Background

 

‘Alaska is different
from every other destination in the world. Every day offers an unforgettable
memory: a mother moose and calf, glaciers and mountains, unique Native
cultures, our Russian legacy and Gold Rush days. Even lifelong Alaskans are
amazed!

 

In these few
sentences the Governor, Bill Walker, has perfectly managed to portray the
uniqueness of Alaska and intrigue people to visit and explore this ‘Great Land’
or the ‘Last Frontier’ as it is also called.

 

It is rightfully
known as ‘The Last Frontier’ as it is located at the northernmost point of
America’s west coast, bordering with Canada on the East while its other sides
are surrounded by water.

Despite not being on
top of the list of the most visited destinations, over the last decades Alaska
has been gaining increasing visitations and popularity amongst tourists.

 

Historically
speaking, Alaska was occupied by Indigenous groups, such as the Aleuts, Haida
and Tlingit, who are thought to have migrated from North America and lived on
the land for thousands of years. In the 18th century, Alaska was
‘discovered’ by Europeans who mostly exploited the Alaskan sea otters for their
fur. It was colonised by the Russians until 1867 when the Unites States of
America bought the area for $7.200.000 signing the ‘Seward’s Folly’ deal.
During that era, Logging, Mining and Commercial Fishing were the leading
Industries in Alaska. In 1959 it officially became the 49th State of
the United States of America.

 

Nowadays, even though
it is considered to be the largest State in the U.S. covering a total area of
1.717.856 km², it is also the third least inhabited State having around 742.000
residents, and almost half of them reside in Anchorage.

 

Due to its location,
climate and diverse geographical and terrain features consisting of islands,
volcanoes, lakes, mountains, forests, and fossil fuels, its main sources of
income come from the
fishing Industry, Oil and Natural Gas Industries and in recent years
from the Tourism Industry which is steadily booming.

 

Focusing on the Tourism
Industry, it is worthy to mention that what makes Alaska even more fascinating
to the visitors is the fact that it is a land of huge contrasts.

It is divided in five
regions with distinct differences, thus, accommodating every one taste and
needs. (See Appendix 1)

 

 

 

APPENDIX 1

Alaska’s Five Regions

 

The first region is
the ‘Far North’ (Appendix 2), where the Arctic Circle is and where the Inupiat
Eskimos live, still fighting to preserve their lifestyle and traditions. There,
visitors can choose to explore the coasts or mountain ranges, enjoy the wildlife,
go back in History to the place where the Great Gold rush happened and/or visit
the Arctic National Park and Preserve.

APPENDIX 2

Far North Region

 

The second region is
the ‘Inside Passage’ (Appendix 3). It is a natural wonder as it was shaped by glaciers
millions of years ago and is has fjords that are home to bald eagles, sea
lions, porpoises and whales. Apart from the rich wildlife, visitors can see the
towering totem poles that the native tribes Tlingit, Haida and Tsimshian
Indians built, as well as the notorious onion-dome churches built by the
Russians during the Colonisation period.

APPENDIX 3

Inside Passage Region

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The third region is
the ‘Interior’ (Appendix 4) which as the name suggests it is Alaska’s mainland.
Initially it was home to Athabascan Indians and later to gold miners, farmers
and fur trappers. There mountaineering-enthusiasts can see the Denali which is
the highest mountain peak of North America, whereas wildlife-lovers can
encounter grizzly bears, caribous, and the Willow Ptarmigan which is the state
bird. What is more interesting is that depending on the visitors’ mood, they
can visit the ‘Interior’ (or any other region) during summer when they will
paradoxically experience sunny nights, or visit the ‘Interior’ in winter when
they can see the mesmerising northern lights.

 

APPENDIX 4

Interior Region

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The fourth region is
the ‘Southwest’ (Appendix 5) which as they say it is a ‘natural paradise’.
Visitors can go fishing next to brown bears that roam in the area, visit the
Katmai National Park which is a landscape of volcanoes, and those with a more
adventurous side can explore the ancient Aleut villages on one of the Aleutian
Islands that are spread 1000 miles across the ocean heading towards Asia.

 

APPENDIX 5

Southwest Region

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The fourth region is
the ‘Southwest’ (Appendix 5) which as they say it is a ‘natural paradise’.
Visitors can go fishing next to brown bears that roam in the area, visit the
Katmai National Park which is a landscape of volcanoes, and those with a more
adventurous side can explore the ancient Aleut villages on one of the Aleutian
Islands that are spread 1000 miles across the ocean heading towards Asia.

