Two years after BP oil spill, tourists back in U.S. Gulf

Sun May 27, 2012 12:46pm EDT

Related Topics

* New Orleans, Florida Panhandle visitors surge

* Some areas still waiting to recover

* Tourism officials say BP money helped

By Kathy Finn

NEW ORLEANS, May 27 (Reuters) - The U.S. Gulf Coast is a hot destination again two years after the massive BP Plc oil spill made the region a tourist dead zone, with the petroleum giant pumping more than $150 million into promotions to help the region recover.

In New Orleans, about 150 miles (240 km) northeast of where BP's well blew up on April 20, 2010, the period since more than 4 million barrels of oil gushed into the Gulf of Mexico has seen a frenzy of tourism efforts.

"Tourism doesn't happen on its own, it takes marketing dollars, particularly if you're battling an image crisis like the oil spill," New Orleans convention and visitor bureau spokeswoman Kelly Schultz said.

A chunk of the $15 million BP initially sent to Louisiana in June 2010 funded emergency advertising to quell misperceptions that New Orleans was laden with oil, and Schultz says it worked. Hotel tax collections in the third quarter of 2010 jumped 33 percent from year-earlier figures

Since then, BP has sent more than $150 million to Florida, Louisiana, Alabama and Mississippi to aid tourism, and will shell out close to $30 million more by the end of 2013. Another $82 million was committed for seafood marketing and testing, BP spokesman Craig Savage said.

It is hard to tell how effective the dollars have been.

Data from international market analyst Smith Travel Research Inc. show that occupancy in hotels within 10 miles (16 km) of the Gulf Coast was 11 percent higher in the first quarter of this year as compared with the same quarter in 2010, immediately before the oil spill. Average daily hotel room rates rose 7 percent in that period.

But hotel occupancy and room rates nationwide rose by similar rates, the figures show. And along the Texas coast - where the oil spill had no direct impact and BP provided no marketing money - hotel occupancy rose 15 percent during the same period.

HOW HOT IS IT?

It is not clear whether states most affected by the oil spill still lag behind others as tourism improves nationally. "The question is really hard to answer," Smith Travel Research senior analyst Jan Freitag said.

What is clear is that visitors are returning to some places with a vengeance. Hotel occupancy in New Orleans jumped 3 percent and average room rates shot up 13 percent just in the first quarter of this year, said Freitag.

"That's a lot," he said.

To the east, along the white sand shores of the Florida panhandle, Walton County tourism Director Jon Ervin is marveling over a tourism boom that has pushed hotel room tax revenue up almost 60 percent since 2010. "You go back and check your math because you can hardly believe it," he said.

Ervin said the initial funding from BP - Florida received the largest portion among the four states - helped speed the area's recovery after tar balls appeared on local beaches.

But farther south, in Fort Myers, Florida, the picture is different. Lee County tourism bureau Director Tamara Pigott said that even though oil never reached local beaches, the area took a hit.

"The phones stopped ringing after the oil spill," she said.

Her agency immediately spent $750,000 from emergency reserves on advertising to counter public misperceptions about Fort Myers resorts. An additional $500,000 arrived courtesy of BP, but Pigott said it was not enough to restore the area's previously surging business.

She said the agency now is forced to spend heavily on advertising to keep up with destinations to the north that received a much larger boost from BP.

"I don't feel we benefited from the BP advertising money," she said.

But BP's promotion continues. Unrelated to the marketing money the company has sent to coastal states, BP has funded its own "Voices from the Gulf" television, radio and social media campaign. Savage would not disclose how much BP is spending on the campaign, but he said its mission is "to promote Gulf Coast tourism and highlight what we have accomplished to date."

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