RESEARCH, MARKETING,AND INDUSTRY COVID-19 UPDATE

• Opening Comments

• Consumer Sentiment Research Update

• Marketing Update

• Media and Public Relations Update

• Closing Comments

WHAT WE’LL COVER

• Things are really tough

• Unprecedented time in history

• No blueprint or playbook for how best to handle

• Devastating impacts on the travel and tourism sector

• Keeping close tabs on aid and relief, consumer sentiment, and marketing

• Resources on SDVisit.com

OPENING REMARKS

North American COVID-19 BarometerAPRIL 6, 2020 WAVE III

MMGY Travel Intelligence and Destinations International

COVID-19 Update

MMGY Travel Intelligence and Destinations

International Foundation have partnered on an

ongoing survey to monitor the impact of the

coronavirus on destination organizations.

The online survey, designed and analyzed by

MMGY Travel Intelligence, is conducted biweekly

among the Destinations International members.

DMO Organization TypeN=197

90%

8%

2%0%

City/regional tourism organization

State tourism marketing organization

Other type of tourism marketing organization

Other

DMO Organization Population Representation

N=189

25%

29%20%

26% Less than 100,000 Residents 100,000–299,999 Residents

300,000–999,999 Residents 1,000,000+ Residents

DMO Organization Location

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

West Midwest South Northeast Canada Puerto Rico

3/9/2020n=170

3/23/2020n=189

4/6/2020n=197

This is the third of a multiwave study on the impact of the coronavirus outbreak on North American destination organizations. It was in the field from March 30–April 6, 2020.

1. While almost 30% of organizations surveyed are still receiving more than 20 COVID-19-related inquires daily, Wave III represents the first time we’ve observed a decline in the percentage of organizations receiving this level of inquiries – an indication that awareness is more consistent and visitors are likely starting to assume destination businesses are closed in the near-term.

/ Key Findings

Coronavirus-Related Inquiries

0%

10%

20%

30%

40%

50%

Less than 1 1-5 6-10 11-20 More than 20 None

Number of Inquiries3/9/2020n=170

3/23/2020n=189

4/6/2020n=197

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

OtherSchool closures*Medical facilities

Public safety activitiesLodging availability*

Sporting event cancellations*Business meeting cancellations*

Media Inquiries*Conference/convention cancellations*

Attraction closuresRestaurant closures

Hotel closures*Event cancellations

Type of Inquiries4/6/2020n=185

3/23/2020n=179

3/9/2020n=153 * Added 3/23

This is the third of a multiwave study on the impact of the coronavirus outbreak on North American destination organizations. It was in the field from March 30–April 6, 2020.

1. While almost 30% of organizations surveyed are still receiving more than 20 COVID-19-related inquires daily, Wave III represents the first time we’ve observed a decline in the percentage of organizations receiving this level of inquiries – an indication that awareness is more consistent and visitors are likely starting to assume destination businesses are closed in the near-term.

2. 95% of organizations have now either reduced or postponed planned marketing expenditures related to COVID-19 (up from 84% two weeks ago). And, more than 8 out of 10 have shifted sales and marketing strategies or revised or altered their marketing message.

/ Key Findings

Alterations to Normal Organization Business

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Nothing at this time

Diverted sales and marketing budgets to other areas of organization*

Decreased sales and marketing efforts for remainder of year*

Revised or changed marketing message*

Shifted sales and marketing strategies

Reduced/postponed sales and marketing spend

4/6/2020n=197

3/23/2020n=189

3/9/2020n=170

* Added 4/6

3. Destination organizations have remained connected with prospective travelers during this pandemic principally through social media and informational emails. Paid promotional advertising has experienced the sharpest drop, with only 10% of responding organizations indicating that they continue to invest similarly in this marketing channel today. 50 percent of organizations expect to return to paid promotional advertising within the next 60 days. Industry sponsorships and brand activations may be impacted the most over the next 2 months.

/ Key Findings

Marketing Engagement Activities and Expectations*

0%

20%

40%

60%

80%

100%

Paid promotionaladvertising

Paid informationaladvertising

Promotional emailcampaigns

Informational emailcampaigns

Paid searchinvestments

Industrysponsorships or

brand activations

Paid social mediaplacements

Social media postsand updates

Prior to COVID-19 DoingToday

Expecting30 Days

Expecting60 Days

* Added 4/6

Research and analysis conducted by:

Travel Intentions Pulse Survey (TIPS): Impact of COVID-19

KEY FINDINGS – March 27, 2020

TIPS: IMPACT OF COVID-19

The U.S. Travel Association has engaged MMGY to conduct an ongoing survey to monitor the impact of COVID-19 on U.S. travelers. The online survey designed and analyzed by MMGY Travel Intelligence is conducted bi-weekly among 1,200 U.S. residents who have taken an overnight trip for either business or leisure in the past 12 months. The maximum error at the 95% level of confidence for a sample of 1,200 is +/- 2.83%.

