The ongoing global health crisis has changed the United States Virgin Islands’ tourism industry in several ways, Tourism Commissioner Joseph Boschulte said during Tuesday’s Economic Development and Agriculture Committee hearing.
How a tourist travels to the territory, where a tourist lodges during the duration of their visit and the type of tourist traveling during the COVID-19 pandemic are all vastly different than what the department is accustomed to.
“The younger demographics are really comprising those who are traveling to the territory right now in the middle of the pandemic,” Boschulte said.
Without reporting detailed numbers, Boschulte said the department’s data shows that in the past, guests 65 and older have been the typical travelers to the territory. However, since the beginning of the pandemic, the islands have seen a significant reduction in that age group and a steep rise in those traveling to the territory who are ages 25 to 34.
“That’s a sign that clearly COVID-19 has impacted the older traveler from traveling. We also recognize that the majority of traffic coming to us, particularly in St. Thomas and St. John, are leisure guests,” Boschulte said.
These leisure guests typically find lodging with Airbnb. During fiscal year 2021 hotel room revenues are down approximately 65 percent, but Airbnb room tax collections rose 65 percent, according to Donnie Dorsett, a senior policy analyst with the Bureau of Economic Research.
Boschulte said the Airbnbs are absorbing the demand for lodging lost during the 2017 hurricanes.
“The reason why we are able to accommodate the amount of guests who are coming in now is because of the Airbnb market. Right now, the Marriott is closed; Sugar Bay is closed; Caneel Bay is closed. That represents almost 1,000 rooms that we don’t have, yet our airlift is where we were before the major hurricanes,” Boschulte said.
With the cruise ship industry shut down by the pandemic, the average tourist now travels into the territory by air. While daily passenger arrivals into St. Thomas plummeted from 2,400 on March 14 to less than 100 by the end of March, Boschulte said airlift has “increased dramatically.”
“St. Thomas winter capacity now rivals pre-hurricane levels of 2017, and St. Croix capacity has surpassed its 2017 levels,” Boschulte said.
While the rising airlift passenger arrivals are encouraging for the industry, Dorsett said the projected direct economic loss to cruise passenger arrivals for the first six months of calendar year 2021 is $240 million.
To attract more guests into the territory the Department of Tourism had to completely rethink its marketing strategies.
“The marketing for tourism and hospitality has shifted a lot because of the results of the pandemic,” Boschulte said. “Most people have been home for the last year and what we have seen as being more efficient, in terms of marketing, has been digital and streaming marketing on those platforms.”
The department has pivoted away from traditional marketing methods and opted for marketing on social media platforms such as Facebook and Instagram.
“In the past, more traditional marketing has been focused on broadcast and print media. What we found is we walk on a line in terms of marketing, because people are still dying from COVID-19 and we are very empathetic to that fact. However, we do recognize that we, like the world, need our economy to move so we can continue to survive and have a high quality of life,” Boschulte said.
He added the department believes it is the best method for the continued marketing of the Virgin Islands tourism product.
Sens. Dwayne DeGraff, Alma Francis Heyliger, Novelle Francis Jr., Donna Frett-Gregory, Javan James Sr., Milton Potter and Kenneth Gittens were present for the hearing. Non-committee members, Sens. Genevieve Whitaker, Kurt Vialet and Franklin Johnson also attended.