Alaska’s Not-So-Hot Summer

Cruise passenger numbers are up, but travelers curtail spending on interior tour packages

By: Robert Carlsen

Alaska’s slow but steady tourism growth during the past few years came to a decisive halt this summer, according to a statewide survey of 315 travel-related businesses.

Commissioned by the Alaska Travel Industry Association in late September, the survey revealed that, while cruise passengers increased by 4%, many of them did not book supplementary land packages and high-end shore excursions, causing big declines in volume for interior Alaska businesses and small tour operators. In fact, 87% of interior region businesses said revenue was down for the 2002 summer season.

Of the statewide businesses in Alaska that reported decreases, 43% said volume was down at least 11% and, in some cases, by as much as 50%. Relative to the markets they cater to, 81% of businesses primarily serving the adventure travel market reported a decline in volume; 65% of businesses serving the sport fishing market posted volume drops; and 61% of businesses primarily serving the cruise/cruise tour market said volume declined.

Overall, the state reported a 6% drop in independent visitors.

Though cruise ship companies reported record numbers of passengers this year 720,000 compared with 690,000 in 2001 many passengers did not take the package tours, impacting interior Alaska greatly, and many did not take the high-end shore excursions critical to small tour operators.

The survey said 30% of all businesses made some type of adjustments, including:

" 23% reduced staff.

" 22% consolidated/reduced inventory.

" 20% discounted/lowered rates.

" 19% reduced expenses/adjusted budgets.

" 14% changed/adjusted markets.

" 9% spent more on advertising/marketing.

" 3% raised prices.

“A decade worth of budget cuts in tourism marketing have clearly taken a toll on the state’s ability to attract visitors,” said Ron Peck, ATIA’s president and COO. “Our cruise-ship partners are doing a good job in marketing Alaska, but that means the only growth our industry is seeing is in cruise ship passenger volume.

“In fact, bookings for 2003 are expected to be slow, and the independent market, which has been in decline for a number of years, is in trouble.”

Perhaps Kirk Hoessle, president of Alaska Wildland Adventures, put it best: “Survival was how we measured success this year.”

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