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Tour & Activity Industry Terms

What is a DMO?

Acronym for Destination Marketing Organization.  An organization (non-profit or for profit) that promotes a specific location such as a city, state/province, or country.

DMOs are traditionally governmental or pseudo-governmental agencies that are tasked with the promotion of their specific regions and to drive tourism spending.  Most organizations are funded using one of two primary models:

  1. Tax funded – These DMOs derive their funding from the collection and redemption of a bed or hotel tax collected by hotels in the region.  The budget of the DMO may be augmented with additional government grants and advertising revenues.  Due to the nature of the tax collected, these organizations tend to be driven by increasing hotel night stays.
  2. Member funded – These DMOs derive their funding through membership dues paid by corporate members.  Budgets for these DMOs may be augmented with additional grants, advertising, and sponsorships.  Member based DMOs have the challenge of ensuring they provide value to members in order to maintain membership.

DMOs have traditionally focused on traditional marketing but have recently begun aggressively moving into digital marketing in order to stay relevant.  Some destinations, such as Australia, have developed databases of products and providers that help them to better market their destinations.

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