This study was motivated by the recognition that there is a lack of empirical data on the characteristics of convention and visitor bureaus (CVBs), CVB executives and the organizations that employ them. The purposes of the study were to:
History
According to Gartrell (1992), the first CVB was established in 1896 in Detroit, Michigan. The primary motive for creating the early bureaus was to attract conventions to cities. The International Association of Convention Bureaus (IACB), now the International Association of Convention & Visitor Bureaus (IACVB), was formed in 1920 and had just 28 city bureau members. The association grew relatively slowly from the early 1920s to mid-1960s; by 1966, IACB had just less than 70 members (Gantrell, 1992). Reflecting an increased emphasis on attracting individual and group pleasure travelers, the "V" for visitor was added to the association's name in 1974 (Migdal, 1991). The membership of the association grew more rapidly after 1966, reaching 394 members in 25 different countries by 1993 (Newman, 1993). Not all CVBs are members of IACVB and it is estimated that there are 900 or more bureaus in the United States at the moment (Howell, 1993).
According to an annual IACVB member survey, the older the bureau, the larger is the CVB budget. For example, those bureaus with budgets of over $5 million had been in business for an average of approximately 45 years, while those with budgets of under $200,000 averaged only 8 years of operation (IACVB, 1993). It is also true that the older and most heavily funded bureaus tend to be in the larger cities of the USA.
Organizational Structures
The organizational structures of CVBs vary depending on the character of the destination, the quality of its product and funding levels (Gartrell, 1994). Some CVBs represent a single city, a metropolitan area, a number of cities and towns (such as in a county), while others represent a multicounty or regional destination. Regardless of their geographic scope, CVBs can be public, quasi-public, non-profit or private organizations. In North America, most bureaus are one of four types: independent, nonprofit associations/business leagues; chambers of commerce as non-profit associations or non-independent subsidiaries; local government agency, department or public authority; or a special legal entity/authority. According to IACVB, almost 60% of their member bureaus are independent, non-profit associations, 15% are chambers of commerce, and the remaining 25% are public agencies (IACVB, 1993). Most of the largest bureaus are independent organizations and were formerly part of chambers of commerce.
In the USA, most CVBs are classified as 501(c)6 or 501(c)3 non-profit associations which promote the general business interests of their constituencies. As such, they cannot engage in regular business activities that are normally conducted on a for-profit basis. Revenues generated by bureau activities must be primarily expended on bureau programs that demonstrate the basis for its tax-exempt status under the rules and regulations of the Internal Revenue Service (Gartrell, 1994).
Roles
The roles that CVBs play in their local economies are often misunderstood and under-appreciated. Bureaus play a number of roles, but it could be said that their primary reason for being is to act as a destination marketing organization (Morrison, 1989). In the USA they have become the principal organization responsible for marketing by attracting large and small meeting and pleasure travel groups and independent travelers (Fesenmaier, Pena, & O'Leary, 1992). On a state-by-state basis, the collective funds of each state's CVBs are usually much greater than the state government's own tourism office. In fact, some large USA CVBs, such as the one in Las Vegas, have larger budgets than the U.S. Travel and Tourism Administration.
Perhaps the most important role of the CVB within its community is to serve as a focal point and an "umbrella" organization for the diverse range of organizations and individuals involved in tourism. In this role, the CVB not only becomes the collective marketing vehicle, but also is an advocate for the local tourism industry, as well as a "one-stop shopping center" for visitors. As an example of this latter function, for the convention meeting planner, the CVB can check hotel availability, distribute meeting specifications to hotels, solicit bid proposals, conduct personalized site inspections, suggest spouse programs and other activities, and provide transportation and other logistical assistance (Barker, 1993; Meetings & Conventions, 1993). An important feature of a CVB's service from the visitor's perspective is that the bureau's advice is typically unbiased in recommending hotels, meeting facilities, and other community services (Migdal, 1993).
