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Experts: Park must use marketing to rock on

Hard Rock Park needs to go on a $10 million to $40 million advertising spree if it wants a chance at making its second season successful, local marketing experts said.

It is unclear whether the shuttered $400 million theme park, which filed for bankruptcy in September after being open for six months, will be able to raise those types of funds. The park did not respond to repeated requests for comment.

In court papers, the park said its inability "to engage in effective out-of-market advertising was particularly devastating" and, along with general economic malaise, was why the park failed. Now, the park plans to "develop a marketing campaign that will position them properly for the reopening" in 2009.

Local marketing and business experts say they repeatedly warned the park before its opening about what, in their view, would be a fatal strategic error.

"It's a classic example of having a good product and not spending the money to market it," said Chad Prosser, director of the S.C. Department of Parks, Recreation and Tourism. "We've seen the results."

Local businesses said they had a stake in the success of the park, which was touted as the largest-ever investment in the state's tourism industry. If the park brought in the 3 million visitors a year it projected, it would benefit surrounding hotels, restaurants and stores and raise the overall profile of Myrtle Beach.

Now, the park is reorganizing under Chapter 11, which holds creditors at bay and buys time for businesses to sort out financial problems. A Delaware bankruptcy court judge has allowed the park to borrow an additional $1 million, while an additional million could be approved at a hearing Wednesday. The park has until Oct. 31 to explain to the court how it plans to reorganize.

But the bank that holds most of the park's debt, Deutsche Bank Trust Company Americas, has slammed the park's plans for the future, threatening to force the park into Chapter 7 bankruptcy if it does not put itself up for sale.

In court papers filed last week, the bank criticized the park for asking for permission to hire eight law firms and an accounting firm, calling the move "blatantly excessive," considering "there is no realistic prospect for a successful reorganization."

Starting on emptyIn November, the park's head of marketing at the time, Kerry Graves, said the company would rely on media buzz instead of blanketing the East Coast or country with advertising. Graves, who parted with the company in April, did not return an e-mailed request for comment.

There were mentions in the national press - a blurb in USA Today, an article in The New York Times and features on national morning shows.

Still, the men who control most of the state's and Grand Strand's tourism advertising said they told the park before it opened they were concerned the lack of advertising would doom the park.

"I always said and told them, you should have $30 or $40 million up front built into your pro forma to create that initial awareness," Prosser said. "Those are the kinds of numbers you're talking about for the size and nature of this product."

The head of the Myrtle Beach Area Chamber of Commerce, which put the park's signature 70-foot Gibson guitar on the front of the chamber's visitors guide, also had warned the park's principles more was needed.

"Early on, we sensed there would not be enough out-of-market advertising," chamber president Brad Dean said. "We encouraged them repeatedly - probably to the point of annoying them - to consider more. ... They needed to persuade visitors to visit the park even before they had packed their bags."

Though the park has been reticent on the specifics of its marketing efforts, observers say the park primarily relied on billboards, local radio ads and spotty ads in markets such as Charlotte, N.C. But the majority of the ads seemed to come in one push around the park's opening.

"I think they came out and launched fairly strongly, but then they faded fairly quickly," said Bruce Murdy, president of Charleston-based Rawle Murdy Advertising and Public Relations. "At the end of the day, I'm not quite sure it was about how much money they spent as how they spent the money they had."

Many of the dozens of tourists interviewed during the summer said they heard about the park on their way into Myrtle Beach, not before.

Charles and Rosie Vandenberg, who are from the Raleigh, N.C., area, were bummed when they came down for their annual Myrtle Beach trip last week and saw the park was closed. But they said that although they knew it existed, many of their friends did not.

"I don't think a lot of people were aware of it," Rosie Vandenberg said. "We may have seen it one time, if even that, on TV."

Before its launch, the park also said it would rely on the roughly 14 million people who already vacation on the Grand Strand annually to sustain it - which Prosser said was the wrong move.

"The real opportunity there was basically to grow the market, not to feed off of the current market coming to Myrtle Beach," he said. "Go out and grab those folks who would otherwise be going to Orlando."

Murdy said he routinely monitors online advertising while representing S.C. and Grand Strand hotels and amusements. He called the park's Web presence "nonexistent."

"If they're targeting someone like me, who is an in-state resident with two teenage children, the perfect demo," he said, "I saw nothing. ... They should have owned it."

In addition, the park should have responded when they saw negative or indifferent online reviews and chatter, Murdy said. "Social networking is an important part of what they should have been doing," he said. "As the buzz started to get negative, what I did not see was any proactive movement."

Game planMoving forward, the park needs a multipronged attack, experts said.

Besides spending tens of millions on ads, experts said the park needs to do more grassroots marketing by aggressively reaching out to people in and around the Myrtle Beach community, such as politicians, church leaders, the media and community leaders, experts said.

"They have simply got to turn the local community into ambassadors and marketers of the park," Dean said. "A locals discount would be helpful but may not go far enough."

The park needs to meet with hoteliers and convince them that the spring 2009 opening is not a pipe dream.

"There's a fair amount of skepticism among businesses right now that [the park will] be able to reestablish their capital" or the money needed to succeed, Dean said.

Also, the park should re-evaluate its ticket prices, which many visitors and locals interviewed during the summer said kept them away from the park.

Initially, the park started selling tickets at $50 for everyone over 3 years old, which did not include taxes or a $10 fee for parking. Theme park experts have said the price was out of line with the market.

In addition, the high price set a high bar for the park, which was plagued during the summer by rides that were in and out of order.

"If they charge that kind of money, it better be really good," said Donald Lichtenstein, a professor of marketing at the University of Colorado who researches consumer perceptions of prices, advertising and marketing and said he was familiar with the Myrtle Beach market.

Word-of-mouth reputation is, perhaps, the most important beast to tame, experts said. The park needs locals and visitors to be able to promote the park when newcomers ask about it.

"What's the answer going to be?" Murdy said. "The answer should be, 'Wow, it was a great experience. They had some financial difficulties, but I can't wait until they open in the spring.'"