HomeMy WebLinkAboutItem 17 - Tourism StudyMEMO TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: •- • -P
MEETING DATE: SEPTEMBER 15, 2015
SUBJECT: ECONOMIC IMPACT OF TOURISM TO GRAPEVINE STUDY
City Council to consider awarding a professional services contract to Tourism Economics
for a comprehensive economic impact of tourism study.
FUNDING SOURCE:
Funds are available in account number 115-44540-350-01 (Convention and Visitors
Bureau/Professional Services) in the amount of $35,000.
In order to continue with the solicitation of hotel and attraction development, a study of the
economic impact of tourism in Grapevine would be extremely helpful. It has been more
than 10 years since an economic impact study of this type has been done.
The study will include: a five-year historic trend analysis; an analysis of direct visitor
spending; an analysis of jobs, income and taxes generated by visitors; an estimate of
visitor volume and a five-year forecast of visitor volume and spending. Staff researched
six different companies and received formal proposals from Destination Analysts, Tourism
Economics and VisaVue. Prices ranged from $35,000 to $85,000. After review by the
CVB Executive Director and Directors of Marketing and Sales, it was determined that
Tourism Economics can fulfill our needs at a reasonable cost. See attached proposal.
Staff recommends approval.
m
Proposal prepared for: Presented y:
Grapevine Conventions & Visitors Bureau TOURISM
AN OXFORD ECONOMICS COMPANY
EconomicThe 11d of Visitors Grapevine,
August 2015
Contents
1 Executive Summary........................................................................ 3
2 Economic Impact and Visitor Volume Analysis ............................4
2.1 Compile diverse data sets to measure visitor expenditures .......................4
2.2 Visitor volumes............................................................................................6
2.3 Develop impact analysis.............................................................................6
3 Forecasts......................................................................................... 9
3.1 Industry performance data..........................................................................9
3.2 Visitor metrics..............................................................................................9
3.3 Economic drivers.......................................................................................10
3.4 Analysis of non -economic drivers............................................................14
3.5 Develop dynamic forecasting tool.............................................................14
4 Project Deliverables......................................................................15
5 Project Terms................................................................................17
6 Expertise........................................................................................18
6.1 Overview...................................................................................................18
6.2 Key factors underpinning Tourism Economics' work................................18
6.3 Previous studies........................................................................................19
7 References.....................................................................................27
8 Testimonials.................................................................................. 28
9 Project Team.................................................................................. 29
10 Agreement..................................................................................... 31
"TOURISM ECONOMICS 2
fhe Economic Impact of Visitorsas.
August
1 Executive Summary
Visitors represent an integral part of the Grapevine economy. Visitor spending generates
significant state and local tax receipts and the tourism sector's broad range of job creation
provides a vital economic foundation.
By monitoring the visitor economy, the Grapevine Conventions & Visitors Bureau can inform
decisions regarding the funding and prioritization of the sector's development. It can also carefully
monitor its successes and future needs.
Economic impact analysis enables this sort of tracking because it measures tourism in the
categories that allow it to be compared to other sectors and which matter to policy makers. These
categories include tax generation, employment, wages, and business sales. The result of this
analysis will be a compelling and detailed document which quantifies and explains the economic
value of tourism to Grapevine in detail. The report will monitor changes in the significance in the
travel economy and the importance of the travel sector relative to other economic sectors. In
addition, the report will depict the value of tourism to both households and to the public sector.
The analysis will provide substantial detail, comprehensiveness, and policy relevance.
Tourism Economics, an Oxford Economics company, is pleased to submit this proposal to serve
these purposes. Our team brings together a strong complement of leadership, industry
experience, and technical expertise for this project. We have conducted over one -hundred
economic impact studies and/or visitor projection models for developers, tourism associations,
CVBs, state tourism offices, and national tourism offices across every region of the world. Our
commitment is to provide an economic impact assessment that is credible, comprehensive, and
clear. In particular, our Philadelphia team who would be managing this project has hands-on past
experience in analyzing the importance of the Texas visitor economy.
Our proposal is organized as follows:
Section 2 describes our approach;
Section 3 lays out the project deliverables;
Section 4 suggests project terms;
Section 5 describes Tourism Economics' experience;
Section 6 provides references;
Section 7 includes testimonials;
Section 8 sets out the project team; and
Section 9 presents an agreement.
Thank you for this opportunity.
`TOURISM ECONOMICS 3
The Economic Impact of Visitors to Grapevine, TX
August 201
Economic Impact!VisitorVolume
Our approach is built with three objectives in view:
Clarity—results will be communicated to maximize relevance to
stakeholders
Credibility—analysis will be grounded in consistency with government -
reported data and based on a variety of data sources
IN Comprehensiveness—the incorporation of a broad range of data sources
will ensure that the entire visitor economy is quantified
To meet these objectives, the Tourism Economics team will take the following steps in the
development of the tourism economic impact analysis for Grapevine.
The analysis will begin with a compilation of all relevant data sets as inputs to the model.
Tourism spans many different activities and sectors so a number of perspectives must be
brought together to quantify each component of the tourism economy.
