banner
← Back to Cruise News Articles Section

Meltdown hits local tourism

By Scott Bowlen

Ketchikan’s tourism industry felt effects from the national economic meltdown with declines in visitor numbers and most types of spending in 2009. Cruise passenger numbers dropped by about 0.5 percent from 941,910 in 2008 to 937,419 passengers in 2009, according to the Ketchikan Visitors Bureau.

The number of air visitors declined by an estimated 13 percent to about 50,835 visitors in May through September of 2009 compared to the year before, according to the visitors bureau. Ferry arrivals with the Alaska Marine Highway system fared better, declining by only 0.5 percent to about 11,978 visitors from May through September. However, AMHS numbers for August and September actually outperformed the same time period in 2008, according to the visitors bureau.

Hotel stays were down about 20 percent during the May-September months, according to the visitors bureau. Spending in restaurants also declined, as did purchases in the curio and jewelry retail sectors, according to Ketchikan Gateway Borough revenue figures obtained by the visitors bureau. Jewelry saw the biggest hit, skidding about 21 percent from $38.7 million in the second and third quarters of 2008 to about $29.9 million in 2009.

It wasn’t all gray economic skies, though. In fact, the summer’s excellent weather is thought to have potentially contributed to a surprise rise in tour excursions during the 2009 season. Patti Mackey, executive director of the Ketchikan Visitors Bureau, presented a snapshot of the 2009 visitor season during the KVB’s quarterly membership luncheon.

Given the economic situation and announced changes in cruise ship schedules, locals were expecting fewer visitors to Ketchikan in 2009 than during 2008 when the community had its first-ever 1 million visitor year (an estimated 1.013 million guests).

The 36 cruise ships that made a total of 496 port calls in Ketchikan during the 2009 season brought 937,419 passengers to the First City, according to Mackey. “When all was said and done, we actually only saw a decrease of … almost 4,500 passengers this year compared to 2008,” she said. That slight of a decline says hat the cruise lines were very good at marketing, according to Mackey.

“They found a price point that they needed to find in order to fill their ships,” she said. “So they did a great job of maintaining the numbers of people that were on their ships this year.” The visitors also did a great job in buying shore excursions.

“Interestingly, tourism adventures actually went up this year,” Mackey said. “There’s any number of reasons for that. It could be that there was great weather. … (Ketchikan had) wonderful weather this year compared to last.

“There are a lot of tourists that are on the lower side of the price scale,” Mackey added. “It could be we saw a lot of increase in the less-expensive tours that helped boost it up.”

Based on a formula developed to estimate the visitor percentage of people who arrive in Ketchikan by air and ferry, visitor arrivals by air were down 13 percent in May-September from the same period in 2008, according to Mackey.

“But in May and June, we were actually down, on average, 20 percent from what we’ve done in past years,” she said. Mackey credited the Alaska Marine Highway System’s marketing staff for its work in attracting ferry ridership this year.

Of the 17,277 people who arrived in Ketchikan aboard AMHS ferries during the May-September period, about 69 percent â?? 11,978 â?? were visitors.

“(It’s a) very, very slight decline in what we saw last year,” Mackey said. “And, in fact, the passenger numbers on the ships in August and September this year were actually up over 2008.”

Ketchikan hotel stays were down about 16 percent overall from January to September, accelerating to a 20-percent decrease in May to September, according to KVB information. Hotel gross revenues dropped from about $13.8 million during the second and third quarters of 2008 to about $11.9 million during the same period of 2009.

Wanda Vandergriff, who operates the Ketchikan Reservation Services that books local bed and breakfast inns and vacation rentals, said the 2009 season was “definitely slower,” with really slow bookings for the May and June start of the season before picking up for the months of July, August and September. She noticed that some regular groups didn’t come this year, and some of the larger regular groups brought fewer people.

“It wasn’t always financial (reasons),” Vandergriff said. “But still, it entered in.”

She estimated that vacation rental and B & B inn operators experienced drops of between 15 percent and 20 percent. “At least that; it could have been a little more,” she said.

Restaurant spending slid about 1.5 percent during the second and third quarters of 2009 from the year earlier, going from about $8.84 million in 2008 to $8.7 million in 2009, according to KVB information.

Retail curio sales for those quarters in 2009 declined about 7 percent to about $11.15 million, according to KVB.

There was a lot of dock talk in 2009 about the state of the fishing-lodge and charter-fishing sectors.

Russell Thomas, manager of Clover Pass Resort and a board member of the SouthEast Alaska Guides Organization, said a recent conversation with SEAGO lodge operators indicated there were reductions of 20 percent to 40 percent in package bookings for the 2009 season “The economy was a big issue, and then, halibut (harvest) restrictions, I think were something that some people said hindered their ability to sell trips,” Thomas said. He’d also heard that some lodge operators reduced the amount of time they were open in 2009.

This followed a period of time when most lodge operators had been slowly growing their business or had developed a pretty stable business. “Industry wide, I think this (downturn) is probably unprecedented, at least in recent memory,” Thomas said. He added that the industry had a “six months heads-up” that the season was going to be difficult.

“We’re not like a construction company in Las Vegas that all of a sudden found ourselves holding a thousand homes that we couldn’t sell,” Thomas said. Lodge operators made “pretty significant changes to how they were doing business” to make sure

For instance, “we put off some capital improvement projects that were on the list to be done, but we just didn’t feel like it was time to expend the money,” Thomas said. “We made cuts in staffing because we knew that we were going to be short. So I think there was a lot of operators that made decisions like that that may have helped protect, or at least conserve enough cash to make it through the winter.”

he fine weather â?? and good fishing â?? of this past summer and fall proved to be a bright spot, he said. “We saw more last-minute bookings this year than we’ve ever seen,” Thomas said. “And I think some of that had to do with people just holding on to their money until they really felt like they … felt comfortable in spending it.”

Some lodge operators attracted late bookings through discounting, sometimes substantially, according to Thomas.

He viewed the good weather and fishing as helping to boost the growth in local traffic for boat rentals, fish processing and fuel that they had in 2009

“We saw that as being real positive for us this year,” Thomas said.

Source: Ketchikan Daily News

Categories: Cruise News Articles