For the first time since the pandemic quarantine, Nevada’s visitor volume was more than 4 million in June, said Brenda Scolari, director, Nevada Tourism & Cultural Affairs, TravelNevada. “Even though that’s 16 percent below comparable in the same month in 2019, we have had visitation growth steadily improving month to month.”
Visitor numbers reflect tourism trends statewide and show a difference between northern and southern Nevada. Recent research from TravelNevada shows Las Vegas down approximately 10 percent below July 2019; comparably, Washoe County was down 5 percent.
Tourism by the Numbers
“July marked the strongest visitation month since the pandemic began,” said Steve Hill, president and CEO, Las Vegas Convention and Visitors Authority (LVCVA). The destination saw 3.3 million visitors, up 11.2 percent month over month and down 10.4 percent from July 2019.
“This last summer we saw really historically strong numbers,” said Charles Harris, president and CEO, Reno-Sparks Convention and Visitors Authority (RSCVA). “Specifically, we set an all-time record in the month of July for the most taxable room revenue for a single month.” Following the best June on record with $45 million in taxable income, July came in at $53.8 million, making it the best month in RSCVA history.
“If you look at the summer, we had backto-back months that were [in the] top five [in taxable revenue] of all time,” said Harris. “But if you look at the first three quarters of the last fiscal year, there were struggles due to the pandemic. In fiscal year 2021, taxable revenues were down about 19 percent compared to pre-pandemic numbers of 2018, 2019.”
Other areas rebounded even faster. When Tahoe reopened to visitation after the 2020 shutdown, demand was instant and unexpected. Outdoor recreation was in demand, and in winter 2020-21 the ski season was mostly normal.
“Summer was good, better than 2019, which preceded the pandemic. No one could have anticipated such strong tourism coming out of the shutdown. We had lost our long-haul markets, the flight markets, because people were still hesitant to fly, and international was shut down,” said Carol Chaplin, president and CEO, Lake Tahoe Visitors Authority (LTVA).
But then, northern California is the region’s biggest drive market, and during the pandemic, it expanded. “People were willing to drive longer to get to a destination,” said Chaplin. “And because they were driving longer, they were willing to stay longer.” With the new remote work trend, some could stay as long as they wanted.
August saw a drop in visitor volume statewide, possibly due to the spike in delta variant cases, as well as the wildfires. Even before the Caldor Fire burned toward South Lake Tahoe the Dixie and Tamarack fires were burning across northern California and Carson Valley, affecting Tahoe’s air quality.
When Caldor started getting close, “We were effectively evacuated for 10 days,” said Chaplin. “So, you know, close, shutdown, open, close, repeat.” A rough estimate provided by the City of South Lake Tahoe shows economic losses of $21 million in hotel/motel revenue, and $19.4 million in retail/restaurants for the end of August and start of September.
Still, the softening of numbers in August could have been normal. August usually marks a slowdown as kids go back to school and seasonal changes in travel play out. Northern Nevada room revenues dipped less than 1 percent in August compared to 2019, and that was during the wildfires.
Statewide, numbers are basically 10 to 15 percent below August 2019. “That’s a fair amount of recovery,” said Scolari.
“It’s been better than expected,” said Hill. Despite the pandemic rollercoaster, when LVCVA budgeted for the fiscal year at 70 percent of normal room tax collection, they might have been overly cautious. “It was the best July room tax month ever,” said Hill. August was a little less, but still above what was budgeted.
Lodging was never required to close during the 2020 shutdown, said Virginia Valentine, president and CEO, Nevada Resort Association (NRA). Large hotels shut down because they couldn’t operate a 6,000-room hotel without guests. As recovery continues, occupancy is higher on weekends when people can travel, and lower during the week, since meetings and conventions aren’t operating at 100 percent attendance.
Tourism statistics don’t show whether visitors come to Nevada for outdoor recreation or indoor gaming, but overall statistics show when adults visit Nevada, about half gamble. Summer 2021 saw a significant rise in gaming by both locals and tourists, resulting in six straight months of $1 billion in statewide gaming revenues. Numbers released by the Nevada Gaming Control Board showed $794 million in gaming revenues in Las Vegas in July, an all-time high and a 46 percent increase compared to July 2019.