We will use these different measurements to complement and to cross-check one
another:
Survey data on visits and spending by visitor type (day/overnight,
bus iness/conventionNFR/leisu re) and by category of spending (local
transport, lodging, retail, recreation, food & beverage). This will be
sourced to DK Shifflet & Associates published data. Dallas -Grapevine
MSA data will be shared down to the City of Grapevine based on hotel
room demand and visitor -related industry concentration.
Employment (NAICS 700+ industries, source: BEA and BLS) – by
industry
Wages (NAICS 700+ industries, source: BEA and BLS) – by industry
Lodging performance data (STR)
Tax receipts by industry (sales tax and bed tax)
US Census data on seasonal second homes by county (to measure
imputed rent and related spending)
Aviation -related spending for visitors based on airport and passenger
data
11 Group event attendance and definite room demand (from the client)
TOURISM ECONOMICS 4
The Economic op of f Grapevine, TX
August
This comprehensive set of data will provide a holistic view of visitor activity that is
constrained by known measurements. For example:
1. Tax receipts data by industry will provide measurements of revenue for
industries providing tourism goods and services.
2. This will be compared to spending estimates derived from visitor survey
expenditure estimates.
3. This will further be compared to employment and wage data by industry to
cross-check the total size of each related industry and the implicit share of
tourism for each industry.
This "triangulation" approach provides a set of anchors so that the end results are
consistent and credible.
Example of data cross-check method
Tax data
Visitor
spending
by industry
Traveler Jobs and
survey wage data
data
This approach also allows the analysis to clearly follow specific Grapevine geographic
boundaries.
Syndicated visitor spending data will break down visitor expenditures by type for
determining the tourism share of sectors which are only partially tourism -related such as
restaurants. BEA employment data will provide an overarching perspective on the total
jobs (whether or not generated by tourism) within each tourism -related sector. This will be
used as a reasonableness check of the economic model results.
°TOURISM ECONOMICS
The Economic Impact of Visitors to Grapevine, TX
August 2015
Using these diverse and complementary datasets, we will quantify total visitor
expenditures at the county level, by industry, for the most recent year with a review
analysis reaching back five years.
Spending figures in the most recent year will be segmented by visitor type (day/overnight,
business/leisure) and by industry. This will provide valuable insights into the relative value
of visitor segments as well as the extent to which various industries benefit from visitor
activity.
I • •
In addition, the client will receive total visitor volume counts for the most recent year,
including a breakdown of day/overnight and business/leisure volumes.
These will be based on local statistics of STR hotel room demand, seasonal second
homes, recreation and entertainment assets, employment by sector) for Grapevine.
Regional estimates of visits from the Texas tourism office will be used as a control in
calculating local Grapevine visitor volumes.
Our team will then employ an Input -Output (1-0) model for Grapevine based on an
IMPLAN (www.implan.com) model. IMPLAN is recognized as one of two industry
standards in local -level 1-0 models. An 1-0 model represents a profile of an economy by
measuring the relationships among industries and consumers. For example, an 1-0 model
tracks the flow of a visitor's restaurant expenditures to wages, profits, capital, taxes and
suppliers. The supplier chain is also traced to food wholesalers, to farmers, and so on. in
this way, the 1-0 model allows for the measurement of the direct and indirect sales
generated by a restaurant meal. The model also calculates the induced impacts of
tourism. These induced impacts represent benefits to the economy as employees of
tourism sectors spend their wages in the local economy, generating additional output,
jobs, taxes, and wages.
IMPLAN is particularly effective because it calculates these three levels of impact — direct,
indirect, and induced — for a broad set of indicators. These include the following:
Business sales (also called gross output)
Wages
Employment
Federal Taxes
State and Local Taxes by type
TOURISM ECONOMICS 6
The Economic Impact of Visitors to Grapevine, TX
August
The modeling process begins with aligning the tourism expenditure measurements with
the related sectors in the model (e.g. restaurants, retail, transportation, lodging, and
recreation). The model is then run to simulate the flow of these expenditures through the
economy. In this process, the inter -relationships between consumers and industries
generate each level of impact for each economic indicator (sales, wages, employment,
etc.).
Illustration of impact model flow
Tourism Economics will then iteratively adjust the model to balance the results with known
industry measurements. IMPLAN is flexible, allowing for adjustments in coefficients. This
ensures that the results of the model are consistent and reasonable compared with other
sources of specific tourism sector employment and taxes.
Figures will be segmented by industry—including those industries which benefit indirectly.
This will provide valuable insights into how various industries benefit from visitor activity.
A detailed tax analysis will combine IMPLAN output with bottom-up calculations of sales
taxes, bed taxes, and other tourism -specific taxes to complement the standard model
results. Tax impacts will include the following detailed line items.
Federal Taxes
Corporate
Indirect Business
Personal Income
Social Security
State Taxes
Corporate
Personal Income
Sales
'` TOURISM ECONOMICS 7
The Economic Impact of Visitors to Grapevine, TX
August 2015
State Unemployment
Dividends
Other taxes and fees
Local Taxes
Sales
Property
Lodging
Amusement
Excise and Fees
Personal Income
In addition to the absolute value of taxes, these will be expressed as "savings in state and
local taxes per household" based on the assumption that were it not for visitors, resident
households would need to fund these revenues.
