Officials project bleak year for Alaska tourism
Published Saturday, December 20, 2008
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Stumble It!FAIRBANKS — State tourism officials are warning that 2009 could be a bleak year for Alaska’s tourism industry, with some projecting decreases in business of about 30 percent.
If that scenario plays out, Alaska businesses could suffer severely, they projected.
“Certainly, it is looking to be a very potentially scary summer,” said Dave Worrell, spokesman for the Alaska Travel Industry Association. “Optimistically, I would like to believe we would be down slightly. Pessimistically, we could be down dramatically. It really depends on what the economy does.”
A 10 percent decrease wouldn’t surprise him in the least, but declines could be as high as 25 to 30 percent, he said.
That doesn’t bode well for the state economy, with the average visitor spending almost $1,000 while in Alaska, enabling 40,000 full-time equivalent jobs. In 2008, that spending translated to a $1.7 billion boost to the state economy.
“That’s a big hit,” Worrell said. “It’s something our policy leaders need to be very, very concerned about.”
Fewer visitors coupled with less spending by budget travelers, could have a “dramatic impact,” he warned.
“That money probably rolls around the economy two and a half, three times,” Worrell said. “That $1.7 billion easily becomes $3 billion to $5 billion in economic activity.”
Cruise lines in particular are heralding declines.
The Alaska Cruise Association represents nine cruise lines that bring about 1 million visitors to Alaska annually.
“All the indications from them are that bookings and sales are off dramatically,” association president John Binkley said. “Our hope is that the trends are just changing, that people will eventually come, but they’re waiting to book.”
Hitting home
Binkley is close to the tourism industry in other ways as well. His family operates the Riverboat Discovery in Fairbanks, where his son, Ryan, is president and CEO.
John Binkley acknowledged the summer outlook is bleak for businesses catering to tourists, with an unprecedented shift in an industry that tends to grow each year.
Only in 1967, when floods hit with a vengeance, and in 2002, the year after the terrorist attacks of Sept. 11, 2001, was business down from previous seasons.
“Those events really pale in comparison to the level which we may be facing this summer,” Binkley said.
The Riverboat Discovery started treating tourists to trips on the Chena in 1950.
In the ensuing years, Binkley has never seen a drop quite like this. Advance bookings already are down about 38 percent from a year ago. That means the business will probably hire fewer people than in a typical season.
“Hopefully, it will start to turn around, and we’ll be able to hire more people than we anticipate,” he said.
Diane Shoemaker is sales director for Fountainhead Hotels, which includes Sophie Station, the Wedgewood and the Bridgeport. Many of the hotel rooms are booked through tour operators, who say it’s hard to tell just yet what the summer season will bring, Shoemaker said. Some downturn is expected.
“We’re pretty much still holding out hope that things will rebound a little after the first of the year,” she said.
Selling Alaska
A rebound could hinge on how well the state steps up advertising Alaska to potential tourists across the nation and the world.
The state contracts with ATIA to market Alaska, using a budget of about $11.7 million. About 70 percent of that comes from the state, with the industry pitching in the remainder. Worrell said the marketing budget is inadequate, especially when compared to other states, such as Hawaii, where the state spends $50 million to $70 million annually to lure visitors.
“We believe strongly that Alaska should be spending at least $20 million a year to be competitive in the marketplace,” he said.
Binkley said this is a “critical time” for Alaska to boost advertising.
“My belief is the state should step up to a greater extent,” Binkley said. “This is really an important time for the state to be bold in getting into the marketplace and not losing market share.”
Several Interior legislators also pushed the need for state government to boost the industry, which feeds local economies through the busy tourist season.
Sen. Gene Therriault, a North Pole Republican, said a downturn in travel spending is happening nationwide and that other states are probably stepping up marketing programs to snag what visitors they can. Alaska should do likewise or risk losing out on market share, he added. Additional funding could help.
“We are always struggling for adequate marketing of the state as a destination,” Therriault said.
While ads running in magazines and on television across the country are promoting Alaska, the messages were honed months ago, well before the economic downturn, Worrell said. The association is doing what it can to refocus those messages on the value an Alaska vacation offers.
“We are definitely doing what we can to enhance our messages and let people know this is a great time to come to Alaska,” Worrell said. “Our marketing program is going to try to focus people’s attention on some of the great discounted opportunities that are going to be available this summer.”
Budget travel
Worrell said people with fewer flexible dollars will be looking for bargains. Will Alaska be their destination?
