“I believe that meetings, because they promote the free exchange of information, are absolutely critical to our success as a country. For that reason alone, I think membership in associations should be tax-deductible. Why not?”
That's the question asked by the new chairman of the Professional Convention Management Association, John Lisack Jr., CAE, at PCMA's annual meeting, January 5 to 8, Anaheim (Calif.) Convention Center. The event drew nearly 2,500 registrants — about 500 more than in 2001. Lisack, executive director of the American Society of Plant Biologists, said one of his missions is to encourage the involvement of CEOs in meetings. “I consider it irresponsible for any CEO not to be engaged in the group's convention. These events are just too important to the bottom line.”
Meetings are increasingly important to hotels' bottom lines, reported keynote speaker Bjorn Hanson, a noted lodging analyst with PricewaterhouseCoopers. Hanson said group business accounted for 27 percent of profits at full-service hotels in 2002 — up from 20 percent in 2000. In fact, in many major cities last year, the group rate was higher than transient rates. (Hanson's full report is available at www.lodgingresearch.com. For more perspective on Hanson's data, see “Buyer's Market with a Twist,” AM December page 22.)
“Hotels understand this [the value of group business] but they may not want to share it,” he said. “Corporate rate negotiators were brutal in 2002, with expectations that rates would be lower in 2003 than 2002. I suggest you follow their lead.” Hanson predicted that a recovery would not begin until 2004 — assuming the United States does not go to war. If so, lodging demand would drop as much as the third quarter of 2001 if the war went beyond 12 weeks.
Even without a war, Hanson's data shows a disturbing trend: a continuing drop in demand even as the economy recovers — a drop due increasingly to traveler concerns about safety and convenience. “Now that we have a Department of Homeland Security, you can count on more travel alerts,” he said, which is going to continue to depress travel.
Housing was a hot issue. PCMA released a survey in which 40 percent of the 650 association planners surveyed were most concerned about attrition penalties, while 25 percent said their biggest concern was attendees booking outside the block. At press time, it was expected that the Convention Industry Council would announce plans for an industry-wide effort to address the problem. Visit CIC at www.cic.org.