China Fiscal Year Advertising ROI Report. January 2017

Transcription

1 China Fiscal Year Advertising ROI Report January 2017

2 Contents Section Page Background & Objectives 3 China Methodology 4 Insights: Overall 5 China Economic Climate 7 Advertising Campaign 8 Advertising Recall & Creative Ratings 9 ROI Wave Detailed Findings 16 Trip Specifics 26 Appendix: Rental Cars 35 Appendix: Incremental Travel & ROI Methodology 37 Appendix: Questionnaire 39 2

3 Background & Objectives In spring 2016, Visit California (VCA) ran TV, digital, out-of-home, social media, and Brand USA co-op advertising in China. VCA again invested marketing dollars in Beijing, Shanghai, and Guangzhou and added Chengdu and Shenzhen as target markets. The TV ad was the China Dreamers Revise brand spot. The digital advertising included Dream365TV banners and videos and Chinese New Year banners. The out-of-home campaign consisted of Dream365TV videos. The social media campaign included KOL posts & Youku Video links, including Dreamers, Dream Eater, and Always in Season. The Brand USA co-op consisted of Wanda Cinema ads. VCA partners with Strategic Marketing & Research Insights to conduct research that measures the level of California travel attributable to the advertising and calculates return on the investment. The research also explores travel behavior and gathers information to assist VCA in refining future marketing efforts in China. 3

4 China Methodology The survey was conducted online, with actual advertising shown to measure advertising recall. The interviews were conducted from December 5 th to December 14 th, In total, 1,985 surveys were completed in the five Chinese markets. Respondents qualified by being at least 18 years old, having taken a leisure trip to the U.S. in the past 2 years or are likely to visit in the next 2 years, and are involved in the travel decision-making process in their household. 591 respondents had visited California in the past year. A large number of visitors were collected to allow analysis of trip specifics and marketing implications. The data were weighted to reflect a representative level of California travel when measuring advertising impact. 961 respondents were categorized as the culinary target audience. Market Completed Surveys Beijing 490 Guangzhou 427 Shanghai 624 Chengdu 194 Shenzhen 250 Total 1,985 4

5 Insights: Overall VCA invested $5.1 million on the fiscal year China advertising. This is the second-highest individual country media spend, behind the US investment. VCA added two Chinese target markets Chengdu and Shenzhen in addition to the existing target markets of Beijing, Guangzhou, and Shanghai. The China campaign consisted of revised Dreamers TV/OTV (brand) ads, Dream365TV digital and out-of-home ads, social media ads, and a Brand USA co-op that aired in cinemas. The social media advertising had the highest awareness (67%), followed by Dream365TV digital (61%) and Dreamers TV/OTV (53%). Overall, 77% of Chinese consumers were aware of the advertising campaign. The advertising ultimately influenced California travel, resulting in an ROI of $150 for each $1 invested, up from a $98 ROI in calendar year The advertising had the greatest impact in Shanghai. No incremental travel was generated in the new Chengdu market. It may take multiple campaigns for the ads to wear in and influence travel there. The ads did influence travel from the other new market (Shenzhen), but the impact was lesser than in the established markets. Again, ad influence is likely to build over time. Success was driven by achieving strong advertising awareness and overlap with near-universally appealing creative. Awareness of a single campaign, including the Dreamers TV/OTV ads, is not enough to generate incremental travel. The opportunity for VCA is to continue to balance the use of TV/OTV to generate reach and build the brand, while using more targeted efforts to build overlap and impact. The advertising not only influenced travel, but it also led to more active, fulfilling trips and more social media advocacy. Chinese visitors are motivated by many activities, including scenery, beaches, urban sightseeing, historical sites, parks, unique restaurants, museums, Hollywood, zoos/aquariums, festivals, and luxury shopping. Activities with strong niche appeal include taking kids to the beach, adventure activities, and snow sports. 5