Jobs, income, and total business sales figures will be presented in terms of their share of
the Grapevine economy and direct impacts will be ranked against other industries.
"TOURISM ECONOMICS
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The Economic Impact of Visitors to Grapevine, T
August 201
Tourism Economics will develop a rigorous and dynamic forecasting model for
Grapevine that supports its decision making processes.
This model will be based on historical correlations between travel, economic, and
non -economic indicators and will provide forecasts five years into the future.
The model will have three sets of inputs:
Industry performance data
Visitor metrics
Economic drivers
Monthly or quarterly industry performance indicators will be compiled in coordination
with the client. These will include hotel performance metrics, scheduled air seat
capacity, airport enplanements, any available volume tracking at key attractions,
and any other destination measurements tracked by the client. This will provide
input on recent performance and will provide leading indicators to the model.
The indicators to be forecasted will be primarily visitor demand metrics by market
segment. These indicators will include the following:
Total Visits
Visitor Spending
'"TOURISM ECONOMICS
The Economic Impactof ! Grapevine, TX
August
Using this industry performance and visitor volume historical data, Tourism
Economics will estimate the correlations between travel demand and economic
activity for each of the segments mentioned above. This regression analysis will be
multi -variate. That is, the equations will be sophisticated enough to isolate the
respective effects of various drivers at the same time. For example, incomes may
rise at the same time a market's currency is weakening. Each of these indicators
has a different coefficient (elasticity) as well as a different sign (positive or negative).
The model will identify the magnitude and direction of each indicator's influence on
travel demand over time. The historical correlations and related statistics will be
estimated in EViews (http://www.eviews.com/). Tourism Economics will evaluate
the following economic indicators to determine their relative strength in predicting
changes in travel demand:
Real disposable income
Unemployment rate
Employment
Exchange rates (inflation-adjusted and nominal)
Corporate profits and investment (for business travel)
Real GDP growth
Consumer confidence
,'°TOURISM ECONOMICS 1
The Economic Impact of Visitors to Grapevine, TX
August 2015
We have found these indicators to be strong determinants of travel demand, with
the exact form of the equation varying across markets and particular travel
segments. The following charts show relationships between the strength of origin
markets exchange rates / GDP and their outbound travel expenditures.
Exchange Rate and Tourism Spending
250 % Growth in
International Tourism y = 0.656x + 57.765
200 Spending
(US$) 2002-2007
150
100 /i
50
0
-50
Appreciation in currenc 2002-2007
Economic Activity and Tourism Spending
% year
25
20
15
10
5
0
y' -5
-150 -100 -50 0 50
Source : Tourism Economics. IMF
— 1990 1994 1998 2002
100 Source : Tourism Economics, Haver Analytics, IMF
Personal income and exchange rates can be effective predictors of travel demand.
The first chart below shows GDP growth for San Diego's key origin markets along
with forecasts for overnight visits.
We can also observe strong correlations between business travel and corporate
profits as well. The second chart below shows this for US domestic business travel
(as developed for the US Travel Association).
San Diego: Overnight Visits
% growth v -o -v
15%
10%
5%
0%
-5%
-10%
-15%
2002 2004 2006 2008 2010
Source: Tourism Economics/CIC Research
2012
2006
2011
=,TOURISM ECONOMICS 11
Business
visits, investment and profits
% growth
20%
30
Company profits
25
10%
20-
0%
15
Real fixed
investment
-10%
10
5
-20%
0
30%
-5
Business visits
-40%
-10-
1995
1999
2003 2007
Source:
Tourism Economics
2006
2011
=,TOURISM ECONOMICS 11
The Economic Impact of Visitors to Grapevine, TX
August 2015
These same relationships will be established for Grapevine as a destination.
Historical data will provide a statistical basis for determining the multi -variate
correlations between these economic indicators and travel activity.
Two additional examples are shown below from our Tourism Decision Metrics
model. The below charts show "fit' vs. "actual' performance in terms of inbound
visits. For Canada to US travel, the equations yield an R -squared of .92, meaning
that 92% of the year-to-year changes are explained by the economic drivers. It is
clear from the below charts that the equations generate cyclical timing and volatility
which is very close to the actual data.
Canada: US Inbound visits
'000s
20000
18000
16000
14000
12000
10000
8000
6000
4000
2000
0
1995 1999
Source : Tourism Economics
2003 2007
Canada: US Inbound visits
growth
15
10
5
0
-5
-10
-15 1
1995 1999 2003 2007
Source: Tourism Economics
One noteworthy feature of a tourism demand forecasting model must be to deal with
the sometimes volatile effect of business cycles on travel demand. Model equations
will include long -run and short -run dynamics to allow both growth and levels of
spending to be consistent with the fundamental economic relationships.
Short -run. Spending growth in the first years of the forecast period
is typically dominated by growth rates in key identified economic
drivers.
Long -run. Forecast growth rates in the medium to long-term are
consistent with spending levels according to the fundamental
economic relationships. For example, if growth has been particularly
strong in recent data (due to external factors), then slower growth is
expected further out to return spending to expected levels. This is
included by using error -correction mechanisms within the equation.
