Posted on: Monday, October 15, 2001

The September 11 attack | America strikes back
Kama'aina keeping merchants afloat

By Susan Hooper
Advertiser Staff Writer

Ron Dugay, left, of 'Aiea, with son Chase, 7, center, and family friend Kalan Camero, 5, head out on a ferry that will take them to an Atlantis sub. Atlantis Submarines is among many local merchants offering discounts to kama'aina. Richard Ambo • The Honolulu Advertiser

Like many other Hawai'i tourism businesses, Atlantis Adventures was hit hard by the drop in tourism since the Sept. 11 terrorist attacks. The company, which operates Atlantis Submarines and several other attractions, turned to the kama'aina market in hopes of luring local customers with 50 percent discounts off most of its regular kama'aina rates.

The results have been more than promising, company officials say.

"We have seen a surge in the reservation numbers because of our advertising, so we're really hopeful," said Loreen Matsushima, director of public relations for Atlantis Adventures, which also operates Navatek Cruises, Sea Life Park and Waimea Falls Park. "Our chief financial officer said that he thinks the kama'aina will be very, very instrumental in keeping the revenue stream going."

Atlantis Adventures is one of many Hawai'i tourism companies reporting success with efforts to attract business with special kama'aina discounts.

Overall, companies say, an increase in local customers has helped offset the sharp drop in out-of-state traffic that followed the attacks.

But the kama'aina business is not replacing tourism companies' lost revenues, because even on the best of days there are fewer kama'aina customers to be had and many are now enjoying deep discounts. Perhaps for those reasons, not all tourism companies have crafted new kama'aina rates since the attacks. And some are offering "deals" that may still be out of reach for most kama'aina.

In spite of the mixed picture for new kama'aina rates, however, several Hawai'i companies say they have been pleasantly surprised by the results so far.

Marc Resorts, which operates 20 properties in the Islands, launched a promotion Sept. 21 giving kama'aina every other night free and a discount for the paid nights of about 35 percent off the standard retail rate. The promotion has increased local business about 10 percent since it started, according to Kathryn Acorda, the company's director of marketing.

On most days Marc Resorts receives between 300 and 400 calls from prospective guests, she said. The day after a local television news show aired a piece on the promotion, company operators received nearly 300 inquiries from kama'aina.

"The objective was to keep jobs and maintain our occupancies, which we have done," Acorda said of the new kama'aina promotion. "It's been a great success for us."

Unlike many other tourism companies, Marc Resorts has not had to lay off any of its 1,000-plus employees since the Sept. 11 attacks, Acorda said. The firm also has occupancy levels across its properties of about 60 percent to 70 percent, depending on the island, which she described as "very strong."

"I was impressed by the kama'aina response we received," she said.

Murray Towill, president of the Hawai'i Hotel Association, said he believes that "most" of his group's 200 member properties are offering some type of kama'aina special.

"Obviously, it's not going to replace your out-of-state business, but one of the important things it does — and that helps us as a community — is provide additional business, and that in turn keeps people working," he said of the kama'aina promotions. "The more business in a hotel or attraction or restaurant, the better off that business is, and the more of their employees will be working closer to a regular schedule."

The Hawaii Prince Hotel Waikiki and Golf Club is offering new kama'aina specials on hotel stays, golf packages or dining in the Prince Court Restaurant, according to Liana Mulleitner, manager of marketing and public relations for the Hawaii Prince and Maui Prince hotels.

Mulleitner said kama'aina bookings have increased, although she could not estimate by how much. But she said she has noticed something with kama'aina customers.

"We're getting a lot of people that are shopping around," she said. "They know that the hotels are having a challenging time. I think they're saying, 'Why don't we come into Waikiki and see a show?' "

The new kama'aina specials at Hilton Hawaiian Village Beach Resort & Spa have increased kama'aina bookings by about 50 percent over regular local bookings for this time of year, according to Paula Imamura, the property's public relations manager.

"The kama'aina market is important all year round," she said. "Every little bit helps, and it's always good to get kama'aina to come to Waikiki and experience things because they're a great referral source, and they're also valuable customers."

Nevertheless, she said, hoteliers realize that the kama'aina market alone cannot restore the tourism industry to pre-attack health.

"When you look at it from a business standpoint, the kama'aina market is still a very important share, but we still need to see a return of the eastbound and westbound visitors to continue to see an increase in our occupancy levels," she said. "I think everyone looks to the kama'aina market as a solution, but it's not a permanent solution."