With cut rates on some cruise lines, it could be, he said, citing one seven-day cruise package being offered at less than $500. Cruise lines have set their itineraries months to years in advance, and will likely do “whatever it takes” to fill berths, he said.
Those deals could net a different type of tourist than Alaska is accustomed to, Worrell said. The visitors might be those on a tight budget, willing to dole out fewer dollars on discretionary purchases like restaurants meals, side trips and souvenirs. They might opt for a T-shirt instead of a flightseeing trip.
“A lot of it is going to really impact a lot of the smaller businesses, the ones that supply tour product, activities, restaurants,” Worrell predicted. “There is a lot of concern.”
Even a bleak outlook has its silver lining. In 2009, that could be lower gas prices that boost visitors driving up from the Lower 48, Worrell said.
“A lot of it is going to depend on the economy,” he said. “But if gas prices stay low ...”
Over-the-road visitation was down in 2008, credited to gas at almost $5 per gallon. The saving grace proved to be increases in international travel, particularly from Japan and German-speaking European countries, driven by a weak dollar. But the situation has since changed.
“The value of the dollar is picking up dramatically,” Worrell said. “The U.S. and Alaska are not on sale right now, and probably won’t be on sale this summer. We probably won’t have that silver lining to help us out again this year.”
Community Discussion
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this will be an interesting year for those of us who work summer jobs in the tourist industry
The image and appeal of Alaska have been tainted by Sarah Palin, Don Young, and Ted Stevens. They are a three-person tourist repellent team. My Outside friends tell me they heard so many negative stereotypes about Alaska and Alaskans that they will never come to visit our state. Perhaps the state should invest some money into fixing the tainted image these three have projected.
Oh come on glow, if that were true why did Gov Palin draw such huge crowds where ever she spoke? I seriously doubt if most tourists come to Alaska to see our politicians.
I'm just gonna wait for someone else to make fun of Glow.
Getting kind of late DHT3, you might have to do it yourself. I'm headed to bed. Maybe I'll catch ya in the AM.
AkRascal....the reason Palin drew such huge crowds (and mainly in the southeastern states) was much the same reason the Jerry Springer Show is still on tv after 16 or 17 years. And I suspect she draws much the same crowd, too. Given the latest on her future son-in-law's family happenings, you can see wherein lies the attraction. She does not disappoint, you betcha, by golly!
If you want to know why there will be less visitors, talk to Alaska Airlines. I try to come up a couple of times a year to visit my family. A few years ago my plane ticket was around $350. Now it's well over $1,000. The price of fuel went up, the price of tickets went up. Now that fuel has dropped considerably, the price of tickets went...well...nowhere.
I seriously doubt that the political personalities has anything to do with the desire to visit Alaska. Fact is, most come to Alaska without having even heard of Stevens or Palin and now that they have been in the news there is no reason for it to hurt tourism to your state.
Alaska is unlike anything available to experience in the lower 48. The wilderness, the wildlife, the vastness and the history are all reasons why I believe folks come up there. Add to it experiences like the culture, aurora borealis and Denali and how can you really think that Stevens, Palin, et al can hurt tourism.
I have been to Alaska an average of nine days each of the past three years (2006, 2007 and 2008). The only reason I'm planning to return in 2009 is because all of my vacation time (and money) is budgeted for other trips (two weeks in Hawaii, and a week each in Arizona and New Orleans). With that being said, I'm planning for what will probably be two trips in 2010 including a winter trip either for the Fur Roundy in Anchorage or the ONAC in Fairbanks . . . and then an extended trip during the summer to take in fishing, bear tours and the like. That later trip may also include extended family members (sisters and BIL's).
I love Alaska and cannot wait to be on her soil again!
Yvonne Bennett
Milw, Wisc.
It's not just the Lower 48. We just returned from Ireland and took the Viking Splash Tour in Dublin. The tour guide said he and his wife will be visiting Alaska in May and just can't wait. With the dollar slipping (again), you'll see more Europeans (again).
When you kill all the wildlife and crap up the place with gas and oil fields on public land how can Alaska attract tourists? Yes tourists--come to Canada! Lots of wildlife and pristine places at bargain prices.
Sad to see the tourism industry suffering. Tourism does, after all, contribute significantly to the economy of our state. But on the bright side, at least the highways won't be so cluttered with oversized RVs traveling below the speed limit all summer long. I guess it's obvious I don't earn my living off tourism. Cuz I'm *overjoyed* when there's fewer of them to slow me down when I'm on my way to earn my own bread and butter.
