Dammrich letter explains Grow Boating decision
CHICAGO – In an “open letter to the industry” released yesterday, National Marine Manufacturers President Thom Dammrich discussed the decision to redirect Grow Boating funds and the future of the program.
The letter, in its entirety, follows:
NMMA recently announced that 85 percent of the Grow Boating assessments incurred by boatbuilders will be redirected back to the boatbuilders for their use in assisting their dealers in moving people off the fence to become purchasers. The reaction to this decision has been overwhelmingly positive; however, some have misinterpreted this action as the end of Grow Boating.
With sales of new boats and engines down 25 percent this year, the funds available to Grow Boating through the engine assessment were expected to be reduced to $7 or $7.5 million for 2009—well below the $12 million we averaged annually during the first three years of the program. The marketing committee put together a great plan to make best use of the more limited funding. They recognized that at this level, there simply were not enough funds to have an effective national advertising campaign, and being good stewards of the funding is our top priority. Realizing this, the marketing committee developed a plan focused on tactics that would deliver more traffic to dealers at boat shows and in their dealerships, as well as a drastically scaled-down national advertising campaign.
However, in reviewing these plans, NMMA members concluded that if we couldn’t produce an effective national advertising campaign then they and their dealers were better positioned to use the reduced assessment funds for their individual marketing efforts. This would better enable each manufacturer and its dealer network to move people from shopping to purchase as opposed to the scaled-back Grow Boating advertising campaign. And so the decision was made to redirect 85 percent of the Grow Boating assessments paid by boatbuilders back to the boatbuilders for use to assist dealers. At the same time, the NMMA Board passed a resolution indicating its commitment to the Grow Boating Initiative long term.
The NMMA Board also agreed that 15 percent of the assessments would be enough to continue moving forward with other effective programs within the Grow Boating campaign. From the outset, Grow Boating has had two broad strategies: Promote the boating lifestyle while simultaneously improving the boating experience. We promote the boating lifestyle with the national ad campaign, but we also do this with an aggressive public relations program, an interactive marketing effort, DiscoverBoating.com, viral marketing and more. It is truly an integrated national campaign—not just advertising. At the same time, we have been working to improve the boating experience through product certification, dealership certification and efforts to enhance access to our nation’s waterways.
Grow Boating has always been much more than our 30-second commercial. Yes, the ads have received a lot of attention and are one of the more visible and high-profile parts of the campaign, but our efforts in PR, interactive marketing, DiscoverBoating.com, product and dealership certification and water access are equally, if not more, important to our long-term success. We won’t be advertising in 2009, but we will be spreading the message of the positive benefits of the boating lifestyle nationally though our PR efforts, interactive marketing and DiscoverBoating.com, and will continue to support and grow product certification, dealership certification and our focus on improving water access. Assuming we see some improvement in the boating marketplace in the next nine months, we will start collecting 100 percent of the engine assessments paid by boatbuilders again next summer so we can be ready with a new national advertising campaign for 2010. We are adjusting in this economy the same way you are adjusting in this economy: We’re doing the best we can to grow interest in boating and help sell boats with the funds we have available.
Some of you have asked me what NMMA, as the industry’s trade association, is doing to help manufacturers and dealers during these tough economic times. What you may not realize is that NMMA uses funds from its association budget—the funds you provide through boat show space and membership—and puts them right back into the industry. NMMA is using its association dollars to provide the dollars needed to continue the important marketing, certification and water access programs within Grow Boating I just described. In 2009, NMMA will continue to fund water access activities, product certification efforts and staff and overhead costs for Grow Boating.
This is a good time to reflect on what we have accomplished to date:
Overall CSI scores in the industry are rising, and the CSI scores of Certified Dealerships are rising much faster than non-certified dealerships. The industry is delivering a better experience to the consumer.
Nearly 10 percent of those who have requested a DVD (more than 16,500 people) have already purchased a boat.
The lifetime value of these 16,500 new boaters is $2,277,000,000. That is two BILLION dollars! And, that is just the value of the new boats and engines they will buy in their lifetime; that figure does not include all the other marine products and services they will purchase. That’s a pretty good return on a $36 million investment!
We set out to increase boating participation recognizing that people don’t buy new boats if they’ve never been on a boat or had a boating experience. The good news: It’s working! The National Sporting Goods Association reported that boating participation was up 6 percent in 2006 and up another 8.9 percent in 2007. We have stopped a 10-year decline in boating participation.
As boating participation dropped from 32 percent of the adult population to 26 percent of the adult population over the past 10 years, is it any wonder that it was getting harder to find customers, especially new customers? In the first two years of the Discover Boating campaign, five million more people went boating! It doesn’t take a lot of them to fulfill their dream of owning a boat to have a significant impact on boating sales.
We haven’t changed our basic strategy to Grow Boating or our commitment to Grow Boating. We have adjusted the emphasis on our strategies and adjusted our tactics to reflect current market conditions. In 2009, we will be working as hard as ever to Grow Boating in the long term, making the most effective use of the dollars you entrust to us and measuring everything we do to insure it is effective. And, while we continue our work to get more Americans interested in boating, there will be more dollars available to manufacturers to help their dealers sell boats now.
The 30-second commercial is an important part of our efforts to Grow Boating, but Grow Boating has always been much more than the 30-second commercial.
If you have questions about how the assessments will be invoiced or would like additional information, I urge you to visit our Q&A on NMMA.org.