Tourism spending up 8 percent

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A scene from a Pure Michigan TV commercial features shopping in downtown Traverse City. Analysts say the advertising campaign has drawn a steady increase in out-of-state visitors to Michigan. Special to the Record-Eagle

March 28, 2012

Tourism spending up 8 percent

By JOHN FLESHER Associated Press Wed Mar 28, 2012, 07:25 AM EDT

TRAVERSE CITY — Tourism spending in Michigan rose in 2011 for the second consecutive year, a trend likely to continue as an improving economy trumps concerns about higher gasoline prices, analysts said Tuesday.

A steady increase in visits from out-of-state residents drawn by the "Pure Michigan" ad campaign combined with the recovery to help post an 8 percent rise in spending on tourism, said Dan McCole, assistant professor of tourism at Michigan State University. That was twice as big an increase as he and colleagues had predicted.

McCole projected tourists will spend 6 percent more in 2012.

"As long as the weather is good — and that's always a big 'if' — I think we're going to see a very strong year for tourism," he said during the Pure Michigan Governor's Conference on Tourism 2012 in Grand Rapids.

The 2011 jump happened despite a cooler, wetter summer than a year earlier, said Sarah Nicholls, an associate professor at Michigan State. Hotel occupancy was up 7 percent statewide and 10 percent in Detroit.

The university team doesn't calculate precise spending totals, but consultants hired by the state put the figure at $17.2 billion for 2010. Their estimates for 2011 will be released later.

McCole said the economy remains a mixed bag, with indicators such as housing construction and the stock market improving although unemployment remains high. Although half the U.S. population wasn't affected by the recession, many of those who could afford to travel held back out of caution, he said. Those people should loosen their purse strings as conditions improve.

One survey showed 44 percent of Americans plan to step up their leisure travel this year, McCole said. Despite widespread complaints, expensive gas probably won't be a big problem overall, although some out-of-the-way destinations might get fewer visitors. Activities built around heavy fuel use, such as boating, also could take a hit. But most travelers are doing well enough financially to absorb the added cost.

"People prioritize their vacations. That's something they're going to fight to defend," he said.

Some on tight budgets might sacrifice short, weekend-long excursions to preserve a longer summer vacation trip, said Steve Yencich, president of the Michigan Lodging and Tourism Association. Businesses could target that market by offering special overnight packages or gift cards to offset gas purchases, he said.

Statistics released at the conference said the Pure Michigan cable television ad campaign drew 3.2 million visitors and generated $1 billion in spending last year. Those travelers paid $70 million in Michigan taxes, meaning the state received $4.90 for each dollar invested in Pure Michigan ads, according to a study by Longwoods International, a tourism research company.

The program is "delivering impressive results for our state," Gov. Rick Snyder said.

Drawing visitors from other states and even other countries will be increasingly important to building the Michigan tourism industry, McCole said. Spending by out-of-state residents in Michigan now exceeds that of travelers from within the state, a trend that's unlikely to change, he said.

In the future, tourists will be increasingly educated, racially diverse and interested in quality time with family and friends, he said. They'll also be looking for good deals and inclined to make last-minute decisions about where to go.

"The big message is they're willing to be enticed to come to Michigan," McCole said.

Google searches by potential Michigan travelers show rising interest in beaches, restaurants, breweries, wineries and farmers' markets, he said. That suggests the Pure Michigan campaign, with its emphasis on eye-catching vistas, is changing the state's images.