President's Letter
I would like to thank each member of this organization for allowing me to serve as your President for the past year. It was an honor and a great learning experience for which I am grateful. The last year has been full of change for SCEDA and for the SC economic development community. During that time SCEDA has stayed true to our mission while continuing to dig deeper into professional development and legislative matters. I encourage you to take advantage of SCEDA’s professional development activities. Most recently SCEDA hosted a tour to the SC Ports Authority and the Boeing facilities. The day was a great example of the diversity of the learning and business development opportunities that SCEDA provides. The year ended on a high note with a great Annual Conference. Be sure to check out the links (below) to many of the presentations from the meeting, including the newest video that is being used to market the SC Ports.
As the summer issue, it only seems appropriate that this edition of the SCEDA Voice is focused on Tourism. You all know Tourism is such an important part of our economy. Each year it is estimated that tourism contributes over $18.4 billion to our economy. Read on to find out more from Duane Parrish, Director of PRT about the return on investment generated from tourism spending. There is also a story about the connection between SC tourists who later relocate or locate a facility to our state. Finally, SCEDA wants to congratulate and welcome the new team members at the DOC and Ready SC. This issue has brief biographies for Amy Love, Marketing and Communications Director; Jennifer Noel, Director, Global Business Development; and the newest members of her staff Mandy Brawley and Warren Darby in addition to Susan Pretulak, the new VP for Economic and Workforce Competitiveness. Sincerely,
April Allen, SCCED Past President (Has Been) SC communities sport a winning mindset when it comes to tourism
In thinking about the intersection of sports and tourism, golf may be the first thing to come to mind for many South Carolinians, from high-profile events such as the PGA Championships, which are coming to Kiawah Island in 2012, to the thousands of amateur golfers who descend on the state’s 360 championship-caliber courses each year.
Building from the ground up Many in the state consider Rock Hill a pioneer in sports tourism, although it got off to a bit of a rocky start. Back in the 1980s, the city approved the construction of Cherry Park, a softball and baseball complex, amid some controversy that ultimately cost several city council members their jobs. Today Cherry Park hosts state, regional, and national tournaments year-round, and the complex is part of an extensive network of sports facilities that have brought nearly 400,000 visitors to Rock Hill during the past five years and had a $51 million direct economic impact on the city. “These sports tourism facilities . . . act as an important economic development tool to grow our city,” says Ed Thompson, director of Rock Hill Parks, Recreation, and Tourism. Thompson says that all kinds of hospitality and retail businesses, from hotels, restaurants, and gas stations to department stores, pharmacies, and laundromats get a boost from the tournaments. “Some new businesses, such as Dick’s Sporting Goods, have established themselves near [our] sports facilities,” Thompson says. Greenville was able to capitalize on its natural terrain, rather than a constructed facility, when it was awarded the USA Cycling Professional Championships in 2006, ending a 21-year run for Philadelphia, which had hosted the event from its inception. “[The event organizers] love the course,” says Angie Prosser, director of public information and events for the City of Greenville. She notes that both the time trial and the road race routes for the event are technically challenging. “To have a national championship, they want it to be the survival of the fittest. They want the best to come to the top, so having the Paris Mountain [State Park] course as our course allows that.” Prosser says winning the prestigious event was just another step in a journey Greenville started in the 1990s, when city leaders decided to play to their sporting strengths and make Greenville a hub for cycling. “We started with a vision, and every year we worked to do a little bit more,” Prosser says. “Our parks and recreation department got involved with the [local cyclists and] started sponsoring small amateur races, then some of them became larger, then we got involved with the Tour DuPont, and we saw that it could help put Greenville on the map in the cycling world.” While no official economic impact study has been done on any of Greenville’s cycling activities, Prosser says that anecdotally, “we know we put a lot of heads in beds” once all the cyclists, event volunteers, and out-of-town fans are considered. “We hear it from the hotels,” Prosser says. She says that the economy is also stimulated by the excitement that the championships generate throughout the city. “The month after USA cycling, the bike shops, we’ve heard that their sales increase. That’s the true reason that Greenville is interested in this [event]. Not just one weekend and the ‘heads in beds,’ but it’s the spin for Greenville as a community—being a cycling community,” says Prosser. “The number of bike shops has increased in Greenville.” “When you see a pack of professional riders flying by on Paris Mountain, people get excited, and they say, ‘You know what? I’m going to go buy a bike.’ Not necessarily to race, but it just spurs it on,” Prosser says.