"TOURISM ECONOMICS 12
$
AugustThe Economic Impact of Visitors to Grapevine, TX
For example, in the following charts, outbound spending from Germany in the period
to 2006 was weaker than would be expected according to the observed long -run
relationships. We would expect this pent-up demand to be realized over the forecast
period with a return to expected levels of spending determined by the long -run
relationships. Similarly, in the case of stronger than expected growth, any over-
spending is expected to unwind with slower growth rates into the medium term. This
technique will enable the model to deliver reasonable results despite any recent
volatility.
Outbound Spending Growth: Germany
% year
50
40
30
20
10
0
-10
-20
1992 1996 2000 2004 2008
Source: Tourism Economics
The model will be populated with all
of the economic drivers used in the
regression analysis with 3 -year
quarterly forecasts based on the
latest results of Oxford Economics
global macroeconomic model.
These forecasts are among the
most accurate in the industry, as
shown in the adjacent table:
'`TOURISM ECONOMICS
2012
Outbound Spending Growth: Germany
% year
140
120
100
80
60
40
20
0
1992 1996 2000 2004 2008 2012
Source: Tourism Economics
1E
The Economic Impact of Visitors to Grapevine, TX
August 2015
Travel demand is notoriously difficult to forecast because of external events which
can trump the effects of economic factors in a given time period. On the negative
side, natural disasters, security concerns, disease and fuel costs can temporarily
constrain demand (although their resolution typically results in a recovery period of
above-average growth). On the positive side, special events, major conventions,
and focused marketing campaigns can influence travel demand beyond what would
be indicated by economic analysis alone. Tourism Economics will incorporate any
of these potential factors in the Grapevine travel outlook.
At this point, Tourism Economics will be able to develop a customized forecasting
model for Grapevine which will allow for dynamic scenario analysis and ongoing
updates using new historical data and economic drivers.
The model can be easily expanded to include additional markets and/or change the
time horizon. We propose that the base model will be developed to produce 5 -year
forecasts. The forecast output will be on an annual data frequency.
'.TOURISM ECONOMICS 14
The Economic s.' of Visitorsto Grapevine,
August 2015
The key outputs from this project will be:
11 Comprehensive report of findings
Five years of comparable data
A description of data inputs and methodology
Raw data files in MS Excel
A presentation to stakeholders (WebEx)
Assistance with the development of press releases
Even the best research is only as good as its presentation. The Tourism Economics team
will develop a clear and graphical presentation of the results with narrative explaining the
concepts and their importance. The report will be accessible to the layperson with a view
towards a diverse set of audiences including market analysts, legislators, the media,
planners, and other stakeholders.
The results of this analysis are grouped into four main areas:
Size—the magnitude of impact will be quantified in terms of spend,
business sales impact, employment, wages, and taxes. Our analysis
ensures that all activities are measured, including spending in the
vacation ownership, seasonal real estate, aviation and local transport,
hospitality, recreation, retail, and restaurant sectors.
FA Segmentation—the analysis will then segment the impacts by purpose of
visit (business/leisure), source of visitor (domestic/international), industry
(for seventeen sectors), and level of impact (direct, indirect, and induced).
Trend—by factoring in aviation and tourism -related tax information
alongside BLS/BEA data on employment and income, we are given a
solid foundation for trend analysis. On this basis, we are able to show
how the impact of the visitor economy has evolved over the past three
years.
Context—large numbers are more meaningful if given context. Tourism
Economics reports provide this in two ways. The first is by calculating the
share of the economy (wages, jobs, sales, and taxes) attributable to
visitors. The second is through a series of creative comparisons of tax,
wage, and job impacts with the size of government budgets, impact per
minute, and sports venues. For example:
TOURISM ECONOMICS 1
The Economic p,. of to Grapevine, rap
August 2015
■ Visitor -generated taxes would fund the entire (public school
system, police department... ) X times over
■ The jobs created by visitor spending would fill X
times
■ Visitors to Grapevine generate more jobs than the X, Y, and Z
industries combined
Our proven competitive advantage is the ability to communicate complex
information in a way that is understandable, relevant, and interesting.
°TOURISM ECONOMICS
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August 2015
5 Project Terms
Tourism Economics will meet a six-week time table for the project.
FA Weeks 1-2: Tourism Economics compile all data for the study
Week 3-4: Analyze data and build spending model
Week 5: Develop impact model and produce findings
Week 6: Deliver reports and data. Host conference call to review findings.
Finalize deliverables.
Economic impact with five years of history:
$20,000
Visitor volume analysis:
$8,000
5 -year forecast of volume and spending:
$7,500
Total professional fees:
$35,000
Any required data inputs will be billed at cost.
Our typical payment schedule is 50% upon contracting, 25% upon draft report delivery,
and 25% upon satisfactory completion of the project.
%OTOURISM ECONOMICS 17
The Economic pact of Visitors to Grapevine, TX
August ,
M
Tourism Economics is an Oxford Economics company with a singular objective: combine an understanding
of tourism dynamics with rigorous economics in order to answer the most important questions facing
destinations, developers, and strategic planners. By combining quantitative methods with industry
knowledge, Tourism Economics designs custom market strategies, destination recovery plans, tourism
forecasting models, tourism policy analysis, and economic impact studies.
