In British Columbia and Washington, 2009 is going to be a tough year for the tourist business. Here's what some experts are doing to get through the recession.
It's tough economic times, including for the tourism industry. Cities and destinations in the Pacific Northwest are scrambling to bring in visitors. KING-5 News aired a feature on Feb. 19 with the headline: Western Washington tourist destinations struggling. It highlighted the communities of La Conner and Snohomish as two tourism-dependent towns affected by the recession.
Washington State Tourism has recently redirected its marketing efforts, no longer trying to lure in people from 13 western states and Canada. Instead, it's focusing on the nearby markets of Washington, Oregon, California, and British Columbia. It's all about catering to dollar-conscious travelers opting to take shorter trips.
Earlier this year, I spent several days in Vancouver and Victoria, talking and listening to people directly involved with the tourism industry in British Columbia. The story of our neighbors north of the 49th parallel pretty much parallels ours: 2009 is going to be a very difficult year.
Those were the words of Robert Gialloreto, President and CEO of Tourism Victoria. He's been on the job just barely a year, arriving from Calgary where he marketed Alberta in the Asia-Pacific region, the Americas, and Europe. His focus differs at Tourism Victoria, a $4 million marketing organization composed of 980 members. "Our three markets are Greater Seattle, Alberta, and Vancouver," says Gialloreto. "And we're linked to Vancouver for international travel." As of January, Victoria had the lowest hotel vacancy rate of any Canadian city.
In February, Tourism Victoria was recognized for its Set Sail on Us campaign with BC Ferries, which featured complimentary vehicle and passenger fare to and from Vancouver when visitors booked two consecutive nights in Victoria. The ferry-free packages sold out in three days, and the destination said it realized a 362 percent increase in sales through Tourism Victoria.
Gialloreto also acknowledges the benefit and spillover from the Vancouver 2010 Olympic and Paralympic Winter Games that begin Feb. 12, 2010. Victoria has the honor of being the start of the Olympic torch relay when the torch arrives in British Columbia's capital city on October 30, 2009. Gialloreto ticks off some new programs and attractions: the New Marine Centre at Sidney, an aquarium and marine discovery center, is scheduled to open in the spring of '09; and the North American premiere of Treasures: The World's Cultures from the British Museum is on display at Victoria's Royal BC Museum from May 1 to September 30, 2009.
Another Calgary transplant, Herbert Wat, is VP of marketing for Rocky Mountaineer Vacations in Vancouver. With Rocky Mountaineer Vacations offering more than 70 packages and four train trips through BC, Alberta, and the Canadian Rockies, the company also offers trips on board the Whistler Mountaineer train that travels between North Vancouver and Whistler.
Wat says the five key areas he's targeting are Washington, California, Texas, Florida, and New York. "2009 will be a year of economic challenges," Wat concedes. "We'll have fewer visitors from Australia and the UK, due to the dollar." In light of that, Rocky Mountaineer will be going after the short-haul market from Canada and the U.S. "40+ up are the demographics," explains Wat. "We need to talk to the baby boomers now." He adds that retirees would continue to be a large portion of their customer base.
"Travel consumers are watching all the deals," Wat continues. But as far as those "deals," he isn't into "discounting" a brand. "Once you discount your brand, it takes a while to get it back," he says. "We'd rather add value to the brand than do discounts." In light of that, Rocky Mountaineer Vacations has scheduled offers throughout the year, which include thousands of dollars in added excursions.
A familiar face on the Vancouver hospitality and tourism landscape is Stephen Darling, Regional Vice-President and General Manager for Shangri-La Hotels and Resorts. In January, Darling opened the Shangri-La Hotel, Vancouver. The 61-story hotel, which features 190 rooms, is the first Shangri-La Hotel in North America. It's home to the restaurant MARKET by Jean-Georges and CHI, a luxurious spa. For many managers, opening a hotel during a deep recession could cause plenty of sleepless nights, but Darling is upbeat yet circumspect.
"In many ways, Washington state and British Columbia are in a similar situations, as compared to the rest of the US and Canada," he says. "We are two sub-economies that are more diversified and less reliant on 'old economy' business, and generally more diversified in our GDP." He also credits the upcoming 2010 Olympics with providing BC with a unique economic engine — one that will result both in business and leisure travel to Vancouver and the region. "We are most fortunate to have this momentum; and it's one that will help see us through the hard times over the next year," he notes.
Darling also thinks the outlook for this summer is promising. Since opening the hotel, the Shangri-La has received good response from the Pacific Northwest, along with guests from as far south as California. "People who are accustomed to luxury travel will continue to do so," said Darling. "But they'll seek luxury experiences that offer greater value; and they'll do so in less conspicuous ways."
At the February BC Tourism Industry Conference in Vancouver, Michael Campbell was one of the keynote speakers. Touted as BC's best-known business analyst, he hosts Canada's top-rated financial radio show, MoneyTalks. Both enlightening and entertaining, he's also the brother of BC Premier Gordon Campbell. The charismatic speaker addressed the bigger picture of the economy, describing the severe downturn as "an event." Noting that 93 percent of Canadians are still working (with the number higher in BC), he emphasized that how people react and embrace change during this recession is the key. "People will come out of this situation stronger," Campbell predicted.
He put a more positive spin on the current situation than many economists. "In Canada, manufacturing is getting killed, but our banking system is sound," said Campbell. "We only have six major banks. BC is much better situated than other jurisdictions, and there is still tons of opportunity." Saying that an average recession lasts 14.4 months, he acknowledged that the world will look very different a year from now. And for those in the tourism biz, he advised them to hedge their risks. "Be aggressive. Be innovative. Be a different thinker."
This article originally appeared in the May 2009 issue of Northwest Business Monthly magazine. Reprinted with permission.