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Tourists are welcome here: Utah's largest private industry.


Utah's Largest Private Industry

Utah's scenic beauty is big business, and it's getting bigger all the time. According to Jay Woolley, director of the Utah Travel Council, tourism is the largest or second largest private sector industry in the state. "Some think agriculture is number one and some think tourism is first. The key words are |private sector'--obviously defense is bigger, but the dollars tourists bring to the state are substantial, and it's a major growth industry."

Something for Everyone

Visitors spend about $2.3 billion per year in Utah. The industry employs about 52,000 people and has an annual payroll in excess of $450 million. Each year, about 11.5 million people visit the state, and the number is growing. Increases have been steady as national and state parks have been established over recent decades, but during the past few years there have been surges with growth into the 15 to 16 percentiles. During 1990, growth leveled off to around 8 to 10 percent, but Woolley predicts that major increases would "absolutely" continue.

"There is a trend toward outdoor recreation, and we have the ultimate destination for outdoor recreation," says Woolley. "I think that will continue for a couple of reasons. For one, the dispensable income is getting to an age group that is much younger than it used to be. In other words, there are younger people with more money to spend on vacations. Secondly, families are recreating together, and we have the opportunity for those kinds of vacations. There may be a plateau where it'll level off as the families get older, but I don't think we'll see that in my lifetime. I think it's a continuing growth industry."

The major obstacle to industry growth the state is grappling with now is in infrastructure--the ability to feed, house, and host the number of visitors it is getting. "There are places in the state where, particularly in the summer, it's completely full," Woolley said. "There are locations in the state with unmatched scenic beauty but no place to stay. Those problems are being addressed, but in the meantime we're trying to spread out the impact by selling the |shoulder' seasons: spring and fall. There's no place more beautiful in the fall than Utah. If you go down to Lake Powell in September and October, it's beautiful and there's no one there." Woolley said he believes the trend toward year-round schools will help expand the travel season for families.

What is the state's strategy to ensure that growth continues? "Our promotions focus on pushing the state's scenic beauty," Woolley said. "We use what we call our |sellable differences' to draw people across the borders of the state. Those sellable differences are known quantities like national parks, state parks, and those kinds of things that have name recognition throughout the world. We have international and national programs which work directly with tour operators for bulk travel. We also have offices in Tokyo, Seoul, and Brussels to help us promote the state, especially to groups and major tour operators in the international arena."

Foreign Visitors

The Brussels, Belgium, office opened last year and is run by Vera Novak. Utah is the only state that runs a tourist office in Europe with a full-time professional. "I thought I was going to turn to all the other state reps for help when I got to Europe," said Novak. "But there aren't any." Utah draws more of its foreign tourists from the United Kingdom, Germany, France, and northern Europe than from anywhere else, she said. "Many Europeans are really just discovering America. It usually takes a couple of trips before they can be coaxed inland."

Woolley said 10 to 11 percent of Utah's visitors are foreign. "It is significant, and even more significant is the amount of money they spend. The foreign tourist spends a lot more than the domestic tourist. We spend about the same percentage of our budget on international promotion. Utah is uniquely situated to host international visitors because of the large number of interpreters we have available here. It's a payoff from the LDS Church's missionary program. For Japan/America Week, for example, we had 155 Japanese interpreters. There aren't very many places capable of putting together 155 people fluent in Japanese."

See America, See Utah

On the domestic scene, Woolley said, the state's strategy is to target organizations. "We work very closely with organizations like the National Tourists' Association. They are the major tour operators, bus operators throughout the U.S. and Canada. We also work directly with travel agents outside the borders of the state. We do a lot of things like familiarization tours for the press, where we try to expand our advertising dollars through the use of free coverage. Travel writers come in and spend time with us and then go back and write articles about their visits. If you had to buy the space we get that way in newspapers and magazines, it would cost about $3 million a year. Our direct advertising budget is about $1.5 million, so we expand that advertising dollar extensively."

