By eTN Editor
Created 1 Mar 2015 – 10:24pm
(eTN) – Recently, eTN caught up with Tom Garzilli, Senior Vice President of Global Marketing at Brand USA. In a series of talks, eTN had the opportunity to discuss what Brand USA is doing today. This portion of the interview discusses Brand USA funding and partnerships.
eTN: Hello, Tom, and thank you for taking the time to speak with eTN.
Tom Garzilli: My pleasure.
eTN: Could you talk a little bit about your objectives on the European market, and maybe a little bit about Brand USA? Specifically, could you talk about your matching funding policy – how this works? I know that most of the funding you’re getting is from what many in Europe call the entry fee into the United States when travelers pay for and are on a visa waiver. Is this the money Brand USA has as its marketing dollars?
Tom Grazilli: How we work is this funding mechanism was created with the Travel Promotion Act of 2010 and the creation of ESTA [Electronic System for Travel Authorization]. ESTA is an automated system implemented by the Department of Homeland Security in 2008 that determines the eligibility of visitors from 38 international markets to travel to the United States under the Visa Waiver Program (VWP). ESTA authorizations are generally valid for multiple trips over a period of two years or until the traveler’s passport expires, whichever comes first.
No US taxpayer dollars are used to fund Brand USA’s marketing efforts. Instead, the organization is supported by contributions from partnering organizations that are matched by fees paid by international travelers to the Electronic System for Travel Authorization program.
So from all the visa waiver countries, if you’re in a visa waiver country, you have to go thru ESTA to register, and you pay a $14 fee every two years. From that $14 fee, $10 of it goes into a fund for Brand USA, and we can tap into up to $100,000,000 a year from that fund. But in order to release any of that fund, we have to first raise matching contributions in the form of cash or in-kind contributions from our partners. So, ultimately 50% of the funding comes from the ESTA fee, and the other 50% comes from contributions from our stakeholders.
Is it common practice for countries to charge a fee to international travelers?
Yes. In fact, the $14 fee for eligible travelers who come to the United States under the Visa Waiver Program is significantly lower than what travelers pay to visit other countries. To put this in perspective, it’s important to note that on average other countries charge entry and/or exit fees of nearly $60 per traveler per visit — usually attached to taxes and fees on travel purchases such as airline tickets. Some of these fees are as high as $150 per traveler. In contrast, the $14 ESTA fee covers travelers from VWP markets for a period of up to 2 years regardless of the number of visits these travelers make to the USA.
eTN: Your stakeholders, for the most part, is from the private industry in the United States?
Grazilli: Yes, it’s primarily the combination of destinations of the CVBs [convention and visitors bureaus] and the states’ private industry – the attractions, hotels, airlines, and yes, primarily the private industry as a whole.
eTN: How do you make sure that not only the Starwoods, and the Marriotts in the world get a fair chance to be a part of promoting the USA overseas? In other words, how do small hotels, DMCs [destination management companies], and tour operators selling to the overseas market take advantage of teaming up with Brand USA?
Grazilli: This is a big part of our mission. Obviously the big partners and the big players are very interested in what we are doing, but just as much, the smaller partners both in the private and public sectors really count on us to bring value to them and help them in the international markets. We play a very big role in helping them do that, and in fact we just did our recent partner survey. We did about 50 hours of interviews with about 67 partners talking learning about what value they are receiving from us. Especially the smaller partners, they look to us to really help them in their various markets, and so we do that in a lot of ways.
We have an infrastructure in place here to really work very directly with all of our partners at all levels. It just depends on the market they are interested in and the kind of media they are about to participate in. In a lot of cases they just need us to help them with resources. They need us to help them have market-ready programs.
For smaller destinations, it’s interesting, because we always also have another question that often comes up, which is, how do we chose which markets to focus on? We always talk about the difference between established and emerging markets. And in the end, that is a very subjective thing, depending on the destination that you are or the hotel that you are. What is one person’s emerging market is another person’s established market. So, we are really in lots of markets and just trying to help whatever partners want to work with us in whatever markets they are in.
In the last two years, we went from about 50 partners in our first year to over 400 partners this year, and we’ll get hopefully be at around 500 by the end of this year. So, obviously Brand USA is taking in far more than just the big guys, whom of course we love having, but they are just a portion of our list of partners.
eTN: Thank you, Tom. Now, let’s move onto a topic near and dear to eTN’s heart – Hawaii tourism.
Stay tuned for the next portion of the interview with Tom Grazilli of Brand USA.
Source URL: http://www.eturbonews.com/56008/brand-usa-where-does-funding-come-and-who-are-its-partners
