Tourism Reboot

World-class events such as the Coachella music festival and the Palm Springs International Film Festival are sparking renewed economic growth in the valley.

Sheila Grattan Attractions, Vision 0 Comments

The Coachella Valley has its groove back. Defying the myth they had become extinct east of Los Angeles, 20- and 30-somethings have returned in full financial force to lead a visitor boom.

This growing market has sparked an increase in tourism offerings that encompass world-class experiences for film buffs, sports fans, music lovers, history enthusiasts, outdoorsy types, and couples in love. It also translates into significant local economic benefits: Overall visitor spending in 2013 totaled $4.5 billion — a 12.5 percent increase from 2011.

The Millennial infusion is also acting as an elixir for Baby Boomers and middle-aged Gen Xers. “People in their 70s come up to me all the time when I’m checking out restaurants and nightspots,” says Palm Springs Mayor Steve Pougnet. “They love the younger vibe and tell me to keep it going. It goes to show that older locals and visitors enjoy a good time, too. They just go home earlier.”

The return of Greater Palm Springs is fueled largely by a slate of events such as the Coachella Valley Music and Arts Festival and the prestigious Palm Springs International Film Festival. Major media outlets, including The New York Times and Esquire, have recently touted the resort area’s cachet.

New Hollywood is paying attention, too. Leonardo DiCaprio purchased Dinah Shore’s Donald Wexler–designed estate in 2014, and recent television and film shoots in the valley include The Real Housewives of Beverly Hills, Italy’s Donnavventura, Bravo’s Newlyweds, and A Christmas in Palm Springs. The area has also seen an uptick in high-profile photo shoots for companies such as Victoria’s Secret, Nordstrom, and Crate & Barrel.

 

The Coachella Effect

There would be no renaissance without Goldenvoice CEO Paul Tollett, founder of Coachella (see page 7), says Palm Springs tourism and civic guru Aftab Dada. “Because of Coachella fest and Stagecoach, youthful music fans from around the world stay here and find they love Palm Springs and come back,” says Dada, general manager of the Palm Springs Hilton and chairman of P.S. Resorts.

In 2013, more than 180,000 fans attended Coachella over its two consecutive April weekends at the polo grounds in Indio; Goldenvoice’s Stagecoach Country Music Festival drew 45,000 attendees. The combined events pump more than $254 million into the local economy annually, according to the Greater Palm Springs Convention & Visitors Bureau.

Local hotels are among the beneficiaries — overall room demand grew 6.9 percent from 2011 to 2013 — with many festivalgoers staying at Palm Springs hotels that have been updated to appeal to Millennials. These include the Saguaro, Curve, Hard Rock Hotel, Viceroy Palm Springs, Riviera Palm Springs, and Ace Hotel & Swim Club. The venues attract younger travelers by being dog-friendly and offering such amenities as pool parties, games, car battery charging stations, spa services, offbeat décor, courtesy bicycles, yoga, craft cocktails, tapas, and healthy morning-after smoothies.

Other draws include Tachevah, a Palm Springs block party produced by Goldenvoice in conjunction with Coachella fest. In 2013, the Splash House summer pool parties at three Palm Springs locations drew 1,500 attendees and contributed $800,000 to the economy in the event’s first year.

“Paul and Goldenvoice have done wonders for Palm Springs,” Dada says. “He is the most down-to-earth and easiest person you could hope to work with.”

The Hyatt Palm Springs, a stalwart on Palm Canyon Drive, is also shifting its marketing to cater to the under-40 market with pet-friendly policies, gourmet pizza, exotic drinks, and signature Palm Springs–centric mural and photo art, says Hyatt hotel executive Celeste Brackley.

Marking its 10th year, the Parker Palm Springs, formerly the 13-acre Merv Griffin Resort Hotel & Givenchy Spa, was the area’s first hotel to recognize a niche for sophisticated young professionals seeking a classy, unstuffy place to relax, says Steven Pipes, president of Jack Parker Corp., the parent company for the Parker and Le Méridien hotels.

“Parker Meridien wanted to increase its hotel portfolio, and we decided to take an old and staid market and shake it up,” Pipes says. To that end, Pipes hired Jonathan Adler, a darling of midcentury modern décor and global pop art, to create the hotel’s fun yet sophisticated décor. Pipes’ marketing concept was prescient: The Parker has always been newsworthy, from its décor to its celeb guests attending the hotel’s annual Palm Springs International Film Festival afterparties.