 

APPENDIX 5

Southwest Region

 

AVSP – Alaska Visitor
Statistic Programme

 

As with any market
‘product’ knowing the target audience’s profile, needs and likings will help
create the best version of the ‘product’ (in this case Alaska being the
destination of choice among travellers), thus attracting more ‘buyers’.

For this reason, the
State of Alaska, funded by the Department of Commerce, Community and Economic
Development (DCCED), occasionally carries a study to get a more comprehensive
insight on its visitors’ profiles.

The following results
are taken from their latest survey, carried out during the 2016 high-season
(May -September) compared to the findings of their previous surveys dated back
to 2006.

 

As the graph below
shows, even though there have been some minor fluctuations throughout the
10-year period, the number of visitors in the summer of 2016 was 1.857.500
which is the highest number of visitors ever recorded.

Interestingly, the
findings of the study show that 82% of visitors travel to Alaska for
vacation/pleasure purposes, compared to the rest 18% who travel for visiting
friends/relatives, business and business/pleasure purposes. Both data confirm
the increasing popularity of Alaska as a tourism destination.

Regarding the
visitors’ country of origin, the results show that there ere has been an only 1-2% change
over the last ten years. In 2016, 84% of visitors came from the U.S, 9% from
Other International areas and 7% from Canada. The same year, the main means of
transport used to get to Alaska was by Cruise Ships (55%), followed by Planes
(40%), and Highway/Ferries (5%).

 

 

In terms of gender,
the number of travellers is equally halved between males and females throughout
the years, but it is worth to mention that when asked for the first time in
2016, women seemed more likely to plan the trip (53%) compared to men (38%),
leaving the remaining 9% planning to outside parties. Between 2006 and 2016
approximately 60% of visitors travelled in groups of 2, compared to around 18%
who travelled alone, and the rest who travelled in larger groups consisting
three, four and/or five or more people.

 

Visitors’ age is
another interesting find, as the majority – almost two-thirds – are people over
the age of 50.

 

 

Moving on, the
percentage of visitors purchasing multi-day packages compared to independent
travellers did not have any dramatic changes during the last decade, averaging
67% and 33% respectively. However, there seems to be a notable 2% increase in
independent travellers and 2% decrease in package purchases every five years.

 

Regarding the
destinations travellers choose, Southeast and Southcentral remain the two
most-visited regions since 2006 (having 67% and 52% visitations respectively in
2016) even though both face a steady decrease throughout the years, followed by
Interior (29%), and Southwest and Far North (approximately 3% each).

More specifically,
the top 10 destinations visited in 2016 are: Juneau, Ketchikan, Skagway,
Anchorage, Glacier Bay National Park, Seward, Denali National Park, Fairbanks,
Hoonah/Icy Strait Point and Talkeetna.

 

 

 

As discussed earlier,
after arriving to Alaska the visitor has a plethora of activities to choose
from. According to the study, the ranking of the top ten activities has barely
changed during the 10 year period. The most common activities include:
shopping, wildlife viewing, day cruises, hiking/nature walks, city/sightseeing
tours, museums, and fishing.

 

 

Finally, it is
important to mention the findings regarding Visitor Spending. Since 2006 there
has been a remarkable increase of 30% in the total Visitor Spending (soaring
from $1.51 billion in 2006 to $1.97 billion in 2016) which shows the strong
growth in visitations in Alaska and the huge impact of the Tourism Industry in
the state’s income.

The average visitor
spending per person and by categories can be seen in more details in the charts
below.

 

 

Challenges, Marketing
Plans & Promotion

 

It is needless to say
that a great number of visitors to any destination help with tax revenue,
traveller spending in its various communities, job creation and business
growth.

Thus, tourism
marketing and promotion plays a vital role in establishing more destination
visitations year by year as competition is extremely high.

 

Over the last
decades, Alaska has successfully managed to implement various techniques in its
tourism marketing plan, which include:

 

Advertising;
Public/media relations; Domestic and international sales missions and trade
shows; Travel guide development; Toll-free telephone travel planning
assistance; Travel information response mailings; Direct mail advertising;
Internet site development and promotion; Cooperative marketing with surrounding
regions; Domestic and international operator familiarisation (FAM) tours;
sales.

