By Michael Ganley -- Open spaces brushed by the aurora at night, untamed wilderness and authentic cultures: great nature has long been used to define the North. But is the tourism industry doing enough to entice visitors to come see it?

Long-time Northern tourism operator Alex Hall tells the story of sitting on an airplane beside a man from Edmonton a couple of years ago. “He was about the age of retirement and I thought he was fairly well educated,” Hall says. “I told him I lived in the NWT and he thought about it for a couple of seconds and then he turned to me and said ‘Where’s the Northwest Territories?’ This is what we’re up against.”

In the hyper-competitive market to attract tourists, growing the industry is about two things: marketing and product development. First of all, you have to put your destination on the psychological map of potential tourists. Then, if they do get interested, you have to have the products they want: the trips, the experiences, the hotels, and the entertainment.

To handle the marketing end of things, each territory has what is called in the business a destination marketing organization, or DMO. In the case of the Yukon, the DMO is a department within government, Tourism and Culture. In the other two territories the DMOs are independent organizations – NWT Tourism and Nunavut Tourism – under contract to the governments. They receive their core funding from the territorial governments and also take membership fees from private operators.

Of the three territories, the Yukon is doing the best job of marketing itself and attracting tourists. “We had 329,203 visitors enter the Yukon in 2007,” says Pierre Germain, director of marketing for the Yukon. “That’s a 4.2 per cent increase over 2006 figures and the second highest visitations to the Yukon ever, second only to 1994 when we had about 1,000 more.” The Yukon may have the advantage of a long and colourful history, good road access right through to Alaska and the Rocky Mountains, but it also puts up the most money for marketing, about $4-million last year.

When it comes to measuring the effect of that spending on the Yukon’s gross domestic product, things get tricky. First of all, what exactly constitutes a tourist? The guy in the Hawaiian shirt is clearly a tourist, but government and Statistics Canada definitions of tourism also include business travellers, family and friends visiting, and locals travelling and working around the territories.

Defining the contribution of tourism to an economy is even trickier. A night’s accommodation for a visitor or the rental of a car can easily be classified as tourism, but if a new hotel gets built, it gets measured as construction activity, not tourism. If a new road to an attraction is built, it’s measured as transportation.

With those caveats, the best statistics suggest that tourism in Canada contributed two per cent, or about $27.4-billion to the Canadian economy in 2006, the last year for which complete statistics are available.

The results for the Yukon have been impressive, with a greater proportion of the territories’ gross domestic product coming from tourism – four per cent – than is the case for any other Canadian jurisdiction and almost twice the Canadian average. The industry in the Yukon will also receive a shot in the arm from the $16-million expansion recently announced for the Whitehorse airport, which will expand the secure facilities for the Canada Border Services Agency and allow more international flights to come directly to the Yukon’s capital. “Air access is critical to sustain growth,” Germain says. “The CBSA needs certain space and secure areas or they won’t accept a plane.”

Nunavut is in the toughest position of the three territories, difficult and expensive to get to and with an underdeveloped industry. In tourism industry lingo, businesses are export ready (that is, they’re ready to connect with a business outside of the territory, say a wholesaler in Germany who will sell the experience that a local business will provide) or market ready (meaning, say, they have a website and scheduled trips) but many in Nunavut are neither.

Some of Nunavut’s tourism operators – the cruise ship companies Cruise North and Adventure Canada, for instance, and some of the lodges – are export ready, but most are far from it. And investment from government to develop the industry has been slow to come. “Of the three territories, we invest the least amount in tourism development right now,” says Paul Lewis, chief executive officer of Nunavut Tourism, “partly because of the situation we’re in as a new territory and partly because we’re focusing more on the primary industries. I think government could certainly invest more in tourism and I think they recognize that.”

The shining star for Nunavut in recent years has been the cruise ship industry, which has seen growth from 11 cruise ship trips in 2005 to 22 in 2006 and 27 in 2007. Indeed, 50 per cent of tourists (other than friends, relatives and business travellers) to Nunavut come through the cruises. The challenge is to make their experiences diverse and profound. Those cruise ships pulling into isolated ports of call along Nunavut’s coast need activities for their passengers, some mix of adventure and cultural offerings that can mean more money left in local coffers.