Keys to victory Even with Rock Hill’s top-tier facilities, “It’s a very competitive process” to attract events, says Thompson. “Rock Hill must compete against other cities from across the country.” The city obviously knows what it takes to win. Rock Hill was just awarded the 2012 national championships for U.S. Youth Soccer, which will be held at Manchester Meadows (part of Cherry Hill). (Incidentally, Greenville will host U.S. Youth Soccer’s Region III finals; the first time a state has hosted the championship as well as a regional tournament.) Thompson says that attracting events involves “attending various conferences and conventions, building relationships with event holders, nurturing those relationships, and building regional partnerships,” such as those Rock Hill’s PRT has established with the local convention and visitors bureau, chamber of commerce, YMCA, school district, and Winthrop University. Thompson continues: “We feel strongly, however, that word of mouth is our best method for attracting tournaments.” He says that the experience participants and visitors have in Rock Hill should be top-notch from beginning to end, from the signs that direct visitors to the facilities, to keeping the parks meticulously clean throughout an event, to providing excellent customer service to all attendees. Prosser also cites partnerships as an essential ingredient for successfully attracting events. “If the cycling community, the city, and the county are not at the table, we would not have US Pro,” says Prosser. “It absolutely takes the [whole] community to support it, [including] sponsors. If Greenville Hospital System, Duke, GE, and TD Bank didn’t step up to the table, we wouldn’t have US Pro. Without that corporate sponsorship and support, these events wouldn’t take place.” Keeping the championships year after year involves teamwork, as well. “Between the City of Greenville, Greenville County, and Medalist Sports, we produce a wonderful event,” says Prosser. Medalist is a sports event management company based in Atlanta that has been involved with Greenville cycling events for years. Greenville’s fan base is another element of the city’s cycling success. “[The event organizers] love being able to go out on the course and see the support all along the course; that’s good for the cyclists, it’s good for USA Cycling, and it’s good for Greenville,” says Prosser.
Finding your niche Thompson and Prosser have advice for other communities that are considering adding a sports-related component to their tourism or economic development efforts. Thompson brings it back to building strong relationships and trying to gain broad community support. “Support from city council and citizens, with input [from] a parks, recreation, and tourism commission, is invaluable.” Also: “Be conservative with economic impact projections.” Says Prosser, “I think that every town owes it to themselves to figure out what they can do well, and stick with it. And not try to duplicate what someone else is doing well.” “Rock Hill built Cherry Park, and they were probably the best in the state as far as pushing sports tourism,” Prosser says. “Then everybody tried to duplicate what Rock Hill was doing.” Instead, Prosser emphasizes, it’s really about working with what you have. “[We thought,] ‘we don’t have a beach, we don’t really have a mountain, what do we have? We have wonderful terrain for cycling,’” she says. “We started looking at cycling events and asking, ‘how can we promote this and make sure that we always have a cycling event in our calendar?’ “There are a lot of different sports out there, and [towns] need to figure out what they can do that is different from the next town over—not just to compete and do the same thing, but to find their own niche.” “I think I’m seeing that trend more now,” Prosser says, citing the fishing tournaments that have become established across the state as an example. “Now we’re really starting to see those communities say, we can do this.” More opportunity in the air for the Palmetto State thanks to Southwest
“We’ve had meeting planners flat-out tell us, we don’t meet anywhere that Southwest doesn’t serve,” says Lawson. “It opened a lot of doors for us that previously weren’t open.” Southwest began serving Charleston International Airport (CHS) and Greenville-Spartanburg International Airport (GSP) in March, and the impact has been striking. Southwest has increased the competitiveness of Charleston and the Upstate as business and tourism destinations while making it easier and less expensive for executives, economic developers, and citizens to get where they need to go.
