Across the nation, many communities are concerned because bookings for conventions and meetings are down from what they were last year. Others feel the pace of bookings is off or that they definitely aren’t growing as fast as people thought they would.
Although conventions and meetings represent only 10% of overall visitation nationwide, this must be particularly alarming for communities still over reliant on this segment.
People are tempted to look at short term causes such as the uncertainty created by the election or sequestration. One short-term cause is certain to be the uptick in other types of more lucrative business travel. When this occurs, hotels are often reluctant to pre-sell to groups at discounted rates.
A closer look at bookings at communities with which I am familiar gives a more complicated picture at this point in the year. The number of groups booked may be down or flat in the case of bookings facilitated directly rather than just spearheaded by the community’s destination marketing organization (DMO.) Related lodging room-nights are off much less but overall attendance, which includes day-trip visitors more so.
Of course there are longer-term, structural shifts at work. Conventions and meetings have been in gradual decline now for decades. And a new new benchmark report illustrates why it is now important not only to measure traditional in-person conventions and meetings but also online and hybrid events.
The report shows that while in-person attendance is flat or down for nearly six out of ten meetings, it is up for nearly seven out of ten where the event is online or an online hybrid of an in-person event.
Any trend analysis of conventions and meetings is incomplete now without measuring digital alternatives or hybrids as well and that may be why so many communities are in the dark.
The new benchmark report indicates that while 80% of the survey participants produce physical events, 70% of these also produce online events. The survey included a broad cross-section of meeting types including 23% associations, 17% corporations, 7% trade shows as well as a large number of business to business and commercial conference producers.
Online events are no longer at the margins. Six out of 10 draw more than 250 participants with nearly a third drawing 1,000 or more. More than just webinars, eight out of ten last more than an hour and 36% last five hours or more.
Judging by the amount of time typically wasted during in-person events, online or hybrid events are obviously more cost-effective too.
None of this is good news for communities that continue to sink tens and hundreds of millions of dollars into huge facilities reliant on an ever shrinking number of in-person conventions and meetings, often shelling out more to “buy” the events than they are ever likely to generate in impact.
Even where the community’s DMO has responded by diversifying into more lucrative visitor segments and promoting more realistic expectations and facilities, they are often subverted by an outdated cocktail of community ego and hubris.
Only when ratings agencies and bond markets finally rebel will many finally release their hostage communities. In time, behemoths will be replaced by much smaller facilities capable of facilitating or staging hybrid and online only events and occasionally much smaller in-person components.
Those looking into the future of conventions and meetings such as Jessie States with Meeting Planners International share predictions that this new generation of smaller, more nimble facilities will also be more local – local materials, local foods, local artists, local icons and local talent – they will embrace “place.”
There will always be a role for face-to-face conferences as illustrated in the results of a new joint survey released this month by the Chief Marketing Officer Council and the E2MA.
But even as 73% of the respondents rated conferences, conventions and trade shows as “still very valuable” or “essential to doing business, 45% have a challenge making a business case for attendance, 38% are slimming down participation and 31% are moving to webinars and virtual presentations.
Hopefully, Empowermint, the DMO subscription database of histories on 40,000 meetings and 20,000 producing organizations is already being updated by Destination Marketing Association International to track online and hybrid as well as in-person meetings.
As recommended last week by my friend and DMOpro consultant Bill Geist, many savvier destination communities must begin to recalibrate analysis for why they lose a convention and meeting and in my opinion that must include tracking ongoing shifts to digital and hybrid alternatives.
A friend at the City of Durham mentioned to me in passing at an event last week that under new contract management by Global Spectrum the Durham Convention Center (DCC) has cut the building’s operating deficit by $1 million compared to the hotel company that previously managed the facility.
For decades, hotel companies contracted to operate it had been treating the DCC as their own ballroom and as hotels often do with their own facilities, subordinating the needs of the Center’s meeting space whenever more lucrative transient business was available.
Fortunately though these conventions and meetings were rarely lost to Durham, just to that particular facility. Even so, local governments still reaped but failed to attribute tax revenues related to this segment of visitors.
Even though, it will be a few years before several new hotels near the DCC all become operational and make the facility even more marketable, Global Spectrum is ensuring that it competes to harvest its full share of conventions and meetings spearheaded by the community’s DMO.
Durham has long reaped its fair share of conventions and meeting-related visitation but Durham’s DMO has been very wise over the last decade and a half to make sure that the community has been in a position successfully pursue the 9 out of every 10 visitors nationwide for other purposes.
Long-term, the writing is on the wall about conventions and meetings and it isn’t good.
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