Tourism bounces back after slow start
A cold spring brought a slow start to the 2013 tour season, but the season rebounded in July and August to finish with numbers on par with last year.
Below the surface, however, is an undercurrent of change, including some fueled by fear that numbers of independent travelers aren’t rebounding to historic highs. Cruise ship tour operators say they saw a small improvement in business over 2012, but numbers are still down from peaks seen before the 2008 national recession.
“We’ve seen a fairly steady decline in independents in the past 10 years. It’s discouraging. There’s so much publicity about Alaska right now,” said Alison Jacobson, whose family-run boat tours to Juneau started in 2000. The firm also ran a shuttle between Haines and Skagway, starting in 1991.
The company has cut days of operation and hired family members to reduce costs. Next year they’ll try an independent whale-watching tour out of Skagway, marketing through the Internet.
Canadian visitors have helped buoy the Jacobsons’ business in recent years, but they’re not filling boats like traffic from the Lower 48 used to, Jacobson said. August was a great month for the company but the numbers came from fuller and larger RV caravans, not independent travelers, she said.
“We guarantee a lot of things, and we can produce it. We can show people whales, porpoises, seals, but it’s still hard without that Lower 48 traffic to pull from,” Jacobson said.
If Jacobson’s Skagway venture pays off, she’ll join a small group of operators who are carving a niche by tapping into cruise ship traffic, independently. Haines tour operator Joe Ordonez has taken a similar route.
Three-quarters of Ordonez’s business is off Skagway cruise ships, but less than half his business comes from sales aboard ships. The difference comes from website sales and tour brokers.
Ordonez said cruise passengers have become savvy in recent years, and are more willing to book tours independently, relying on ratings from outfits like TripAdvisor.com, where his company has received excellent reviews.
“For the passenger, it’s a little more effort and a little more risk. Their ships aren’t standing behind the tours they’re buying, but they’re finding they can have a quality tour, in a smaller group, and do something different,” Ordonez said last week.
Ordonez employed 15 part-time guides this year and offered tours including kayaking in Chilkoot Lake, gold panning in the Porcupine, wildlife viewing and photography.
He sells some tours through big cruise ships, but he also caters to smaller ships whose clients are looking for tours in smaller, custom options. His company grew enough this year that he’s training a manager. “We were up. We had a good year.”
Ordonez said for Haines to try to resurrect historic cruise ship or RV traffic is “barking up the wrong tree.” He said Haines should market itself as an offshoot destination from Skagway. Nowhere else in Southeast is a busy cruise port like Skagway so close to a small town like Haines, he points out.
“Skagway is the gateway community to Haines. That’s the way I’m looking at it. That should be our marketing strategy. For 68 bucks (fare on the fast ferry) you’re in a small town with only 1,000 people in it, with great people and restaurants,” Ordonez said.
Ordonez said Haines also could serve as a “bedroom community” for Skagway summer workers, possibly ensuring traffic for a shuttle between the towns.
Jetboat tour operator Karen Hess said Ordonez has identified a niche in the cruise market, but she sees it as a small one with limited impact on the local economy. “For the town to really benefit, people need to come over to go shopping and see the town. That will be hard until we get more shops in Haines. Until the town gets more businesses, it’s going to be hard.”
Getting more ships docking in Haines would spur investment in local retail, she said, making the town more attractive as a destination from Skagway.
Hess said her company’s numbers saw an uptick in 2013, but have been mostly down since 2007 due to the loss of ships, including Cruise West, and a general downturn in spending by passengers. Revenues in 2012 were the company’s lowest since 1997 and half of what they were in 2007, she said.
“In the last five years, people have been holding onto their money tighter. When they’re spending on shore excursions, they’re only going to have one expensive excursion on their entire cruise,” Hess said.
Hess once sold logo clothing at a company gift shop on the Chilkat River. As sales declined, she shifted to less expensive souvenirs. She then closed the shop, as the volume of sales didn’t justify the effort, she said.
“Things seem to be starting to come up now. We’re hoping that continues,” she said.
For now, the Haines tourism department is still working on attracting large ships. Tourism director Tanya Carlson said she’s pinning hopes for an uptick in cruise traffic in Haines to 2015, when larger ships that previously couldn’t fit through the Panama Canal will be deployed to Alaska.
Carlson’s hoping those giant ships will bump smaller ones to destinations like Haines, part of a “Backroads Alaska” campaign to steer cruises to less crowded destinations.
Haines will lose two Princess Cruise dockings next year, as the company is pulling a ship out of Skagway, making room for the Haines dockings to move up the canal. The town should see 30,481 cruise passengers next year, compared to 31,696 in 2013.
The town will again see 18 dockings by Holland America ships, but the larger Oosterdam will replace the Zaandam, bringing up to 250 passengers more each week. Also, Haines will gain the 600-foot Regatta, a 680-passenger vessel catering to upscale clients who are typically bigger spenders in port. Also in 2014, there will be 10 dockings of the Legacy, an 88-passenger vessel sailed by Uncruise Adventures, a company that will include Haines in trips between Juneau and Sitka.
Highway numbers since 2009 show a decline of about 3,000 travelers per year in each direction through the border between May and September.
Independent travelers still outnumber cruise passengers about two to one, but Carlson isn’t optimistic about returning to historic numbers of visitors by road.
Tighter work schedules and higher gas prices have hurt that traffic, she said. Lower 48 residents are more likely to fly in and rent an RV than to drive from the Lower 48, she said, but when they do, their destination is Anchorage, which is generally less expensive than coming into Juneau.
She said she’s hoping to secure funding from the borough for a study that will help identify the demographics of independent visitors, including their ages and place of origin. Also, next year for the first time since the 1980s, the State of Alaska will advertise on network TV in prime time.
Such advertising helped boost road traffic to record highs in the early 1990s, but isn’t likely to have that much bounce. “It’s just cheaper to cruise up here,” Carlson said. “But it will also help the independent market.”
Tour-related businesses without a direct tie to cruise ships provided reports similar to tour boat operator Jacobson’s.
Hotel owner Jeff Butcher said the season was “right in the middle” of the previous years, with a slight increase over last year, he said, due in part to two conventions held here this year.
Bookstore operator Tom Heywood said the summer was the store’s slowest. “It was very similar to last summer, the previous lowest.” His numbers have been sinking in the last four to five years, he said.
“Wednesday ships do not create many sales for us,” Heywood said. “We’re trying to figure out a way to diversify to stay afloat.” But road traffic, for the book store, was definitely down, he said.
Fred Shields of the Wild Iris found that business was about the same as last year. “I think there’s been a downward trend.”