6 Insights: ROI Calculation Calendar Year 2015 Fiscal Year Insights Adding Chengdu and Shenzhen as target markets resulted in a larger household base Total Qualified HHs 12,605,404 17,414,204 from which to assess advertising impact. Ad Recall 85% 77% VCA refreshed the China advertising campaign and targeted two new markets in fiscal year , which led to a lower awareness percentage (as new creative takes time Ad-Aware HHs 10,725,968 13,380,239 to reach consumers and generate recall), but there were more ad-aware households. Travel Increment (Ad-Influenced Travel) 1.2% 1.5% The fiscal year China ads were impactful and generated a stronger travel increment than in Adjustment 93% -- In 2015, incremental trips were adjusted down to account for higher rates of California travel in the sample as compared to the general population. No adjustment was needed in the fiscal year calculation. Incremental Trips (Ad-Influenced Trips) 123, ,864 The fiscal year China advertising generated about 201,000 California trips. This marks a 62% increase compared to the number of trips generated in calendar year Average California Trip Expenditures $3,688 $3,831 Average California visitor spending is up compared to the prior measurement, despite a slowing Chinese economy. Ad-Influenced Visitor Spending $456,580,322 $769,567,845 Higher average visitor spending and more ad-influenced trips led to more economic Ad-Influenced Tax Revenue $29,220,891 $48,790,601 impact and tax revenue. Media Expenditures $4,647,318 $5,147,198 VCA increased media spending on the refreshed campaign. ROI (Total Visitor Spending ROI) $98 $150 Ultimately, the fiscal year China advertising returned $150 in visitor spending and $9 in tax revenue for each $1 invested. These ROI figures are notably higher than they were for the calendar year 2015 campaign, especially positive given General Fund ROI (Tax ROI) $6 $9 a new campaign, new target markets, and a somewhat challenging economic situation. 6

7 China Economic Climate One challenge facing VCA is the state of the economy in the non-domestic target markets most notably the weakness of the Canadian dollar and a deep recession in Brazil. China s economy has been growing at its slowest pace in three decades, but at the time of this research the country has avoided a full-fledged recession. The chart below shows that there is some indication of Chinese travelers cutting back. However, the current situation is similar to last year and by way of comparison is less dire than in Canada, where we see between 20% and 25% of leisure travelers intending to alter their plans. 9% 7% 11% 10% 8% 7% Very likely Certain 3% 3% 3% 3% 3% 3% You will spend less money on leisure travel than last year You will choose destinations closer to home than last year You will take fewer leisure trips than last year 7

8 Advertising Campaign In total, VCA spent $5.15 million on the fiscal year China advertising campaign. This is the media expenditure figure that will be used to calculate ROI. VCA spent about 11% more in fiscal year than in calendar year The brand TV/OTV Dreamers Revise advertising received the largest portion of the fiscal year investment. OTV spending was increased by 36%, while TV spending was reduced by 13%. VCA also reduced digital advertising spending in fiscal year compared to calendar year 2015, but added out-ofhome and social media advertising. The fiscal year campaign includes ads focused at specific audiences namely Dream Eater and Always in Season digital, which target culinary travelers Fiscal Year % Change TV $1,678,900 $1,466,869-13% OTV $1,602,139 $2,183,537 36% Digital $966,279 $678,697-30% Brand USA Co-Op $400,000 $300,000-25% Out of Home $0 $366,057 Social Media $0 $152,038 Total $4,647,318 $5,147,198 11% 8

9 Advertising Recall & Creative Ratings

10 Advertising Recall: TV, Digital, Total More than three-quarters of Chinese target households are aware of the VCA fiscal year advertising. The TV/OTV advertising reached 53% of Chinese households, while the digital advertising reached 61%. Awareness of the individual media is similar to previous waves, but overall awareness is down a bit which indicates more overlap. Awareness by Media 61% 59% 60% 61% 53% 49% 81% 85% TV/OTV Digital Any Fiscal Year % 10

