Winter Doesn't Chill Outlook For Tourism

April 20, 2008
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GRAND RAPIDS — Heavy snowfall may have caused some headaches this past winter, but for the travel and tourism industry, it has caused some smiles.

Dr. Sarah Nicholls, assistant professor at Michigan State University’s Department of Community, Agriculture, Recreation and Resource Studies, spoke at the Driving Tourism 2008 conference last week, saying she believes upcoming figures will show that the heavy snowfall sparked an increase in Michigan’s travel and tourism industry for winter sports.

The nation as a whole is expected to grow its travel and tourism demand between 2008 and 2018. Part of the rise will be caused by the increased attractiveness the U.S. presents to international travelers, thanks to the weakening dollar.

Pure Michigan, a two-year old advertising campaign, aims to bring a portion of those travelers to the state. The campaign was established by Travel Michigan, the state’s official agency for the promotion of tourism. The campaign Web site is www.michigan.org

George Zimmermann, vice president of Travel Michigan, spoke on the state’s tourism industry at the conference. According to Zimmermann, money spent on travel and tourism was down 3.6 percent in 2007, to $18.1 billion. While resident travel within the state was down, non-resident travel was up 4 percent. Hotel occupancy stayed flat.

The Pure Michigan campaign targeted five cities outside the state — Milwaukee, Cincinnati, Chicago, Indianapolis and Cleveland — and Ontario, Canada. The campaign saw a very favorable response in the markets of Chicago, Indianapolis and Cleveland. In those three markets, there was an increase of 109 percent in trips taken to Michigan in 2007 compared to 2006 — 1,043,000 trips in all. The total for all six markets came to 1,255,000 in 2007, up 80 percent from 2006.

The campaign spent $19.97 million in out-of-state advertising, which brought in $805 million in visitor spending. Next, Travel Michigan looks to increase its advertising in the new markets of Columbus, Dayton and St. Louis, and launch the state’s first winter advertising campaign and the first national cable television advertising buy.

Nicholls now hopes for a long, dry summer to follow the long, snowy winter, in hopes it will increase outdoor activity and encourage tourism and travel in the state. Nicholls presented data that showed a noticeable decrease in the amount of highway traffic counts over the past four years for Michigan. In 2007, only June, July and August reported an increase in traffic counts.

The Department of Community, Agriculture, Recreation and Resource Studies at MSU tracked several more trends to help make projections for 2008. Those trends include the currency exchange rate, interest rates, gasoline prices, the stock market, consumer confidence and unemployment.

Gasoline prices have, of course, risen and the department believes prices will continue to rise. The stock market has slumped, consumer confidence has seen a 43 percent decrease, and Michigan’s unemployment rate has gone up since last year. All of these factors have combined to aid a 7.6 percent increase in travel prices since last February. Lodging and airfares have also increased.

Nicholls also noted that the negative media coverage of the automobile industry, economic gloom, the Detroit mayoral scandal and the presidential primary election provides another hurdle for the state to overcome.

The department did find some bright spots in their projections. The strength of foreign currencies, including Canada’s, can be a positive, bringing in more foreign tourists. Events such as stops by the PGA tour and the new Rothbury Music Festival in July should generate more tourism, and the increase in gasoline prices may encourage more Michigan residents to spend their vacations closer to home.

MSU projects that travel spending will stay relatively flat and travel volume will decline for the southwestern region of Michigan in 2008. That region can expect a 3 percent increase in revenue from tourism.

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