Tourism Business Is Looking Up

December 24, 2003
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Tourism businesses across Michigan, after holding their own this year and coping with difficult business conditions for more than two years, expect things to pick up in 2004.

Likewise, travelers say they expect to travel more often next year, according to a new survey that gauges prospects for the state's $15 billion tourism industry.

Overall, the new Michigan Travel Business Barometer from Travel Michigan offers an upbeat outlook, signaling a much-welcomed rebound after the two tough years the industry has experienced and reflecting improving economic conditions.

"Consistent with other reports, Michigan's tourism industry is optimistic about the coming year," said George Zimmerman, interim CEO for the Michigan Economic Development Corp. and vice president of Travel Michigan.

To gauge future prospects, Travel Michigan surveyed both travelers and tourism businesses.

Of the 365 responding businesses, six out of 10 indicated they "are much more optimistic" and expect to do better in 2004 than 2003, according to survey results. More than three-quarters of the business owners and managers believe their business will grow by 5 percent or more.

Only 6 percent of those answering the Travel Michigan survey were anticipating a worse year.

Attractions also report strong advanced booking and sales for 2004, Travel Michigan Managing Director Dave Lorenz said.

The results on the consumer side of the survey generate further optimism. The survey found that the nearly 2,300 respondents collectively plan to increase the number of trips they take in 2004, from an average of 5.1 to an average of 5.7, equating to a more than 10 percent increase in travel volume.

The big question now is how many of the respondents will follow through on their intentions and actually travel and how much they'll spend. That unknown raises the importance for destinations, attractions and tourism communities to step up their advertising and marketing to create a strong awareness among prospective travelers, Lorenz said.

"That's where marketing and advertising really pays off," he said.

This year saw the state's tourism industry "holding its own," Lorenz said, with flat volumes and revenues that came on the heels of a down year in 2002. The year represented a bottoming out for the industry, he said.

West Michigan, particularly along the lakeshore, fared better than many other areas of the state because of the region's proximity to key travel markets and status as a drive-to destination.

In Muskegon, the Muskegon County Convention and Visitors saw revenues from assessments on motel and hotel rooms rise 4 percent for the fiscal year that ended Sept. 30, said Joanne Hatch, tourism development director for Muskegon County.

Hatch anticipates that Muskegon's tourism economy in 2004, with the launching of the new high-speed ferry service, will have a "huge, solid" year.

Lorenz also credits the Beachtowns and Michigan's West Coast tourism promotions conducted in partnership with Travel Michigan with helping the region's tourism economy. Both promotions will return in 2004 and a third partnership promotion in West Michigan will commence when Muskegon launches its own campaign targeting Milwaukee in conjunction with the new high-speed lake ferry that starts June 1.

In addition to the $15 billion economic impact, the tourism sector in Michigan employs 188,000 people and generates $868 million annually in state and local tax revenues.

Nationally, the Travel Industry Association of America projects that leisure travel volumes, hurting in the wake of economic conditions and the Sept. 11, 2001, terror attacks, will grow 3.2 percent in 2004 over this year, and in 2005 by nearly 2 percent.    

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