Last updated: 05:00 AM ET, Fri April 24 2015

Golden Gate Boom: San Francisco Tourism Hitting Historic Levels

Destination & Tourism | Ryan Rudnansky | April 24, 2015

Golden Gate Boom: San Francisco Tourism Hitting Historic Levels

It wasn’t a surprise that the San Francisco Travel Association reported strong tourism numbers at the 10th annual Visitor Industry Outlook & Marketing Conference in March.

But the spike in tourism from year to year raised more than a few eyebrows, and it may have taught several lessons for destinations across the globe to keep in mind.

San Francisco has been a top tourist destination for years, but the city’s tourism numbers catapulted at a historic level in 2014. According to San Francisco Travel, SF brought in 18.01 million visitors last year, an increase of 6.5 percent. Perhaps even more impressive, visitors spent $10.67 billion in the City by the Bay, a 13.7 percent jump in just one year’s time.

But how did SF do it? After all, considering such a spike, it’s safe to say visitors aren’t coming to SF just to see the Golden Gate Bridge these days.

Joe D’Alessandro, president and CEO of the San Francisco Travel Association, spoke with TravelPulse recently about the significant increase in SF’s tourism numbers.

You may have guessed that SF is on top of travel trends, given the spike, but it’s the number of current trends that SF caters to and is naturally built for that figures to catapult the city even more moving forward.

SF is not only becoming an even greater force when it comes to technology and social media, D’Alessandro said, but it also has a longstanding history with international travelers and Chinese travelers (perhaps the most sought-after traveler in the world today), the LGBT community and foodies, given its proximity to major food and wine regions such as Napa County and Sonoma County. Tack on the fact that the city was basically the catalyst for the shared economy’s rise and the boutique hotel movement and you start to understand why SF is popping right now.

“Last year was the strongest year the city has ever seen (in terms of visitors and spending),” D’Alessandro said. “It was a year like we’ve never seen before. It wasn’t just one factor. It was the whole variety of things.

“We’ve seen the growth building up since 2009 and 2010 and it keeps getting stronger. There’s a lot of buzz about San Francisco right now. It’s kind of this cradle of innovation right now with social media and all these creative thoughts.”

Technology—something the travel industry, for one, is focusing heavily on—has been a big reason why SF has experienced increased interest from the world.

“Technology and social media is really the way a lot of people are getting their travel information today,” D’Alessandro said. “A lot of people are posting where they went and that creates a lot of buzz. People are getting their information and often booking online. That has changed dramatically in our industry and the dynamics of how people use online resources to plan, book and find out about more activities is becoming a huge factor.”

San Francisco’s Moscone Center regularly hosts high-tech conventions. It booked 41 conventions in all in 2014. SF Travel expects Moscone Center to fill 939,115 hotel room nights by 2029, with attendees and exhibitors spending more than $679 million.

SF’s extensive history with China also helps these days. After all, the city boasts the oldest and largest Chinatown outside of China, and about 40 percent of its population is Asian (with Chinese being the major Asian group). Many of its elected officials are Chinese or Chinese-American. Heck, even San Francisco’s current mayor, Ed Lee, is Chinese-American.

“We’re just starting to see the growth of that outbound visitors from China,” D’Alessandro said. “The long-term potential for strong growth and investment from China is huge.

“We’ve been long investors in China in terms of energy communications and cultural exchanges. San Francisco’s oldest sister city is Shanghai. We’ve been investing in that relationship for a very, very long time. I think that’s one of the reasons why we’re seeing some of the earlier benefits.”

In all, SF welcomed 4.1 million international visitors in 2014, accounting for 31 percent of visitors from outside the Bay Area and 22.8 percent of all visitors, according to SF Travel. They spent $3.4 billion, or 34 percent of the total spent. The Chinese market is expected to grow by 20 percent in the next three years. Other markets such as Brazil, South Korea and Taiwan figure to boost tourism numbers moving forward, D’Alessandro said.

To accommodate, SF recently launched websites in traditional and simplified Chinese in partnership with Brand USA. In addition to re-launching its American site in October, SF Travel recently launched a version of its website in Portuguese for Brazilian travelers. That’s in addition to websites in Spanish, Italian, Japanese, German, French and Korean (all expected to be rolled out by June).

“The international market for us is huge,” D’Alessandro said. “There are so many markets in the world that are growing their outbound international travel. The long-term for SF really is in the international marketplace.”

LGBT travelers are also being heavily targeted in the travel industry these days, given their numbers and spending power. One city that has long been attached to the LGBT community is San Francisco.

“Just like any market, you want to feel comfortable where you’re going,” D’Alessandro said. “San Francisco was the first city to have same-sex marriage in the United States. It's the birthplace of the rainbow flag, the symbol of the LGBT community. We’ve always been welcoming to the LGBT community. We are a very tolerant and welcoming destination.”

Of course, a certain little company called Airbnb also sprouted from San Francisco, driving the sharing economy’s rise in the process. While there has recently been some friction between Airbnb and SF’s hotel industry, D’Alessandro stressed that SF Travel is an advocate for Airbnb and the sharing economy, noting that Airbnb’s recent agreement to pay back taxes to the city has softened the resistance.

“The sharing economy is part of San Francisco’s story,” D’Alessandro said. “We will accommodate customers who want to stay with Airbnb. You don’t force customers into your mold. What you do is you make sure that your destination has what the customers are looking for. We would not be San Francisco if we were trying to stop innovation. We want to work with them. Airbnb is one of our partners.”

San Francisco welcomed 130,000 visitors who stayed in peer-to-peer lodging in 2014, according to SF Travel.

In addition to all of this, SF has also been boosted by the boutique hotel movement, which has gone from drawing a niche audience to becoming more of a mainstream desire among travelers. Kimpton Hotels & Restaurants, a major pioneer of the boutique hotel, was born in San Francisco in 1981. Joie de Vivre is another well-known boutique hotel brand that has flourished since introducing itself in SF in 1987.

“That whole boutique hotel movement was born here in SF,” D’Alessandro said. “And a lot of the big-box hotels are also trying to adopt that; that kind of sense and that feel. They want to make it a more personal experience. You’re not in just some non-descript lobby, but you’re in a lobby that shares itself with the neighborhood. I think that’s a movement that the hotels are going in.”

Oh yeah, and Super Bowl 50 just so happens to be taking place in the San Francisco 49ers’ new stadium, Levi’s Stadium, next February. Although the stadium is technically in Santa Clara, D’Alessandro said most of the events and experiences will be held in SF. That includes a fan village dubbed “Super Bowl City” and an NFL Experience at the Mascone Center. D’Alessandro said he expects the Super Bowl to bring more than one million visitors to SF, expecting it to be “one of the most high-tech,” “diverse” and charitable Super Bowls ever. SF will be working with local technology companies and minority, LGBT and women-owned businesses. For every $1 raised, 25 percent will be given to charities.

“We want to set a new standard for how a community celebrates the SB,” D’Alessandro said.

San Francisco is perhaps also setting a new standard for how the travel industry should cater to today’s traveler: As its marketing theme “Never the same, always San Francisco” suggests, stay true to what has always attracted travelers, but never stop innovating.


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