Source: MMGY Travel Intelligence

The Likelihood of Taking a Domestic Business Trip in the Next 6 Months Has Declined Materially In Past Month*

Source: MMGY Travel Intelligence

82%

39%

Take a Domestic Leisure Trip(% Top 2 Box; 5-point Scale)

Wave I MMGY Travelhorizons (Feb 2020);n=1,771

% of travelers who say they are likely to travel domestically for leisure in next 6 months

* Among those taking a leisure trip in past 12 months

40%26%

Take a Domestic Business Trip(% Top 2 Box; 5-point Scale)

Wave I MMGY Travelhorizons (Feb 2020); n=1,771

Wave I U.S. Travel Assoc TIPS (Mar 2020); n=1,200

Perceived Safety of....

Source: MMGY Travel Intelligence

10%12%

13%13%13%13%13%

14%14%14%

15%16%16%

17%18%

20%25%

29%40%

68%

International flightsCruises

Trains/railwaysPerformance/movie theater

Indoor concerts/festivalsConferences or conventions

SchoolsDomestic flights

Indoor sporting eventsShopping malls

Bars/restaurantsOutdoor concerts/festivalsOff-site business meetings

Places of worshipOutdoor sporting events

Hotels/resortsVacation rental homes/condos

Grocery stores/supermarketsParks

Personal cars

% Top 2 Box; 5-point ScaleN=1,200

3/27/2020 (benchmark survey)

% of travelers who say they feel safe in each of the listed locations or activities

Business Travelers Generally Feel Safer Traveling Than Leisure Travelers

Source: MMGY Travel Intelligence

0%

10%

20%

30%

40%

50%

60%

70%

80%% Top 2 Box; 5-point Scale

3/27/2020 Overnight Business Travel in Past 12 Mo. (n=583) 3/27/2020 Overnight Leisure Travel in Past 12 Mo. (n=1,169)

% of travelers who say they feel safe in each of the listed locations or activities

Slowdown in Spread of COVID-19 will have the Most Impact on Travel Decisions During Next 6 Months

Source: MMGY Travel Intelligence

29%

31%

32%

33%

35%

36%

46%

46%

47%

Concerns for my job security

Easing of international travel restrictions

Concerns for financial health of employer

Great travel deals

Availability of flights to destinations…

Easing of domestic travel restrictions

CDC reducing risk advisroy level

Slowdown of COVID-19 worldwide

Slowdown of COVID-19 spread in U.S.

Impact on Taking a Business Trip(% Top 2 Box among those who took a business trip in past 12 months; n=567)

3/27/2020

26%

32%

37%

43%

43%

45%

46%

55%

61%

63%

Availability of cruises to destinations…

Concerns for my job security

Easing of international travel restrictions

Availability of flights to destinations…

Concerns for personal financial situation

Great travel deals

Easing of domestic travel restrictions

CDC reducing risk advisroy level

Slowdown of COVID-19 spread in U.S.

Slowdown of COVID-19 worldwide

Impact on Taking a Leisure Trip(% Top 2 Box among those who took leisure trip in past 12 months; n=1,111)

3/27/2020

% of travelers who cite each factor as having an impact on their decision to travel in the upcoming 6 months

Travelers Are Just As Concerned About Family Members Contracting COVID-19 As They Are About Getting It Themselves

Source: MMGY Travel Intelligence

6% 7%

20%26%

36%

1 Not at allConcerned

2 3 4 5 ExtremelyConcerned

For Others in My Household

3/27/2020µ = 3.83

8% 10%

27%23%

32%

1 Not at allConcerned

2 3 4 5 ExtremelyConcerned

For Myself

3/27/2020µ = 3.61

Younger Travelers Are More Likely to Worry More About Others, But They Are Also Concerned About Their Own Health

Source: MMGY Travel Intelligence

68%

64%

62%

67%

18-34 34-49 50-64 65+

For Others in My Householdby Respondent Age (% Top 2 Box)

3/27/2020

56% 58%

49%

59%

18-34 35-49 50-64 65+

For Myselfby Respondent Age (% Top 2 Box)

