Shane Nelson
Shane Nelson

InsightDespite a slight setback in August, the Aloha State remains on pace to break its all-time visitor arrivals and spending marks in 2014.

Total arrivals to the state dipped 1.3% in August, while tourism spending was essentially flat, slipping less than a percentage point year over year to $1.3 billion, according to preliminary estimates released by the Hawaii Tourism Authority (HTA) Sept. 29.

Both metrics were up slightly, however, through the first eight months of 2014 as the Hawaiian Islands welcomed nearly 5.6 million travelers while seeing total visitor spending top $10 billion.

“Hawaii’s visitor industry has continued to surpass last year’s record-breaking numbers in both arrivals and spending,” Mike McCartney, the HTA president and CEO, said in a statement. He added that through the end of August, visitors spent an average of $41 million a day statewide. ShaneNelson

“We were pleased to see that most of the neighbor islands continued to experience a boost in visitor spending through August as we have continued to focus on promoting visitor arrivals and spending across the state,” he said.

After nearly a year’s worth of monthly declines, visitor arrivals from U.S. states west of the Rockies, Hawaii’s largest source market, have now increased two months in a row, climbing nearly 2% in August to more than 304,000 arrivals. Spending from the U.S. West also increased 2.4%, to more than $444 million.

The figures were not as good from U.S. states east of the Rockies, where arrivals were off nearly 3% year over year in August and spending dipped 2.3%.

Although Hawaii’s overall tourism returns are clinging to a record-breaking pace through eight months of this year, 2014 business to the Islands hasn’t been as good for Classic Vacations as it was in 2013.

“Our business this summer was definitely not as strong as the previous summer,” David Hu, the president of Classic Vacations, told Travel Weekly. “As we’ve been saying for a while now, the high airfares, high ADRs [average daily rates at hotels] and competition from Mexico have created an environment where we are seeing movement away from Hawaii to other destinations.”

However, Hu did say Classic saw “pockets of last-minute strength” to Hawaii this summer, driven by some late-season airfare sales that generated “some last-minute demand.”

Hopeful that some of the reduced airfares will stick around, Hu expects Classic’s fall business to Hawaii to be flat or up slightly year over year, and the wholesaler has recently launched a “Take Off to Hawaii” promotion, which can be booked prior to Oct. 31 for travel through Dec. 18. The deal offers an air credit of up to $500 for stays of five nights or more on Maui, Kauai or the Big island of Hawaii, and travelers can receive a $400 air credit for stays of four nights or more on Oahu.

“We hope that putting these air incentives out there we will help travel advisers stimulate some demand for the destination,” Hu said. “To a certain extent, [Hawaii] is starting to get stigmatized as a high-priced destination that has a hard time competing with offerings from other destinations.”

Hu pointed out, meanwhile, that Classic has started to see not only some airfares lessen slightly of late but also lower room rates at some hotels.

“Our air credit incentive is an attempt to keep the destination top of mind especially now that overall package rates have moderated,” he said. “We feel that as we’re gearing up for fall and winter demand, we can possibly help change consumers' perceptions. As the HVCB [Hawaii Visitors and Convention Bureau] has highlighted, there is a high intent for consumers to visit the destination. Now we’re telling them that the price points are within reach, and we can actually convert that intent.”
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