Traffic heads north, fares head south (west) “We are certainly seeing larger increases in traffic since the arrival of Southwest,” says Roslyn Weston, vice president of communications for GSP. May of this year was the second-best May in the airport’s history. At CHS, the effect was record-breaking: “April was the best month the airport has ever had in terms of numbers of people traveling in and out,” says Lawson. “Then May was even better.” Southwest’s entry into the two markets resulted in a not-unexpected drop in fares. “It’s just like anything else; what drives prices down is competition,” says Weston, who acknowledges that GSP was perceived to have extremely high fares before Southwest’s arrival. “Southwest has introduced some price discipline into the marketplace.” “You’ve just got that many more seats in and out of Charleston, which has a moderating effect on rates across the board,” says Lawson. Price competition among airlines at GSP is already benefiting the Upstate Alliance. President and CEO Hal Johnson notes that on a recent business development trip, his airfare—on a legacy carrier that was serving GSP before Southwest’s arrival—was half of what it otherwise would have been. He says savings like that will affect how the Alliance does business. “[Alliance staff members used to] drive to Charlotte or Atlanta or other airports if we couldn’t get a reasonably priced ticket [out of GSP],” says Johnson. That added mileage costs to the plane ticket that the Alliance was already paying for. “Now we don’t have to do that. The savings . . . are pretty substantial. It will allow us to increase our travel, and we’ll do it.” Hank Taylor, vice president of global business development for the Charleston Regional Development Alliance, agrees, noting that Southwest has “reduced costs for CRDA’s global business development activities."
Adding lift to economic development efforts The addition of Southwest to the Charleston market offers “greater connectivity with more direct service flights,” a key asset for businesses who locate in or near the city, says Taylor. The same is true for the Upstate, says Johnson. “Companies looking to locate in the area are very interested in access to markets, and Southwest has helped us [in that area].” He notes that attributes such as accessibility to an airport and the costs involved with air travel are important to prospects, especially headquarters operations. “It’s just one of those factors that adds to the whole package,” Johnson says, noting that Greenville has welcomed several headquarters operations to its downtown since Southwest’s arrival.
Easy to jet in and jet out “Southwest had a positive impact even before they began flying [to Charleston], because it gave us something to talk about with meeting planners,” says Lawson. “It was impressive to us how many meeting planners were truly interested in the fact that Southwest was going to be flying here.” “We definitely have booked business as a result of Southwest [serving Charleston],” he adds, noting that it’s not only the draw of Southwest as a brand, but the sheer logistical power of having more direct flights to and from Charleston, that have made the city more desirable as a meetings destination. He notes that the increased interest from Houston (which now has a direct flight to Charleston via Continental and Southwest) has been an especially pleasant surprise, given that the Charleston CVB had not specifically targeted that city in its prospecting efforts in the past. When the Men’s Collegiate Lacrosse Association recently chose Greenville to host the group’s national championships in 2012 and 2013, the Greenville Convention and Visitors Bureau noted that one of the city’s draws was the easy access from the Northeast, Southeast, and Midwest thanks to Southwest Airlines’ new service to GSP.
