Tourism on the Ropes

June 7, 2006

For the past five years tourism officials in Michigan have sounded like a broken record. Each spring bold predictions are made about a recovering tourist economy and each fall when expectations fall short excuses are made: Michigan’s economy, fears from 9-11, the weather, and high gas prices have all been blamed for the state’s struggling tourism economy.
By the end of 2005 Michigan ranked dead last in hotel occupancy rates in the country. While national occupancy rates hovered around 63%, Michigan was at 52% and Northern Michigan was at 50%. Most states whose economies are tourism-driven (Florida, Illinois, California and Texas) have all seen their industries return or pass pre-9-11 levels. Yet, Michigan, and in particular Northern Michigan, have not.
“To put it bluntly we are getting our butts kicked,” said Brad Van Dommelen, President of the Traverse City Convention and Visitors Bureau. “We can make excuses but the bottom line is our competition (other states) has recovered and we have not. In Michigan we became complacent. When you consider that 87% of the visitors to Northern Michigan are from this state, that was great when the auto industry was flourishing. We didn’t need to look elsewhere for visitors; now we do.”
 
DEFICIT SPENDING
Another startling statistic to Van Dommelen is that fact Michigan has the largest tourism deficit in the country at $3 billion. That means that residents are spending $3 billion more on travel outside of the state than they are within Michigan annually. 
“Wisconsin has a tourism dollar surplus. They are kicking our butts,” said Van Dommelen. “It is not because they have more to offer, or a better product. They are doing a better job of marketing themselves than we are.”
Van Dommelen points to the lack of dollars the state is investing in marketing to visitors as one key factor to this. Michigan is spending a little more than $5 million annually to promote tourism while Wisconsin is at $14 million and Illinois is over $30 million.
“We are asking the legislature and the Governor to consider an annual budget of $30 million,” said Van Dommelen. “They have authorized an extra $15 million for the next couple of years. But it is going to take more than that.”
While Van Dommelen is unwilling to place any blame or point fingers at anyone in particular for the state’s troubled tourism economy, Joe Bredeinstein of Walloon Lake has plenty to say.
 
ENGLER’S HAND
“Maybe others are unwilling to place blame but I am willing to point to the Engler years as when the decline started,” said Bredenstein, a longtime promoter of springtime tourism efforts in Michigan. “Not only did he cut the tourism budget substantially, he created a mindset among Republican legislators that the tourism industry should be marketed through the Convention & Visitor Bureaus (CVB). This lack of leadership from the state created a competitive environment between CVBs instead of a cooperative effort. So instead of working together and pooling resources these CVBs began using marketing dollars to compete against one another.”
Bredeinstein recently held a Tourism Summit in Petoskey to explore ways for partnering and networking. He and others feel that tourism in this state needs to be redefined and expanded.
“If you factor in all the areas tourism impacts in this state from agricultural
to restaurants, tourism is at least our second largest industry if not largest,”
said Breidenstien. “There is no question that it is the driver of the Northern
Michigan economy.” 
 
OUT OF TOUCH
But just how vital is tourism to Northern Michigan? No one knows for sure as the most recent tourism impact study was conducted 15 years ago.
“It is safe to say that tourism is one of the most important components to our economy in Northern Michigan,” said Van Dommelen. “We plan to conduct another economic impact study soon. But we know that tourism has direct (where the visitor opens his or her wallet), indirect (local suppliers who benefit) and induced (tourism business owners and employees spending money in the local economy) benefits to our economy. Once the study is completed we will have a better understanding of this and, more importantly, so will the community.”
Van Dommelen says there are other benefits to a strong tourism economy.
“The vibrant shopping districts we have throughout Northern Michigan are a definite result of tourism,” said Van Dommelen. “We have several amenities that other towns our size don’t have because of our tourism economy. Our heath care system, cultural arts and the quality of the restaurants are just some examples.”
States and communities with strong tourism economies often attract more economic development and growth in their professional base.
 FALLING IN LOVE
“The tourism economy is the most effective economic driver a community can have,” said Van Dommelen. “People visit our region fall in love with it and decide they want to live here. So tourism attracts entrepreneurs and professionals to the area to live and invest in the community.”
Since arriving in Traverse City last December Van Dommelen is amazed at how little the outside world knows about Traverse City and Northern Michigan. He says those who live up here or visit here often assume that everyone is familiar with the region.”
  “Recently I was speaking to someone who asked me what the name of the river was between Wisconsin and Michigan,” said Van Dommelen. “There are always people who are amazed that we have beaches up here. When people think beaches they think Florida or California. They have no concept of the size of the Great Lakes. We need to create a better understanding of the Great Lakes and the simple fact that when you stand along the shore of Lake Michigan and look across the lake you can’t see Wisconsin.”
Van Dommelen and others feel that Northern Michigan is a destination that appeals to the national market and the only thing standing in the way is getting the message out.