About 27 percent of Utah's domestic tourists come from southern California, according to Woolley. "Another large percentage comes from the states around us." Recent studies indicate about 24 percent are coming from the states east of the Mississippi. "It's pretty well rounded. The bulk of our advertising goes into the contiguous states and the Los Angeles Basin. That's simply a matter of limited dollars. If we had more money, we'd go into the major population centers in the East and Midwest," Woolley said.

How does our advertising and promotion budget compare with our neighbors? "Nationwide, we're in about 33rd position for tourism budgets. We spend about $3.5 million. Colorado spends about $9 million, Arizona about $5 million, Montana and Wyoming about $4 million. Idaho spends a bit less, but basically we're not very high," Woolley noted.

We're in This Together

One way the state tries to maximize its promotion budget is to coordinate its efforts with its regional and industry counterparts. "We work very closely with organizations like the Salt Lake City Visitors and Convention Bureau, the Park City Chamber Bureau, and others around the state. We work with them specifically on conventions that are tourism oriented, like the National Tourist Association convention held here in 1989 and the recent Japan/America Week convention. We also work together on literature to help draw other conventions here."

Utah's travel regions, such as Color Country, Castle Country, and the Golden Spike Empire, also coordinate their efforts with the state office and receive matching funds for their programs. "Our job is to get the tourists across the borders of the state. Once we get them here, it's up to the regions."

Woolley said his office also works closely with the Utah Ski Association, advertising jointly or in complementary publications to make the most of both budgets and stretch the dollars. "There's lots of communication and common strategy."

In addition, he said, "we're in the image business, and we also work very closely with the Division of Community and Economic Development to help attract new businesses here and get conventions. It's a mutual effort that helps us both to spread our dollars."

Working on Utah's Image

What is the state's image around the world and the nation? "Fifteen years ago," Woolley said, "studies indicated we were perceived as being very rural, Amish-type people with a closed society. People thought we walked around with bonnets on. But as we've advertised and things have happened, like the Utah Jazz, the Olympic bid, and other positive things, our image has been enhanced. There are probably a lot of people around the world, however, who still think that way, and that is one of the things we work on."

Once people visit the state, they like it here, according to Woolley. "We have a large number of repeat visitors. Our philosophy is that once we get them here, we've got them--and the facts bear that out."

To make sure visitors have good experiences here and keep coming back, the state recently signed up to spearhead a $100,000 training program this summer aimed at helping motel clerks, restaurant employees, park rangers, and gas-station attendants be more hospitable to travelers. The instructional program is called "SuperHost," and it was developed and is franchised internationally by the British Columbia Ministry of Tourism. The Travel Council contracted with the Canadian province to secure program rights and training materials. The pilot program will be offered in Cedar City, Ephraim, Garfield County, Green River, Ogden, Park City, Provo/Orem, Richfield, and Vernal. The program will concentrate on topics such as improving listening, communication, and interpersonal skills; handling complaints; and giving directions to visitors. Woolley said, "We anticipate it will be an ongoing educational program for people coming into the hospitality industry so they can learn how to treat people and understand the benefits of treating them well."

Other programs, such as "Take Pride in Utah" and "Don't Waste Utah," are also directed at residents because litter isn't scenic. "If we're not protecting our resources, we're shooting ourselves in the foot. We need to be proud of what we have," Woolley said.

The travel business is frequently criticized as an industry that provides only low-paying jobs. Woolley disagrees. "There is some of that, but there's some of that in almost any industry. There are lots of highly paid people in the tourism industry--a lot of managers and general managers, food and beverage managers, and a lot of owners. And yes, there are a lot of people making minimum wage, but I think that there are a lot of people in almost any industry making minimum wage. I guess I equate it to the fact that it's better having them working making minimum wage at something rather than collecting welfare."

The Skiing Tourist

Roughly 700,000 of the state's 11.5 million visitors are winter travelers, and that number is growing, according to Randy Montgomery of Ski Utah. "This was our best ski year ever," he said. Preliminary studies indicate skier days increased a whopping 10.1 percent over last year and were up 6.6 percent over our previous best, the winter of 1988-89. The contributing factors, according to Montgomery, were the good snow conditions for a Thanksgiving opening, the drought conditions at the California resorts, and the publicity generated by being the United States' candidate for the Winter Olympics.

