January 31 2014
BY: Greg LaRose, Editor New Orleans CityBusiness
If your retail business is looking to tap into the growth in spending from international visitors coming to Louisiana, you might want to consider what appeals to shoppers in Brazil.
A record $32.7 million was spent at businesses participating in the Louisiana Tax-Free Shopping program in 2013, with visitors from Brazil accounting for $4.59 million â€” the most of any single country.
Visitors from the South American nation have been among the biggest spenders for several years, according to LTFS data. These numbers, along with strong supporting anecdotal evidence from the hospitality industry, make Brazil the top growth market for the New Orleans Convention and Visitors Bureau.
“Brazil is a country that has a lot of wealth, and they are traveling in great numbers to New Orleans,” said Kim Priez, the CVB’s vice president of tourism. “â€¦They have a lot of money and they’re not afraid to spend it.”
The bureau is increasing its emphasis on drawing visitors from Brazil, Priez said. The country is the sole focus of one of its staff members who will take three trips there this year to promote New Orleans to travel businesses. By August, the CVB intends to reestablish a contract satellite office in SÃ£o Paulo similar to the one that existed before Hurricane Katrina.
The August goal date coincides with CVB President and CEO Stephen Perry’s planned trip to Brazil for the Bourbon Street Festival, an annual event in SÃ£o Paulo that features and celebrates New Orleans music. Priez said the festival, which will mark its 12th year in 2014, has been key in enticing visitors to the city.
“There’s so much in common between our cultures,” she said. “We’re finding that even though we don’t have a direct flight there (to New Orleans), Brazilians tend to come to the U.S. and then wander, and New Orleans is a place they’re coming to more often.”
An official count on exactly how many Brazilians visit the United States and where they travel is hard to obtain. Priez explained that surveys conducted by the federal government only track 0.5 percent of international tourists coming to the U.S. The best estimate of the CVB, based on its own surveys and feedback from member businesses, puts the number of visitors to New Orleans from Brazil around 49,000 last year, she said.
Priez said that number surpassed 60,000 before Katrina, and she anticipates the CVB’s renewed focus on Brazil can raise the current numbers to that level.
She credits Louisiana Tax-Free Shopping for helping attract international visitors, although Priez noted the program was more vigorously promoted with signage and marketing before 2005.
To that end, the program is lowering its annual membership fee from $100 to $25 to attract more “mom-and-pop” businesses, Executive Director Denise Thevenot said.
To participate in Tax-Free Shopping, businesses purchase vouchers from the program. A book of 25 vouchers sells for $5.50. When a shopper with proper identification notifies a vendor that they are an international visitor, the merchant fills out a sales tax voucher for the visitor, who can redeem it at one of six refund centers around the state.
The program brings enough business to Macy’s at Lakeside Shopping Center in Metairie that it hosts a refund site and provides shuttle service from the Morial Convention Center for major events, with at least 20 percent international visitor attendance.
“It has definitely been one of the most impactful parts of our business,” store manager Bill Ballard said.
He pegs the foreign shopper’s average purchase at Macy’s at around $300, and said the store recently added a cosmetics line specifically because of its popularity with international visitors.
The LTFS refund center at the Riverwalk Marketplace has been relocated to the Convention Center on weekdays and the Port of New Orleans headquarters on weekends while the property is being transformed into The Outlet Collection at Riverwalk. General Manager Frank Quinn notes part of the renovation will include an elevated walkway from the Erato Street Cruise Terminal into the mall’s food court. In addition, there will be an elevator bank to serve cruise passengers and crewmembers, the latter accounting for a sizeable portion of tax-free shopping.
LTFS totals from 2013 show visitors from the Philippines accounted for $3.45 million in spending, trailing only Brazil’s total. Priez at the CVB said Filipinos account for a huge percentage of the staff aboard the cruise ships that dock in New Orleans, a fact that cruise operators â€” Royal Caribbean, Carnival and Norwegian Cruise Lines â€” verified without providing specific numbers.
The Philippines topped the LTFS list in 2012 when its visitors spent more than $4.37 million.
International visitor spending through the program has increased every year since 2008, with the figure exceeding $25 million for each of the past three years. Spending totals for 2011 and 2012 came close to $27 million, with refunds for each year totaling more than $2.17 million. â€¢