That means the need for development of local tourism products, so Nunavut is bucking the trend towards spending on marketing and instead targeting much of its limited funding to product development. “You have to strike a balance between the amount of exposure you’re giving to the territory and the kinds of products you can deliver,” Lewis says. “We have to be careful that we don’t try to sell a supply we don’t have.”

Another challenge for Canada’s newest territory is gathering basic research on how many tourists come, what they do and how much they spend. The government of Nunavut initiated a visitor exit survey in 2006, which was its first real piece of hard research. From that survey the territory estimates that it has 13,000 visitors a year and that the industry generated $26-million.

Lewis hopes that over the next couple of years the territorial government will increase Nunavut Tourism’s core funding from roughly $2-million per year to about $5-million.

Investing in tourism is not a subsidization,” Lewis says. “It’s a real investment and that’s so demonstrable around the world. Newfoundland would be the shining example in Canada where they really ponied up a lot of money in the last three or four years and it’s reaping huge rewards for them.”

Somewhere in the middle comes the NWT, where the tourism industry brought in $113.6-million in 2006-2007. The territory saw a 25 per cent increase in rubber-tire traffic last summer and visitations from German-speaking Europe have been strong, helping to offset the downturn in the number of Japanese visitors. “We hear a lot about the Japanese market and what we should be doing but the reality is that almost every single long-haul destination that the Japanese are going to has had a significant decrease in Japanese visitations over the last number of years,” says David Grindlay, executive director of NWT Tourism.

With the U.S. likely in a recession already and with real threats to both the caribou and polar bear sport hunts, it will be increasingly difficult for the NWT to keep the tourist numbers up, and that will have a particularly devastating effect on some of the communities. “If Holman outfits 10 polar bear hunts that’s $300,000 of new money going into that community,” Grindlay says. “You can’t replace that.”

One thing Richard Zieba, director of tourism and parks for the NWT government, would like to see to help the situation is greater coordination between various tourism industry sectors. “Right now if you want to go to Blachford Lake Lodge you have to find your own way to Yellowknife, arrange your own accommodation while here, then find your way down to Air Tindi for the flight to the lodge,” Zieba says. “That’s an issue in terms of marketing.”

In recent years the federal government, driven by the belated realization that Canada needs to assert sovereignty in the North and recognizing that having people living and working in the territories is an excellent way to accomplish that, has begun to contribute to develop the tourism industry. “The federal and territorial governments have stepped up to the plate to reasonable levels,” Grindlay says, “certainly a lot more than what we were getting in past years. The federal government particularly has come on board after many years of not providing any funding for the tourism industry.”

All three territories have received help from the federal government with marketing over the last three years through a program called Strategic Investments in Northern Economic Development, or SINED. Administered by Indian and Northern Affairs Canada, SINED has provided millions of dollars to the three territories over the last three years for marketing.

About $5-million in SINED money was used last year for a trilateral marketing campaign surrounding Whitehorse’s Canada Winter Games. The major television, print and web campaign promoted the North as a place to visit, invest in and live, and Zieba says the NWT has already seen results. “We saw a 25 per cent increase in road traffic last summer after a couple years of decrease,” he says. “We did a survey of people who drove across the border and there was a very high awareness among Canadians of that advertising campaign. People remembered them and were really impressed with them.”

But SINED runs out this year, and there’s as yet no program to replace it. “We’re very hopeful that the government of Canada will renew that program,” says Nunavut Tourism’s Lewis.

While marketing may appropriately be the major focus of government dollars, Canoe Arctic’s Alex Hall says governments could be doing a better job at some of the little things that might help tourism operators along, things such as the drafting of a basic waiver of liability.

“I happen to have a very good waiver and I happen to know that the right kind of waiver is very important to have,” he says. “I’ve gone through a whole lot of stages over the decades with my waiver, in fact I just beefed it up again about a year ago.”

At the same time he says it’s not government’s job to prop up businesses. Hall, who’s been at it for 37 years, also says each individual operator has to commit to marketing. “It’s not easy to see the results of your marketing budget,” he says, “but in this business if you don’t market yourself successfully you won’t have a business. It’s as simple as that.”