A sluggish season for Alaska tourism

Companies cut rates across the state; locals say things not as bad

Posted: Sunday, June 24, 2001

ANCHORAGE -- Alaska tourism companies are slashing rates and offering special packages to attract business in what most describe as a sluggish visitor season.

Princess Alaska Lodges, for example, is offering $99 rooms at its two hotels along the Parks Highway close to Denali National Park and Preserve. That's dirt cheap for Alaska's peak season. The rooms normally would fetch $149 during June and July, said Tom Dow, a Princess spokesman.

"This is kind of unusual for us to be extending this rate into the middle of the season," said Dow. "By the end of the year, we'll be lucky to end up flat with last year."

Economic jitters, stock market woes and higher gas prices are the main factors keeping tourists away from Alaska, tourism analysts said. Many travelers that would come to Alaska seem to be wallet-watching and choosing destinations closer to home, said Tina Lindgren, executive director of the Alaska Travel Industry Association, the state's major tourism-marketing organization.

"There's not a crisis. But nobody is saying this is a gangbusters year," said Lindgren.

Tourism is lagging more in the Interior than in Southeast Alaska, where cruise lines continue to unload full ships, said Linda Huston, regional manager of Southeast Alaska and the Yukon for Holland America and Grayline. Many of the passengers are traveling on cut-rate tickets though, Huston said.

"All the marketing departments for all the cruise lines are definitely being creative with their specials," Huston said. "A lot of people are almost paying more for their shore excursions than they have for their cruise."

There are fewer independent travelers in Juneau so far this year, Huston said. Some small tour groups dropped Southeast from their itinerary because of problems in past years on the Alaska Marine Highway, Huston said.

"Overall Alaska is a very expensive destination for anybody in the Lower 48 and their choices to come to Alaska are made well in advance," Huston said. "Certainly with the news in the stock market a lot of people called off a plan to come up here to do something less expensive down south."

Alaska is also competing with Europe for travelers this summer, analysts said. Weakness in the euro, the new European currency, and a strong U.S. dollar have made many European destinations a bargain for Americans, said Eric Downey, marketing director for Alaska Wildland Adventures of Girdwood. But many Europeans who might have chosen Alaska for a trip seem to be staying away.

Hotel owners are also competing against each other. A slew of new hotels have shot up in Anchorage. Older properties have upgraded and added rooms as well.

The soft tourism market hasn't hurt sales at the House of Russia in downtown Juneau though, said owner Liv Cadigan.

"We seem to be doing just fine," Cadigan said. "Our sales are par with last year. I don't feel that there are less people just by judging the people on the street."

While visitorship to Alaska seems flat or even down slightly, one sector is perking along, several tourism officials said. Industry insiders call it the "VFR" market -- visiting friends and relatives. While some tourists with no state connections may be heading elsewhere, people who know or are related to an Alaskan are coming regardless of economic concerns.

"The VFR market is not doing badly," said Terzah Tippin Poe, tourism marketing director for Cook Inlet Region Inc. CIRI owns hotels in Talkeetna and Seward and offers day cruises in Kenai Fjords and Prince William Sound.

CIRI is trying to capitalize on the VFR market it by adding value to deals geared toward locals, she said. The company is offering packages that combine a railroad trip to Talkeetna, discounted rooms at CIRI's Talkeetna Alaskan Lodge and a bus ride back to Anchorage. The package sells for $145 per person, Poe said. If purchased separately during peak season, a room by itself would go for $160, she said.

Tourism executives said the state should be spending more on marketing Alaska if it wants to compete effectively.

"There's been a lot of slippage because of the weak marketing effort" due to declining state spending, said Dennis Brandon, head tourism executive for CIRI.

Juneau Empire reporter Kristan Hutchison contributed to this story.

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