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Where does the money go? Parks and Tourism has a $5 million plan.

In 1989, the Arkansas Department of Parks and Tourism traded an old problem for a new headache. But to hear Executive Director Richard Davies talk, it was worth it.

Until 1989, the department languished without the funds it needed to generate more interest and dollars in the state. Davies and the Parks and Tourism Department had to operate with what he calls a scrimp-and-save attitude.

"We were losing out in our own markets," Davies says.

He says Arkansas did not have an image problem. It did not have an image.

No one knew about the state because the department could not afford to advertise it properly.

Ironically, those were easier days for Davies.

With a budget of between $600,000 and $800,000 for more than a decade, Davies had few choices for what to do with the department's money.

"When you have such little money in such a big market, it's hard to make a mistake," he says.

Davies placed the department's money where it was guaranteed to work. He didn't have any left over.

But when a 2 percent tax initiative was passed three years ago, Davies suddenly had $4 million with which to work. This year, his budget generated from the tax on gross receipts is $5 million.

"Point being, we've got enough money to really mess up," Davies says.

For instance, when the department initially received its funding, Arkansas was invited to have a float in the Paris Bastille Days parade.

That's Paris, France, not Arkansas.

Of course, Davies would like to attract visitors from Europe, but for his cost per dollar, it's more advantageous for him to advertise in Tulsa, Okla., than Paris.

Of this year's $5 million budget, close to $3.9 million will go toward advertising. Included is almost $2.2 million for the spring-summer advertising campaign and $275,000 for the fall-winter campaign.

Almost $1 million is spent on maintenance and operation costs. That includes such costs as office space, postage and other catch-all expenditures.

A regional matching program constitutes $408,288 of the budget. For every $1 that each of the 12 regional associations raises, the state gives it $2.

All other categorical expenditures are $54,500 or less. This includes payroll expenses for such things as Social Security.

There also are professional fees -- such as when a photographer is hired.

The additional money allows for more staff positions. For example, the Parks and Tourism Department provides salaries for three positions at the new Siloam Springs Tourist Information Center.

The expenses may seem nebulous to those outside the system, but Davies says the department's economical attitude is still intact even though it has more money.

Every dollar has a specific purpose.

It's all part of what he calls "the plan."

The Dollar Details

After the state Legislature passed the 2 percent tax initiative in 1989, the Parks and Tourism Department's first task was to create a five-year strategic plan.

"The goal is to be quantifiable so that our degree of success can be determined without a shadow of a doubt at the end of the five-year process," according to the 16-page planning booklet.

The department's performance review will examine the growth of the travel-generated tax base, the annual travel expenditures and total annual visitation.

In effect, Davies explains, the department has a built-in report card.

If it misuses the $5 million, everyone will know it.

Davies says the five-year plan is an offensive and defensive document for the department. The plan not only orchestrates what the department needs to do, it outlines boundaries for the department.

One of the goals of the plan is "to prevent knee-jerk reactions."

That is where research is essential.

"You can't afford the shotgun mass media approach," Davies says.

As soon as the tax was passed, the department began creating a research base through which it could decide where to focus its windfall.

And the research has not stopped. This year, the research budget is $85,000. That's part of the almost $4 million devoted to advertising. Sometimes, the research budget is as high as $100,000.

Surveys and focus groups help those in the Parks and Tourism Department learn what people think of Arkansas as a tourism spot, who comes to the state and why.

"This all sounds terribly simplistic," says Davies. But, he adds, when potential Arkansas tourists ask "What can I do?" the department answers by saying, "What do you want to do?"

The research uncovers what tourists want.

The advertising reflects those desires.

For instance, research showed state tourists are an upscale crowd interested in places to shop on vacation. It also showed a large number of older visitors.

So, in this year's print and broadcast ads, area shops are shown. One television ad shows an older couple with their grandchild coming out of a shop.

"The ads have been designed to push those hot buttons," says Davies.

With more money, more buttons are being pushed.