Tourism Economics has more experience than any other firm in the world in conducting tourism impact
analysis. Our client list spans the globe and includes the majority of leading destinations and companies.
Oxford Economics is one of the world's leading providers of economic analysis, forecasts and consulting
advice. Founded in 1981 as a joint venture with Oxford University's business college, Oxford Economics
enjoys a reputation for high quality, quantitative analysis and evidence -based advice. For this, it draws on its
own staff of 90 highly -experienced professional economists; a dedicated data analysis team; global modeling
tools, and a range of partner institutions in Europe, the US and in the United Nations Project Link. Oxford
Economics has offices in London, Oxford, Dubai, Philadelphia, and Belfast.
• .' • • . MM 1, •
Travel industry expertise
Tourism Economics has vast experience in providing actionable and credible analysis of travel activity. Our
combined team has substantial direct hands-on experience in destination visitor economic impact.
Modeling expertise
Tourism Economics and its partner, Oxford Economics, are founded on state-of-the-art modeling expertise.
This is best evidenced by the Oxford global economic model which is used by blue chip companies and
governments around the world, in addition to the US Treasury, World Bank and IMF. Our Tourism Decision
Metrics forecasting model is the most rigorous of its kind, taking into account both economic and destination
determinants.
Economic and tourism databases
Our global tourism database of origin -destination visitor flows and spending has the best country and
indicator coverage of any private sector provider through our partnerships with the UNWTO, PATA, and the
CTO along with our internal updates of the most recent trends. The Oxford Economics global model covers
190 countries and is updated constantly by our data team in Oxford.
TOURISM ECONOMICS 18
The Economic #.' t of Visitors to Grapevine,
August 2015
Senior staffing
Tourism Economics operates as a boutique tourism consulting company in one important sense: we assign
senior staff at the center of each and every project. Our project directors are integrally involved in every
stage of work and are directly involved in its development. The principals who represent our work are the
same who conduct the work. We have found this to be an optimal way to sustain high quality and maintain
close relationships with our clients. It is also the way we enjoy working.
Scope: Economic Impact of Tourism
Client: 15 states, 20 cities, 20 countries
Description: Tourism Economics regularly updates analysis for governments seeking to understand the
economic contribution of tourism activity on their city, state, or country. Past US state experience of the TE
team includes: North Carolina, Connecticut, Kansas, Missouri, New Mexico, Michigan, South Carolina,
Delaware, New Jersev, New York, South Dakota, Pennsylvania, Minnesota, Ohio, Wisconsin, Maryland, and
Georgia. (Underlined states are current clients.)
Public examples of our work include:
http://industrv.travelwisconsin.com/research/economic-impact
http:/l .visitni.or lq new -jersey -tourism -research -and -information
http://www.visitpa,com/economic-imr)act-travel-report
http://corporate.vis itorlando. com/research-and-statisticslarland o-visitor-statistics/vi s ito r-fo recast/
http://wttc.or /research/economic-impact-research/
htt ://visitmar land.or /Pressaom/Pa sliourism eneratessubstantialreturnonstateinvestmnt2.s x
httL)://www. nc. ov/html/om/ df/2012/n o ecanomic im act charts throw h 2015. df
Scope: Economic Impact of Events
Clients: 150 CVBs across the US
The DMAI Event Impact Calculator is an online economic impact analysis tool designed by Tourism
Economics for CVBs to calculate the economic value of trade shows, conferences, and other events on their
destination. The platform is the established industry standard for economic impact analysis among CVBs.
Scope: Economic Impact of Business Travel
Client: U.S. Travel Association /World Travel & Tourism Council
"'` TOURISM ECONOMICS 1
ffie
Economic r. of » to Grapevine,
«
Tourism Economics quantified the economic impact of business travel on overall corporate and national
economic performance for the US and for each world region.
Scope: ROI of Brand USA marketing investments
Client: Brand USA
Description: Tourism Economics built a three-part model to estimate the returns on Brand USA's 2013/14
marketing expenditures. This included an analysis of US market share, a counterfactual regression model,
and a model based on advertising effectiveness.
http:// .thebrandusa.com/-/media/Files/Key%20Dox/2014/ROI%2OResults/Brand%20USA%20R01%20F
Y2013%20Final.pdf
Scope: Visitor Opportunity Market Assessment
Client: Visit Britain, Netherlands Tourism, NYC & Company, Visit Orlando
Description: A Market Analysis Platform (MAP) was developed for the client that ranked the relative strengths
of weaknesses of a broad array of international markets. The MAP combined a wealth of economic forecasts
and other relevant indicators for each market to determine a series of scores for each market according to
factors such as market size, opportunity, alignment, risk and constraint. By combining the scores for each of
these factors the relative attractiveness of each origin market can be determined to inform how a marketing
budget can be allocated across the markets. This platform allows flexibility in which markets are analyzed
and compared as well as in which factors are considered to be important in determining relative opportunity.
Scope: Impact of the Gulf Oil Spill / Economic impact of unused vacation time / Impact of Business Travel
Client: U.S. Travel Association
Description: Oxford Economics is a research partner of the U.S. Travel Association, providing policy analysis
on a periodic basis. Relevant projects include the economic impact of business travel, the Gulf oil spill,
funding of destination promotion, and an expanded visa waiver policy.