Soaring expectations Local officials indicate that Southwest is pleased with the results of their expansion into South Carolina. “They have indicated that they are extremely happy with the way [Charleston] is performing for them,” says Lawson. “The percentage in passenger increase [at GSP] has far exceeded Southwest’s expectations,” says Johnson. The feeling is mutual. “Southwest opens the Charleston region to new markets and allows us to showcase our community as a great place to live, work, and play for visitors, businesses, and potential new talent,” says the CRDA’s Taylor. “It puts us in a different position as a region, because we’ve changed the complexion of air service in and out of GSP,” says Weston. “You’ve probably heard people call the arrival of Southwest a game changer . . . that’s what it is.” Connecting in-migration and job creation
For this issue of the SCEDA Voice, we caught up with Pat Mason, founder of the Center For Carolina Living (CFCL). Mason has been watching tourism trends in South Carolina since 1986. In fact, over the last 25 years, more than 100,000 people have completed CFCL’s Carolina Lifestyle Survey™, which reveals some fascinating tourism trends that have a direct impact on economic development. According to CFCL, the S.C. tourism industry creates and sustains 192,800 jobs, nearly 10 percent of all employment in the state. In addition, it generates $1.2 billion in taxes, about 20 percent of total collections. Below, Mason discusses how in-migration leads to job creation in South Carolina. SCEDA: In your work with CFCL, you often focus on a group of people you refer to as “Turbo Tourists.” Please tell us more about this group and what part they play in economic development. Mason: South Carolina will welcome an estimated 28.5 million visitors this year. Of our visitors, research confirms that about 6 percent (1.7 million) are touring specifically to investigate relocation and investment opportunities. Those visitors are “Turbo Tourists.” These affluent, educated families visit numerous destinations as part of their “discovery” mission. They spend more, stay longer, and return more frequently on average. Beyond a $2,000 to $20,000 vacation, there’s an economic “turbo-effect” when they relocate or acquire a second home, investing $250,000 to more than $1 million in the first year. Then, the “turbo-effect” kicks in again, as these new homeowners begin entertaining on average six friends and family groups a year, some of whom will also become “Turbo Tourists” and relocate (invest their capital) in South Carolina. A third “turbo-effect” ices the economic cake. Our surveys of 100,000 people since 1986 consistently report that 14 percent say they plan to start or move a business, bringing intellectual capital, investing millions, and creating thousands of new jobs across the Carolinas. SCEDA: What is motivating people to invest in South Carolina in terms of both personal and business relocation? Mason: Capital and family decisions follow value opportunities. These decisions relate directly to relative cost differentials. Concurrently, quality of life plays a part as the “deal closer.” To the degree that South Carolina can maintain these value differentials, including our Beautiful Places, we will have an advantage in terms of attracting people and businesses. SCEDA: What advice would you offer local economic developers and community leaders to increase their numbers of visitors, investors, and in-migrating families? Mason: First, realize that tourism is a major economic engine, even in small towns and rural communities. Focus on building local awareness of your tourism and quality-of-life assets. Burnish those products—be it main street, parks, entertainment venues, nature trails, historic sites, festivals, cultural events. Spiff these up primarily for your citizens. Next step is to showcase your destination and invite the audience segment you want to attract. Challenge the local leadership to marshal a steady stream of marketing communications funding. Create a positively memorable “visit experience.” The result will be that CEOs, entrepreneurs, and relocating families (including educated, affluent retirees) will put you on their list, plan more visits, and ultimately bring their capital. Witness the leadership over many years that’s transformed the likes of Greenville, Newberry, Aiken, Charleston into primo “places” to visit, invest, work, live, play, do business and retire. Consider these 11 recommendations for successful tourism development:
SCEDA: How many people do you predict will relocate to South Carolina in 2011? Mason: The best forecast of the “gross-in” counts for men, women, and children of all ages is 155,000 this year. What’s important for long-term planning is that the number goes up every year. Also important to note are some of the characteristics of the people who will relocate to our state. A total of 77 percent have earned college degrees, median household income is $119,000, and 44 percent are over age 50. SCEDA: What percentage of those people on average will start or relocate a business? Mason: Our surveys of 100,000 families since 1986 consistently report that 14 percent say they will move or start a business. The data reports needed square feet and planned employment. So, if 14 percent of these 59,845 new households per year actually launch an enterprise and many hire workers, a significant number of jobs could be created. SCEDA: Please talk a little about the economic impact of retirees and what communities need to have in place to attract this coveted group? Mason: Today, 45 percent of newcomers are over 50. That percentage will grow as the 74 million boomers enter retirement. Communities that build their tourism