11 Advertising Recall: Trending 81% Any Ad Recall 85% 77% Calendar Year 2014 Calendar Year 2015 Fiscal Year Households 12,093,076 12,605,404 17,414,204 Any Ad Recall 81% 85% 77% Calendar Year 2014 Calendar Year 2015 Fiscal Year HHs with Ad Recall 9,795,391 10,744,553 13,380,239 The use of a refreshed campaign resulted in an awareness decline compared to calendar year 2015 (85% to 77%). The addition of two target markets resulted in more traveling HHs compared to calendar year 2015 (12.6 million to 17.4 million). Despite a lower awareness percentage, the larger household base led to a 25% increase in ad-aware households compared to calendar year

12 Advertising Recall: Campaigns Fiscal Year Recall by Campaign 53% 61% 45% 67% 59% 20% China Dreamers Brand TV/OTV Refresh Wanda Cinema Brand USA Co-op China Dream365TV Digital Video & Banners Out-of-Home Social (KOL posts & Dream365TV Video Youku Video links - Dreamers, Dream Eater, Always in Season) Sun Nan ads The social media initiatives, which include several posts and videos, achieved the highest awareness. The brand TV and Dream365TV digital initiatives also had relatively high awareness. VCA invested relatively heavily in the Sun Nan ads/videos, and positively, this content reached 59% of consumers. 12

13 Creative Ratings Sentiment: Brand TV/OTV Brand TV/OTV Reaction 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 1% 1% 1% 1% 14% 10% 7% 20% 85% 89% 2015 Fiscal Year % Fiscal Year No Recall 92% Fiscal Year Recall Negative Neutral Positive The fiscal year brand TV/OTV advertising received mostly positive reactions and a greater percentage of positive reactions than the prior year s brand advertising. Those who saw the brand ads before taking the survey are more likely to react in a positive manner. 13

14 Creative Ratings Sentiment: Digital Ratings by Awareness 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 1% 1% 3% 2% 2% 2% 8% 11% 11% 26% 31% 33% 74% Dream365TV No Recall 91% Dream365TV Recall Response to Digital Ads by Awareness 66% Dreamers Sun Nan No Recall The Dream365TV, Dreamers Sun Nan, and Dreamers in total ads all receive a more positive reaction among the consumers who are seeking this type of content. 87% Dreamers Sun Nan Recall 65% Dreamers Total No Recall 88% Dreamers Total Recall Negative Neutral Positive 14

15 Creative Ratings Sentiment: Campaign Sentiment by Target Dream Eater & Always in Season Reaction 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 1% 1% 16% 10% 15% 11% 83% 2016 Dream Eater (Overall) 89% 85% 89% 2016 Dream Eater (Affluent Target) 2016 Always in Season (Overall) 2016 Always in Season Affluent Target) Negative Neutral Positive The Dream Eater and Always in Season campaigns receive mostly positive reactions among the total audience, and an even greater portion of positive responses among the affluent target. 15

16 ROI Wave Detailed Findings

17 Fiscal Year Incremental Travel & Influenced Spending Beijing Guangzhou Shanghai Chengdu Shenzhen Total Total Qualified HHs 4,521,566 2,457,710 5,626,129 2,767,902 2,040,897 17,414,204 Ad Recall 76% 76% 77% 78% 78% 77% Ad-Aware HHs 3,445,003 1,877,086 4,310,930 2,146,234 1,600,987 13,380,239 Travel Increment (Ad-Influenced Travel) Incremental Trips (Ad-Influenced Trips) Average California Trip Expenditures Overall, the fiscal year China advertising generated a 1.5% travel increment, with the greatest impact realized in Shanghai. The ads also influenced travel from all other cities except Chengdu, which was a new market this year. It may take multiple campaigns for the ads to wear in and influence travel in this market. The travel increment translates to about 201,000 ad-influenced trips. 1.7% 1.5% 2.3% 0.0% 0.9% 1.5% 58,557 28,095 99, , ,864 $3,831 $3,831 $3, $3,831 $3,831 Ad-Influenced Visitor Spending $224.3 million $107.6 million $382.1 million $0 $55.5 million $769.6 million Using a 12-month average exchange rate, the ad-aware China visitors spent $3,831 on their California trips which equates to a total of about $770 million in ad-influenced visitor spending. 17

