YOUR BUSINESS AUTHORITY
Springfield, MO
Changes in the market, in lifestyles and in entertainment are driving SDC's plans for the future.
by Clarissa A. French
SBJ Staff
Silver Dollar City is taking the past into the future with a strategy for tourism-industry success, according to Cary Summers, president and chief executive officer of Silver Dollar City Inc.
Summers addressed a crowd of 85 at the March 24 Breakfast of Champions lecture at University Plaza. His topic was Silver Dollar City, "Where We Have Been and Where We Are Going," an overview of changes in the market, in society and in entertainment that are driving the SDC planning process.
Where SDC has been. Established in 1950 by Pete and Jack Herschend, the attraction that was to become Silver Dollar City started out simply as Marvel Cave, and the business was exclusively cave tours.
By 1960, the company had 17 employees, and the Herschends built their first additional attractions to the cave an ice cream parlor and town square, essentially a place for tourists to wait their turn for cave tours, Summers said.
The explosion began when the Herschends added a train to take people out of the cave. Suddenly the cave had 40,000 visitors a year. The Herschends added a crafts village, street entertainers, rides, food, etc.
The first advertising for the attraction began in 1965, when the name of the venue was changed from Marvel Cave to Silver Dollar City. In keeping with the theme, change was given in silver dollars, Summers said.
But many more changes have occurred since then for SDC and the travel and tourism industry.
The market has changed. Originally SDC, and most other Branson attractions, offered a summer season only, open Memorial Day to Labor Day. In recent years the season has been year-round.
Also, for many years, the entertainment base was exclusively local, centered around groups like the Presleys and The Baldknobbers, Summers said. Now the entertainment market is dominated by national celebrities, and the focus has changed from country/hillbilly music to large-scale live entertainment. Additionally, Christmas-season business is growing every year.
The "60 Minutes" broadcast which launched the Branson boom was a mixed blessing, providing nationwide exposure, but also creating a stereotype of visitors as "blue-haired little old ladies," Summers said.
Other items that have added a twist to the market include 161 percent growth in the room supply, with a resulting drop in occupancy rates from 81.5 percent to 44 percent since 1991, and an initial overconcentration of Branson marketing dollars in motorcoach tours, which in fact comprise only 10 percent of Branson tourism, Summers said.
Regarding the oversupply of hotel and motel rooms, the free market is coming into play. "The good hotel operators made more money than ever last year; the lousy operators" did not, Summers said.
Lifestyles have changed. Since the time SDC began marketing itself in the mid-'60s, people have drastically changed the way they live.
For example, instead of dad working and mom staying home to raise the kids, now both parents work.
In the past, money was tighter but vacations were longer, with two weeks being the norm. Now, people have more disposable income and more leisure time, Summers said, however, they perceive that they have less time, and they are plagued by stress. The average vacation has shrunk from two weeks to three days.
Family trips used to be mom, dad and the kids. Now it is more likely to be grandma, grandpa and the grandkids mom and dad are working, he said.
Trends indicate people are unplugging from their high-tech lives and seeking good value, exciting entertainment with family members and an escape from stress, Summers said.
These and other societal changes are driving the continuing evolution of the industry, he added.
The population has changed. Promotions 20 to 30 years ago were directed to a homogeneous market, and marketing techniques were simple and general.
But the days of homogeneity are gone. Cultural diversity is the way of the future, Summers said.
Estimates show that in the next 20 years, the Asian population will increase by 95 percent, the Hispanic population by 84 percent, the black population by 28 percent and the white population by 6 percent. By 2050, whites will become the minority in this country, he said.
The key is "Know thy customer," and marketing is based on everything from demographics, psychographics and geographics to behavioral studies and focus groups. "It sounds like a science project and it is," Summers said.
Other factors in the changing population mix include the aging of the baby boom generation and the rise of generation X.
Entertainment has changed. There's a lot more competition for entertainment dollars these days.
There has been an explosion of leisure options in recent years. TV viewing tops the list of leisure activities, with the average person watching 15 hours per week. Video game sales rose 53 percent in 1997 over 1996, movie theaters draw 38.3 million people yearly and are projected to have revenues of $8 billion by 2002, and virtual reality garnered an estimated $480 million in 1997 and is projected to break $1 billion by the end of 1998, Summers said.
Performing arts, professional sports, concerts and live events, and festivals and fairs post impressive attendance and revenue rates. And 1997 witnessed a record number of travelers 1.2 billion person- trips making record-setting expenditures.
Cultural and heritage travel experienced 23 percent growth last year. This includes historical places, cultural events and festivals. This is the sector where SDC is "hanging our hat," Summers said.
The entertainment glut. Because there are so many options, audiences are fragmented, there are fewer entertainment "giants" competing for larger market share and entertainment companies are investing more but earning less, Summers said.
For example, Disney posted a 25 percent operating margin in 1987, compared to a margin of 19 percent now. Viacom and Time Warner have experienced similar margin reductions, Summers said.
Visitors are more demanding than in the past, and as a result, theme parks must invest more in newer, better, more high-tech attractions, Summers said.
Where SDC is going. Silver Dollar City is positioning itself to be "America's leader in bringing the heritage and fun of the Ozark Mountains to life," Summers said.
That means entertainment with a definite Ozarks flair, but produced in a sophisticated and professional manner even if the sophistication doesn't necessarily show on the surface. What the audience sees may look folksy and low-tech, but behind the scenes is high-tech computerized equipment.
"We've used high-tech to stay low- tech," Summers said.
In terms of expanding entertainment options, SDC offers its own versions of such programs as "Stomp" and "Riverdance," with a definite Ozarks twist. SDC's version of "Stomp," for instance, features milking cows into metal buckets.
The goals are to create memories worth repeating by exceeding customer expectations, maintaining and enhancing themed environments, utilizing high-powered research and marketing to optimum effect and all "in a manner consistent with Christian values and ethics," Summers said.
In addition to technology, the means of achieving these goals include a focus on the family niche; seasonal changes such as SDC's yearly festivals; "edutainment," combining entertainment and learning; craft classes; tracking of advertising and measuring of results; and, perhaps most importantly, branding.
Consumers in general are looking for reliability brand names they can trust, Summers said. SDC promotes its brand of entertainment via the elements of friendliness, old-time atmosphere, crafts, natural beauty, family activities and safety.
PHOTO CAPTION:
Cultural and heritage travel, SDC's sector, saw 23 percent growth in 1997.
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Maintaining its old-time charm while taking production, marketing and research high-tech is one of Silver Dollar City's goals.[[In-content Ad]]
BluCurrent Credit Union held a June 21 grand opening at an office building it renovated at 4520 S. National Ave.; Ozark Mountain Gymnastics changed ownership; and a Branson theater property made way for a new entertainment business with the opening of Star Concert Hall.