Utah has about a 5 percent share of the U.S. ski market, said Montgomery. In comparison, Colorado has about a 20 percent share, and California has 15 percent. "We're still relatively small. Colorado has many more ski areas, but they're concerned about us. They're envious of the fact that we're a candidate for the Olympics, and we have definite advantages. Our snow is more consistent, our access is the best in the industry, and our low room costs compare very favorably. Our new snowmaking facilities are also very important. The ski industry is very competitive. If anybody is positioned to be in the right place, it's Utah."

Skiers may represent a small percentage of Utah's visitors, but they are an important component because they are big spenders. Demographic studies of Utah skiers last year revealed that 60 percent were from out of town, had a median household income of $97,500, stayed 4.2 days, and spent an average of $145 a day. Skiing is about one-third of Utah's total tourist business. The figures are expected to be even bigger this year. Ski Utah is working to ensure that growth continues.

"We attend 14 consumer ski shows, publish 550,000 copies of our winter vacation planner, sponsor ski clubs in the schools, and hold Learn to Ski and Take a Friend Skiing days at the resorts. We work closely with the Utah Travel Council and national and international organizations, such as Ski USA, which promotes skiing in the U.S. worldwide," Montgomery said.

The ski industry is also a growth industry, Montgomery said, but he added that the costs of doing business are also increasing. "We're seeing major expansions in labor costs, capital expenses, fuel and equipment costs. Utah is one of the few states that requires the payment of sales tax on lift tickets. The market has grown to expect really good service and equipment. Skiers want quad lifts and groomed runs. Insurance costs have also increased dramatically. It's a tough business."

But it's worth it, Montgomery said. "The tourism industry is good for the state. It's one of the most desirable kinds of industry you can have. It's clean, and it has a low impact on the infrastructure. Tourists come in, spend money, and go home. They don't use the schools, and they create jobs. You have to use the benefits that you have as a state, whether they are minerals or industry. Our natural resources here are great skiing and fantastic scenery. Tourism is an intelligent use of our natural resources."

How will Denver's new Stapleton Airport affect Utah's share of skiers? "I actually think it might help us," said Woolley. "I happen to know a little about Stapleton because I came from the airline industry and worked on that facility for many, many years. It's 30 miles further to the east than the current airport, so it's going to be about 30 miles further away from the ski resorts. I think it's going to enhance our offerings. That's a particular advantage of ours. There's no place else you can be skiing within an hour of landing."

According to Woolley, the state is also beginning to target the bicycling market. "We believe that is a major growth industry. You can see it particularly in some areas such as Park City and Moab. Bikes are coming out of the woodwork, so to speak. We like to see that because the demographics of bikers are very similar to those of the skier, so it's a high-end group and very important to pursue." The Utah Travel Council is targeting biking publications and also distributing through its mailings a Bicycle Utah brochure that highlights the state's cycling resources.

Where are the biggest business opportunities in Utah's growing tourism industry? Woolley said he sees a definite market for accommodations with full resort capabilities in rural Utah around the national parks. He said he doesn't see the current lack of four-star facilities as a particular shortcoming, but others have been more critical. At the April Governor's Conference on Tourism in St. George, Utah economist Thayne Robson said, "People love our scenery, but they don't like our night life, hotels, and restaurants." He urged the state to formulate a $25 to $50 million capital loan fund that would allow businesspeople to develop tourist facilities throughout the state.

PHOTO : Temple Square attracted 4.7 million visitors in 1990, making it one of Utah's most popular attractions.

PHOTO : Bryce Canyon, one of Utah's five national parks, is open year-round. Utah's spectacular scenery lures visitors from around the world.

Free-lance writer Rose Gilchrist is based in Salt Lake City.
COPYRIGHT 1991 Olympus Publishing Co.
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1991 Gale, Cengage Learning. All rights reserved.

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Author:Gilchrist, Rose
Publication:Utah Business
Date:Jul 1, 1991
Previous Article:The key to going public.
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