“We have remarkable numbers in gaming,” said Scolari. “We had $1.36 billion in gaming revenue in the month of July, which is a record.”
For all the good news, a report from the Nevada Gaming Control Board indicated the trend isn’t expected to continue. After being quarantined for so long, pent up demand to do something is driving travel, outdoor recreation and indoor gaming. Newly flexible work schedules and homeschooling mean people can visit destinations longer; accumulated savings and stimulus funds mean they can afford it.
“We do see some encouraging signs in gaming revenue,” said Valentine. “It’s up at both ends of the state. Gaming is a part of the business model, it’s not the whole business model. So, while gaming is up, we still need things like room rates and occupancy to improve and for international travel to return, for trade shows to return, for entertainment to be fully reopen.”
Stay Longer Spend More
In November, Nevada will reopen to international travelers, which should provide a boost to tourism dollars.
“There’s no doubt we value international visitors and consider them very high value, because they stay longer and spend more when they’re here,” said Scolari. “Many tourism partners build programs and incentivize international visitation quite specifically, and those numbers have been all but eliminated. We were down almost 94 percent for the past 16 months. So hopefully the allowance for vaccinated travelers to visit domestically is really going to help.”
It’s expected there will be lingering concerns over the delta variant in the U.S., which may affect how and when travelers visit and whether they come for business or leisure. Quarantines in origin countries could also affect international travel. “That may determine whether visitation is high or low from those destinations,” said Scolari. “It’s still all good news. We’ve been waiting for borders to open and have been celebrating the fact that they have.”
November isn’t traditionally a heavy tourism month, said Valentine, but with international travel opening, November 2021 might be different. The impact of international travel is different at either end of the state.
“If you look at how we segment and look at visitors, there’s a certain percentage that we have of international visitors, but the biggest draw to the destination is really domestic today. International travel is not a big part of tourism in Northern Nevada,” said Harris.
Drawing international travelers to northern Nevada is a growth opportunity, but there are more international flights into Las Vegas than there are into Reno. Gateway cities like Las Vegas and San Francisco have an easier time capturing international travel dollars.
“Access to those folks where they come in is going to skew those types of visitor numbers. That being said, there’s an opportunity for us in North America to target Mexico, Canada, or international visitors that are coming to major gateways like Las Vegas or San Francisco. If they’re going to San Francisco and end up going to Yosemite, [northern Nevada] could potentially grow a larger piece of that audience as they come through Reno. Tahoe could be promoted as well. But really that’s a growth opportunity. The bread and butter of where our visitors are made up from is domestic,” said Harris.
Meetings, Conventions and Trade Shows
Meetings and conventions are important components of Southern Nevada’s tourism economy, though they play a smaller role in Northern Nevada. Meetings, trade shows and conventions are happening again, but attendance is between 30 and 100 percent, according to Hill, with the largest trade shows averaging around 50 percent of normal attendance. Which is why the strong performance of the leisure market remains important.
“The domestic leisure market has really performed very strongly and uber performed from 2019 comparisons. That has been very helpful and it’s what is carrying the city right now,” said Hill.
From a booking standpoint, the Las Vegas Convention Center is as busy as it’s ever been with meetings, conventions and trade shows. But the shows are smaller, and attendance isn’t 100 percent. Attendance varies by industry— some have continued to be well attended; others have suffered.
Tahoe has a limited number of properties on the South Shore that can handle large meetings and conventions, making such events a smaller segment of the local economy. The pandemic forced many to cancel or reschedule, and while some events returned in 2021, the ability to hold hybrid virtual and in-person meetings made a difference in recovery dollars.
LTVA is building a convention center on the site where the Montbleu Resort once stood. Located at the intersection of Hwy 50 and Lake Parkway in Stateline, the venue will have 6,000 arena seats, 13 suites, and meeting space. At 133,000-square-feet, it’s expected to bring in about $40 to $60 million annually once it opens in 2023.
The ban on international travel has directly affected Nevada’s convention revenue. A number of the large trade shows have a strong international component, typically 30 percent international traveler rates, said Hill.