sector and have quality health care delivery, cultural amenities, life-long learning opportunities, trails, etc. will enjoy retiree market share. That said, why just retirees? I say, the economic challenge and opportunity for S.C. community leaders is to attract and retain talent and capital—whatever their age. Household income for a 27-year-old working couple (say, $75,000) mirrors the income of an affluent retired couple. The former is spending earned income. The latter spending saved income. SCEDA: As you see it, what are some examples of S.C. communities that are harnessing tourism effectively to drive economic development? Mason: Beyond our major metro destinations, there’s a crop of emerging destinations successfully harnessing tourism to drive economic development: Aiken, Clemson, Newberry, Gaffney, Jasper County, Sumter, Edisto Island, Hardeeville, and Walterboro. As traditional industrial development becomes more challenging in many ways, communities across the state are awakening to tourism and its potential to attract visitors, affluent entrepreneurs, and retirees. Think: Marion, Darlington, Oconee, Mt. Pleasant, Bennettsville, Lancaster, Fort Mill, Allendale. There are dozens more that are successfully showcasing nature-based recreation such as Little River with its Blueway, McCormick with its state parks and golf, and Greenville and Travelers Rest with its Swamp Rabbit Trail. This “economic gardening” approach normally is led by a city council or chamber board, while local economic development officers sometimes see more wisdom in certifying industrial parks. I encourage economic developers to mimic the model being used in Newberry and go for both. For more insight on this relatively new “economic gardening” approach to building wealth from within, click here. Meet PRT Director Duane Parrish
Parrish came to PRT from Premier Hospitality Group, the hotel development and management firm he opened in 2000. He has served as a manager with the Charleston Area Convention and Visitors Bureau and as chair of the SC Hospitality Association. In total, he has more than 35 years of experience in the hospitality industry, including extensive experience in hotel property management and development throughout the state. At the time of his appointment, Gov. Haley commented, “What we looked for in a PRT director is someone from the private sector who knows the tourism industry, its players, and, most importantly, that tourism is critical to economic development and job creation in our state.” Below, Parrish weighs in on his approach to increasing tourism in South Carolina. He also talks about his plans to keep the communication lines open between PRT and local developers and to help put the “sizzle” in prospect visits. SCEDA: What do you see as the link between tourism and economic development? Parrish: I think there are two parts. Part one is that no one moves a company here without becoming a visitor first. Often, someone is on vacation here when they say, “Hey, this is a nice place to be. I wouldn’t mind living here and wouldn’t mind moving my company here.” I think there’s a direct link between someone visiting the state and moving a company here. Therefore, it’s critical that they have a good experience on that first visit to the state. I was recently in Paris and got to attend a reception with Commerce surrounding the Paris Air Show. There, I had a chance to speak with a man who owns a company that wanted to do more business with Boeing. He and his sister had both vacationed in the Upstate and had great experiences, so he decided to locate a facility there. He now employs 100 people and is thinking about putting a facility in Charleston too. One of the things that we would like to do, where it’s prudent, is that if Commerce or local economic developers have someone coming to visit with the potential of moving a company here, we in hospitality and tourism could be involved to make sure that prospects have great experiences on their visits. The second part of that link between tourism and economic development is that tourism, by most measures, is the largest industry in the state, so it is economic development in itself. People often think of tourism jobs as primarily low-wage, but the industry actually creates higher-paying ones as well in management, ownership, and the like. The tourism industry also helps employ those who may not have the skills to work somewhere else, which helps keep the state’s unemployment rate down. We employ over 200,000 people in the state—that’s a lot of jobs out there. SCEDA: How are you and the rest of the PRT team working with Commerce and Secretary Bobby Hitt? Parrish: Bobby Hitt and I were both tasked from day one by the governor to find a sponsor for the Heritage. I think Bobby and I partnered well together and that gave us a working relationship from the start, which continues today. One of our current projects is that we are working on trying to create a business symposium that would be part of the Heritage and would take place the same week. Boeing and RBC would be sort of the headliners there and the event would involve tourism and other industries around the state. I think PRT and Commerce will head up the event. We will invite not only people doing business in the state, but also people thinking about doing business here, which I believe will be some great exposure for South Carolina from a marketing standpoint. SCEDA: Under your leadership, what will be some of the main focus areas for PRT? Parrish: If the rest of the states have single digit growth, I want double digit growth. I mean we should capitalize on the great diversity in product we have from a tourism standpoint. We should show significant growth in an improving