Exchange rates may play a part in luring overseas shoppers


NEW YORK -- It's a British invasion here for the holidays -- and, at least in part, it's thanks to the powerful pound.

Certainly, international arrivals to New York are up. Chris Heywood, director, international and domestic public relations, travel and tourism at NYC and Company, said international arrivals were expected to reach as high as 8 million this year, up from 7.3 million in 2006.

The U.K., New York's top international market, is expected to grow 5% this year to 1.23 million visitors; that's up from 1.17 million in 2005.

The city's 12 Marriott properties have seen a 15% hike in U.K. business over last year, according to Kathleen Duffy, Marriott's director of public relations, New York City. From other countries, the rise is more dramatic -- 41% from France, 60% from Italy and 69% from Ireland.

Research compiled by NYC & Company shows shopping as the second most-popular activity in the Big Apple, following dining out. For U.K. visitors in particular, 95% list dining out as a trip "activity," followed by shopping at 92%.

And why not New York for the holidays? According to the exchange rates posed on last week, one British pound would buy the equivalent of $2.08, giving British travelers a discount on shopping, hotel rooms and lattes at Starbucks.

The euro, meanwhile, equaled $1.48, giving other European visitors a break on prices.

"There is no doubt that New York is having a good few months, and the holidays will hopefully be even better," said Geoff Freeman, executive director of the Discover America Partnership, an inbound tourism advocacy group in Washington.

At least three factors are playing in New York's favor, he said. First, New York "runs one of the best [tourism] promotion programs in the world today." Another is New York's position as a top gateway city.

However, he said, New York's success, particularly in the U.K., may be largely due to the declining dollar.

Marriott's Duffy said it was hard to determine if overseas visitors were arriving this holiday season simply because the dollar is weak and to what extent they were coming specifically to shop.

"Everyone shops here, even business travelers," she said.

But Bath Travel in Bournemouth, England, does come specifically to shop. The agency organized a shopping tour to New York after 9/11 to show solidarity with the city. The group traveled in November that year, occupying 70 Marriott rooms, according to Duffy.

Since then, she said, the agency has operated two shopping trips a year to New York. Last month's group required 220 rooms, triple the number of the first visit.

Matthew Bauer, president of the Madison Avenue Business Improvement District, said that when it comes to New York, "you can never say it is one thing" that drives a visitor's decision to come to town.

Nevertheless, he said, stores on upscale Madison Avenue see international customers buying more. "The stores are very busy," as are the avenue's restaurants and hotels, he said.

Bloomingdale's is well positioned to report a 35% uptick in the number of foreign shoppers in its aisles this season with their spending growing still faster. As for U.K. results, in particular, David Ender, media consultant for the iconic New York department store, said only, "I wish we could release numbers, because they are off the charts."

Bloomingdale's, which has maintained its International Visitors Center since the early 1990s, relocated, expanded and upgraded the facility two years ago. It is a 2,100-square-foot, club-like space offering multilingual assistance to shoppers, savings certificates, gifts with purchases and some concierge services.

At Saks Fifth Avenue, Caroline Dougherty, vice president of public relations and special events for the store, said that the New York store "benefits from the weak dollar," and its sales are "trending" above companywide averages "driven, in part, by robust international tourism."

The W Hotels in New York, seeing the potential benefits from a declining dollar, earlier this year launched a package called W and the City for sale overseas. It was marketed only outside the U.S. and featured on international Web sites.

The package was so successful it was extended 12 months to June 2008, a spokeswoman said.

She also said that, in an informal survey, W's New York concierges reported that international travelers most frequently request information on shopping, followed by restaurants, clubs and theaters.

Beyond New York

Arguably, as the dollar continues to decline in value, it is likely that inbound arrivals to the U.S., which for the past six years have been soft, will recover.

But Freeman contended that such a recovery would only be temporary.

In the long term, the Travel Industry Association said New York's rising U.K. arrivals were not enough to make up for what the rest of the U.S. has lost in recent years.

"The numbers are still not coming back in the way you'd think they would," said Richard Webster, the TIA's senior vice president of government affairs.

According to Webster, British overseas travel to the U.S. was down by 11% since 2000, the strongest year for inbound tourism.

"The U.S. has been essentially having a fire sale," Webster said. "Like Filene's Basement or Nordstrom Rack, we have been on this huge sale." But despite bargain prices, Webster said, relatively few travelers from the U.K. and other top inbound markets were buying.

"Imagine if the dollar hadn't been so weak," Webster said. "I can't imagine what the numbers would be right now."

No other city is reporting the type of results New York is, Freeman said.

"We think what New York is doing is fantastic. But I don't think any of us should see a declining dollar as the solution to our travel woes."  

To contact the reporters who wrote this article, send e-mail to Nadine Godwin at [email protected] or Michael Milligan at [email protected].

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