When Network World magazine decided to move its conference from a hotel to a convention center because the event had grown, Dale Fisher, director of event operations for the South-borough, Mass. — based media company, didn't think she would have trouble finding a venue. All she had heard about was the overbuilt convention center market, a stark contrast to the hotel industry's raging seller's market.
But that was not the case.
Officials from one venue told her that while they had several weeks on the calendar available, they were leaving them open in case a group came along that could book the entire week. That is something that she would expect a hotel would do — not a convention center. After four months of looking, she finally found space at Moscone Center West in San Francisco.
“What I found was that the convention centers wouldn't take my business either, which surprised me,” she says. “I thought that would be my easy answer.”
Convention centers turning business away is fairly uncommon, says Jim Grinstead, owner, Convention and Conference Facilities, a Nashville, Tenn. — based consultant. When a group can't book a city, it typically isn't “a matter of convention centers turning away business — they'd never get a shot at it,” he says. If centers cannot accommodate groups, “It's more likely that there aren't enough hotel rooms for the market.”
Candy Adams, owner of Trade Show Consulting, Vista, Calif., knows firsthand how difficult it is to find rooms in some markets. In booking a block of rooms for an upcoming trade show for a client in the Southeast, she called an hour and a half after the block officially opened, but had to settle for rooms 15 miles away from the convention center. That was as close as she could get. “I'm out in the boondocks,” she says, where the rates aren't much different from those of downtown hotels and transportation is required. “That would never have happened a few years ago.”
Doug Ducate, president and chief executive officer, Center for Exhibition Industry Research, Dallas, confirms that the high-demand, low-supply seller's market is affecting hotel booking policies in a big way.
In major convention cities where there are multiple convention hotels, the ones that are not designated headquarters hotels are only willing to give a fraction of their rooms to citywides. They would rather hold out and book an in-house meeting that also uses their function space and food and beverage.
Ducate explains the situation from the perspective of the hotelier: “If I give away my inventory of rooms as a secondary or overflow property, then I don't have the committable rooms to attract another piece of business.” As a result, the room blocks are being spread out to many different properties, which is inconvenient for both planners and attendees.
What's also happening, says Brad Weaber, executive vice president and chief customer officer, Experient (formerly Conferon Global Services), Twinsburg, Ohio, is that groups are being caught short of rooms because they might have booked smaller blocks a few years ago to avoid attrition penalties. Now, with attendance levels higher than expected, they are having to scramble to add rooms. But with such high occupancy rates, those rooms are hard to find.
For planners who can book space 12 to 18 months out, the key is flexibility, says Tim Brown, partner, Meeting Sites Resource, Irvine, Calif. “Getting in is one thing — getting in right is another thing,” says Brown. So, it may be better to shift dates a little bit to “have the right fit,” he adds, than to compromise the package by settling for less convention center space or an inconvenient room block. Being flexible may also mean looking at secondary and tertiary markets, provided that they have enough room to accommodate the event.
Long Beach, Calif.; Tampa, Fla.; Charlotte, N.C.; Salt Lake City, Utah; and St. Louis are some second- and third-tier cities that are seeing more overflow meeting activity, says Weaber.
To find hotel rooms for a meeting on short notice, corporate planners might be better served by “waiting to see what the hotel has versus walking in and saying, ‘This is what I want,’” says Weaber.
Guaranteeing a certain amount of F&B is a good way to make the piece of business more attractive to hotels, he adds, as is building a block by using multiple brands within a chain.
For their part, convention and visitors bureaus are trying to help by being flexible as well. “We're trying to layer business among [Moscone's] three buildings so that hotels don't feel such extreme peaks and valleys with the room flow generated by the [convention] center accounts,” explains Lysa Levin, director of sales, San Francisco Convention & Visitors Bureau.
In today's hot hotel market, the role of convention and visitors bureaus has never been more valuable for meeting planners seeking space.
“Going through a convention bureau and letting them move that potential piece of business among the whole competitive set so that meeting planners can get a better assessment of the total marketplace is really helpful,” states Bill Peeper, president of the Orlando/Orange County Convention & Visitors Bureau, who recently announced his retirement after 22 years with the bureau.
Christine Shimasaki, executive vice president of sales and marketing at the San Diego CVB, agrees. “I think [the seller's market] is a huge opportunity for convention and visitors bureaus, because as availability and supply tighten, what meeting planners are going to need is a source that enables them to do a comprehensive search for availability — and that's what CVBs are here for.”