2 The over optimistic visitor numbers
and the marketing strategy
12. The original economic appraisal forecast 160,000
visitors per annum to the Centre within ten years of opening.
However, the C&AG's Report tells us that the annual visitor
numbers never exceeded 50,000 and averaged 33,000 over the eight
years of the Centre's existence. As a result the Centre was in
financial difficulties throughout most of its existence and received
regular revenue deficits from public funds, the last of which
ceased in March 2001.[20]
13. We note from the C&AG's Report that the actual
paid admissions, not by schools but by others, were as low as
10% of even the pessimistic estimates.[21]
We consider that this should have started alarm bells ringing
to say that this Centre is not going to be viable.[22]
14. We noted the Department's view that Navan was
a centre that visitors were unlikely to revisit.[23]
When the concept was originally envisaged it included a 300 acre
archaeological park which was to be of international status. The
capital funding was provided because this was perceived to be
a flagship project and would have attracted return visits. However,
plans for the archaeological park were shelved and because the
project as originally envisaged was not delivered the visitor
figures proved to be overly optimistic and the number of return
visits was low.
15. The Department has acknowledged that government
was naïve with regard to projected visitor numbers and it
also accepted, with the benefit of hindsight, that the original
forecasts of visitor numbers provided by consultants were grossly
misleading as the wrong comparators were used.[24]
16. We fail to understand why anybody thought that
the Giant's Causeway and the Ulster American Folk Park made proper
comparators. The Giant's Causeway is a geological formation which
is world famous and which increased its visitor numbers from 120,000
to 300,000 over a period of eight years. The Ulster American Folk
Park started from scratch and after nine years had not even doubled
its numbers, going from 48,000 to 82,000. We were, therefore,
most surprised that anyone should assume that a site which basically
consists of a number of grassed earthworks would move from 30,000
visitors to 160,000 visitors in seven years.[25]
17. The Department told the Committee that the Navan
Centre had exceeded its own target of 30,000 visitors in year
one and that it was in year three that Navan itself approached
Government and said that they had been ambitious in their aspirations.
This led Navan to downgrade estimates of visitor numbers both
at that stage in 1996 and also later in 1998.[26]
18. We welcome the Department's acceptance that the
original estimates of visitor numbers were overly optimistic.[27]
The Department has also acknowledged that there had been unease
from the outset about the viability of the Centre and that the
records show that officials at a number of stages expressed concern
about ongoing viability.[28]
We consider that there have been many incompetent decisions taken
when it was clear that this project was never going to work.[29]
We fail to understand why it was allowed to drag on for so long
and that no one said enough is enough and pulled the plug.[30]
19. The Department told us that there were a series
of circumstances including the effects of political unrest particularly
those associated with Drumcree, the restrictions caused by the
foot and mouth outbreak and a fire at the Centre all of which
had an impact on visitor numbers.[31]
However, we agree with the C&AG's Report that in addition
to these factors the evidence would suggest that the basis of
the forecast numbers was unsound from the outset.[32]
20. We asked the Department whether they were confident
that this situation would not happen again with another Centre
and how they could be sure that realistic projections of visitor
numbers are provided by consultants rather than ones which tell
them what they want to hear. The Department told the Committee
that there are now procedures in place, such as Gateway, that
ring warning bells at an early stage.[33]
We welcome the adoption of this approach and trust that lessons
learned from the Department's experience with the Navan Centre
will be fully applied in existing and future projects in all Departments.
21. The C&AG's Report tells us that when consultants
were brought in they were surprised that the 1995 marketing strategy
had not been updated in the two and a half years since the marketing
manager had been made redundant.[34]
The Department agreed with the Committee that the marketing strategy
should have been revisited. The Department also accepted
that because of the cost savings which the Navan Board made, including
making the marketing manager redundant, there had not been a properly
targeted marketing effort and this had led to a downturn in visitor
numbers.[35]
22. We are disturbed as to why, if officials were
consistently concerned about the commercial viability of Navan,
there was not more of an effort made to develop a marketing strategy.
The Department told the Committee that it was because of these
concerns that they commissioned a consultant in 1997 to look at
marketing.[36] We consider,
however, that more could have been done to market the Centre and
that momentum was lost in raising the profile of Navan in the
early years of its operation.
23. One area of the Centre's activities where there
was significant success was the education programme which we were
told was of a high calibre. We consider that this example demonstrates
that, with well targeted marketing, they may have been able to
increase visitor figures.[37]
24. We noted that one consultant found that "awareness
of Navan is low even with prompting" and "the incidence
of visiting is low and the likelihood of paying further visits
is also weak". There appears to have been the assumption
that this Centre could be built up into a big international venue.
This seems to us to have been massively optimistic at the time.
We consider that all the precedents for such a Centre should have
led the Department to look at the Navan Centre with a jaundiced
eye.[38]
20 C&AG's Report, para 1.5 Back
21
ibid, Appendix 2 Back
22
Q 73 Back
23
Q 129 Back
24
Qq 7, 22-26 Back
25
Qq 81-83 Back
26
Qq 25-27 Back
27
Q 133 Back
28
Q 103 Back
29
Q 107 Back
30
Q 112 Back
31
Q 79 Back
32
C&AG's Report, para 4.4 Back
33
Q 40 Back
34
C&AG's Report, para 4.12 Back
35
Q 50 Back
36
Q 51 Back
37
Q 93 Back
38
C&AG's Report , para 4.11; Qq 91-92 Back
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