18 ROI Compared to Prior Year The fiscal year VCA advertising in China ultimately returned $150 in visitor spending and $9 in tax revenue for each $1 invested. Compared to the prior measurement, more ad-aware households, a larger travel increment, and higher average visitor spending in fiscal year led to more ad-influenced visitor spending and tax revenue. ROI and tax ROI are up notably despite higher media expenditures. It should be noted a slightly lower tax rate was used this year (6.34% vs. 6.4%). Calendar Year 2015 Fiscal Year Total Qualified HHs 12,605,404 17,414,204 Ad Recall 85% 77% Ad-Aware HHs 10,725,968 13,380,239 Travel Increment (Ad-Influenced Travel) 1.2% 1.5% Adjustment 93% -- Incremental Trips (Ad-Influenced Trips) 123, ,864 Average California Trip Expenditures $3,688 $3,831 Ad-Influenced Visitor Spending $456.6 million $ million Ad-Influenced Tax Revenue $29.2 million $ 48.8 million Media Expenditures $4,647,318 $5,147,198 ROI (Total Visitor Spending ROI) $98 $150 General Fund ROI (Tax ROI) $6 $9 18

19 Historical ROI Incremental Trips (Ad-Influenced Trips) Average California Trip Expenditures Ad-Influenced Visitor Spending Ad-Influenced Tax Revenue Fiscal Year , , ,864 $3,050 $3,688 $3,831 $334 million $457 million $ million $23 million $29 million $ 48.8 million Media Expenditures $3,500,331 $4,647,318 $5,147,198 ROI (Total Visitor Spending ROI) $95 $98 $150 General Fund ROI (Tax ROI) $7 $6 $9 The fiscal year China ROI is up considerably compared to the past two years, driven by reaching more households, generating a stronger travel increment and more ad-influenced trips, and higher average visitor spending. 19

20 Ad-Influenced Spending by Region $122.8 $115.1 $113.8 San Francisco Bay Total Ad-Influenced Spending Allocation Across Regions (millions) Los Angeles County Central Valley $102.8 Central Coast $69.2 High Sierra Total ad-influenced spending = $770 million $48.6 $48.4 Desert North Coast $41.0 San Diego County $33.3 $32.6 Gold Country Inland Empire $26.9 Shasta Cascade $15.0 Orange County Region Ad-Influenced Spending San Francisco Bay $122,844,619 Los Angeles County $115,112,411 Central Valley $113,828,514 Central Coast $102,819,593 High Sierra $69,179,368 Desert $48,609,751 North Coast $48,392,426 San Diego County $41,019,682 Gold Country $33,257,986 Inland Empire $32,649,209 Shasta Cascade $26,890,623 Orange County $14,963,663 Total $769,567,845 San Francisco and Los Angeles have the highest rates of visitation and the longest stays, so naturally they also have relatively large pieces of the ad-influenced travel revenue pie. As seen in the previous China ROI studies, Chinese visitors have relatively high rates of travel to the Central Valley and Central Coast, making these two regions the second tier in terms of ad-influenced spending. 20