The two major market segments to which most CVBs promote are the convention/meeting and pleasure travel markets (Rubin, 1992). While the convention promotion role has traditionally been a main focus of activity, especially for larger city bureaus, the importance of pleasure travel promotion had been increasing. In addition to these marketing tasks, Gartrell identifies seven other management functions for bureaus: organizational, financial, personnel, communications, membership, events, and facilities equipment management (GartreIl, 1992). While several of these roles are internal in nature, others involve contact with a bureau's three other "publics" apart from visitors; bureau members, local citizens, and elected officials.
Many CVBs solicit members and charge membership dues. According to IACVB, approximately 48% of its member bureaus receive a portion of their funding from membership dues. However, membership dues accounted for only 5% of the collective budgets of the IACVB's survey respondents (IACVB, 1993). Gartrell indicates that a bureau's membership management function involves the development, retention, and integration of members including membership programs and communications (Ganrell, 1992). Member services often include newsletters, educational programs, publication of membership directories, and the availability of sales "leads."
Public affairs is another CVB role suggested by Rubin (1992). Gartrell (1992) classifies this as communications management or the linking of the bureau with all its "publics" through a variety of media. As mentioned earlier, the CVB often acts as an advocate for the local tourism industry with respect to its citizens and elected officials. In this role, the CVB provides information and raises the awareness of tourism business levels, economic impact and current industry issues. Other CVB roles include:
Generally, the roles of a CVB can be described through its five primary functions. A CVB is:
Hotel occupancy/transient taxes, or "room (bed) taxes" as they are often called, have been the major catalyst in the growth of CVBs in the USA. These taxes are normally levied as a percentage of the room portion of the guest's bill and, therefore, place no tax burden on the community's citizens. They have existed in the USA for more than 50 years, but have become most popular among local governments since the late I 960s (Migdal, 1991). An estimated 77% of IACVB member bureaus receive funding through room taxes. These taxes represented approximately 53% of total bureau funding of $585 million in 1993 for the 278 responding IACVB members. The remaining bureau revenues came from government matching grants and general tax funds (24%), membership dues (5%), restaurant taxes (2%), and other non-dues sources (I 6%). Room taxes accounted for 67% of the average CVB budget of $2. I million in 1993. It is interesting to note that smaller bureaus are more dependent on room taxes. CVBs with budgets of less than $2 million received 84% of their funding this way, while those with budgets of over $2 million had 65% of their revenues generated by room taxes (IACVB, 1993). It would seem that larger bureaus have a greater ability to diversify their funding.
Although the majority of USA CVBs are independent, they are "quasi-governmental" in nature because a substantial portion of their funding comes from a room tax which has been enabled through legislation. This specific hotel room tax is in addition to any other general sales tax (city, county, state, national), surtax or other dedicated levies that may already be applied to hotel rooms. The average hotel room tax in the USA is approximately 5%. The average total tax on hotel rooms, including the room tax just mentioned, is typically around 10% (Gartrell, 1994). Several of the largest cities in the USA have room taxes above 10%. For example, New York's room tax rate is now 16.25%, Chicago's is at 14.9%, Columbus at 15.8%, and Minneapolis at 12% (Broadway, 1994; Cahn, 1994). Of the total hotel room taxes collected in the USA, 25% goes to visitor-oriented CVB marketing, 27% to convention center construction, debt service and operations, and 48% to non-visitor uses (IACVB, 1993). For the foreseeable future, room taxes will continue to be a vital funding source for CVBs in the USA.
Some of the major future trends in CVB funding are expected to be that an increasing percentage of hotel room taxes will be used for non-visitor expenditures; other user fees will be investigated and applied; general tax funds and government grants will be less available for CVBs; more emphasis will be placed on industry-member support; partnership and buy-in programs will become more important; and increasing hotel room taxes may cause an industry/consumer backlash. In the latter case, there have been several situations, such as in New York City, where the hotel industry has opposed increases in room taxes. In particular, the use of portions of room taxes for non-visitor programs, e.g., civic/community projects, has become a most contentious issue within the tourism industry itself
CVB Management Skills and Qualifications
Having profiled CVBs in the USA, the characteristics of bureau executives
can now be reviewed. There have been relatively few previous research studies
on the characteristics of CVB leaders. Sims completed a study based upon
a sample of 83 CVB directors to examine the skills and personal qualities
that are desirable for CVB employment. For CVB sales positions, the respondents
mentioned industry and product knowledge, marketing, and sales most frequently.
