Destination Development and
Institutionalization Strategies
In the OIC Member Countries
34
Table 2: DMO Funding Sources112
Amsterdam Marketing Barcelona Consortium of Tourism Granada DMO South Tyrol DMOs
Public Funding
Membership Fees
Commercial Activities
Revenue
Public Funding
Membership Fees
Commercial Activities Revenue
Public Funding
Industry Support of Activities
Public Funding
Membership Fees
Source: DinarStandard
Funding for Amsterdam Marketing, in Holland, comes from the city of Amsterdam, membership fees and
commercial activities such sales revenue from books and maps at their visitors’ centers as well as the
Amsterdam City Card that gives tourists access to transportation and museums.113
In Spain, the Barcelona Consortium of Tourism, which promotes and markets the city of Barcelona and
was founded in anticipation of the Olympic Games, gets public funding raised through hotel stay taxes in
addition to getting membership fees and revenue from product sales. 114
Funding for Tour Granada is provided through the Granada provincial government, however, some
activities are supported through contributions from the tourism industry, such as hotels providing
accommodation for familiarization tours groups, tour agencies providing guides, and food and beverage
outlets providing meals.115
In Italy, the South Tyrol government had to reverse its “voluntary” approach for funding DMOs through
membership fees and institute a lodging tax paid by tourists to fund the activities of destination
management organizations since membership in the local tourism organizations is not mandatory thus
was not sufficient to ensure sustainable funding of DMOs in the region.116
A recent study by Destination Marketing Association International (DMAI), the “2015 DMO Organizational
and Financial Profile Study” which consisted of a survey of 246 DMOs from the United States, Canada and
Bermuda, indicated that almost 90%of funding of small (less than $1M) andmedium sized ($1-5M) budget
DMOs came frompublic sources. The main source of public funding was hotel room taxes, which accounted
for 73% of total public investments made available to DMOs, with more than 87%of DMOs receiving funds
from it. 14% of DMOs also mentioned receiving public funds from district tourism improvement and
voluntary assessments. Other sources of public funding include restaurant taxes, state, city and province
funding. With respect to private sources of funding, 39% of all DMOs mentioned getting revenues from
paying members, with 60% of the larger (more than $5M) budget DMOs citing getting revenues from
memberships. On average, advertising revenues represented almost 25% of all private revenue of the
surveyed DMOs, while membership revenues consisted 16% and partnership revenues 12%. Other
sources of private funding mentioned by surveyed DMOs included corporate sponsorships, event hosting,
publication sales and service fees.117
It is important to note that the legal form of DMOs can affect the funding sources available to them, with
governmental DMOs mainly depending on public funding raised through hotel taxes and user fees, while
112 For more information on the mentioned DMOs, please refer to the case studies chapter.
113 Interview with team member of Amsterdam Marketing.
114 Interview with team member of Barcelona Activa.
Interview with team member of Tourism Planning and Development, Patronato Provincial de Toursimo de Granada.
116 Please refer to Italy’s case study for more information about DMOs in South Tyrol.
117 Destination Marketing Association International (2015). DMO Organizational and Financial Profile Study. 1-40