Scope: Overseas market strategy for United States
Client: Discover America Partnership
Description: Tourism Economics conducted analysis to identify key competitors for overseas visitors to the
US. Our team then assessed potential market gains as a result of a proposed promotional campaign. The
project also included a survey of US and international tourism offices to determine their budgets and
strategies for destination marketing and promotion. The analysis formed the backbone of the policy
recommendations within the Discover America Partnership Blueprint for Change.
,,TOURISM ECONOMICS 20
The Economic Impact of Visitors to Grapevine, TX
August 0
Scope: Visa Waiver Program expansion analysis
Client: U.S. Travel Association
Description: Tourism Economics developed a model based on historical benefits of the Visa Waiver Program
to evaluate the likely gains that would be realized through expanding the eligibility criteria to include 10 new
countries.
Scope: Analysis of travel to America's cities
Client: Travel Business Roundtable and US Conference of Mayors
Description: Our team conducted a survey of CVBs and Mayors of the top 45 city destinations for overseas
visitors to determine the perceived causes and effects of recent declines to the majority of cities. We
supplemented this with our own data analysis and review of best practices among competing destinations.
Scope: The economic impact of visas impeding participation in US exhibitions
Client: The Center for Exhibition Industry Research
Description: Tourism Economics assessed the broad economic losses of non -participation in US -based
exhibitions as a result of visitor visa issues. This analysis quantified two broad categories of US export losses
from business -to -business (13213) trade shows (exhibitions). 1) Foregone spending by would-be attendees—
affecting international demand for hospitality services as well as a wide range of spending at the event itself.
(These are measured as service exports in balance of trade measures). 2) Lost exports of US companies
who are unable to meet with current or potential prospects.
Scope: Economic impact of tourism and the I Love New York campaign
Client: New York Association of Convention and Visitors Bureaus
Description: Tourism Economics developed a county -by -county tourism economic impact model to measure
visitor spending, and related jobs, wages, and taxes. The model quantified tourism value added across each
affected industry. We then quantified the impact of the I Love New York campaign across the same metrics
using the output of a separate marketing conversion study.
Scope: US Domestic Tourism Forecasting
Client: US Travel Association
Description: US Travel has provided forecasts of domestic travel to the industry at large for over a decade.
Tourism Economics was approached to construct a new model of US domestic tourism to generate these
forecasts. This model separately tracks and forecasts travel flows according to market segment (business,
leisure), mode of transportation and trip length (day, overnight). The model considers domestic travel relative
to international travel and also considers substitution between these different types of domestic trips. Key
`' TOURISM ECONOMICS 21
The Economic Impact of Visitors to Grapevine, TX
August 2015
model drivers are forecasts taken from Oxford Economics' US macroeconomic model as well as the TIA
travel price index.
Scope: Hotel market forecasts
Client: Smith Travel Research
Description: Tourism Economics is STR's forecast partner, developing market -level forecasts of hotel
demand, supply, ADR, occupancy, and RevPAR for over 70 markets worldwide.
Scope: State of California Tourism Forecasting
Client: California Travel & Tourism Commission
Description: Tourism Economics conducts periodic forecasts of travel demand for the state of California.
These forecasts and related analysis include domestic and international market detail.
Scope: New York City Tourism Forecasting
Client: NYC & Company
Description: Tourism Economics conducts periodic forecasts of travel demand for New York City. These
forecasts and related analysis include domestic and international market detail.
Scope: Orlando Tourism Forecasting
Client: Visit Orlando
Description: Tourism Economics conducts periodic forecasts of travel demand for Orlando. These forecasts
and related analysis include domestic and international market detail.
Scope: Lodging Demand and Performance Forecasts
Client: Intercontinental Hotels Group
Description: Tourism Economics developed a forecast model of hotel room demand, supply, occupancy,
ADR and RevPAR for the US as a whole and for each of the 50 states, using data from Smith Travel
Research. Hotel room demand was calculated relative to economic developments in key origin markets for
each state. Supply forecasts were based upon Smith Travel room pipeline information, and occupancy was
derived as the ratio of demand to supply. ADR was found to follow occupancy (and therefore the imbalance
between supply and demand) closely, with a slight lag, as well as inflation in the wider economy.
TOURISM ECONOMICS 22
The Economic Impact of Visitors to Grapevine, TX
August
Here are some recent examples of reports and communication platforms developed
for our clients. (Cntrl+Click on image to view full report)
To quantify the impacts of the worldwide vacation ownership
industry for the ARDA International Foundation (AIF), Oxford
Economics analysed industry information from a variety of sources
and prepared a holistic, global view of industry significance.
As part of this analysis, Oxford Economics:
• worked with AIF, survey professionals, and representatives
of the Global Alliance for Timeshare Excellence to design
and implement a multi-lingual survey (25 languages) of
2,800 vacation developers/operators;
• analysed industry composition, operating performance, and
outlook; and,
• calculated direct, indirect, and induced economic impacts
for seven global regions.
The results show a sector with over 5,300 resorts that supports a
worldwide economic impact of $113.9 billion, with over 1.0 million
jobs and $13.4 million in taxes.
