A business model typology for destination management organizations

Purpose – The need and legitimacy of DMOs are increasingly questioned. Still, the tourism literature provides little advice on how DMOs change and finance their activities for the benefit of their destination given contextual change. This conceptual article, contributes to filling this gap. We do so by proposing a typology of business models for destination management organizations.
Design/methodology/approach – With the help of typological reasoning, we develop a new framework of DMO business model ideal types. To this end, we draw on extant literature on business model typologies and identify key dimensions of DMO business models from the tourism literature.
Findings – The challenges DMOs face, as discussed in the tourism literature, relate to both ends of its business model: On the one end, the value creation side, the perceived value of the activities they traditionally peruse has been declining; on the other end, the value capture side, revenue streams are less plentiful or attached to more extensive demands. Based on two dimensions, configurational complexity and perceived control, we identify four distinct ideal types of DMO business models: the destination factory, the destination service center, the value orchestrator, and the value enabler.
Originality/value – We outline a “traditional” DMO business model that stands in contrast to existing DMO classifications and that relates DMO challenges to the business model concept. The typology provides an integrated description of how DMO business models may be positioned to create and capture value for the organization and the destination(s) is serves. The ideal types point to important interdependencies of specific business model design choices.