Gulf Coast Tourism Spots Ask BP for a $55 Million Grant for Marketing

A consortium of 11 tourism destinations near the Gulf of Mexico has asked BP (BP) for a $55 million grant to pay for a marketing campaign to promote the areas affected by the oil spill.

Sent late last month by SouthCoast USA, a trade association established in 2000 to promote the region as one of the country's top leisure destinations, the request follows grants made by BP in May -- $25 million to Florida and $15 million each to Alabama, Mississippi and Louisiana -- to promote tourism. Tony Hayward, BP's chief executive, said the company made those funds available to "support the industry's efforts to provide accurate information about the state of the beaches across the region."

"While we are aware BP has distributed funding to individual Gulf Coast states, SouthCoast USA is in a unique position to maximize the benefits and exposure of an organized and sustained positive public relations campaign to alleviate and mitigate damage to our industry resulting from the spill," SouthCoast wrote in its letter to BP. The group said it would use the $55 million to launch a region-wide media marketing campaign over the next several months.

Toby Odone, a spokesman for BP, said the company "will respond directly" to SouthCoast USA about its request for funds. He also noted the company had already given "large sums of money to four coastal states to promote tourism."

A Tourism Recovery Derailed

SouthCoast's consortium partners operate tourist destinations in Louisiana's Lake Charles, Lafayette, New Orleans, Baton Rouge, Houma and the Northshore; Mississippi's West Coast; Mobile, Gulf Shores and Orange Beach, Alabama; and Pensacola, Florida.

In its letter to BP, SouthCoast USA said it had been "actively involved in revitalizing tourism following Hurricanes Katrina and Rita... Unfortunately, the spill is reversing much of our progress, and it's critical that we take action now to address concerns about visiting the region."

According to data compiled by the U.S. Travel Association, the trade association for the U.S. travel industry, in 2008, domestic and international travelers visiting the four Gulf Coast states spent $94.2 billion, which represented 12% of all travel expenditures in the U.S. In addition, the trade group said there were more than one million travel-related jobs in the four states, representing 8% of all non-farm employment.

Roger Dow, chief executive of U.S. Travel, estimated revenues at hotels in the Gulf Coast region have plummeted as much as 35% since the oil spill. "It took five years for them to recover from Katrina, and they expected 2010 to be the biggest summer they've had," he said.

A Costly Crisis of Perception

Areas that remain untouched by the oil spill are also getting hurt. Hotel revenues at beach communities hundreds of miles from the oil spill are down 15% to 17%, "because people think the spill covers the entire Gulf Coast and Atlantic seaboard," said Dow.

"They've got physical problems, but what's more costly is the crisis of perception. We have to shorten the recovery period," he said.

"Everyone is trying hard to figure out a way to let people know what's happening in their area. The oil impact is not constant, the oil ebbs and flows, comes and goes," said Mike Foster, chairman of SouthCoast USA and vice president of marketing for Gulf Shores/Orange Beach Tourism.

To that end, Gulf Shores/Orange Beach runs a video, updated daily, on its Web site on the condition of its beaches. A recent video about Gulf Shores public beach showed footage of bulldozers creating a sand wall against an incoming tide that was washing up oil balls. The speaker suggested other activities to do in the area further away from the beach.

Foster said some hotels and condos in the Gulf Coast region are offering refunds to guests if the oil spill closes the beach at the destination where they have booked. Orbitz, the online travel company; Hotels.com, an online lodging provider; Marriott and Hilton have instituted similar policies.