 

Unfortunately
however, despite all the positive outcomes and clear evidence that Alaska’s
Tourism Industry will continue to grow in the future, due to fiscal challenges
for the State’s budget the State of Alaska dramatically cut down the tourism
marketing funding, from $10-$16 million in previous years to a mere $1.5
million in 2017.  Additionally, the Legislature (HB 256) asked the tourism
marketing board ‘to develop a long-term funding plan for destination marketing
with less reliance on state operating dollars’.

 

For this reason,
Alaska Travel Industry Association (ATIA) and Industry Partners are currently
trying to create a more sustainable and reliable funding plan through a Tourism
Improvement District (TID) model.

The explanation of
TID in their own words is that: ‘The TID model provides a self-assessment
framework, a mix of current and new revenue and is focused on visitors with
less impact to residents. 

A state-wide or
Alaska TID could be created by state statute and would identify a voluntary
level of assessment or fee for industry businesses to pay into a fund for
Alaska tourism marketing. While Alaska’s Constitution does not allow for
dedicated funds, creating an industry self-assessment model through a TID
allows the legislature and Governor a way to allocate an investment in tourism
marketing.’

(A more detailed
explanation of how the TID model works can been seen in Appendix 7)

APPENDIX 7

TID – Tourism
Improvement District Model

 

Along with their
current Sustaining Partners (such as Denali Level, Alyeska Level, Arctic
Level) who play a key role in the growth of ATIA programmes, ATIA envisions

to: help Alaska
become a top visitor destination; double the industry’s economic impact to the
state; secure sustainable tourism marketing funding at $30,000,000; integrate
year-round visitor experiences with a goal of five million visitors; and
continue to protect the environment, the wildlife and Alaska’s unique cultural
identity.

Further Development, Management & Sustainable Investment Solutions

 

Apart from the
funding challenges the Tourism Industry faces, there are also other issues that
need to be addressed and resolved to improve Alaska’s welfare in the future.
 

 

First and foremost, there
are reasonable concerns regarding the impact large amounts of visitors have to
the environment. The creation of Wildlife Conservations for visitors to see
animals without disturbing their natural habitat, as well as the use of
multi-use roads to accommodate all means of transport (including hikers and
cyclists) to keep excessive noise and pollution away from unspoiled landscapes,
are some of the measures already taken by the State and they should constantly
work to improve this.

Also, as Alaska is
surrounded by water and has always thrived on making the most of this
geographic feature, there should continue to be emphasis on marine utilisation.

For example the
government should be having an important role for the monitoring and
controlling and management of the marine tourism. That could be accomplished by
the continue establishing of fisheries control agencies and marine parks
management authorities.

More Individual
companies could invest in chartering fishing boats, sea kayak tour guides,
whale watch cruises and charter yachts companies and cruise ships.

Furthermore the
private sector should invest more in tourism by chartering more fishing boats,
and yachts. Addition to that sea kayak for tour guides and whale watch cruises
could be arranged.

  

Also, Alaska Ocean
Observing System – AOOS does a great job by observing and reporting coastal
oceanic data for the protection and preservation of the Alaskan oceans, and
relies on various stakeholders, such as mariners, fishermen, scientists,
educators, and coastal security operations.  

 

Moreover,
urbanisation and globalisation may not only threaten the native and local
communities, but also the economy. For this, the State should promote local
business opportunities and encourage the younger generation to take the lead in
entrepreneurships that could focus on touristic interests, and glorify the
uniqueness of the local communities.

 

Lastly, Alaska should
stop being so reliant on its main source of income which comes from fossil
fuels. Oil is a non-renewable source of energy and apart from the fact that it
could run out at some point, there are also many competitors who produce
cheaper and unconventional forms of it. Instead, the State should focus on
investing on the improvement of the infrastructure and promote smart growth in
its communities which will not be solely dependent on oil extraction.
Allocating a bigger budget to the Tourism Industry could result in bigger
income, as this is the type of industry that flourishes on the ‘give and take’
policy.

 

To conclude, despite
all the challenges it is facing, Alaska is a rising travel destination that has
a lot to offer to its visitors and if all the right actions are taken it will
rightfully show its great potential and be among the strongest competitors in
the tourism market.

 

 

 

 

 

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