SIOUX FALLS, S.D. (KELO) — When cities are offering more than 190 free hotel rooms, cash and other incentives to lure organizations and conventions to their city, how can Sioux Falls compete?

In short, it can and it can’t, said Teri Schmidt the executive director of Experience Sioux Falls, the former visitors and convention bureau. Schmidt gave the city council an update on activities and the 2023 budget at a city informational meeting on Tuesday.

Sioux Falls can’t offer 190 free hotel rooms, receptions, cash and other incentives but it can compete, Schmidt said.

“We want to get more aggressive. We want to get spicy,” Schmidt said. “With this budget, we think we are on the road to beating the competition.”

The 2023 budget includes $619,000 in digital marketing plus lesser amounts for other marketing. There is an other $65,000 for incentives.

“We have to do it, if we don’t up our game we are going to fall behind,” Schmidt said of increasing Experience Sioux Falls’ digital marketing.

Digital marketing includes using social media, even Tik Tok, a social video site where users post video.

Council member Marshall Selberg asked how much Experience Sioux Falls spent on its digital strategy in the past.

Schmidt said it spent about $458,000 last year and about $278,000 the year before.

Strategic placement

Schmidt said proximity is a key in attracting visitors and events.

“We need more hotel rooms to attached to the convention center,” Schmidt said. Because it doesn’t have enough hotels, that causes us to lose business.”

Council member Rich Merkouris asked if there were more future opportunities for swimming events.

That is a growing sports market but just like any event, location is important.

“…the walkability around it so people aren’t away from what they consider the action,” Schmidt said.

The city needs to consider what is the neighborhood around those pools, she said.

Experience Sioux Falls must also deal with the sometimes limited availability of the largest meeting facilities, Schmidt said.

Strong 4th quarter needed to pass 2021

Experience Sioux Falls is funded by a $2 per room per night hotel fee and a 1% hotel tax. The $2 fee is a business improvement district or BID fee. The BID fee was started by hotels in 2011 as a way to pay for marketing the city.

57 hotels, 5,168 sleepingrooms. “Our job is to fill those rooms,” Schmidt said.

Experience Sioux Falls graphic

The BID fee has raised $1.4 million as of June. Another $729,599 was raised in the 1% tax as of the end of May.

In 2021, the BID fee raised $1.8 million and $1 million in the 1%.

Through July, the city had 898,470 visitors, Schmidt said. The economic impact of those visitors through July is $318,224,347.

“We know a lot more people coming into Sioux Falls but if we can’t count ’em, we can’t chart them,” Schmidt said

The city had 1,235,490 visitors in 2021. The economic impact was $437,591,682.

“Are we gonna hit 2021 numbers? I sure hope so,” she said. “We’ve got a little time left, a few months.”

Schmidt said the organization would make a strong push to attract visitors this fall.

“Summer is kind of wrapping up, it will be a different kind of traveler now to get us through the rest of the year,” Schmidt said.

Hotel occupancy so far this year has been at 66.2% which is the highest among 10 comparable cities. Fargo, in second, has a rate of 61.4%