 

Youthful Buying Power

The Hilton’s Dada has been involved with downtown improvement measures for decades and says the passage of Palm Springs’ Measure J two years ago reflects the tremendous buying power of the expanded current visitor mix.

“The 1 percent sales tax increase was projected to raise $8 million annually,” he says. “The second year, it exceeded expectations and raised $12.5 million, with 80 percent of that funded by tourism. This represents an astounding $1.25 billion in annual sales.”

Palm Springs’ Pougnet is equally bullish on the city and advises possible local startups to “ do their homework and consider public-private partnerships.” He notes that the hotel revival is an example of a successful public-private relationship.

“The City Council was challenged by the budgeting woes in 2008-2009 when people stopped traveling because of the economy,” he says. “We had budget shortfalls of $12 to $15 million. We had to reduce staff to balance the budget. The [city’s hotel improvement] incentive program pumped $200 million into the local economy and revamped 3,000 hotel rooms.”

 

Reaching a Younger Market

Hip local hotels market mostly via the Internet and social networks, and customers can offer instant feedback on Twitter, Facebook, or Yelp, says Mary Jo Ginther, director of the Palm Springs Bureau of Tourism. “Advertising has been turned on its head since the younger market identifies digitally,” she explains. “We have six ways to target the market, including phone numbers, desktop IP addresses, computer-use tracking, and going through networks.” She says that websites are crucial and notes that hits on the bureau website have exceeded 2 million since the website domain name, visitpalmsprings.com, became a call-to-action mini ad.

And it’s working. “I noticed a change with Modernism Week,” Ginther says. “Visitors were a good 10 years younger than previous modernism groups. There were highly traveled visitors, including active singles and older Baby Boomers who now had a reason to visit here other than to see friends and family.”

According to Scott White, president of the Greater Palm Springs Convention & Visitors Bureau, ecotourism is also growing. Two Bunch Palms in Desert Hot Springs is on its way to becoming the nation’s first carbon neutral spa, for example. (See page 26.) Other local eco-friendly attractions include the Living Desert Zoo, Cabot’s Pueblo Museum, abundant hiking trails, Jeep tours, Palm Springs Aerial Tramway, Indian Canyons, Salton Sea, agricultural tours, and the Coachella Valley and Thousand Palms preserves.

More visitors, straight and gay, are coming here to put a ring on it. Since droves of friends and families also attend destination weddings, bells are ringing for popular hotel venues. Weddings are posh affairs at the venerable La Quinta Resort & Club; the reopened Ritz-Carlton, Rancho Mirage; and Parker Palm Springs. The city of Palm Springs is on board, too: Its city clerk remains open on Fridays to process last-minute licenses after other city offices close. Girls-only, bride and bridesmaid getaways, and soothing “babymoon” escapes for expecting moms and dads are also popular new visitor trends.

 

A Global Destination

The international traveler is also a strong market in the desert, contributing $870 million in 2013 — more than 19 percent of total tourism spending — and those numbers are projected to keep rising. “Year-to-date passenger activity is up more than 9 percent, with Palm Springs International Airport one of the few airports of this size that is consistently increasing year over year,” White says.

German and British visitors love the heat and contribute to the growing summer business, with Canadians leading among international travelers — Air Canada added another nonstop flight from Vancouver this year.

Both the CVB and Palm Springs Bureau of Tourism have maintained representatives in Europe for years and are looking closely at formalizing business ties in Asia. The Chinese market has surged since the June 2013 meeting between the presidents of China and the United States at Sunnylands in Rancho Mirage, according to White and Ginther.

Visitors from China, Korea, and Japan come to the desert with independent tour groups to ride the Palm Springs Aerial Tramway, play golf, or shop at the Desert Hills Premium Outlet mall in Cabazon, Ginther says.

“The overall tourism growth potential for the Chinese market is stratospheric,” says Maryanne Coury, media director at The Jones Agency in Palm Springs. By 2018, according to U.S. Department of Commerce statistics supplied by Coury, outbound visitors from China will reach more than 4.8 million, Japan 4.2 million, and Korea 1.8 million.

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