Analytics

OVERVIEW

Oxford Economics, in coordination with its Tourism Economics subsidiary company, conducted a detailed analysis of the return on investment of Brand USA’s marketing in its 2015 fiscal year (October 1, 2014-September 30, 2015). Ad tracking surveys in eight markets, a market share analysis, and Brand USA key performance indicators of market activity informed the analysis to quantify the incremental visits and spending generated by Brand USA.

Section 1: The vital role of destination promotion

The vital role of destination promotion Destination marketing plays an integral and indispensable role in the competitiveness of the local and national visitor economy, and acts as a catalyst for economic development. Brand USA serves a valuable function by promoting the US collectively with the scale necessary to gain share of voice in an increasingly competitive global marketplace.

Section 2: US international inbound market performance

US international inbound market performance The global economy presented the US tourism industry with the dual headwinds of weakening output growth and a strengthening US dollar. Exchange rate shifts produced an average price increase of 16% for visitors to the US in 2015. Despite these headwinds, overseas air arrivals increase 4.3% in 2015 according to APIS statistics. Canadian visits to the US fell 10% due to the combined effects of economic and local currency weakness. Based on preliminary data, seven of the nine key markets where Brand USA was active expanded in FY2015; Canada and Japan were the two exceptions. The US lost 1.2% percentage points of market share within Brand USA focus markets in FY2015.  

Section 3: Brand USA ROI

Brand USA ROI Across all markets, each dollar of Brand USA marketing generated $21.20 dollars of visitor spending. Including all operating overhead, Brand USA achieved an ROI of $19.30 and generated $3.0 billion in visitor spending. Total visits generated tallied 1,025,183. This was 1.4% of all visitors to the US in FY2015. The returns on Brand USA marketing were most pronounced in the Asia Pacific and Latin American regions with a combined ROI of 37:1. Returns were more subdued from North America (where market penetration is high and spending per visitor is relatively low) and the mature (and slower growing) European markets. These mature markets demonstrated a return of 15:1.  

Section 4: Brand USA economic impact

Brand USA generated $3.0 billion in incremental visitor spending to the US in FY2015. Including indirect and induced impacts, a total of $6.6 billion in economic activity was generated by Brand USA. Economic activity generated by Brand USA sustained 44,533 jobs earning $1.9 billion in personal income. At $457 million, Brand USA generated more than double its funding in incremental Federal taxes and another $410 million in state and local taxes.

Download the Economics Report