For administrative jobs, the most frequently mentioned skills were finance,
personnel management, leadership, public relations, and planning. The respondents
mentioned skills in
communication, human relations, and time management, and professional
appearance as being important for all CVB positions (Sims, 1990).
O'Halloran (1992) conducted a similar study to examine the backgrounds of CVB directors, and to get their opinions on the resources, skills, and abilities required for CVB management. The respondents holding CVB director positions were found to be predominantly males aged over 40, who had worked in tourism for more than six years and earned more than $40,000 per year. Only 8% of the respondents were females.
The respondents in the O'Halloran (1992) study rated leadership skills
and human relations as the two most important skills for CVB directors,
with leadership being the most highly rated. The author stated that CVB
directors must be able to demonstrate their leadership by being able to
"visualize a great city or tourism destination area." The human relations
skills were vital since CVB directors had to rely on other people to implement
their vision of the city or destination area. In addition to these two
skill areas, prior CVB experience, a college education, communication skills,
knowledge of the tourism system, and political savvy were identified as
other vital qualifications for CVB management.
This study was completed during the period of 1992-93. A questionnaire was developed with the assistance of a number of CVB executives and was then tested with a small sample of other CVB executives in the Midwest. Some modifications were made to the form as a result. The revised questionnaire was mailed to 346 CVB executives in the US. Some 254 completed responses were received for a response rate of 73.4%. The 364 CVB executives selected were members of the International Association of Convention & Visitor Bureaus (IACVB). The IACVB's membership is considered to be very representative of the 900 CVBs in the USA. The procedures for questionnaire and cover letter design, and for followup, were as recommended by Dillman (1978). The initial request was followed by a postcard follow-up, and then by two additional letters (the second including a replacement questionnaire). These procedures resulted in the excellent rate of completion.
The study is believed to be the first to provide a comprehensive profile of CVB executives and the bureaus for which they work. The annual survey conducted by IACVB only provides information on CVB budgets, expenditures, and funding sources. The IACVB financial information is not analyzed to determine if statistically significant differences exist between various subgroupings of CVBs.
Chi-square analyses and one-way analyses of variance (ANOVA) were used to determine if significant differences existed for various characteristics of CVBs and CVB executives.
The results were prepared to meet the study's objectives stated earlier. While the literature review presented considerable detail on CVBs in the USA, this study also provided information on CVB budget levels and more importantly the relationship of these budget levels to CVB executive characteristics. The second study objective was to describe the characteristics of CVB executives. The results presented below include information on ten CVB executive characteristics (gender, age, education, incomes, job titles, college majors, certification, previous work experience in travel and CVB fields, years of experience in CVBs, and years in current position). The third objective of determining which factors (independent variables) influence CVB executive and CVB characteristics was accomplished by preparing one-way ANOVAs using incomes, years of CVB experience, and CVB budgets as the dependent variables and other CVB executive characteristics as the independent variables.
CVB Executive Characteristics
Gender. Approximately 59% of the CVB executives were males and 41% were females. As the following results indicate, there were significant differences between the male and female executives for several other demographic and bureau characteristics including age, highest level of education attained, before-tax income, job title, and CVB budget.
Age. Approximately three-quarters of the CVB executives were between the ages of 35 and 55. The major age groupings were 45-54 with 39.3% of respondents and 35-44 with 36.1%. There was a significant difference in the ages of male and female CVB executives (chi-square = 14.4, df = 4, p = .006). As Table I shows, the female CVB executives tended to be younger than their male counterparts. While some 55.8% of the female executives were under 45 years old, only 39.2% of the male executives were in this younger age category. The largest of the age/gender groupings were males aged 45-54 (25% of respondents) and males aged 35-44 (20.2%).