The economic impactof amusement parks
attractions in the US
To quantify the impacts of attractions with a wide set of
characteristics (e.g. amusement and theme parks, historical sites,
museums, and zoos) for the International Association of
Amusement Parks and Attractions (IAAPA), Oxford Economics
analysed a variety of data from sources including:
• U.S. Census Bureau,
• Bureau of Labor Statistics (BLS)
• Bureau of Economic Analysis (BEA)
• IAAPA Research Studies
The results show a sector with 30,000 attractions that supports a
nationwide economic impact of nearly $219 billion, with 2.3 million
total jobs. Over the period from 2004 to 2011, the industry
experienced an average annual growth rate of 6%, ahead of
aggregate U.S. economic growth of 3.5%.
'' TOURISM ECONOMICS 23
impact of
Brand USA
marketing
trade shows
The Economic Impact of Visitors to Grapevine, TX
August 2015
& Fiscal
Impacts of
Market8
Casino in
Philadelphia,
PA
industries in Taiwan
WOURISM ECONOMICS 24
Economic
impact of
travel and
tourism in 190
countries
The Economic Impact of Visitors to Grapevine, T7
August 2015
and social
The economic
in the U.K.
TOURISM ECONOMICS 25
Economic p. of Visitorsto Grapevine,
August 0
We are pleased to provide the following references. We encourage you to contact
these individuals with any questions you may have.
Client: Destination Marketing Association International
Scope: Event Impact Analysis (100+ cities in the US)
Christine "Shimo" Shimasaki, CDME, CMP
858-935-9179 (San Diego)
202-835-4094 (Washington DC)
shimoO-destinationmarketing.org
Client: NYC & Company
Scope: Economic impact, tourism forecasting, and volume tracking
Donna J. Keren, Ph.D., Senior Vice President, Research & Analysis
+ 1 212 484 1221
dkeren a.nycvisit.com
Client: Greater Philadelphia Tourism and Marketing Corporation
Scope: Tourism economic impact and volume tracking
Laura Canci
215-599-2294
laura@gptmc.com
Client: Ohio Tourism Division
Scope: Tourism economic impact, state and counties
Tamara K. Brown
Public Relations Manager
Tourism Ohio
614.466.8591
Tamara. Brown Odevelooment.ohio. aov
Client: Pennsylvania Tourism Office
Scope: Tourism economic impact, state and counties
Elizabeth Sechoka, Director Research & Statistics
(717)720-1308
esechoka(@STATE. PA. US
TOURISM ECONOMICS 27
The Economic Impact of Visitors to Grapevine, TX
August
"Tourism Economics' reputation for excellence is well-deserved. We are confident our forecast product
will be an invaluable tool set for decision makers during this budgeting season and beyond."
BRAD GARNER
Chief Operating Officer, STR
"As always, T.E. was a hit! They have a remarkable ability to make economic trends digestible, even to
those who insist they don't understand economics."
BERKELEY W. YOUNG
President, Young Strategies, Inc.
"Their reports are consistently informative, easy to interpret and apply, and defendable to various
stakeholders. Their responsiveness to questions and professional demeanor ensure satisfaction among
all our industry members."
AMIR EYLON
Director, Ohio Tourism Division
"They are incredibly responsive to requests for support and have gone out of their way to help with last
minute queries."
PETER NASH
Head of Strategy Development & Insights, Tourism Ireland
"Our success in informing national travel policy has been linked to T.E. analysis."
GEOFFREY FREEMAN
Executive Vice President, U.S. Travel Association
"Thank you for the excellent work you performed in terms of the degree of analysis, and especially the
recommendations flowing from them. We went well beyond the initial agreed scope and your assessment
was quite useful to us."
DAVID JOHNSON
Director -General, Bahamas Ministry of Tourism
"The Tourism Economics team is a pleasure to work with on projects. They are always willing to talk
through different approaches or perspectives to solving problems."
CANDICE SNOOK
Manager, Performance Strategy & Planning, InterContinental Hotels Group
TOURISM ECONOMICS 28
0
The Economic . .ct of Visitors to Grape
August 2015
Given the importance of this project—both to the client and to Tourism Economics—the project will be
directed by Adam Sacks, President of Tourism Economics. Adam will be ultimately responsible for client
satisfaction and will be the first point of contact with the client. His involvement will be integral at every stage
of the project, from inception to final presentation to model support.
The project's day-to-day management will be handled by Christopher Pike, Director. Chris will be supported
by Michael Mariano and Zachary Sears on data compilation and model development.
Adam Sacks – President, Tourism Economics
Adam Sacks is the President of Tourism Economics; an Oxford Economics company dedicated to
analytically -based consulting to the tourism sector. Over the past sixteen years, Adam has worked with
hundreds of travel sector clients to address fundamental economic questions.
On the public sector side, Adam has worked with national, provincial/state and local tourism offices
throughout the world. He is an authority on measuring the economic impact of tourism activity–both broadly
and for specific initiatives and projects. He has advised destinations on tourism investment policy, the effects
of proposed entry procedures, tourism taxation, and marketing strategies. He has provided numerous
destinations with analysis on market positioning and emerging opportunities.
