Wikipedia says:

Originally a lumber town and port, Saugatuck, along with the adjacent city of Douglas, became a noted art colony and tourist destination in the Arts and Crafts movement of the late 19th century. In the early 20th century, Saugatuck was home to the famous Big Pavilion, a large dance hall that attracted bands and visitors from across the Midwest. The building was a popular destination on Lake Michigan from its construction in 1909 until it burned down on May 6, 1960.

Today, tourists are drawn to the art galleries, harbor, marinas, scenery, unusual stores, the view from atop Mount Baldhead, and tourist attractions as well as Oval Beach on Lake Michigan, which enjoys a worldwide reputation. Nearby are Saugatuck Dunes State Park and Allegan State Game Area as is the city of Holland.

Our Hip Reviewer notes:

This is truly a hip community, located along the shores of beautiful Lake Michigan, surrounded by picturesque sand dunes. Saugatuck is the epicenter of many western Michigan coastal communities offering a very laid-back chilled atmosphere, and amongst the population you will find an immense multitude of artists and a majority of open-minded people. The downtown is very eclectic, with many far-out shops, including the popular Shakedown Street, offering a variety of Grateful Dead and hippy-related merchandise. Coffee shops are also quite abundant here. There’s also a lot of very cool natural attractions, such as Mt. Baldhead and Oval Beach. The entire scene here reeks of peace. I must say that this town is the ultimate chill-spot.