GOT IT ALL
“We have world-class everything up here; the traveling public just doesn’t know it,” said Van Dommelen. “We need a national campaign that delivers that message. For example we have all these championship and signature golf courses. During the summer months our destination is very attractive to southern golfers, but they need to know we are here.”
So how does Michigan launch a national marketing campaign when the tourism industries differ from Northern Michigan to Detroit?
“Detroit needs to be marketed as an urban tourism destination and they are doing that,” said Van Dommelen. “We need to market our beaches, bays and boutiques and all the natural resources we have. But we can’t do it alone.”
Van Dommelen is a believer in partnerships. In the first few months on the job he reached out to other area CVBs to form a “Bays, Beaches, & Boutiques” coalition.
“I think regional partnering is important. There are a lot of similarities from Manistee to Petoskey and a collective effort makes sense,” said Van Dommelen. “I think we can work collectively to pool our resources to drive people here.”
He also feels festival and event marketing is an important component. Next year Traverse City hosts the National Governors Conference in July. It is anticipated that close to 600 journalists will visit and a huge spotlight will be on Traverse City as some political pundits are pointing to this conference as the start of the 2008 race for the Presidency.
“This is our Super Bowl,” said Van Dommelen. “While the media will be here to cover the conference as with the Super Bowl they will write and report about their experience here during the conference. This is going to have a major impact on our area.”
 
EXPLORING POSSIBILITIES
The conference was last held here in 1987 and local business leaders saw substantial increases in real estate sales and tourism spending in the region within the year following that has been attributed to the conference. He and his staff will travel this July to the conference in South Carolina where they will set up a booth to promote Traverse City to the media, the governors and others.
He is also exploring other festival
and event opportunities including a
couple major music events and the
possibility of attracting the film industry to Traverse City.
“I put together a business plan for a film industry in Detroit and I think it is very viable for Northern Michigan,” said Van Dommelen. “Mackinac Island is still reaping the benfits from the movie ‘Somewhere In Time,’ being filmed there. Commercials and feature films are big dollars for communities, so we are exploring this.”
 As for the possibility of additional funding from Lansing, Van Dommelen sees at least some hope.
Van Dommelen isn’t willing to go on record with any bold predictions for this summer. Early indicators over Memorial Day Weekend show the potential for recovery but he isn’t banking on anything.
“We have a lot of work to do. The tourism industry is a very competitive marketplace. We need to work together, there needs to be more regional promotion. Individually we just do not have the resources to market ourselves nationally,” said Van Dommelen. “The state of Michigan needs to re-think its position on tourism. Tourism needs to be its own department (it is currently a division of the Michigan Economic Development Corporation). Agriculture has its own department and we need ours.”
To Joe Breidenstein those words are music to his ears.
“Finally we have someone up here that understands the concept of working together. It is not about one community
it is about a collection of communities. Market them together and we have a destination that rivals anywhere else in the United States.” said Breidenstein. “I agree that Michigan needs to re-think its position on tourism marketing and create a separate Travel and Tourism Department. They also need to re-visit some of their current marketing efforts because they don’t seem to be effective.”
Does Breidenstein have any suggestions?
“Sure, not to long ago we had a great campaign in this state. It was simple and effective. It had people bustling with pride and the industry was booming then, ” said Breidenstein. “I say go back to it.”
That campaign Breidenstein was referring to was “Say Yes To Michigan” developed in the late 1970s.
“Somewhere along the way we lost the message. Obviously if our residents are spending $3 billion more on travel outside of Michigan than is being spent
in Michigan, then despite all these
excuses that are being given
Michiganders are traveling. They are just traveling out of Michigan,” said Breidenstein. “We need to remind them: Just Say Yes To Michigan… Again! Pretty simple and to the point.”
 
Next week Express contributor Rick Coates will conclude his series on tourism with a look at how wineries & water parks in Northern Michigan have been  “crushing” and “splashing” the current trend in tourism.