“The decision recently by the federal government to open up international travel to vaccinated travelers, that segment can start to come back in November, so that will be very helpful both from a leisure standpoint as well as from a meeting standpoint,” said Hill.
Uncertainty caused by the pandemic meant some events scheduled for the spring 2021 rescheduled for fall, while others held smaller events in the spring and scheduled larger shows for the fall, with mixed success, since many attendees were hesitant to attend twice in a six-month period. Shows whose major exhibitors were international often struggled with attendance.
The Changing Face of Tourism
Travel was changing before the pandemic began; COVID simply accelerated those changes. In the near future, rapid result COVID testing is expected to make travel easier. If new apps that store vaccination data are utilized by airlines, air travel should become easier as well.
In mid-August, Governor Sisolak announced Emergency Directive 049, allowing gatherings in venues with fixed seating capacity of 4,000 or greater to be held without masks provided every attendee is vaccinated (and the event meets other requirements).
“The pandemic accelerated things that were going to happen anyway,” said Valentine. “The use of cashless systems, of kiosk touchless systems for check-in, the focus on health, safety, and cleanliness.”
Social media is changing the way the tourism industry collects data. “People are making travel and tourism decisions based on social media,” said Valentine. “That’s really interesting. It provides a lot of feedback to the industry to see what people are thinking, in almost real time, about the experience they’re having.”
It’s not all technology. Humans are changing the face of tourism. Today’s travelers want authentic and unique experiences rather than packaged tours. They want new experiences and to see things the folks back home haven’t seen. Nevada’s tourism experience can provide both.
“Nevada can capitalize on both those trends because we certainly have so much to offer in regard to outdoor experiences that a lot of domestic and international travelers might not be aware of,” said Scolari.
As travel reopens domestically and internationally, Nevada needs to be positioned as the drive-to and fly-to destination. Visitor’s authorities statewide get the word out in normal markets. It’s even more important as the travel industry tries to return to normal.
Toward that end, Nevada is receiving $13.65 million in federal funds from the U.S. Economic Administration, to be used to augment state tourism and outdoor recreation marketing efforts.
“TravelNevada will be administering the grants and with the help of the Governor’s Office we’ve made decisions about allocations and have the majority of the money going to destination marketing programs,” said Scolari. Which means LVCVA, RSCVA and TravelNevada itself will receive marketing dollars. The money will also be used to restore funding to two Nevada Commission on Tourism grant programs, and to destination development grants which fund longterm marketing plans and infrastructure.
“In addition to promoting existing tourism assets, we’re now actively supporting and helping communities assess their tourism assets and make a plan for long-term economic growth in that area,” said Scolari. “So, we identify the gaps. We help them assess and workshop a marketing plan to support that, to fill in the gaps. Then, the community itself will identify any infrastructure projects that would help their tourism economy.”
Infrastructure might mean changes to a trailhead, seeding a larger project, or something simple like signage and wayfinding. The point is to allow communities to look at opportunities through a tourism lens and see what they might have missed.
“The federal funding is really complicated,” said Chaplin. “Visit California and TravelNevada are our two state tourism organizations, and both of those organizations will have funds that impact our region.” Whether or not LTVA is awarded part of the $13.65 million or not, there are rural grant opportunities, and Lake Tahoe is considered a rural area.
Las Vegas is slated to receive $7 million in funding, which accounts for 7 percent of their normal marketing budget, and a change from what federal funds can usually be used for.
“Typically, federal grant dollars are not allowed to be used for marketing, and in this particular case, they will be,” said Hill. The visitor’s authorities in Nevada are funded largely by room tax, which means revenue has been way down over the past 18 months. “In our last fiscal year, we generated maybe 30 percent of our normal revenue, so just our ability to do our job has been greatly diminished.”
Some of the funds will be used by visitors’ authorities to market their regions internationally. Marketing the state as a destination to a worldwide audience is difficult. Marketing a destination at all is complicated when travel is still uncertain.
RSCVA is slated to receive $1.25 million of the federal funds, which must be spent within two years.
“What we have to look at is intent to travel,” said Harris. “We don’t want to use marketing dollars to attract people if intent to travel is down.” But if people are ready to travel and confidence is up, then targeting travelers who feel safe and ready to travel can help Nevada tap into that market.