Like the oil sands? :/
Oh for the love of Pete, decreased tourism has nothing to do with Palin or Stevens. We are coming up for two weeks next August. When I tell people here (Missouri) about our love affair with Alaska (this will be my 3rd trip in four yrs.), they invariably say 'Oh, it looks so pretty there but I don't like the cold'. For real, they have the impression that even in July, people are walking around wearing parkas and mittens. I show them picture of self wearing t-shirt, sandals, and shorts and they still don't believe it. One guy even asked if you could 'drive right up' to the Walmart in Fairbanks -- he thought you had to get there via snowmachine. So here's what the Dept. of Tourism needs to do -- show advertising with people outside wearing typical summer clothing, doing fun summer stuff -- fly fishing, inline skating, river rafting/cruises, hiking, camping, etc. Everyone loves the awesome pictures of icebergs and mountains, but those also tend to leave the impression that it's all snow all the time.
The Dept of Tourism could hire me to help tell their story :)
Rena Delbridge, if tourism is going to be down this year, why would anybody invest money for 2 new hotels to be built in fairbanks. And 1 in North Pole?
yes blame it on Palin, not the fact the country is in a major recession. Take time to talk to people who have traveled outside this Christmas and maybe people up here will get a picture of how bad the economy really is. Seems like Fairbanks is in a snow globe when it comes to grasping the serious nature of what is happening in the lower 48. People are thinking on how they spend their money and stay at home vacations are what many will choose if they still have a job. Just be thankful we live here and do not have to worry about traveling to see one of the most beautiful places in the world.
if every thing is Palin's fault then it stands to reason that nothing is Palin's fault. This thread is not about Palin.
Would you confused liberals like to know why people come here. It is to see our wildlife living in it's natural habitat. At least that's what they tell me. As long as we have access to our wilderness people will come to see it. If the hardcore libs manage to lock it up for themselves then we are screwed.
Didn't need the article to know tourism will be down. All I had to do is look at our hotel bookings for next summer. Benji, just because they are building new hotels doesn't mean more tourists will come. They plans were based on a different economy. Without the native corporations dividend money being spent this month, our hotels occupancy would be next to nothing.
Typical.
These big, very wealthy corporations, and multi-millionaires like Binkley, expect the people of Alaska to dole out corporate welfare for their businesses.
How unethical can they get?
If the multinational corporations do not care enough to fund an advertising campaign- to promote their own businesses- then why should the people of Alaska have to foot the bill?
The answer is very simple: GREED. They would rather spend your money to make their business more profitable.
"Crap up the place with oil fields."
A tourist can not even drive to see an oil field in Alaska. You would have to charter a private plane just to get a glimps of ANWR. Take a football field and put a postage stamp on it. That is how much area is disturbed by oil fields in Alaska. Seriously if you are that narrow minded we don't want you to come visit.
1. High cost of regular gas in Fairbanks
2. High cost of hotels during tourist season
3. High cost of Air taxi travel
bed tax,out of municipality gas tax, etc,etc,etc
And the sting of taxes for a tourist to come to Fairbanks,maybe a complete overhaul in taxation needs to be looked into.
We visit in the winter around Fairbanks and North Pole. We have met some of the nicest and friendly people that go way out of their way to make sure that you have a good time and enjoyed Alaska. We watched dog sledding,ice skating,ice fishing,snow machines and drove into the Arctic circle and so much more I can not think of right now.
I think some of the local people get so use to having all the things unique to Alaska they take it for granted. I'm so glad we met a lot of folk's that still live in and love Alaska because it is Alaska.
Just my two cent's worth from Indiana.
Oh who cares if the tourists come i dont they annoy me i dont come to your state so dont come to mine. I need a nap. What the hell are you people doing up at three and four in the morning posting on here anyways go to bed
Glow........ do you think this conversation has happened?
Wife: "Honey, I'm thinking you need to seriously reconsider your once in a life time hunting trip to Alaska"
Husband:"I've been planning it for years.... why ever for"?
Wife:"Well, they convicted a Senator of bribery, and, Alaska does have that Palin women there."
Husband: "OMG! I hadn't considered that!! Yeah, rather than go on that Fly-in caribou hunting trip I've planned for 10 years...... we need to do something else. The thought of possibably bumping into Sarah Palin while in such a dinky small 6 million square acre hunting zone just gives me the willies!"
