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Island will not have an advertising agency for most of 2011

The Ministry of Tourism will not have an advertising agency for most of the year because a new contract was not prepared in time for the summer season.

Minister Patrice Minors, who took over from former Minister of Tourism Ewart Brown in November last year, clarified that the Department would be without an advertising agency until December 2011 yesterday.

She also announced that January's air arrivals were up 5 percent from last year and the pacing reports, which track reservations, at Bermuda's large hotels are 29 percent higher for the next nine months than they were at this time last year.

The Minister said her aim was to attract 300,000 air visitors to Bermuda annually within the next three years. Since 2000 the Island has failed to attract 300,000 air visitors a year apart from 2007.

Ms Minors delivered the Department of Tourism's Budget brief at the House of Assembly yesterday.

She clarified how Bermuda would be advertised internationally, going to a media buyer for the eight months instead of hiring an advertising agency.

The contract for the Ministry's current advertising agency, GlobalHue, expires on March 31 this year. They were paid $41 million over five years.

Ms Minors told the House of Assembly a “formal open tender Request For Proposal (RFP) process” for a full-service advertising agency would have taken 12 weeks at this stage.

She said this “would have challenged our summer season and placed our hotel industry at a disadvantage.”

“In order not to compromise our destination awareness presence in the marketplace, for 2011 summer season, a media buyer was selected to place existing ads for all television, radio and print media for an interim period until December 2011.”

She added. “Three media buyers were pre-selected on criteria that included their size, experience and the ability to carry on the BDOTs business in a relatively short period of time.

“The selection of the recommended media buyer was made by a panel of seven that included senior civil servants, tourism board members and Bermuda Hotel Association partners.

“The decision to use an interim media buyer effectively saves an agency fee of approximately $1.6 million that would normally be paid to most full service agencies.

“It should be clearly pointed out that the ‘media buy' contract will allow the buyer to use the budgeted funds for this period to purchase advertising whether on television, radio or print.

“The media buyer will receive a negotiated commission on all media placed by them on behalf of the department.”

She added the media buyer would be announced in the near future.

Bermuda Democratic Alliance MP Shawn Crockwell asked why the Minister had not put an RFP out when she took over the Department in November last year.

“Why wasn't this looked at then, when the time constraints are not what they are now,” he asked.

United Bermuda Party MP Cole Simons asked what the “negotiated commission” was.

He also asked if Government was looking to recoup$1.8 million the former Auditor General Larry Dennis said Government overpaid GlobalHue. In a critical report he also noted CornerStone, the media buyer GlobalHue hired, charged commissions as high as 181 percent. The industry average is 15 percent.

Opposition MP Grant Gibbons asked: “What has happened in the four months that they cannot conduct an agency review? It suggests a tourism authority is needed to ensure continuity rather than amateur management.

“Running the old GlobalHue ads won't work, they didn't do much for us. “What we need is a new approach and a new direction.”

Ms Minors was not able to answer the MPs questions in Parliament because she was left only a minute to speak after MPs spoke on her three hour brief. In total the Ministry of Business Development and Tourism was allocated five hours.

After the debate

The Royal Gazette asked her why an RFP was not put out earlier.

She replied: “It also could have been put out before I arrived.”

She added that given the time constraints they decided to work directly with media buyers. The Tourism Board has been tasked with creating a national plan that will entail how best to advertise the Island. She said once this was done they would be in a better position to pick a company.

This paper also asked her the names of the three ‘pre-selected' media buyers, the names of seven individuals who selected the media buyer and the name of the media buyer that was ultimately selected. We also asked what rate of commission had been set with the media buyer. Ms Minors said she would prefer to answer those questions when she announces the new company shortly.

Earlier yesterday Ms Minors said sports marketing was becoming a niche for Bermuda, but that funding had been cut by 22 percent this coming fiscal year.

She said: “Some of the events will be scaled back or find other sources of funding or some will be cancelled.

“It is not that the events are not good enough, but how they compare to others we support.”

She added the Ministry would provide “in kind” support for the events.

Speaking outside the House Ms Minors clarified that no current events would be cancelled, however proposed sporting events had been cancelled.

She said the Department would continue to support the Bermuda Triangle, Argus Gold Cup, Goodwill Golf Tournament, World Rugby Classic and PGA Grand Slam and SheRox Triathlon and the Bermuda Big Game Classic.

Read tomorrow's

Royal Gazette for more on the Ministry of Business Development and Tourism's budget debate.

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Published March 03, 2011 at 9:16 am (Updated March 03, 2011 at 9:15 am)

Island will not have an advertising agency for most of 2011

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