Education. About two-thirds (66.6%) of the CVB executives had Bachelors degrees or higher. Some 16.6% of the respondents had earned post-graduate degrees; 15.4% had Masters degrees, and three respondents had attained doctoral standing. A significant difference was found in the educational levels of male and female CVB executives (chi-square = 31.64, df= 8, p 0.00011). Female CVB executives tended to be less well educated (Table 2) and more likely to have attended college but not, as yet, completed their degree programs. Some 79.7% of the male CVB executives had Bachelors or Masters degrees compared to just 49% of the females. As discussed later, a significant difference was also found in educational levels by before-tax income.
Incomes. Respondents were asked to indicate their annual incomes in groupings with $5,000 increments. while a true mean income could not be calculated, the most frequently mentioned income ranges were $40,000-$44,999 (11.1%), $35,000-$39,999 (9.1%), $60,000-$64,999 (8.6%), and $110,000 or more (8.6%) (Table 3). Some 38% had salaries under $50,000, while the remaining 62% had salaries of $50,000 or more. Chi-square analyses showed significant differences in incomes by gender, education, CVB budget, job title, and previous work experience in a travel-related field.
One-way analyses of variance (ANOVA) were prepared using income as the dependent variable and other CVB executive characteristics as the independent variables. Significant differences were found at the .01 level by age, gender, job title, previous job, previous work experience in a CVB, years worked in CVB field, and CVB budget (Table 4). Significant differences at the .05 level were found by education and previous work experience in a travel-related field. Incomes tended to increase with age and educational levels. For example, those respondents in the 25-34 age grouping averaged incomes in the $40,000-$44,999 range, while those in the 55-64 age grouping averaged in the $65,000-$69,999 range. Graduates with Masters degrees had average incomes in the $65,000-$69,999 range compared to those with Associates degrees who averaged in the $45,000-$49,999 range. Some 64% of the female executives had incomes under $50,000, while only 19.6% of the male executives were in this salary range (Table 3).
There was a significant difference in the incomes of male and female CVB executives. The male CVB executives averaged in the $70,000-$74,999 range compared to females who had lower average incomes in the $45,000-$49,999 range.
Job Titles. A total of 19 different job titles were supplied by the respondents. The most frequently listed job titles were Executive Director (50%) and President (15.1%). As mentioned above, a significant difference was found at the .01 level in incomes by job title. Respondents with the title of President/CEO averaged incomes in the $80,000-$84,999 range compared to those who were Executive Directors, earning salaries in the $55,000-$59,999 range.
There was a significant difference in the job titles of male and female CVB executives. For example, 41.2% of the males were either Presidents, Presidents/CEOs, or CEOs. For the female executives, the comparable percentage was just 11.8%. As discussed later, a significant difference at the .01 level was also found in CVB budget level by job title.
College Majors. A total of 66 college majors were listed by the respondents. The five most frequently mentioned college majors were business administration (17.7%), marketing (9.5%), education (8.2%), communications (6%), and English (5.2%). Only 1.7% of the CVB executives indicated that their college major was tourism.
Certification. The most frequently held certifications by the respondents were Certified Tour Professional (CTP) (6.3%), Certified Association Executive (CAE) (3.1%), Certified Meeting Professional (CMP) (1.6%), Destination Specialist (DS) (1.6%), Certified Travel Counselor (CTC) (1.2%), and Certified Travel Marketing Executive (CTME) (1.2%).
Work Experience in Travel and CVB Field. A majority of the respondents (66.9%) stated that they had worked in a travel-related field prior to their current job in CVB management. Some 44.9% of the respondents indicated that they had worked in a CVB before accepting their current CVB management position. The 114 respondents with previous CVB experience prior to their current jobs averaged a total of 12.4 years in the CVB field.