Wife: "Why, you could simply hunt the ducks at our local petting zoo - it will be just like hunting in Alaska, and, you don't have to get out of the car either. Just do a drive by."
Husband: "Your are so right honey - and so smart!"
" Typical.
These big, very wealthy corporations, and multi-millionaires like Binkley, expect the people of Alaska to dole out corporate welfare for their businesses."
Tranquility_Base, Good to be pointing out the double standard. Binkley, whether getting the gov to dredge the Chena or getting the state to fork over its dollars to advertise AK to the tourists, it is how the new, or should I say "neo" conservative thinks. We bail out the fat cat banking industry for 700B and none of the "conservatives" ultimately protested it at all. But bail out the auto industry where the money might actually get recirculated back into the economy in the form of paychecks being spent, and all for a measly 2 or 3% of the banking bailout and all hell breaks loose with the Republicans. This country is going down the tubes and it is the greed of big business dragging her down all the way.. The amazing thing of it all is how few people actually see it.. Too many heads up too many a$$es I suppose.
i am with james on the subject. the park is looking very tackey. a stoplight in the middle of a major highway to let the tourists go and come. what is wrong with this picture. do you think any of the tourists money stays in alaska? they put people up in the hotels they own only go to places they control. i see where even the cruiselines do not eveen comply with the alaskan maritime laws. i hope the tour companies close down their alaska operations and never come back.
Alright, so maybe it gets crowded, and maybe you get stopped more than normal with lost foreigners struggling to ask where the nearest restaurant is. Maybe the lines are longer and the roads congested with lumbering RVs.
I work in the Tourist Industry in the summer months. I live in Alaska, work in Alaska, raise my children in Alaska..and, because of my summer tourist trade employment, I get to goof off All Winter and slide down the hills in the sled with my kids. Run my little team of sled dogs, and enjoy spending time with my family and friends chatting until the early morning hours over a cup of coffee and a slice of home made pie.
In the summer, I enjoy almost every single moment of sharing a brief glimpse into my lifestyle with the tourist, and learning some of how they live as well. I never get tired of pointing out the nearest bathroom and Proclaiming that my boss makes the best darn jellies, jams, and fudge in Fairbanks! Showing them what Fireweed looks like before it's a jelly. Telling them about the Cow Moose and newborn calf in my yard that morning.
What am I doing while jabbering away with strangers? Selling goods and making money. Money that supports my Sled Dog Addiction and allows me to treat my children to an ice cream cone purchased from another Summer Time Employee catering to Tourist.
You know where else my money goes? To Big Rays, and once upon a time to Samsons Hardware, and to the Farmers Market. My children have taken dance lessons from local schools all from my Summer Job.
Maybe some of you could care less about the Tourist Trade and how it affects Our Lives, but think long and hard before you wish away this way of life made possible for some locals by those nasty overbearing tourist who get in your way and muck up our state and spend their money here.
As for Gov Palin being a negative influence for visitors headed this way.......I know I have always gauged our family vacations from what Politicians were in power before I stepped foot in another state.......Good Grief ...Did some one really post that on this forum?
Imusuallymoronic --
Courtesy of selling our house. No dividend, but watch out, we plan to be back in AK next year. Now go have a Merry Christmas and stop worrying about my family and our finances. :-)
Who needs 1.7 billion yearly? Who cares if many Alaskans have made a lifestyle/livelihood in that archaic independent private way? There are plenty of swell jobs selling Chinese high quality stuff instead of this junk native to the area.. Why have all these little businesses all over when government jobs are also another way to go? We can always count on the everlasting stability in that. Why mess around when we can place Alaska's income in one oily basket?
And really ,who cares if anyone outside understands us at all, our cultures, people aspirations ,etc. ? All we need is a couple Alaskans to represent us after all. Who cares if they find we bellyache about their temporary existence here? We are in no way related to them anyway, right? Why have these jokers in the way when blasting down the highway to the next road construction obstacle.
Who cares if others find that we will cut off our nose to spite our face? We don't need to make money having allies, that's just stupid.
Dadburnit, I ain't going to Illinois this year. I was going to, but that Barack Obama makes me so angry. Nope. I ain't goin', you cant make me, and to hell with Illinois.
Glacierles I avoide going down there too, but not for that reason. The FIBs get us Cheeseheads on their road tolls as soon as we enter Illinois. Look for the Obama/Chicago connection to build that national transportation infrastructure on tollways across our great country. The cost of travel via autos will skyrocket under Obama's White House and transportation policy.
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