Hotel industry experts offer a
bleak snapshot of meeting activity in Orlando and Las Vegas.
When Meeting Professionals International first brought a panel of industry experts together for a frank discussion on the meetings market last August at its World Education Congress, concern about the economy dominated the conversation. But no one knew then just how bad things would get.
The same panelists — Michael Beardsley, CEO of InnFluent LLC; Vincent LaRuffa, vice president of resort sales and marketing for Universal Orlando Resort; and Chris Meyer, CEM, CMP, vice president of convention sales for the Las Vegas Convention and Visitors Authority — reconvened in Atlanta in February during MPI's MeetDifferent conference to discuss just how much had changed.
Betsy Bondurant, CMP, CMM, president of Bondurant Consulting and moderator of the session, said, “When we met last August the industry was completely different. There was concern about a slowing economy but, frankly, we didn't have a clue.”
In the past few months, factors such as the “AIG effect” (meeting cutbacks due to perception concerns) and proposed government oversight of meeting spend have coupled with the recession to create “the perfect storm,” said Orlando's LaRuffa.
As one of the country's most popular meeting destinations, Orlando is a snapshot of the industry as whole, he added. Unfortunately, that snapshot is pretty bleak. While 2008 was a record year for group cancellations in Orlando, 2009 cancellations are on pace to exceed 2008 levels, he said. The cancellations are coming almost exclusively from the corporate market. Making matters worse, “we have 4,500 rooms coming into the luxury segment in 2009 and 2010,” LaRuffa said.
The Orlando market is not as dire as Las Vegas, however. “I wish we had only 4,500 rooms coming [online] in Vegas,” said the LVCVA's Meyer. “We have 13,000 rooms opening this year.”
Las Vegas has felt the brunt of perception-based cancellations stemming from negative press aimed at companies receiving government bailout funds. “Besides the AIG effect, we now have the Wells Fargo effect to go with it,” said Meyer.
One bright spot for planners: better concessions. Items such as Internet access, meeting room rental fees, and food and beverage are all up for negotiation in this economy, said the panelists. Hoteliers are also willing to be more flexible on attrition and cancellation terms.
So far, this buyer's market has done little to boost group sales. Hotel occupancy dropped 8 percent in the past three months, according to Smith Travel Research. “We are actually seeing occupancy rates declining in the double digits,” added LaRuffa. “If we are not the cheerleaders for the industry, then who is? But I am having a hard time getting my pom-poms in the air.”
Marriott Adds Planner Training
Marriott International launched a new online training program for third-party meeting planners called Meetings Excellence!, which earns planners certification as a “Marriott Meeting Professional.” The course is part of the Marriott Group Partners Web site, started last fall, which allows group travel intermediaries to monitor their commission payments due from Marriott as well as their future bookings. In 2007, Marriott centralized its group commission payments.
Planners are not required to take the course in order to use these Web tools, but completion of the program allows them to take advantage of discounted “Plan-Tastic” familiarization rates, earns them continuing education credits toward the Convention Industry Council's Certified Meeting Professional designation, and gets them on a list to receive news and promotions from Marriott.
