Over the last few months, the meetings, conventions, and events business has shown signs that it is coming back strong in 2011. And Las Vegas is leading the way.
The last couple of years weren’t kind to Las Vegas. Between a generation-defining recession and attacks on the value of meetings and incentives that culminated in President Barack Obama briefly advising businesses not to visit the city, it was hit as hard as, if not harder than, any other major meetings destination.
But with the economy improving and with all of the inherent strengths the city has to draw on, Las Vegas seems determined to come roaring back faster than other major destinations. In hindsight, that shouldn’t be surprising. The Las Vegas hospitality industry aggressively pursued business; in fact, it was among the first major meetings destinations to effectively rally political support to fight against the huge perception issues the industry faced, and it built several incredible new hotels throughout the downturn.
But most importantly, Vegas is Vegas. Jimmy Bellew, director of operations and events for Plano, TX-based World Ventures, found that out after the network marketing company moved its annual international conference from Las Vegas to Dallas in 2009.
“We held it locally because we felt we could have more of our staff participate, have a larger, better event,” Bellew says. “When we were in Vegas, we had larger numbers. ... We are projecting a 20 percent increase in attendance by going back to Las Vegas.”
Five-year-old World Ventures sells group vacation packages to four- and five-star resorts in which members get the benefits of group travel but don’t have to stay with the group. Until 2009, it mostly focused on events in North America, expanding to European and other destinations that year. So its footprint of members based overseas was smaller at that point, and only a few hundred attended. At the conference, Bellew says he found out that about 100 were planning a trip to Las Vegas, on their own, immediately after the convention.
For the 2011 international conference in April, Bellew selected the Paris Las Vegas. He says it met the basic requirements—it’s large enough to hold 5,000 people, has a big stage, and is convenient for guests, who complained in previous years about 30-minute transfers to the venue. “We want them to stay at the host hotel. Everybody staying together is key—remaining connected is key,” Bellew says, in an event where motivation and inspiration are a significant part of the goals.
“Our group is traditionally very late registrants,” Bellew notes. “They’ll commit and book airfares, and all that stuff, but wait until very last minute to book event tickets. For this event, 40 days out, well over half of the attendees we expect are already booked and have rooms. At some of our other events, we have two-thirds register in the last eight days.” The conference is booked at the Paris through 2013.
And April’s international conference is not the first event World Ventures is holding at the Paris this year. “After we picked it, we learned our director of training was looking at it,” for the first of the company’s five main annual training events, notes Bellew.
“What took us to Paris were the people,” Bellew says. “When we did site visits, the sales manager and the people he introduced us to were extremely accommodating; it felt good.”
Hospitality Smiling Again
“I think this could be a really outstanding year for us,” says Michael Massari, vice president of meeting sales and operations for Las Vegas Meetings by Caesars Entertainment. “If that’s the case then we have turned a real corner.”
In hindsight, that corner may have been turned in July or August of last year. “We just didn’t realize it, but it certainly seems that way now. Maybe there is another shoe out there that’s going to drop. But for now, we are feeling pretty positive about the world.”
An interesting factor in this year’s upturn is where the business is coming back, he says. “In our businesses, it is at the mid-end hotel or better. We are still not seeing the same level of pick-up at our more value-oriented properties,” Massari adds. “So our big meetings facilities like Caesars, Rio, Bally’s, and Paris are doing very, very well.”
That positive attitude is found up and down The Strip. “We are definitely seeing substantial growth,” says Chandra Allison, vice president of sales at The Venetian and The Pallazo. “It is trending to be up 15 percent year-over-year. That tells you the big picture.”
“Our biggest market segment that remained strong throughout the recession is IT, but coming out of it, it is really going gangbusters,” she says. “Insurance is pretty good for us, and medical, and short-term pharmaceutical. There is some life and interest back in the automotive sector. That and finance are the last ones coming back to Las Vegas. With everything that was said a couple of years ago, they are a little gun shy, but definitely interested. We are seeing an increase in those segments, but not as substantial as others.”
Gail Fitzgerald, vice president of hotel sales and marketing for ARIA and Vdara, also feels the outlook is good. “In January, we had a record number of leads for both ARIA and Vdara. Of course, we just finished our first year, but we have had a lot of repeat group business. We are working on a lot of multiyear contracts. I don’t think we are out of the woods yet, but I think we have a very positive outlook for the future.”
Richard Harper, vice president of sales and marketing for the Mandalay Bay Resort & Casino, agrees that the market has been improving slowly since last fall. “The perception issue that was clearly prevalent in the last couple years has waned,” he says. “We haven’t heard that in quite some time now. Our lead volume is an indicator the perception issue has waned.”
Over at Wynn Las Vegas, Chris Flatt, the executive vice president of hotel sales and marketing, says, “the Las Vegas convention market has been slowly improving since early last year and has picked up pace this year. Corporate and incentive business is returning and we are definitely seeing the larger groups again. Our larger citywide conventions have shown growth over last year as well.”
Still, she echoes a common refrain: “Lead times are continuing to be short term, but we are starting to see more of the long-term leads for the larger groups again,” Flatt says. “Budgets are tight, but we are seeing a bit more spend on food and beverage and activities.”
Harper agrees that clients “are still budget conscious. It’s going to continue to be that way for the foreseeable future, until the economy gets back to a point where everybody can afford to step up and pay a little bit more and do a little bit more. The interesting phenomenon we’re seeing is onsite increases taking place. Clients are coming into programs with a set budget, but by the time the program’s over, they’ve added various upgrades, either with room product or food and beverage, or audio-visual, or decor.”
What this means to the meetings and events market, says David Gabri, president and CEO of Associated Luxury hotels International, which represents MGM Mirage’s nine luxury properties on The Strip, is that Las Vegas is an extraordinary value right now.
“Savvy buyers are taking advantage of that,” he says. They are gobbling up Las Vegas on sale.” That opportunity will disappear by 2012, he predicts.
Attendance is Booming
With the year just a quarter over, many organizations that held meetings and events in Las Vegas are seeing big attendance growth.
In the last two months, the city has “had just one show after another, both big trade shows and some smaller ones, that have shown pretty substantial increases in attendance,” says Chris Meyer, vice president of sales of the Las Vegas Convention and Visitors Authority.
Among these is Las Vegas’ biggest show of the year, the Consumer Electronics Show, which falls right after the New Year. It saw 11 percent attendance growth over 2010, according to Meyer. He also points to the International Roofing Expo and the Associated Surplus Dealers/Associated Merchandise Dealers show, both up 18 percent year over year; and the Air Conditioning, Heating, and Refrigeration Expo—which hasn’t been to Las Vegas since the early 1970s—is up 40 percent over 2010.
And even the automotive and finance sectors—hit hardest by the recession and perception issues—are staging a comeback here. Earlier this year, the trade shows collectively know as Automotive Aftermarket Industry Week had substantial growth, Meyer says. “We are seeing a lot of training meetings in the financial sector, especially insurance meetings for both training and sales,” he adds. “They had pretty much stopped, and like everybody else you’ve got to get out and increase revenues. You can only cut your way to profitability so long.”