Myrtle Beach chamber releases spending report as city notches record summer sales tax numbers

January 5, 2013 

— The Myrtle Beach Area Chamber of Commerce spent more than $200,000 in public money on a sand sculpture resembling President Barack Obama and other events promoting this area during last summer’s Democratic National Convention in Charlotte, N.C. – part of a $7.9 million quarterly marketing effort using money from this city’s 1 percent sales tax for tourism promotion.

Meanwhile, a separate report from the city shows a record amount of tourism tax collections this past summer. The city received nearly $8.4 million from the local-option tax from retail and other sales in June, July and August – the most recorded in a single quarter and a nearly 7 percent increase over the same period a year earlier.

Statistics show the increase in tax collections resulted from growth in the number of tourists combined with higher prices. The average occupancy rate at area lodgings, for example, was even with the previous year during the first half of the summer before rising 1.6 percent during the second half, according to the Brittain Center for Resort Tourism at Coastal Carolina University. The average price for those lodgings rose by as much as 4.7 percent, according to the center. National figures show consumer prices for all products rose between 1.3 percent and 1.7 percent during the summer months.

City spokesman Mark Kruea said the increase in tourism tax revenue is “a broad reflection that the economy locally has picked up.”

“We’ve recovered more quickly than a lot of the country has,” Kruea said. “It’s very encouraging to see strong numbers again in the summer.”

The Obama sand sculpture – arguably one of the chamber’s most conspicuous publicity efforts due to the convention’s national exposure – is listed on a report the chamber issued at year-end showing how it spent its share of public money from the city’s sales tax during the third quarter of 2012.

That report also shows the chamber spent $17 million during the first nine months of last year – slightly less than the $17.7 million in sales tax money the chamber spent during all of 2011. A year-end total for 2012 should be available by this spring.

The largest single-vendor expenditure – more than $2.7 million – was to Corinthian Media, a New York-based company that places television commercials in many Northeast and Midwest markets. That is slightly more than the $2.5 million the chamber spent with Corinthian during the same period a year earlier.

The Obama sand sculpture, however, was the most visible promotion during the third quarter, drawing mentions by national print and broadcast media.

A breakdown of the DNC expenditures shows the chamber paid $55,687 in public money for the 15-ton sand sculpture resembling Obama, which was erected outside the BlackFinn American Saloon in Charlotte – the site of the chamber’s hospitality room for media covering the convention. The chamber spent another $128,276 for hospitality room expenses, including an open bar and complementary breakfast and lunch buffets for the media. Another $16,506 was spent on an unspecified DNC promotion.

The chamber did not host a similar event during the Republican National Convention in Tampa.

Brad Dean, the chamber’s president and chief executive, responded to questions from The Sun News through a written statement issued by David Slough, a lawyer representing the chamber.

Slough said figures from media tracker Thomson Reuters indicate the sand sculpture generated more than 51 million media impressions valued at $6.2 million. A media impression is a public relations measurement of how many people might have seen a print or broadcast story or website image. For example, a newspaper with a circulation of 250,000 would be counted as 250,000 media impressions regardless of how many of that newspaper’s readers actually saw the story in question.

Slough said the sand sculpture generated more than 23,000 Google images, more than 500 media mentions – mostly broadcast and Internet – and more than 3,500 YouTube video views promoted to 300,000 subscribers, among other media impressions.

Kruea said the city has received mostly positive responses to the Obama sand sculpture, adding that it wasn’t a political endorsement but a “great marketing opportunity.”

“That was great publicity,” he said, referring to nationally televised shots of the sculpture. “It’s the sort of presence that you can’t get any other way.”

Other notable expenditures during the third quarter included:

•  The chamber paid more than $2 million during the third quarter to Myrtle Beach-based Visibility & Conversions, an Internet marketing firm that purchases advertisements promoting Myrtle Beach on more than 4,000 websites.

•  The chamber paid $242,100 to Myrtle Beach-based Beach Boogie and Barbeque LLC, a corporation created under the direction of the various Shriner temples and related groups that promote an annual barbecue festival at Market Common. Slough said the chamber formed a marketing partnership with the LLC and reimbursed it for promotions including broadcast advertisements in North Carolina and Georgia as well as print advertisements in more than 92 publications and online advertising on more than 300 websites.

The chamber also paid $553,650 to Myrtle Beach-based The Brandon Agency for print and billboard ads; $443,035 to Airplanners LLC in Avon, Colo., to help develop commercial air service in Midwest markets; and $143,724 to Myrtle Beach-based Fuel Interactive for an online fall tourism campaign.

The city approved the 1 percent local-option sales tax in 2009 and has received more than $66.7 million since the increase took effect in August 2009. The city has given the chamber $57.3 million of that amount for its out-of-state marketing efforts. State law called for the chamber to receive all of the tax revenue during its initial year, with the city retaining 20 percent of the revenue in subsequent years to reduce taxes on owner-occupied properties and pay for tourism-related capital improvement projects.

The tourism tax is added to the sales tax on most purchases made within the Myrtle Beach city limits. The tax has a lifespan of 10 years, although some council members have said they want to remove the legislated “sundown provision” so the tax can continue to be collected beyond that time period.

Contact DAVID WREN at 626-0281.

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