Center Local Visitor Information Centers AOT has 60 designated Local Information Visitors Centers (LVICs) throughout Arizona. AOT, along with the Visitor Advisory Committee, manages the centers to ensure each facility provides the most up‐to‐date visitor information for travelers. Each center helps to promote local and regional attractions; recreation opportunities; and hospitality amenities. In FY11, AOT, in collaboration with the White Mountain Apache Tribe, established the first LVIC on Tribal Land. The White Mountain Apache Tribe LVIC is located in the Nohwike’ Bagowa, the White Mountain Apache Cultural Center and Museum. White Mountain Apache Tribe LVIC Also, the City of Superior and the Superior Chamber of Commerce opened their Superior Caboose Local Visitor Information Center on Highway 60. This group transformed a historic steam engine caboose into their local visitor information center. AOT contributed to the Superior project through a 2007 and a 2009 Rural Tourism Development Grant. RESULTS  In FY11, AOT’s 60 LVICs welcomed 893,160 visitors. Superior Caboose LVIC Executive Activity and Agency Projects Governor’s Task Force on Tourism and Economic Vitality In May 2010, Governor Jan Brewer configured the Governor’s Task Force on Tourism and Economic Vitality to combat challenges to the Arizona tourism industry. Many current issues such as the condition of the national economy, the negative perception of hosting business meetings or conventions at resorts, and the call for boycotts to the state as a result of SB1070 were impacting the success of the industry. The task force volunteers included members from the AOT, the Arizona Department of Commerce (ADOC), the Arizona Mexico Commission (AMC), as well as the Arizona Hotel & Lodging Association (AzHLA), the Arizona Tourism Alliance (ATA) and other statewide business leaders. Underscoring the importance of tourism as an economic development tool, recommendations from the task force centered on supporting the existing “brand” of Arizona that tourism officials currently use to promote the attributes of Arizona as a location to visit, work and live. Other recommendations included creating a proactive communication plan to clarify facts and misconceptions about SB1070 and to consider national and international marketing, advertising and public relations efforts that would further the existing Arizona “brand” by promoting the assets of the state with a focus on tourism, business and economic vitality. Implementations of the recommendations were managed under the direction of the AOT, ADOC, AMC and ATA in collaboration with statewide businesses and tourism leadership. RESULTS:  Arizona Fly‐in Program – Designed to bring to Arizona the leadership and decision‐makers for potential group and meetings business, this program generated an economic impact of more than $17 million dollars in confirmed booking and additional $22 million dollars in tentative bookings.  Public Relations Program – The task force hired Phoenix‐based HMA Public Relations firm to create a public relations campaign promoting Arizona and clarify misconceptions brought to light due to controversial legislation. Through HMA’s efforts the task force generated an online circulation of more than 21 million readers.  Grassroots ePostcard “Arizona Calling – Share Something Amazing” Program – This campaign featured many of the same iconic Arizona images that are featured in AOT’s “In One Word – Arizona” campaign. With customizable messages, ePostcards can be sent to friends and family around the globe at no cost. This campaign is designed to be on‐going with the images of Arizona changing to reflect seasonal activities and events. Arizona Centennial AOT works in collaboration with the Arizona Centennial Commission on dynamic plans for Arizona’s 100th anniversary of statehood, February 14, 2012. AOT is a proud sponsor of the Arizona Centennial Copper Chopper. Finished in brilliant Arizona‐mined copper and adorned with historic state symbols, the Arizona Centennial Copper Chopper serves as the mascot for Arizona’s Centennial celebrations as well as an educational exhibit about motorcycle safety. The chopper is traveling to events throughout the Grand Canyon State bringing awareness to Arizona’s 100th anniversary of statehood. The copper chopper was designed by Arizona resident Paul Yaffe, one of the most respected and well‐ known custom motorcycle designers in the world. It is a one‐of‐a‐kind chopper and a unique commemorative piece of art that celebrates Arizona for its independent spirit, ingenuity, love of the open road and cultural and natural diversity.