As African-Americans mull options for their summer vacations, many will be clutching their wallets and credit cards a little tighter and putting plans for a European vacation on hold. With gas prices skyrocketing, the U.S. economy in recession mode and the value of the U.S. dollar plummeting, travel industry experts predict that summer vacationers will stay closer to home, take shorter trips and look for all-inclusive packages. The most sought-after international locations will be the Caribbean or Mexico, they say, but even there, the number of visitors is expected to drop. Resort and hotel operators are bracing for a lackluster season.
“People are going to continue to travel, but what you are going to see is travelers who are being creative in how they spend that money, and really try to stretch the value of their dollar,” says Thomas Dorsey, founder of SoulofAmerica.com, a travel Web site for African-Americans. “Vacationers will be more willing to stay closer to home and even drive to their destination for that family reunion or getaway trip. And because of that, we will see a drop in the amount of people going to Europe as well, because of the poor exchange rate with the euro.”
An emerging market
African-Americans are a rapidly emerging market for the travel and tourism industry. In 2003, the purchasing power of African-Americans was $688 billion, and that figure will reach $1 trillion in 2010, according to The Selig Center for Economic Growth, an economic think-tank at the University of Georgia’s Terry College of Business. Industry studies show that African-Americans travel 75 percent of the time with family and friends, 72 percent of the time to sightsee, 65 percent of the time to shop and 25 percent of the time for business — trends that suggest significant opportunities for travel agents, hotel and resort owners.
Moreover, African-Americans contribute $30 billion annually to the travel and tourism industry, and the number of African-American travelers is growing at a faster pace than the national rate, says Andy Ingraham, president and chief operating officer of the National Association of Black Hotel Owners, Operators and Developers. NABHOOD will host its 12th annual International African-American Hotel Ownership & Multicultural Tourism Summit & Trade Show in Atlanta from July 16 to 19. High on the agenda is a discussion of the dismal economy’s effect on the travel industry and opportunities for African-American entrepreneurs. “This year, we will release our first diversity report and look at trends in the lodging industry,” says Ingraham. “Another discussion will be how to survive such a turn in the economy. For our industry, it will be an eighteen- to twenty-four-month period before the market corrects itself.”
While leisure travel will be the most affected by the slumping economy, business travel will help to soften the impact, he notes. Business has to be conducted even in a slumping economy, he says and business travelers will look for more creative and better-priced travel packages to continue to do so, he says. “Over the last couple of years, the travel industry has withstood many obstacles, from the aftermath of the 9/11 terrorist attacks, hurricanes Rita and Katrina and others,” Ingraham says.
Coping with the impact
Travel-industry professionals like Charlotte Haymore, president of Charlotte’s Cruises-N-Tours in Denver, Colo., are already seeing the economy’s impact. In the past, African-Americans were eager to vacation with seven- to 10-day, all-inclusive cruise or land packages. Today, families and groups are looking for five-day packages, which mean less revenue for the booking agent, hotel or resort operators and cruise-ship companies. “With our current economy, travelers are looking for packages that are paid ahead of time and include all or most of their meals so that they don’t have to worry about extra cost during their vacation,” says Haymore, who also is the founder of Travel Professionals of Color, which promotes training, networking and support of minority travel professionals. “And if they have to spend, it is going to be because they want to and not because they have to,” she adds.
At Travel Professionals’ annual conference in New Orleans, the economy also was a key topic, with Gaynelle Henderson-Bailey, Ph.D., owner of Henderson Travel & Tours, commenting on its impact on international travel, particular travel to Africa. “We are expecting to see a decrease in international travel among all people because of the weak dollar,” she told conference attendees. “The industry will not change dramatically, but more people will stay closer to home.”
Henderson-Bailey has operated her Silver Spring, Md.-based travel company since 1957.
While shorter and closer trips will have an impact on all segments of the travel industry, Haymore estimates the loss will not be as significant as in the aftermath of Sept. 11, when many travel businesses shrank to home-based operations, merged with others to survive or went out of business altogether. “After the attacks we encouraged people to specialize their businesses to have a stronger hold in the market,” Haymore says. “I myself specialized in cruises and land packages.”
Traditionally, African-Americans traveling within the United States visit cities with significant Black populations, such as Atlanta, Chicago, New Orleans, New York, Orlando, Fla. and Philadelphia for cultural experiences, ethnic food and built-in entertainment such as music festivals. Lately, cities like Baltimore, Cleveland, Ohio, Memphis, Tenn., and San Antonio, Texas, have started to generate a lot of attention.
“In many instances, with people choosing to stay closer to home or within driving distances, that is going to be a boon for new destinations,” says Charles Presley, president of the African American Travel Conference. “And the draw will be to cities that understand the impact of the African-American traveler and will cater to offer them new cultural experiences.”
Although gas prices may increase during the summer months, many travelers will find driving their personal vehicle or a rental a bargain compared to flying, Presley says. “With travelers driving this summer, they will discover the numerous cities that have a soul connection and places where family
attractions with water parks and other activities are growing,” he says. “And many of the people on the road will be those who because of their financial situation or fears that their financial situation may change, decided to put that cruise on hold.”
Places and events like the Rock ’n’ Soul Museum in Memphis, the numerous Black museums in Baltimore, and the festivals in Atlanta and Cincinnati will be very attractive, Dorsey says.
Cruise lines can also expect a change in destinations, industry experts say. Many travelers will opt for cruises to Caribbean islands that are closer to the United States and will not spend extra money to upgrade their cabins. “What we are going to see is a lot of travelers looking at places in the mainland like New York, where they can get theater packages, shop and enjoy culture,” Haymore says. “The African-American market enjoys traveling to places that have culture and a built-in African-American following. And for that reason, many of the places that might have been overlooked before will become destinations.”