Meeting professionals know the value of the meetings industry in the U.S.—$263 billion, but do they know the value of their specific meetings? The Event Impact Calculator, being rolled out by Destination Marketing Association International, can do just that.
The Event Impact Calculator, released in September, was introduced to a session at the Professional Convention Management Association’s Convening Leaders conference on January 9 in San Diego. The online tool, developed by Tourism Economics, a subsidiary of Oxford Economics, allows CVBs to input data about a meeting to determine its economic impact for that specific destination, explained session moderator Christine Shimasaki, managing director at DMAI’s EmpowerMINT.com, a conference destination search tool. So far, approximately 80 CVBs have signed on to use the tool, including the New Orleans Metropolitan Convention and Visitors Bureau.
NOMCVB, like many other bureaus, has done its own economic impact calculations working with a local university to conduct surveys, said session panelist Nikki Moon, NOMCVB vice president of sales. The DMAI tool is preferable, she said, because it processes a broader range of factors, including local tax rates. It also standardizes the process. The value of a meeting is measured the same in say, New Orleans, as it is in New York. However, a meeting’s economic impact may be different from city to city since expenses, such as meals, will vary.
The online calculator has four tabs for CVBs to input data:
Event parameters. This screen includes fields to enter the basics—meeting dates, location, type of event (convention,, business meeting), and meeting location (hotel, convention center). It’s also where users log the number of overnight attendees and day attendees, hotel room rates, and number of persons per room. It includes all attendees, not just those staying inside the contracted housing block. There is also an option to calculate aviation impact.
Hosting costs. Users track funds spent by the host city that would offset the economic impact of the meeting, such as discounts or in-kind services.
Organizer spend. The CVB uses this tab to log what was spent on meeting space rental, food and beverage, audiovisual, Internet, security, and other services.
Tax rates. The final tab has spaces for state and local sales and bed tax rates as well as local income tax rates and any applicable tourism marketing district assessments.
Once the data is entered, the calculator comes up with a dollar value that represents the direct and indirect/induced economic impact of the event. It also tabulates the amount of local taxes generated for the destination. Additionally, it breaks down money spent by source (visitors, exhibitors, organizers) and by sector (lodging, transportation, retail, recreation, food and beverage, and space rental). Finally, the calculator shows how many jobs the meeting supports, based on the economic impact.
DMAI used the calculator to estimate the economic impact of its 1,100-attendee 2011 annual convention in New Orleans. The result: a $1.1 million direct and $2.1 million indirect economic impact for the host city. The event generated $135,526 in local taxes and directly supported 621 jobs.
The calculator “will allow us to show our stakeholders, city and state officials, the value of the meetings business to the destination,” says Moon. It will be useful when going to bat for CVB budget increases or to support hotel or convention center construction projects, she adds. In short, it helps cities make the case for continued investment in the local meetings industry.
While the tool was developed for CVBs, meeting professionals are encouraged to work with the bureaus and ask them to share the value of their meeting, says Shimasaki. This information can give planners negotiating leverage or show them how their meeting might be more valuable over different patterns or during certain times of the year.
CVBs collect most of the needed information from planners, hotels, the convention center, and local vendors. However, it can be a challenge to capture all the data. Some hoteliers in the session said it’s important to get full cooperation from planners on releasing data on their spend. However, several planners in the audience said the same thing of hoteliers. Often, planners find it hard to get ancillary spending from hoteliers; that is, food and beverage dollars spent in hotel bars and restaurants or gift shops. If it is difficult to pinpoint ancillary spending by the group, one audience member suggested that hotels use averages or look to see if spending during the meeting is above average. It can also be difficult to capture money spent in restaurants or venues outside the hotel block. In the end, it will take the cooperation of planners and vendors.
“We all have a responsibility when it comes to articulating the value of meetings,” adds Shimasaki.