21 Ad-Influenced Spending by Industry Category $235.6 Total Ad-Influenced Spending Allocation Across Industries (millions) Total Accommodations, $148.0 Inn/B&B, $34.0 Homeshare, $29.9 Hotel/Motel, $84.1 Shopping Accommodations Meals/ food/ groceries $98.0 $90.5 Total ad-influenced spending = $770 million $74.0 $72.1 Attractions Entertainment In-State Travel (other than rental car) $51.4 Car Rental Industry Category Ad-Influenced Spending Shopping $235,600,730 Meals/food/groceries $98,042,864 Attractions $90,521,549 Accommodations - Hotel/Motel $84,067,482 Entertainment $73,954,503 In-State Travel (other than rental car) $72,105,185 Car Rental $51,387,533 Accommodations - Inn/B&B Accommodations - Homeshare $34,036,511 $29,851,488 Total $769,567,845 Shopping accounts for the largest portion of ad-influenced travel revenue, followed by accommodations, food, and attractions. The accommodation type spending is estimated based on the percentage of nights spent in each. 21

22 Impact by Campaign With five total campaigns, it is not possible to isolate the impact of each. We can review California travel by awareness of each, but this does not account for overlap. For instance, someone aware of the Brand TV/OTV ads could also be aware of any of the other campaigns. What this chart does suggest is that all of the individual campaigns influence California travel above the baseline (unaware) level of travel. The Brand USA campaign seems to be particularly impactful, but it is important to remember that this campaign had relatively low awareness and that those aware of this campaign are likely to have seen at least one other campaign. 1.0% Unaware Visited California by Campaign Awareness 2.5% China Dreamers Brand TV/OTV Refresh 5.4% Wanda Cinema Brand USA Co-op 2.5% China Dream365TV Digital Video & Banners 2.9% 2.9% Out of Home Dream365TV Video Social (KOL posts & Youku video links - Dreamers, Dream Eater, Always in Season) 22

23 Brand Campaign Impact Visited California 2.4% 1.0% 1.1% Unaware Aware of Only China Dreamers Brand TV/OTV Refresh Ads Aware of other ads Here we see that the brand TV/OTV ads in isolation have a minimal impact on California travel. This suggests that the ads designed to build the brand have a less immediate impact on California travel than the supporting, more action-oriented ads. In other words, it is important to both build the brand and spur more immediate action. 23

24 Media/Campaign Overlap Impact Exposure to at least three campaigns is required to generate a notable travel increment (at least 1%). And impact increases notably when consumers see four or five of the campaign campaigns. 38% of consumers are aware of at least four campaigns. This helped VCA to generate the 1.5% total travel increment. The opportunity for VCA is to balance the use of mass media (TV) that generate reach and build the brand while using more targeted efforts to build overlap and impact. % Visited California by Number of Campaigns Seen 3.1% 5.8% Aware of 3 Campaigns, 19% Aware of 4 Campaigns, 35% Aware of 2 Campaigns, 11% 38% aware of 4 or more campaigns 1.0% Unaware 1.4% 1.4% Aware of 1 Campaign Aware of 2 Campaigns 2.0% Aware of 3 Campaigns Aware of 4 Campaigns Aware of All 5 Campaigns Aware of 1 Campaign 10% Unaware, 23% Aware of All 5 Campaigns 3% 24

25 Impact by Target Consumers Affluent Target California Travel 3.7% 2.0% 1.1% 0.8% Culinary Target California Travel 4.4% 3.0% 1.3% Affluent Target Unaware CA Travel Others Aware CA Travel Unaware Aware of Dream Eater or Always in Season Ads Aware of ads, but not Dream Eater or Always in Season VCA has two specific target groups: affluent (180,000 RMB or more annually) and culinary (participate in culinary activities while traveling). The charts here show that: First, the ads have a greater impact on the affluent group than on other Chinese consumers. Second, the impact among the culinary targets is greater when they see the culinary-focused campaigns of Dream Eater and Always in Season. This again highlights the importance of utilizing targeted campaigns to generate travel. 25