economy—that’s how we’re going to measure ourselves. We want heads in the beds, feet on the fairway, and people in the parks. I’ve even heard some other catch phrases beyond those, but we’ll stick with those for now. SCEDA: Please tell us more about how PRT will be marketing the state? Parrish: Out-of-state dollars are always very important for us and we want to keep encouraging people from other states to come visit. However, it’s also just as critical to keep people in the state. For example, if someone from Columbia goes to Savannah instead of Charleston, that’s just as detrimental to our bottom line. PRT will focus some of our efforts on in-state advertising and marketing, particularly in an economy when we’re seeing shorter stays and people not going as far in terms of distance. We’ll spread our marketing both to out-of-state and in-state audiences. Second, we’ll respond to the changes in social media and the Internet. The old way people got their news has changed and that also applies to where they get their information about a vacation. Today, we’re seeing shorter stays and shorter booking times. A family or couple will sit in their den on a Wednesday or Thursday night and look on their I-Pad for the weather forecast for Asheville versus Charleston or Myrtle Beach and say, “Okay, the weather’s nice in take your pick, we’d really like to go there.” Then, they look on there for deals and make the decision just a couple of days before they leave. Oftentimes, they’re looking for last-minute deals on sites like Groupon or Living Social. Even Google is now partnering with Expedia to offer travel opportunities and discounts and is providing some pretty good ones. These emerging booking channels are sort of a force to be reckoned with and we have to make sure our state is part of the equation. We want to take advantage of the ever-changing world of social media and the Internet and how people look at things. It’s our responsibility to stay on top of that. I also want to put more focus on our state parks, particularly for our in-state residents as well as visitors coming from outside the state. We have some of the most beautiful state parks in the country and a huge diversity. I sometimes think we take our 47 state parks for granted as a state. For instance if you live in Charleston, you don’t go to Fort Sumter or the historic district, but sometimes just assume that it’s there and take it for granted. The phenomenal thing is that visiting our state parks doesn’t cost a lot of money and they are a great value for travelers who watch their vacation dollars. We are upgrading our state parks website right now to increase exposure. In addition, we have SavorSouthCarolina.com, which is sort of our food website. Culinary tourism has taken on a life of its own and is seeing big growth. We have wonderful restaurants throughout the state, particularly Charleston is known as kind of a regional cuisine destination. SCEDA: What trends are you seeing in tourism as South Carolina begins to recover from the affects of the national recession? Parrish: One of the trends is that gas prices have dropped tremendously over the last 60 days. The price reduction is excellent for our summer drive traffic, which is critical since summer is our busiest time. In particular, the lower gas prices have been a tremendous benefit for the coastal areas as well as the Upstate and Greenville. It wasn’t long ago that the media was telling us we needed to worry about $5 per gallon gas and now we are closer to $3 per gallon. We are a drive state and about 80 percent of our tourists, both corporate and personal, are coming in by car, so gas prices have a huge effect. SCEDA: I understand that PRT is visiting some major markets to promote the state. Could you please tell us more about that effort? Parrish: From a PR standpoint, we have recently gone into New York and Atlanta doing media events and hosting travel writers to expose them to the state. In our marketing plan for next year, we’re going into Chicago and Washington, D.C. I believe that Chicago is particularly important now since there are direct flights on Southwest into Greenville and Charleston. BMW and Boeing have a presence there—we have a lot of links to Chicago, so we want to take advantage of it and get as much exposure there as we can. SCEDA: How do you see PRT working with the economic development community? Parrish: I think if an economic developer is working on a tourism-related project, we’ll walk it all the way through, working with Commerce. If it’s a non-tourism-related project, we want to be involved early on in the process to make sure every prospect has a great visit to the state. Bios
SC Department of Commerce Amy Love, Marketing and Communications Director Education: BA from Furman University Masters in Public Relations from USC Past Experience: Deputy Director, New Carolina, Class of 2012 South Carolina Liberty Fellow
Jennifer Noel, Director Global Business Development Education: BS and Masters Degrees from USC in Business Development Past Experience: VP of Marketing, Upstate Alliance, Erwin Penland, Community Representative and Research Manager at the SC DOC Mandy Brawley, Project Manager, SC DOC Education: BS University of Mississippi, Business Administration Past Experience: Biloxi Chamber of Commerce and 4 years of pharmaceutical sales Warren Darby, Project Manager, SC DOC Education: BA from Clemson University Past Experience: VP of Operations for Atlantic Publication Group 2010-2011 Sponsors
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Upcoming Events 2011 Institute Program--Business and Industrial Recruitment August 11-12
SCEDA August Membership Meeting August 25
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