Using analysis of variance, significant differences were found in years
of CVB experience by gender, age, income, and CVB budget (Table
5). The male respondents averaged 14.6 years of CVB experience
compared
to the female executives with 8.7 years. Generally, the older the respondent,
the greater were the years of CVB experience. For example, the 25-34 year
age group averaged 6.7 years of CVB experience compared to
15.1 years for those in the 55-64 age group.
The respondents were also asked to indicate their previous jobs. The most frequently mentioned jobs were as Executive Directors of other CVBs (9.7%), Sales Manager (4.4%), hotel sales (4.4%), and Director of Sales (4%). Some 12.5% of the respondents had worked in the hotel industry prior to accepting their current CVB management position.
Years in Current CVB Position. The
respondents averaged 5.6 years in their current CVIII management positions
(Table 6). The median number of years in
the current job position was 5 years with a range from I to 25 years. Approximately
64% of the CVB executives had been in their current jobs for 5 or less
years, while 87.9% were in their jobs for 10 or less years. Only 4% had
held their current positions for 16 or more years.
However, the total years of CVB experience was considerably more (Table
7). Some 32% had worked in CVBs for 16 or more years.
CVB Budgets
Information was also collected on the budgets of the respondents' organizations. Further analysis was conducted to determine if CVB executives' characteristics varied according to the size of the CVB budgets. Respondents were asked to indicate their CVB's current fiscal year budget. The responses, provided in range format, varied from under $250,000 to more than $10 million (Table 8). The median budget was in the $750,000-$1,999,999 range. The majority of the CVB budgets (73.4%) were under $2 million, while 10.3% of them were $5 million or more.
One-way analysis of variance (ANOVA) was used to determine if there were significant differences in CVIII budgets by various CVB executive characteristics. Significant differences were found at the .01 level for several CVB executive characteristics including age, gender, income, and job title (Table 9). Significant differences at the .05 level were found for education and previous jobs.
The results indicated that female CVB executives tended to have smaller budgets than their male counterparts. Only 7.9% of the female CVB executives had budgets of over $2 million compared to 38.5% of their male colleagues (Table 10). The mean CVB budget figure for female respondents was in the $750,000-$ 1,999,999 range, while the males averaged in the $2,000,000-$2,999,999 range. The size of the CVB budget tended to increase with the age of the respondent. Those aged between 55 and 64 years had budgets averaging in the $2,000,000-$2,999,999 range, while those in the 25-34 age group had average budgets in the $250,000$749,999 range.
General ly, the size of the CVB budget increased with the respondent's before-tax income. For example, those executives with incomes of $110,000 or more had CVB budgets averaging in the more than $10 million category. In contrast, those executives earning incomes less than $35,000, all had average CVB budgets in the $250,000-$749,999 range.
There was also a significant difference in CVB budget size according to the respondents' job titles. Those with the title of Chief Executive Officer (CEO) had budgets averaging in the $3,000,000-$3,999,999 range. Executive Directors tended to have smaller CVB budgets than CEOs, averaging in the $750,000-$l,999,999 range.
Generally, the size of the CVB budget increased with the educational
level of the respondent. For example, those managers with some college
work but degree not completed had budgets in the $750,000-$l,999,999 range;
those with Bachelors and Masters degrees averaged in the $2,000,000-$2,999,999
range. The previous job titles of the respondents also appeared to influence
the size of the CVB budget. Generally, those who had previous CVB positions
tended to have higher budgets than those who came from positions outside
of the CVB field. For example, those who had previously held the position
of Executive Director with other bureaus had budgets in the $750,000-$l,999,999
range; those who said they had been teachers or educators had average budgets
of $250,000-
$749,999.
The size of the CVB budget also increased with the executives' years of experience in the CVB field (Table 11). For example, those executives with budgets under $250,000 averaged 8.8 years of CVB work experience, while those with budgets of $5 to $10 million had almost twice as much CVB experience, at 16.3 years.
