Wednesday, August 30, 2006

Tourism numbers reflect a tough year in Niagara


Tourism numbers reflect a tough year in Niagara
Visitors from U.S. down to lowest level since 1993

Robert Lapensee
Aug 30, 2006

NIAGARA FALLS -- Tourism officials in Niagara are calling 2006 a tough year as the sun sets on the industry's busiest season.

With numerous attractions including world-class golf courses, the Journey Behind the Falls, restaurants and gift shops along more than 1,700 hectares (topping 4,000 acres) of parkland along the Niagara River from Fort Erie to Niagara-on-the-Lake drawing millions of people each year, the Niagara Parks Commission is one of the major tourism attractors in the region. But with a forecasted 12 per cent drop in traffic in 2006, which equates to a five per cent drop in revenue, even Niagara Parks is feeling the sting from a mediocre year, said Executive Director Joel Noden.

"There's been a slight increase in Canadian tourists but there's been a real decrease in American tourists," said Noden. "Americans spend three times (in Niagara) what a Canadian would spend."

What's happening to the Niagara Parks is a trend which is occurring across the country. A Statistics Canada report released earlier this summer said Canada has fallen out of the top 10 destinations for international travelers for the first time in 12 years after ranking 11th in 2004, dropping one spot from the year before. Hong Kong squeezed Canada out after jumping to seventh place, up four spots from 2005.

The StatsCan report cites a drop-off in American visitors as the major reason why Canada was left off the list.

Patrick Gedge, CEO of the Niagara Economic Development Corporation, said it's no surprise Canada has dropped down in the rankings and it's a real concern for the Niagara area.

"Americans make up the bulk of visitors to Canada, Ontario and Niagara," said Gedge. "We've been losing our market share and others have been gaining."

Foreigners made more than 38-million trips to Canada in 2004, down slightly from 2003, the StatsCan report said. Travel from overseas soared by more than 24 per cent but American visitors dropped to its lowest level since 1993.

Americans made 34.6-million trips across the border.

It's been reported about 12-million people visit Niagara annually.

While no one really knows why Americans are staying at home, there are a number of theories. Gedge said the number of American visitors to Niagara has been in decline since SARS hit in 2002.

The StatsCan report said 2.5 per cent fewer Americans visited Canada in 2004 compared to 2003 but what really hurt the ranking was a drop in same-day visits. Gedge calls it the rubber-tire traffic, which he says is very important to border cities like Niagara Falls, Fort Erie and Niagara-on-the-Lake.

Same-day visits fell by 8.2 per cent in 2004 and has been in decline every year since 1999, said the StatsCan report.

"Border areas are more dependent on the rubber tire traffic," said Gedge.

He said the SARS crisis was the point when tourism in Niagara turned downward, more so than in the aftermath of the 9/11 terrorist attacks in the United States in 2001. He said 9/11 reduced tourism and travel for a short time but it rebounded. When SARS hit, it squashed the Americans' urge to travel abroad and kept travellers closer to home, said Gedge.

"But while it started with SARS, it's not the issue anymore," said Gedge. New challenges, like the value of the Canadian dollar, the rising cost of gas and confusion over whether you need a passport to enter Canada, could potentially land another blow to the tourism industry because all are facets the tourism industry has no control over.

"It's our perfect storm," Gedge said. He said fewer Canadians could be coming to the region because the high Canadian dollar could have Canadian travellers visiting destinations out-of-country. "There is the potential this year will be marginal to last year and last year was not a good year."

Word around the Niagara Falls council horseshoe has tourism operators in the city calling 2006 mediocre at best. But while it's been tough, there is a silver lining -- new markets which are starting to open up. Noden said more travellers are visiting from overseas. Visitors from Europe, Asia and other countries from the eastern side of the world won't need passports to enter Canada or return home. The rising Canadian dollar is also not really a concern because it still beats the Euro or the British pound.

"A trend we are starting to see is people from Britain coming for shopping weekends in Toronto and Niagara," said Noden. He said those markets are big spenders since they make up only 10 per cent of Niagara Parks traffic but 33 per cent of its revenue.

"Asia and Europe are spending four times more than what the Americans are spending. We are really putting a focus one these markets. Not ignoring the U.S., but really focusing on increasing our market share."

In spite of all challenges the industry is facing, Gedge said Niagara has a wide range of experiences to offer American visitors, which he hopes keeps the region on the globetrotter's to do list. Niagara Falls is a world icon, Gedge said, and the region is becoming known as the wine capital of Canada. There's plenty of outdoor activities, a growing number of festivals and Niagara is close to major populated centres in Canada and the U.S.

"We have a richness of products that is the envy of the nation," said Gedge. "We just have to make sure we spread awareness of all that we have to offer." Gedge said NEDCOR, along with a host of partners, pool resources in order to sell Niagara to target niches in advertising and at trade and tourism shows.

And while the local tourism industry can't control the value of the dollar, prices at the pump or the confusion from the passport initiative, Gedge said there are things it can control including a level of service which keeps people coming back.

"If people have a great experience, they will go home and talk about the great four or five days in Niagara," he said. "You can't buy that type of publicity."


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