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Arizona Tourism has Second Record-Setting Year in a Row

July 12, 2007



For the second consecutive year, Arizonas tourism industry experienced record-setting visitation and spending numbers, Arizona Office of Tourism (AOT) Director Margie A. Emmermann announced today at the Governors Conference on Tourism.

Year-end tourism numbers for 2006 show that domestic overnight visitation increased 8.9 percent to 31.7 million, setting a record number for Arizona tourism. Combined with international visitation, Arizona welcomed 33.7 million total visitors, a net increase of 8.7 percent or 2 million visitors. In 2006, Arizonas visitor spending brought in $18.6 billion in direct travel expenditures, a nearly 6 percent increase over 2005.

The majority of AOTs marketing efforts are focused on luring high-value, out-of-state visitors to Arizona, and this market segment is leading the way in the States tourism growth, representing more than half of Arizonas total overnight travel volume. In 2006, Arizona welcomed 21.3 domestic non-resident travelers, which is a 3.2 percent increase over 2005. In just looking at the leisure segment of non-resident travel, Arizona experienced a 5.1 percent increase in visitation, reaching 16.6 million visitors, or nearly 80 percent of the overall non-resident travel segment.

Although non-resident travel to Arizona is experiencing tremendous growth, in-state travel is still a significant part of the States overall travel picture. More than 31 percent of overnight visitation came from resident trips. This correlates directly to AOTs new in-state and regional marketing program, which is designed to stimulate travel to the States non-metro regions during their non-peak seasons.

California provided 29.5 percent of non-resident overnight leisure visitation, followed by Texas, Nevada, New Mexico, Michigan, Colorado, Illinois, New York and Washington. Arizonas top origin states continue to be those where AOT and many partners around the state focused the bulk of their efforts.

The average age of Arizonas overnight visitors is also shifting slightly based on AOTs target demographics. For domestic non-resident leisure travelers, the average age is 49, down from 51 last year. For resident travelers, the average age is 43, down from 44 last year. AOTs primary target market for long-haul travel continues to be the Baby Boomers and Empty Nesters. But, AOTs overall marketing strategy, particularly in the in-state and regional markets, is shifting to a slightly younger demographic, trying to capture the Gen X market as they grow into their careers, families and incomes. The slight decrease in the average age of visitors to Arizona shows that this tactic is reaching the desired audience. While the age is decreasing, Arizona is still successful in attracting high-value visitors to the State, as 50 percent of non-resident domestic overnight leisure visitors had an annual household income of $75,000 or higher.

In a world where we face global competition for visitors and tourism dollars, Arizonas second consecutive year of record growth points to a strong, healthy and resilient tourism economy for the Grand Canyon State, said Emmermann. AOT will continue to execute a research-driven marketing campaign that shifts to meet the changing needs of this industry in order to achieve the maximum return on investment for our marketing dollars.

Internationally, preliminary reports show a 17 percent increase in Canadian visitation, which would be another visitation record, with nearly 496,000 Canadians coming to Arizona in 2006, spending an estimated $473 million. AOT invests a significant portion of its international budget into Canadian marketing activities, and this investment continues to pay dividends year after year. Similar to the trend that is being seen across the rest of the U.S., visitation from overseas markets remained fairly flat in 2006. This is mostly due to U.S. entry procedures, U.S. politics and changes in global travel patterns and populations. For instance, the Asian middle-class is growing faster than any other demographic, but they are for the most part traveling within Asia, which is affecting worldwide travel.

Arizonas record-breaking year also extended into the lodging sector, with demand, Average Daily Rate (ADR) and Revenue Per Available Room (RevPAR) all reaching the highest levels in the past six years. According to Smith Travel Research, demand in Arizona increased 1.8 percent, beating out the U.S. increase of only 1.1 percent. ADR reached $98.11, an increase of 8.5 percent from 2005. This increase was higher than both the U.S. and Mountain region (7 percent and 4.6 percent). RevPAR was $65.74, up 10.5 percent, which exceeded the average rates both nationally and regionally. Hotel occupancy also increased 1.8 percent to 67 percent, higher than the U.S. average of 63.1 percent.Created as an executive agency in 1975, the Arizona Office of Tourism is charged with enhancing the state economy and the quality of life for all Arizonans by expanding travel activity and increasing related revenues through tourism promotion and development. AOT works to serve the Grand Canyon States travel industry and related businesses, the traveling public, and the taxpayers of Arizona.

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