A recent look at South Dakota tourism this past year shows it’s a job creating, revenue producing industry, well worth the money invested, according to Gov. Dennis Daugaard.
The report of 2012 tourism figures, compiled by IHS Global Insight, shows the direct economic impact on the state from tourism and supporting industries was $1.95 billion, up 5.04 percent from 2011, the governor announced at a media conference Thursday.
Predictably, the Black Hills region generated the largest revenues, with 38 percent, or $1.373 billion, of the total economic impact according to the Department of Tourism. The southeast region brought in 37 percent, or $1.371 billion.
The central region of the state generated 8 percent, or $304 million, of that impact. While significantly smaller than other regions, that does represent a 2.6 percent bump from 2011.
Daugaard said 76 percent of the money generated by tourism comes from out-of-state visitors, including 8.3 percent from international visitors. The return on the investment for marketing is $5 of tax revenue for every dollar spent, he said.
“That’s the kind of money we like spent – other people’s money,” Daugaard said.
Daugaard said the state had a reason to feel good about the numbers as consumers, still gun-shy from the recession and national debt talks in Washington D.C., are careful where they are spending their money.
“To see a 5 percent increase in spending in spite of that is something we can celebrate,” he said.
Daugaard also touched on the state’s 1.5 percent tourism tax, which has a bill currently in the legislature to keep it from dropping to 1 percent. The current tax represents a third of the Department of Tourism’s budget, he said, and with the return on money spent, keeping it at the current level is just good investment sense.
Jim Hagen, secretary of the state Department of Tourism, said the 5 percent increase over 2011 is due to strategic marketing. The “Your American Journey” campaign, incorporating high-definition aerial photography of the state, has been a rousing success, including in the newly targeted Kansas City and Des Moines areas, he said.
“We are not taking our money and throwing it into the wind,” Hagen said.
Hagen said the department is now eyeing a marketing aimed at Chicago. Vacation guide sales, traffic to the Department of Tourism’s website and surveys show a heavy interest from that area, he said.
An effective peak-season marketing campaign there would cost $1 million, Hagen said.
For 2013, Hagen said the reports he’s seen indicate a 3 to 5 percent bump in travel and visitor spending.