Strong local destination marketing organizations, typically known as convention and visitor bureaus in the USA, have emerged with the mandate of promoting their communities by bringing in more meeting and pleasure travelers. CVBs, as public-private partnerships, are most likely the best organizational model for future local community destination marketing and development worldwide. Their primary focus is on the marketing and sales of the destination's attractions, events, and facilities. However, more of their attention is now being given to acting as a catalyst for development, facilitator, and supporter. The major source of funding of CVBs in the USA are room taxes. In the future, however, an increasing portion of budget monies is expected to come from mutually beneficial industry partnerships and entrepreneurial tourist service ventures. It also appears that the introduction and increasing of room taxes is becoming an increasingly controversial and divisive issue among the key players in tourism in local communities.
CVBs influence in domestic and overseas marketing is expected to grow as their combined budgets surpass those of senior government agencies. CVBs themselves will begin looking further afield for potential travelers, and will increasingly join senior government tourism agencies in related cooperative marketing ventures.
With the great growth in CVBs in the USA during the last 25 to 30 years,
a need has been created for senior executives and professional marketing
and sales staff who understand convention and pleasure travel
markets. Of particular importance is the bureau's chief executive.
This individual senses a coordinating role by not only providing leadership
and knowledge to direct the bureau's activities, but also to be politically
astute to balance the interests of all constituents, including industry-members,
government officials, and local residents. It is vitally important that
the bureau's chief executive direct the CVB in such a way that the benefits
of those activities are seen as being equitably distributed to all affected
parties (Rutherford, 1990). With such high stakes, the skills and talents
required to lead and operate a bureau have grown in complexity.
This study has provided a comprehensive demographic profile of these US CVB executives. The results suggest that those interested in this field should be aware of the significant differences that exist in executive characteristics. The lack of homogeneity within the market is highlighted by the marked differences found between male and female CVB executives. CVB executive characteristics also vary significantly with the size of the CVB budget.
The findings may prove useful to those involved in tourism education, training, and development. The results clearly indicate that having previous academic qualifications in travel and tourism is not, at this point, essential for entering the CVB management career field. In fact, significant numbers of the current incumbents have come from other CVBs and the hotel industry, the majority of them had no previous CVB work experience. They have come from a wide variety of academic disciplines and previous jobs. Those academic institutions offering undergraduate and graduate programs in tourism should be challenged by these findings to find new ways of increasing their graduates' "penetration" of the CVB market. One of the major challenges will be to develop curriculum that is the most relevant to the multi-dimensional aspects of CVB management and leadership. Another educational and training issue raised by this study is that there appears to be no single and predominant "credentialling" mechanism or certification for individual CVB executives. As the IACVB pursues its plans to introduce the Certified Destination Management Executive (CDME) program, it will have to develop a set of convincing reasons and benefits to lure an initial group of certification candidates.
The current study has provided a basic understanding of US CVBs and their executives. Much more research on the CVB field is needed and seems to be justified by the ever-increasing influence of these organizations. It would be highly desirable in the future to complete an analysis similar to this one to determine which trends have occurred since this "baseline" study was completed. There is also a need to examine the relationships among individual CVBs (the "regionalization" concept) and with state tourism offices. These relationships are becoming increasingly important as CVBs attempt to stretch their budgets to the fullest, and as they pursue international markets. Another important research issue that deserves attention is the alternative funding sources to room/bed taxes. CVBs in the USA are increasingly being challenged to justify their existence and the need to levy sometimes heavy taxes on hotel room rates. Critical to this research will be the identification of methods or models to evaluate the effectiveness of CVBs. Another important issue raised by this study is the role of female CVB executives. This study indicates that female executives are younger and do not fare as well in terms of salary levels. Future research might consider the career paths and characteristics of the most successful female CVB executives. As the number of CVBs continues to grow in other countries, such as the United Kingdom and Australia, this could provide a fruitful avenue for future comparative research.
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