3/27/2020

Respondent Demographics

Source: MMGY Travel Intelligence

48% 52%

0% 0%

Female Male Transgender Prefer not toanswer

Gender

3/27/2020

25% 24%29%

22%

18-34 35-49 50-64 65+

Age

3/27/2020

70%

9%21%

Married Living w/partner Single

Marital Status

3/27/2020

8%18% 16% 16%

42%

<$25k $25k-$54,999 $55k-$74,999 $75k-$99,999 $100,000+

Household Income

3/27/2020

31%

69%

Under age 18 None

Children in Household

3/27/2020

71%

10% 18%

Employed Not Employed Retired

Employment Status

3/27/2020

Chris Davidson EVP, Insights & StrategyMMGY Travel Intelligence cdavidson@mmgyintel.com

For more information contact:

CONSUMER RESEARCH

$5

-$20

$0

-$5

-$10

-$15

25%

-100%

0%

-25%

-50%

-75%

NATIONAL WEEKLY TRAVEL SPENDING ($ BILLIONS)YEAR-OVER-YEAR % CHANGE

-9%

-33%

-72%-82%

Source: Tourism Economics, “WEEKLY CORONAVIRUSIMPACT ON TRAVEL EXPENDITURES IN THE U.S.”

2/8 2/15 2/22 2/29 3/7 3/14 3/21 3/28

3/7 3/14 3/21 3/28

20%

-80%

0

-20%

-40%

-60%

Northeast Midwest South West

NATIONAL WEEKLY TRAVEL SPENDINGYEAR-OVER-YEAR % CHANGE

-83%-73% -80% -82%

Source: Tourism Economics, “WEEKLY CORONAVIRUSIMPACT ON TRAVEL EXPENDITURES IN THE U.S.”

WEEK ENDING 2/22 2/29 3/7 3/14 3/21 3/28

SD -12% 8% -1% -21% -58% -70%WI -6% -2% -5% -22% -68% -80%ND -2% 3% -7% -19% -53% -68%IA 6% -2% -2% -16% -60% -71%MN -4% -5% -4% -27% -69% -80%WY 0% -3% -3% -11% -58% -67%

REGIONAL WEEKLY TRAVEL SPENDINGYEAR-OVER-YEAR % CHANGE

Source: Tourism Economics, “WEEKLY CORONAVIRUSIMPACT ON TRAVEL EXPENDITURES IN THE U.S.”

Mar Apr May Jun July Aug Sep Oct Nov Dec

Total LossDirect Loss

0

-5

-1

-2

-3

-4

-6

-7

Millions

TOURISM INDUSTRY JOB LOSSES

Source: Tourism Economics, “WEEKLY CORONAVIRUSIMPACT ON TRAVEL EXPENDITURES IN THE U.S.”

NATIONAL

February 19-21 March 13-15 March 20-22 March 27-29 April 3-5

50%

0%

40%

30%

20%

10%

60%

70%

80%

U.S. TRAVELERS - NATIONALTRIPS AFFECTED BY CORONAVIRUS

11.4%

44.3%

64.3% 66.1%72.8%

STR/TOURISM ECONOMICS HOTEL DEMAND FORECAST

-42%

-81%-76%

-65%

-35%

-50%

-18%-14% -13% -12%

-50%

0%

-40%

-30%

-20%

-10%

-60%

-70%

-80%

-90%

2020 2021Mar Jun Jul Aug Sep Oct Nov DecApr May Jan Feb Mar Jun Jul Aug Sep Oct Nov DecApr MayFebJan

Source: Tourism Economics, “WEEKLY CORONAVIRUSIMPACT ON TRAVEL EXPENDITURES IN THE U.S.”

NATIONAL

MONTH OF CURRENT PLANS TO TRAVEL

March April May June July August September October November December I HAVE NOPLANS TOTRAVELIN 2020

I PLAN TO TRAVEL IN 2021

March 13-15 March 20-22 March 27-29 April 3-5

17.8%

25.4%

21.5%

17.6%

13.1%11.5%

23.2%23.1%

NATIONAL

MARKETING EFFORTS

WHAT WE’RE DOING& WHY

• Always-on, Intent-based Efforts (Expedia, TripAdvisor, ADARA + SOJERN Travel Network Targeted Displays)

• Paid Search

• Social

• eMail

• Magazines (already shipped in early Feb.)

* Adjusted calls to action on all to planning related from actionable and immediate that was running. ** Negatively-targeted COVID-19 related keywords

WHAT WE KEPT GOING

31% 2019 South Dakota Arrivals attributed to 2018 marketing efforts.