Bye-Bye Brown

The Parks and Tourism Department annually invites media outlets to make presentations on why they should be chosen to receive the department's advertising. When the department staged its first such Media Days, a national magazine made a pitch for the department to buy a full page of advertising.

Davies was shocked to learn the price of $138,000 for a one-time, full-page ad.

"Good God, I ran whole parks for that for a year," says Davies.

There's been much for Davies to get used to.

The department's 1991-92 marketing report, entitled "Impressions of Arkansas," carries through the theme of the department's advertising campaign, which is done in impressionistic style. That was something new for Davies, who has spent most of his time in the department's Parks division where plain, brown park signs are the norm.

When he saw the colorful, impressionistic cover of the report, he said, "What are all these damn squiggles on the front of the book?"

Shelby Woods, executive vice president and chairman of the executive committee at Cranford Johnson Robinson Woods, the agency of record for the department, attempted to reassure Davies.

"Great advertising is advertising that makes your hands sweat," Woods said.

"I sweated on that," says Davies.

The report was produced through donated printing and paper. It cost the department nothing.

Davies wanted a good looking report, but he knew a slick, stylish report would be perceived as a waste of the taxpayer's money.

Davies is conscious of the extra scrutiny his department is receiving along with its additional money.

And he's also conscious of how he can stretch his $5 million into even more.

The department often purchases advertising with cities or tourism businesses around the state to buy in bigger volumes and enter into more markets.

A half-page ad that touts Arkansas and individual cities such as Hot Springs and Eureka Springs will do better than a smaller ad for the state alone.

The department spends 88 percent of its advertising budget outside Arkansas. The majority of that -- about $480,000 -- is for television advertising.

Thirty-three percent of out-of-state advertising is spent with magazines, 14 percent with newspapers and 1 percent with radio.

In-state, newspaper advertising accounts for 41 percent of money spent. That totals $280,000.

Twenty-five percent of the in-state budget is spent on television, 25 percent on radio, 9 percent with magazines.

Television and print production totals $210,000, with in-state television purchases totaling $182,000.

There are other expenses, such as a program targeting black travelers that costs $60,000. Publicity and communications programs total $85,900.

The department now can afford to devote more attention to specific areas within tourism, such as group tours.

Before the tax went into effect, the state spent $50,000 to attract tours. Now, $200,000 is being allocated to woo tour and convention business.

Well Spent

Is the extra money paying off?

It's all part of the report card, says Davies.

The tourism tax showed an increase of 8 percent within the last year. Travel expenditures increased by 7.7 percent in 1991, which is the largest real gain since 1978. This amounted to $2.5 billion in expenditures, which yielded $116 million in state taxes and $30 million in local taxes.

It's a continual battle for the department. There is constant competition from other states with bigger tourism budgets.

Arkansas ranks 14th in size out of the 50 state tourism budgets. But two states contiguous to Arkansas, Texas and Louisiana, have the largest and fourth-largest budgets, respectively, in the nation.

And the department has plenty of work to do in Arkansas, too.

"We all tend to downplay home," says Davies. "In many cases, we're our own worst enemy."

Joe David Rice, the tourism director, says focus groups revealed that an alarming number of prominent Arkansans had not been to local tourist attractions. Therefore, they could not recommend them to anyone else.

"They weren't very good representatives of the state," says Rice. He says the department needs to "help Arkansans develop a sense of ownership."

People outside Arkansas may be learning more about the state than its own citizens. With the increased advertising has come increased editorial exposure.

The department won't let a publication make a presentation at Media Days unless a publisher or editor of that publication is present.

Suddenly, many more articles are being written about the Natural State.

"We're sure it's just a coincidence," Rice says.

It may be the department's ingenuity that is helping stretch ad dollars into articles, but the money has allowed it all to happen.

"Suddenly, people are willing to deal with you," Davies says.

People who would not consider dealing with the state before are approaching the department.

Now, the department decides with whom it will deal and with whom it won't.
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Title Annotation:Arkansas's Parks and Tourism Department
Author:Rengers, Carrie
Publication:Arkansas Business
Date:Apr 20, 1992
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