Trends 2016: Kenai Peninsula tourism outpaces state

  • By Kelly Sullivan
  • Tuesday, March 29, 2016 12:36pm
  • Business

2015 was a record year for the Kenai Peninsula’s tourism industry, which may well prove to be a boon for local economies hard hit by financial strains trickling down from the state now or in the near future.

Guided land tours jumped 26 percent from 2014; guided water excursions 7.8 percent; restaurants 10 percent; and accommodations 7 percent, according to the Kenai Peninsula Tourism Marketing Council.

“The Kenai Peninsula Borough saw record taxable sales tax numbers from primary tourism businesses in 2015, up an incredible 8.6 percent over 2014,” said Shanon Davis, executive director of the marketing council. “While the entire state of Alaska saw strong tourism numbers. The Kenai Peninsula’s growth outpaced the rest of Alaska by a significant margin. Every sector of the industry and every community saw an increase, including guided water, which is rebounding from the decline of king salmon as businesses diversify their products.”

It is currently the second largest private sector employer on the peninsula, behind health care, Davis said, and is responsible for 25 percent of the Kenai Peninsula Borough’s total collected sales tax.

Kenai Economic Development District Director Rick Roeske called it a “driver for the peninsula’s $2.2 billion economy.”

Right now the rest of the country is doing well, so that means more visitors headed to Alaska, Roeske said.

“Tourism is affected by many factors, including the global economy, travel trends and marketing investments,” Davis said. “Right now the low price of gas is a great benefit for consumers — it essentially gives them an extra $1,000 in their pocket — and many are using it for travel. Airfares have decreased due to the cost of gas, another added incentive for travel.”

Chambers of commerce are major forces behind promotion and advertising to keep people coming back and new visitors coming in, Roeske said.

Karen Zak, executive director for the Homer Chamber of Commerce, said the organization caters to all types of tourists equally, and puts a huge focus on advocating for the city as a destination.

“The Chamber produces and distributes a full color visitor guide to over 120,000 people each year.” Zak said. “… Social media includes active YouTube and Facebook sites. The Chamber meets and greets nine cruise ships from May-September and includes a walking map of the town, as well as a visitor guide.”

She said the local industry has experienced steady growth in the past eight years, but has seen dips when in when the nation’s economy was struggling.

Davis said the Kenai Peninsula has seen a major recovery since 2013 when the nation jumped back from the recession. Measuring progress in the industry is not always dependent on the number of incoming visitors, she said.

For example, Zak said cite the Alaska Department of Labor and Workforce Development’s projection “that leisure and hospitality section in Alaska — which includes hotels, restaurants and bars — to grow 300 jobs this year,” Zak said.

Davis said the marketing council’s focus is on the facilitating the growth of tourism-generated revenue, “which takes into account our existing capacity of product and infrastructure.”

Because there is a diversity of industries on the Kenai Peninsula, and with tourism not as dependent on local money, the Kenai Peninsula is well positioned to weather the next storm, Davis said.

“Looking ahead, the forecast is that 2016 will be another record-breaking visitor year,” Davis said. “Projections for Alaska’s travel industry are positive as we benefit from growth in domestic travel and international arrivals, new and expanded air service and cruise ship berths.”

Davis said the marketing council works closely with the State of Alaska through the Alaska Tourism Marketing Program to reach potential visitors and show them the Kenai Peninsula is one of the most promising destinations in the state. She said the council is most immediately focused on “accessible adventure. In short, we promote the experience first.”

Davis said people are most likely to visit Alaska for the mountains, glaciers and wildlife, and that “engaging with nature” is one of the biggest reasons U.S. seniors go on vacation.

“There is a continuing shift towards people signaling social status through consumption of experiences rather than material goods,” Davis said. “Technology and travel and leisure experiences are the most coveted luxuries of U.S. households. The rise of social media enhances the value of experiences, as they become social currency used to define and communicate status.”

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