Prospecting and High Inspiration Efforts

• TV + Advanced TV (2nd flight)

• Prospecting Digital Display + Video

• Direct Mail + Direct Mail Co-op

• Out-of-Home

• Radio + Streaming Audio + Podcast (2nd flight)

• High-Impact Digital (mobile rich media + video)

• Dedicated email

WHAT WE PAUSED

73%FY2020 budget paused for shifting or reallocating to

rebound efforts

REBOUNDCAMPAIGN

Industry Video Available at:https://l-s.sharefile.com/d-s4f2da7f6538447b8

MEDIA & PUBLIC RELATIONS

SOCIAL MEDIA

SOCIAL OBJECTIVEAdapt to a rapidly changing environment and execute specific strategies to promote travel to South Dakota once the pandemic’s effects begin to subside.

We will be honest and we will be empathetic. We will inspire consumers to explore virtually and travel later.

SET-Elevate messaging to encourage people to begin getting out and exploring. -Adjust to add more calls to action in messaging.

READY-Be part of the getaway and travel solution. -Enter the travel & booking conversation.-This is where we begin to test adding CTAs into messaging.

CURRENT-Create an escape.-Launch SOUTH DAKOTA STATE OF MIND campaign.-Stay relevant and top of mind without encouraging travel.-Be empathetic and honest.

SOCIAL MESSAGING STRATEGYLong-Lead Focused, Book Now, and Finally Travel Later

GO-When it’s time to start to travel again, we’ll inspire them with what they have been missing.-We’ll add in specific conversion messaging and campaigns that feel back to our normal tone.

Content Strategy

Change messaging to inspiration and removing actionable language and CTAs.

Instagram Takeovers• Photographers from all over the

state

Emphasize South Dakota partners and their virtual content and experiences

Kids resources, activity guides, virtual tours, etc.

SOUTH DAKOTA STATE OF MIND

PUBLIC RELATIONS

PR STRATEGY IN WAIT STAGEPlan During "In Wait" (Current) Stage

• Canceled Immediate Press Trips: Revising plans for social influencers and media professionals.

• Drive Engagement: Drive engagement with virtual activities, encourage exploring from home while consumers can’t travel.

• Create Aspirational Content: Create content that allows for virtual experiences.

• Continue Thoughtful Dialogue: Stay in touch with our media contacts through thoughtful dialogue.

• Ideas We’re Using: Sunrise yoga in the Badlands, continue as planned with baby bison coverage, cooking workshops, and children’s activity guides.

PR STRATEGYRECOVERY STAGEPlan for Recovery Stage

• Perception: Mold and utilize the perception of South Dakota as a safe destination.

• Affordability: Emphasize South Dakota’s affordability.

• Road Trips: Pitch road trip content to media once curve has flattened and develop itineraries.

• Virtual Press Experiences: When appropriate, discuss remote and virtual meetings and interviews to promote South Dakota. Virtual press trip of sorts.

• Reschedule Visits: Revisit press trips & influencers for fall if possible.

RECENT PR INQUIRIESExamples for Recent Inquiries

• CONDE NAST: Working on a story for “What It’s Like To Be a ____ Right Now.” Journalist is looking to interview people in different industries and how they have been impacted by COVID-19 and their hopes for the future.

• LIQUOR.COM: Writing story about what bartenders are doing to channeling creativity during isolation.

• UNDETERMINED OUTLET: Journalist working on story highlighting companies that have shown acts of kindness during COVID-19.

• THRILLIST: Story on bars offering online cocktail tutorials and similar virtual offerings

WAYS TO ENGAGE

MILE MARKER NEWSLETTER

SDVisit.com/Industry-Enewsletter-Sign

RESOURCES FROM THE DEPARTMENT OF TOURISM

BUSINESS AID AND RELIEF RESOURCES

SDVisit.com/Covid-19/Funding-Resources

CONTACT US

KIRK HULSTEIN

Kirk.Hulstein@TravelSouthDakota.Com

BUSINESS/EVENT POSTPONEMENTS OR

CANCELLATIONS

SDVisit.com/Covid-19TravelSouthDakota.com/Closures

TOURISM INDUSTRY WEBINAR SERIES

SDVisit.com/Training-Hospitality/Webinar-Series

• Keep in close contact with us

• We will need the help of South Dakotans and our media

• Travel and tourism will help stimulate economic recovery

• Encouraging emails from visitors

• We Will Get Through This Together

CLOSING THOUGHTS