26 Trip Specifics

27 Trip Specifics: Trip Planning Considered 1 st When Planning CA Trip Ad Impact on 1 st Consideration 30% 39% 29% 1% 1% Started with desired destination in mind Started by considering specific activities you wanted to do Started with the idea of a certain type of vacation experience Considered another destination first Don t know/not sure Someone else planned this trip 1% 2% 1% 2% 0% 0% 39% 36% 29% 38% 30% 22% Aware Unaware About 4 in 10 Chinese visitors first decided that they wanted to visit Callifornia rather than first choosing an activity or type of vacation. It is interesting to note that the ad-aware visitors are more likely to start by considering the destination or with the idea of a certain type of vacation experience which suggests that ads are building the California brand through the experiences that they promote. 27

28 Trip Specifics: Length of Stay & Lodging Ad Impact on Length of Stay Ad Impact on Paid Accommodations & Type % 96% 85% 83% 40% 53% 31% 44% Nights in CA Nights in paid accommodations Used paid accommodations Stayed in hotel Stayed in inn or B&B Stayed in homeshare Unaware Aware Unaware Aware The ads have a positive impact on length of stay. Almost all Chinese visitors use paid accommodations, so the ads don t have an impact on general use of paid accommodations. But the ads do influence usage of specialty lodging like B&Bs or homeshare. 28

29 Trip Specifics: Regions Visited % Chinese Travelers who Visited Each Region 18% 11% 13% # regions visited Mean Total 2.8 Aware 2.9 Unaware 2.0 Nights in Paid Accommodations (among visitors to each region) Average # Share San Francisco Bay % Central Valley % Los Angeles County % Shasta Cascade 2.1 4% 38% 26% 36% 36% 36% 11% 20% 20% 14% North Coast 2.0 7% Central Coast % High Sierra 1.7 8% Gold Country 1.6 4% San Diego County 1.6 6% Inland Empire 1.5 4% Desert 1.4 5% Orange County 1.1 2% 29

30 Top Motivating Activities: Ideal for broadly targeted brand ads The top trip motivators have both high participation rates and high motivation rates (mass appeal and mass motivating power). CHINA FY Top Motivating Activities Viewing and enjoying natural scenery such as beaches, oceans, mountains, etc. Participated Motivated by (of participants) 37% 52% Going to the beach 37% 41% Urban sightseeing 36% 35% Visiting historical sites 34% 40% Visiting a theme or amusement park 34% 48% Dining at a unique local restaurant(s) 34% 31% Visiting state or national parks 31% 34% Visiting museums, science centers or exploratoriums 27% 38% Hollywood/celebrity sightings 27% 45% Visiting a zoo or aquarium 25% 33% Attending a culinary festival or event 24% 30% Luxury shopping 24% 29% 30

31 Niche Motivating Activities: Good options for highly targeted advertising Niche motivators have relatively low participation rates, but relatively strong motivation. CHINA FY Niche Motivating Activities Participated Motivated by (of participants) Taking kids to the beach 21% 39% Adventure activities such as whitewater rafting or rock climbing 14% 36% Snow sports activities such as skiing or snowboarding 11% 38% 31

32 Trip Specifics: Other Activities & Ad Impact These activities offer less potential for advertising application and are best left for promotion by partners or other outlets such as the website. Activity/Attraction Participated Motivated by (of participants) Shopping at a mall 41% 23% Shopping at a unique local shop 32% 14% Shopping at an outlet mall 31% 22% Visiting a winery or wine regions 29% 27% Dining at a celebrity/notable chef's restaurant 26% 22% Night life 25% 21% Visiting museums and other visual arts venues 24% 22% Driving on scenic byways or roads 23% 28% Exploring neighborhoods or small towns 21% 23% Going to a farmers market 20% 16% Visiting a microbrewery 19% 20% Exploring farm tours or farm trails 19% 21% Visiting a high-end resort 18% 13% Attending performing arts events (theater, dance, etc.) 17% 20% Attending a live music event, concert or festival 16% 23% Water sports activities such as surfing, paddleboarding or boating 16% 19% Visiting a spa or wellness center 16% 16% Hiking or camping 15% 22% Road/trail sports activities such as biking, cycling or running 14% 27% Participating in a VIP tour or experience 11% 8% Gambling 11% 26% Attending a live sporting event 10% 23% Golfing 8% 19% # Activities on CA trip 4.8 Unaware 9.3 Aware The ads not only drive visitation, but they also give visitors ideas of things to do, which leads to more active, satisfying trips and more spending. 32

