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The Honolulu Advertiser
Posted on: Monday, February 11, 2002

Visitors bureau extends Value Pass discounts

By Katherine Nichols
Advertiser Staff Writer

The Hawai'i Visitors and Convention Bureau has decided to extend its Value Pass program of discounts for tourists through March 31, even though some legislators question its effectiveness.

In trying to determine if the Value Pass program has been worth the expense, legislators grew frustrated at a recent Senate hearing when bureau officials could not produce the budget of the initial program from Nov. 1 to Jan. 31, nor determine what the cost would be to continue the program.

Bureau officials estimated the cost for the first three months was $385,000. This included a million 16-page, four-color brochures with plastic cards inside, 20,000 tent cards for countertops, 20,000 posters, and 15,000 window stickers. They predicted the cost of the extension would be significantly less because of the absence of design and startup expenditures, but they had no figures.

The brief history of the Value Pass is sketchy. One problem has been that participating businesses failed to educate their staffs about the program or the special discounts, which vary from store to store. The lack of consistency confused customers and often left the impression that merchants knew nothing about the program.

Part of a multilayered marketing plan, the program was created to try to counter the sharp downturn in Hawai'i tourism that resulted after Sept. 11. The goal was to "get it off the ground as soon as possible and keep it short," said Barbara Okamoto, vice president of customer trends and communications for the Hawai'i Visitors and Convention Bureau.

Tony Vericella, the bureau's chief executive, reported in a Senate hearing last week that 849 local merchants, or 72 percent of the original group, have agreed to continue with the program for another two months.

Aloha Airlines spokesman Stu Glauberman said his company is pleased with the program's results and is extending its 10 percent discount on the seven-day island pass for visitors.

ABC Stores, however, has dropped out of formal participation, according to president and chief executive Paul Kosasa. Instead, Kosasa said he would continue to discount products using the Value Pass logo.

"The difference is we offer (the discounts) to anybody," said Kosasa, who clarified that he thought the original program was good, but added, "I didn't want to send the message to our customers that only Value Pass cardholders were entitled to certain benefits."

But Sen. Donna Mercado Kim, chairwoman of the Senate committee on tourism and intergovernmental affairs, challenged the strategy's effectiveness based on her staff's research.

"We did random surveys ... and I'd say 70 percent of the merchants we contacted randomly had very minimal usage of the card," said Kim. "Fifty percent thought it wasn't a very worthwhile program."

Because the brochure only includes a list of stores — without addresses or phone numbers — Kim asked Vericella how customers would know where to obtain the special offers. He answered that "many visitors do a tremendous amount of research" before they arrive. And most ask a hotel concierge where to go.

Maui Divers Jewelry cited "lukewarm" results. "It's not giving us all that much business, but it is giving us some," said Robert Taylor, president and chief executive of Maui Divers Jewelry, which provides a mug with the Value Pass and any purchase over $20. "It's like advertising. It's so hard to measure."

Okamoto agreed. "It's complicated and it's tough to measure because the program is inside of a larger one. Even in the best of circumstances, we never claim that advertising causes people to come to Hawai'i."