Oil Spill? What Oil Spill? Gulf Coast Resort Towns Are Open for Business

Memorial Day is the official kickoff to summer in Destin, Fla., and like many towns along the Gulf Coast, it's trying to get the word out that its shores and beaches are clean and open despite the huge BP (BP) oil spill. City officials are getting scores of calls daily from people planning vacations and wanting updates on local conditions.

"For us it's business as usual," says Destin Chamber of Commerce President Shane Moody. "There's no sign of the spill here at all. There's no indication that it's even close." Moody says there have been some cancellations, but that incoming traffic in town is building. "What we're expecting is people to make very last-minute reservations," he says. "They want to come down here, they were just waiting to see." Moody spoke recently with three local resort management companies, who are all reporting at least 78% occupancy rates for the long holiday weekend.

The entire Gulf Coast region has been nervously watching the progress of the enormous oil spill -- and hoping the damage already inflicted on Louisiana won't be repeated on their shores. Moody says local emergency management officials are speaking several times a day with their federal and state counterparts, "so they are well-prepared and well-versed on everything that's going on."

Vacationers Taking Advantage of Discounts

Travel and tourism are a $20 billion industry along the Gulf Coast -- and are responsible for nearly all of the resort town economies. This disaster also struck after an exceptionally rough year for tourism due to the recession, and there have been hopes that business will pick up.

"Anecdotally, we've heard of some cancellations, but not heavy cancellations at this point," says Jeff Higley, Vice President of Digital Media and Communications at STR, which tracks hotel data. "Vacationers are still looking at it as a wait-and-see approach, because it's not necessarily 'real bad' at this point." According to Higley, the most recent data for Gulf Coast hotels, which are described as those within ten miles of the Gulf shore, "from Brownsville, Texas all the way to Key West," had occupancy up 10.7% for the week ending May 22, compared to last year.

"There are also some reports that hotels are offering discounts for those last-minute reservations," he says, "so some consumers are looking at it as an opportunity to take advantage of that; save a little money and still get to the coast. And even if you don't go to the beach, there's a pool, there's golf courses, there's everything else that those destinations offer that really aren't affected by the oil spill."

Vacation Towns Engage in Targeted Marketing

Gulf Coast states are also working hard to keep tourism going. Earlier this week, Florida received $25 million from BP for state and local tourism offices, "to air a tourism marketing campaign with ads reflecting the accurate condition of Florida's beaches." The company is also giving $15 million tourism grants to Alabama, Louisiana and Mississippi.

Destin has developed its own approach to getting the word out.

"Our markets are Atlanta, Montgomery, Birmingham, Nashville, Memphis, New Orleans, Baton Rouge, over as far as Houston, Missouri, Kentucky," says Shane Moody, "and those are the areas that we're concentrating on right now. Our tourist development council is doing a great job of getting some commercials on television in all those major markets."

Moody says his city is also coordinating with other Gulf Coast communities. "We're all talking to each other, and we all know what each other is doing and we're giving each other advice, but we're marketing our own communities specifically as it relates to what we have," he says. "Fort Walton is so different from Destin, which is so different from Panama City. We know what each other's doing, but we're all marketing our own specific amenities."

In the meantime, much of North America's tourism industry is keeping a close eye on the Gulf Coast, "because whatever happens here will have a domino effect elsewhere," says Jeff Higley. "If people decide not to go on vacation to the Gulf ... there could be some residual effect for other areas of the country, that could possibly benefit from this. However, we want to make it clear that we don't see this as being a situation for people to panic and cancel reservations at this point. Right now, it truly is wait-and-see, take advantage of the other amenities and see how the cleanup goes."