Consumers' Latest Big Splash

Year-Round Indoor Water Parks Explode as Family Vacation Destinations

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CHICAGO ( -- Spring break may send millions to the beaches of Cabo San Lucas, Mexico and Orlando, Fla., but the water parks of the Wisconsin Dells have emerged as a new favorite for the annual post-winter getaway.
In 2005 alone, 23 new waterparks were opened; 23 more will be opened this year.
In 2005 alone, 23 new waterparks were opened; 23 more will be opened this year.

Winter bikinis
That's right. The once-cheesy tourist trap in Baraboo, Wis., with the average March high of 43 degrees is now a year-round oasis for the bikini set, thanks to the explosive growth of indoor water parks. Now, other weather-dependent locales are taking note.

Sporting themes that range from the North Woods to the savannas of Africa, the nation's water parks -- so-called self-contained vacation experiences -- are experiencing a wave of newfound popularity. And water-park development companies are quickly capitalizing on the trend. While there were just five properties in 1994, today there are 157 open or planned in the U.S. and Canada. Most of the sites are in the Midwest, but others are rapidly opening in the East, West and South. Several traditional hotel chains, meanwhile, including Holiday Inn and Sheraton, have begun to add indoor water parks to expand weekend business. Even a hotel in the Caribbean has an indoor park.

Close-to-home vacations
In 2005 alone, 23 water parks opened or expanded in the U.S., and 23 more are slated to open this year, driven in part by a trend of short-term, close-to-home family vacations. With families looking for options everyone can agree on, water parks have become "kind of a fail-safe choice for families with children," said Steve Shattuck, marketing director for the Wisconsin Dells Visitor and Convention Bureau.

A long way from the Holidome indoor pools of childhood vacations past, indoor water parks combine the thrills of amusement parks with the luxuries of upscale resorts and the convenience of the weekend getaway. With exotic names like the Kalahari Resort, Castaway Bay and Wilderness Resort, indoor water parks have as many as 600 guest rooms and features that include massive water slides, lazy rivers, indoor and outdoor pools and hot tubs, gigantic tipping water buckets, water cannons, surfing simulators, arcades, restaurants, bars and winter sports, all within a single property guaranteeing a summer-like environment.

"There is no variable. You're always guaranteed an 84-degree day," Mr. Shattuck said, summing up the reason the parks have blossomed. "The indoor-water-park industry literally takes the weather factor out of the vacation equation."

95% family-owned
With 95% of the properties family-owned, each owner "has the freedom and the courage to push the envelope for things not tried and true," said Mr. Shattuck. As a result, they are continually trying to outdo rivals with bigger, more exciting or more realistic water features like the Howlin' Tornado, which youngsters call "the toilet" -- kids slide around the rim of a massive bowl and then are "flushed" down a central tube. The recently opened Grand Bear Lodge in Utica, Ill., boasts the first interactive water slide that incorporates color motion and sound effects of animals and sharks through its 330-foot descent. The Dells' Wilderness Resort recently opened the first ceiling that allows UV rays to pass through so guests can tan year-round.

Water parks can be profitable from a sheer occupancy standpoint, despite their high cost. In fact, among the biggest booms is lodging, where resorts have exploded with condo developments in which owners put their condos or cabins into a rental pool managed by the resorts. The Kalahari Kondominiums in the Dells and Sandusky Ohio, sold out before they even broke ground. "Hotels with indoor-water-park facilities have a 24% to 30% higher occupancy than those without," said Mr. Shattuck.

Annual visitors doubled
In the decade since the first indoor park opened, annual visitors to the now water park-flooded Dells have doubled to 3 million while tripling their vacation spending, pouring $871 million into the region in 2004, up from $275 million in 1994, according to Mr. Shattuck. Of those visitors in 2004, 1.3 million went during the traditional summer season while the rest visited in what used to be the off-season.

The Erie County Convention and Visitors Bureau has pooled funds to promote its indoor water parks as a way of drawing visitors to its other attractions. In January, the bureau promoted three parks in a 30-second spot, 23 billboards and an Internet site with a $150,000 campaign in the Columbus, Ohio, market, according to Joan Van Offeren, executive director.

For families seeking a quick vacation that requires little travel, water-park destinations serve a distinct purpose. "Today's families are extremely overscheduled almost from the standpoint that they're over-connected, and time is one of most precious commodities we have," said Julie Stokes, national marketing director of Great Wolf Resorts, based in Madison, Wis. "We, in a sense, can be considered an impulse getaway." She said school schedules are a critical factor in driving demand, as are all holiday periods and of late, spring break.

Advertising spending
"Our niche is being a drive-to family destination," she added. "It may be half a tank of gas or a tank of gas, but it's more affordable for a vacation vs. jumping on an airplane for a family of four or five." More than half of guests are repeat or referral business. Great Wolf reported in its annual filing with the Securities and Exchange Commission that it spent $7.3 million on advertising in 2005, double its outlay in 2004. Ms. Stokes expects the total marketing and advertising budget to be about $10 million in 2006. Stephan & Brady, Madison, handles Great Wolf Lodge advertising.

Great Wolf went public in December 2004, and today operates six Great Wolf Lodges and a nautical-themed resort called Blue Harbor Resort. In its annual filing with the SEC, Great Wolf Resorts reported a disappointing first year as a public company, citing a slower than expected summer season in Ohio and Michigan, as well as increased competition in Ohio.

Still, the marketer -- which hired a consulting firm to identify its demographics and marketing opportunities and recently developed a frequent-guest direct-marketing program called Cub Club -- said it expects the recent vacation trend of families taking shorter, more frequent vacations will fuel demand.

Aggressive growth plan
Following an aggressive growth plan, it opened a Poconos resort in October and is set to unveil a Niagara Falls property this month. It has new sites in development in Texas, Washington and Ohio and is planning expansion of existing sites.

With other markets cashing in on the boom, Wisconsin Dells is fighting back to protect its position as the "water-park capital of the world" with a campaign that breaks next month. Created by the Dells' longtime agency Boelter & Lincoln, Milwaukee, the $6.7 million multimedia effort will target 11 markets within a five-hour driving radius.
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