Adam has consulted with multi -national hotel chains, airlines, aircraft manufacturers, theme parks, resort
developers, and retail operators to measure current and future market opportunities. He has presented to
numerous corporate strategic planning teams on the threats and opportunities facing their businesses within
the projected travel and economic climate.
He is an expert in developing custom systems for quantifying relevant tourism market segments and tracking
the competitive landscape for clients. Adam has developed tourism forecasting models with unrivalled track
records.
Adam has implemented the UN -sanctioned TSA methodology for measuring the economic impact of tourism
for over a dozen countries and for seven states in the US.
Adam is a compelling and sought-after speaker on issues related to tourism market analysis, the economic
impact of tourism and travel -demand forecasting He also has presented tourism impact results to
governments around the world. Adam will guide research methodology, review all work, and ensure client
satisfaction.
Chris Pike – Director, Tourism Economics
Christopher Pike is a senior economist within Oxford Economics' Tourism Economics division and is
responsible for measuring the economic impact of tourism activity – both broadly and for specific initiatives
and projects. With his expertise in economic impact analysis, Chris has worked with dozens of state and local
tourism offices. Chris has also been managing a series of consultancy projects related to the tourist sector,
including the impact of U.S. visa issues and a quarterly report on Asian Trends and Prospects. Mr. Pike has
TOURISM ECONOMICS
The Economic Impact of Visitors to Grapevine, TX
August 2015
presented at numerous client sites and at several association meeting along with being quoted in national
and local press outlets. Chris received his Masters in International Trade and Public Economics from the
University of Pennsylvania. He is an expert in tourism economic impact analysis with over two -dozen
destinations analyzed. Chris will manage day-to-day project work and act as primary model developer.
Zachary Sears — Senior Economist
Zachary joined Tourism Economics and Oxford Economics from Moody's Analytics where he worked as a
regional and industry analyst. At Moody's Analytics, Zachary performed regional analysis for U.S. state
(including Rhode Island) and metropolitan areas and a broad range of industry analysis. His responsibilities
included writing regular updates for subscription -based products, conducting econometric modeling, input-
output impact modeling, report editing, and consulting services to public and private sector clients. Prior to
his roles at Moody's Analytics, he worked as a Research Economist for a Vermont -based economics
consulting firm, Economic & Policy Resources, Inc. At EPR he served as a consulting economist for the
Governor's Administration and on numerous impact studies covering most industries of the economy.
Zachary holds a BA in Justice from American University in Washington, DC, an MA in International Relations
from Saint Mary's University in San Antonio, TX, and an MS in Community Development and Applied
Economics from the University of Vermont.
Zachary will work on data compilation and provide modeling support.
Michael Mariano — Senior Economist
Michael Mariano is a Senior Economist with Tourism Economics and Oxford Economics. Michael has over
12 years of experience in economic and statistical consulting, and his research interests include economic
and fiscal impact modeling, econometric forecasting, retail market studies, and GIS (Geographic Information
Systems) modeling and geospatial analytics.
Mr. Mariano has consulted and provided expert testimony for various public, private, and non-profit clients
and has managed projects examining public housing, economic development, tax policy, market analysis,
and real estate impacts. He has worked on economic impact studies for hotels, casinos, and retail parks
nationwide and has extensive experience providing job impact estimates for project funding through the U.S.
government's EB -5 immigrant investor program.
Prior to joining Tourism Economics, Michael was Managing Director of Geospatial Analytics and GIS
Solutions at Econsult Corporation, an economic consulting firm based in Philadelphia. Michael received a
Bachelor of Science in economics and marketing from the Wharton School and a Master of Science in Urban
Spatial Analytics from The University of Pennsylvania.
Michael will work on data compilation and provide modeling support.
TOURISM ECONOMICS 30
U
Approved
The Economic Impact of Visitors to Grapevine,
August1
1. Deliverables
Analysis of the economic impact of tourism to Grapevine including the following:
■ Comprehensive report of findings
■ Five years of comparable data
■ A description of data inputs and methodology
■ Raw data files in MS Excel
■ A presentation to stakeholders (WebEx)
■ Assistance with the development of press releases
2. Project schedule
2.1 The reports will be delivered within 6 weeks of receiving visitor survey data inputs
3. Pricing and payment schedule
3.1 The project will be delivered at a fixed -fee of $35,000
3.2 Required data inputs will be invoiced at cost
3.3 Invoicing will cover 50% upon contracting and 50% upon satisfactory completion of the
project
4. Ownership and distribution rights
4.1 The client has full rights to use and distribute the deliverables.
5 Liabilities
5.1 Because of the uncertainty of future events and circumstances and because the contents are
based on data and information provided by third parties upon which Tourism Economics has
relied in good faith in producing the Deliverables, Tourism Economics does not warrant the
accuracy of its measurements and forecasts and will not be liable for the contents of any of the
foregoing or for the reliance by the Customer on any of the foregoing.
5.2 Liability is, in any case, limited to the current annual value of this contract.
f r''
Authorized Signature for Client Authorized Signature for TE
Printed Name and Title
Date
Adam Sacks, President, Tourism Economics
Printed Name and Title
August 18, 2015
Date
'`TOURISM ECONOMICS 31