33 Trip Specifics: Trip Rating Top 2 Box Trip Rating 89% 88% 85% 85% 85% 84% Top 2 Box Trip Rating 81% 90% 89% 83% 86% 77% 85% 85% 86% 80% 85% 72% Unaware Aware Overall, California visitors are satisfied with their trips. The ad-aware visitors rate all aspects of their trip higher (except for transportation, which makes sense that the ads would not influence this). We previously reviewed that the ads led visitors to do more stuff on their trips. These more active trips are more satisfying, so the ads are leading to better California trips. 33

34 Trip Specifics: Social Sharing & Advocacy Ad-aware visitors have more active, satisfying trips. They also share more about these trips and are more likely to recommend and return to California. 98% Impact of Ads on Social Sharing & Other Advocacy Measures 83% 61% 73% 31% 54% 17% 27% 25% 44% 10% 19% 23% 33% 10% 20% 58% 65% 64% 38% Any social sharing WeChat Weibo DianPing Youku Douban Facebook Instagram Very likely to return to CA Likelihood to recommend Shared on Unaware Aware (Top 3 box) 34

35 Appendix: Rental Cars

36 Rental Cars Among Ad-Aware Visitors Primary Mode of Transportation $573 Transportation within California (minus fuel) Rental car 23% Taxi, 15% Airplane, 35% Private bus/tour bus 7% Personal car/truck 7% Uber/Lyft/other shared service, 5% Public bus 3% Train above ground 2% Limousine/ private car 2% Spending among Those Who Rented Car $380 Gas/fuel $953 Total Transportation 49% Rental Car Usage 23% Car Rented was Car Primary on Trip Mode of Transportation on Tr $498 Rental Car Avis Advantage Budget Fox Hertz Enterprise E-Z Rent a Car Midway National TravCar Payless The advertising influenced $51.4 million in rental car fees. # Days Rented Car in California 5-6 days, 31% 3-4 days, 27% Rental Car Brand Used 5% 4% 7 days, 13% 8+ days, 16% 2 days 12% 24% 21% 19% 16% 13% 10% 9% 9% 1 day 1% 31% 36

37 Appendix: Incremental Travel & ROI Methodology

38 Methodology: Incremental Travel & ROI Review Incremental travel is the key measure in assessing advertising impact and ROI: People would visit California even if there was no advertising. The level of travel among those who are unaware of the advertising is the baseline the level we assume would have occurred anyway. Additional travel among those with ad awareness is attributed to the ads and is considered incremental travel. The level of incremental travel is applied to the quantity of ad-aware households to determine the number of ad-influenced trips. This is multiplied by average trip expenditures to determine the economic impact from the campaign. The economic impact is divided by the media expenditures to determine the return on investment (ROI). The tax ROI is calculated by first multiplying the economic impact by the tax rate (6.34% this year) to produce the tax revenue influenced by the ads. This tax revenue is then divided by the media expenditures to determine the tax ROI. Incremental Travel Example 5.0% Unaware Travel 10.0% Aware Travel % of Total Visitor Spending Local Tax Revenue from Visitors 2.86% State Tax Revenue from Visitors 3.48% Total Visitor Tax Rate to Use 6.34% 5.0% Increment 38

39 Appendix: Questionnaire

40 Questionnaire 40

41 Questionnaire 41

42 Questionnaire 42

43 Questionnaire 43

44 Questionnaire 44

45 Questionnaire 45