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Duluth's tourism industry continues to grow

Figures released Tuesday confirmed that Duluth's tourism industry continued to demonstrate robust growth in 2015. The city's tourism tax collections topped $10 million for the first time this past year. "We've seen amazing growth in these revenue...

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Figures released Tuesday confirmed that Duluth's tourism industry continued to demonstrate robust growth in 2015.

The city's tourism tax collections topped $10 million for the first time this past year.

"We've seen amazing growth in these revenues," said Duluth Mayor Emily Larson. "The fact that we are up nearly 14 percent in hotel/motel revenues and that we're up close to 8 percent in food and beverage sales is pretty astounding in a way that really says people continue to find Duluth to be a place they want to visit and stay and play and eat and dine and do all those things that make us a great city."

Anna Tanski, president and CEO of Visit Duluth, an organization that promotes local tourism, gives part of the credit to some new marketing strategies that were deployed in 2015.

"We tried some very strategic and expanded initiatives that we've never tried before. We're trying to increase our reach into new markets but also across different demographics that we haven't reached out to before, as well as really digging in where we've been successful and trying to have a stronger presence there," Tanski said.


She noted that Duluth still draws most of its visitors - about two-thirds of them - from the Twin Cities area. Nevertheless, Visit Duluth sought to grow that market via targeted social media and digital promotions.

"Our target demographic is females, age 35 to 54, who are the primary decision-makers for family travel," Tanski said.

"We also were very strategic in the gay and lesbian travel market and really tried to make a presence there for family travel, as well as romance," she said.

On yet another front, Tanski said Visit Duluth highlighted outdoor activities.

"We also made a significant push on outdoor, soft adventure, silent sports - primarily promoting the trails and mountain biking," she said

Visit Duluth tried to tap other markets in addition to the Twin Cities, with a variety of campaigns that reached out to prospective visitors from Fargo, Sioux Falls, Thunder Bay, Des Moines, Eau Claire and even Denver.

Dan Russell, executive director of the Duluth Entertainment Convention Center, said: "Duluth has become a Midwest tourist destination. We used to kind of be the Twin Cities' playground, and now that's expanded."

"I think you have to give some of the credit to low gas prices, which makes it very affordable, and additional hotel capacity. We're probably experiencing more hotel room growth than virtually any community in the Midwest, and there are still two or three that are going to open this year," Russell said.


Tanski said she expects about 600 new hotel or motel rooms to come onto the market in the next year or two, boosting the overall inventory by about 13 percent. While occupancy rates held fairly steady in 2015, she said it could be a challenge to maintain that in the future.

"That it is a concern: that we could reach a plateau and whether we can sustain this kind of growth. It's something to celebrate and something to dread at the same time, because we need to be mindful of how much our market really can keep producing and at what level. We want to be realistic about what is sustainable for our market," Tanski said.

Reflecting on what went into the tourism tax growth Duluth experienced in 2015, City Treasurer Brian Hansen said: "There is growth in our tourism industry from the standpoint of new rooms being added and new options coming online from a restaurant perspective, as well."

Hansen noted that coming out of the anxiety of a recession, many people may feel a bit more comfortable taking a vacation to Duluth these days.

Russell described 2015 as nothing short of an exceptional year for tourism.

"I can't remember a better year," he said. "I haven't talked to anyone in the hospitality industry that really didn't set records."

Russell predicts 2016 will be an even bigger year for tourism. He pointed to a solid roster of conventions booked at the DECC, the Tall Ships Duluth festival, the Duluth Airshow, the 40th anniversary of Grandma's Marathon, several popular music concerts on the horizon and a host of other factors that all bode well for the coming year.

Larson said the city continues to reinvest the tax revenues it receives from tourism back into the growing industry as well as new amenities designed to attract future visitors. Those investments include an ambitious list of pending recreational projects that will be sprinkled throughout the St. Louis River Corridor.


"We do have a lot that's going to be coming online in the next few years, and these are going to be really unique experiences that are in addition to what we already offer ... the shores of Lake Superior, the rugged terrain, the beautiful setting and then think about everything else we are about to add into that. To me, it's just very exciting," Larson said.

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Peter Passi covers city government for the Duluth News Tribune. He joined the paper in April 2000, initially as a business reporter but has worked a number of beats through the years.
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