The perfect storm of bad press, proposed legislation, and statements from the White House has hit the meetings industry hard. But if any place could be considered Ground Zero it would be Las Vegas. On March 25,
Successful Meetings and our sister publication,
MeetingNews, hosted two roundtables comprised of leaders of the city's hospitality community at Caesars Palace. This edited version combines the best of both sessions.
Participants:• VINCENT ALONZO, editor-in-chief,
Successful Meetings (moderator)
• KINLEY LEVACK, managing editor,
Successful Meetings (moderator)
• Eric Bello, vice president of hotel sales, Venetian, Palazzo, and Sands Expo
• Chris Bond, vice president of hotel sales, New York New York
• Fletch Brunelle, senior vice president of hotel sales and marketing, Bellagio
• Jordan Clark, vice president of sales, Harrah's Entertainment
• Ed Coffey, vice president of convention sales, Riviera
• Andy Finn, vice president of sales and marketing, Fontainebleau
• Chris Flatt, executive vice president of hotel sales and marketing, Wynn Encore
• Darren Green, vice president of hotel sales and marketing, Planet Hollywood
• Brian Hardee, vice president of hotel sales and marketing, Mirage
• Richard Harper, vice president of sales and marketing, Mandalay Bay
• Michael Massari, vice president of meeting sales and operations, Las Vegas Meetings by Harrah's Entertainment
• Gavin Mealiffe, executive director of sales, Las Vegas Hilton
• Chris Meyer, vice president of conventions sales, Las Vegas Convention and Visitors Authority
• Valerie Moon, director of sales, Excalibur
• Tom Page, vice president of hotel sales and marketing, Las Vegas Hilton
• David Sukala, assistant director of sales, Hard Rock Hotel
• Michael Toney, corporate vice president of hotel sales, Station Casinos
Political Scapegoats
VINCENT ALONZO: What impact did the proposed legislation restricting meetings for companies accepting TARP funds and the statement President Obama made criticizing bringing a meeting to Las Vegas have on the city?
CHRIS MEYER: We have actually released some numbers with regards to that. It was a loss of well over $100 million dollars directly related to the President's statement. It sent a shudder through our industry and if there is any silver lining about that, it did create a groundswell of activity amongst all of our meetings and hospitality industry associations.
Everyone recognized that the attack on us was an attack on everybody.
MICHAEL MASSARI: My concern about the legislation language was that it prohibited meetings and events from happening. Meetings and events are activities that help companies grow and as a taxpayer and as somebody supporting these companies, I want them to grow. I want them to get out of this and have meetings that help them sell products, entertain customers, and educate sales staffs. Manager meetings, strategy meetings—these are things that are going to help companies grow.
VINCENT ALONZO: One of the things the meetings industry coalition has come up with is a proposed set of guidelines for TARP recipients to follow. Do you think they are a good idea?
CHRIS MEYER: Well, I think the guidelines provide a template for companies to work from. I think probably the most egregious item on there is about the limitation of spending that it imposes on sales and marketing efforts to 15 percent of an organization's revenues. That's bad just for the fact that you want these companies to grow. Because if they are growing, then they are employing more people and they are able to conduct more face-to-face meetings. They are going to have a lot more positive economic benefit if that kind of restriction is not in place.
ERIC BELLO: For businesses that have complex products, these sales and marketing budgets may be used for more than meetings. They may lend themselves to other forms of the marketing mix such as television, radio, etc. Some regulations are okay, but when they begin to be an impediment into the private sector it starts to challenge the spirit of America itself.
VALERIE MOON: I think organizations that are not TARP recipients might be offended by those suggested guidelines. Especially those that are marketing-driven companies, which means their sales and marketing expenses might far surpass the maximum budget allotment. I think it is a naive approach to dictate to people how much they can spend. It could create a perception that they cannot hold meetings and that is going to affect their business negatively, not to mention ours.
VINCENT ALONZO: The meetings coalition was able to get a face-to-face meeting with President Obama and the very next day, he toned down his rhetoric, towards meetings. Has that helped Las Vegas out a little bit?
MICHAEL TONEY: I do not think the President had any real intent in preventing meetings with his original statement. I just think it kind of backfired for him. And obviously, we really felt the impact from that as a city and as an industry.
GAVIN MEALIFFE: I don't think his back tracking statement really got the same press that his initial statements received, so I do not think we have seen the benefit of his clarification just yet. We are hopeful that is going to happen.
TOM PAGE: It is very difficult to un-ring the bell. I think our customers are sympathetic to us and to the meetings industry on the whole, but again, the statements that Obama made have definitely hurt us.
JORDAN CLARK: I agree, it definitely takes an awful lot to un-ring the bell. I am optimistic and hopeful that happens because the meetings coalition got a face-to-face meeting with the President. And I think that, in and of itself, will start to eventually yield results. We have seen cancellations drop a little bit since then. So, I am optimistic that it will—hopefully we will get more balanced press coverage.
RICHARD HARPER: There is a direct correlation to every statement that was made that got major media behind it. It started with AIG. Many organizations were already on the bubble in making some economic decisions about whether to hold a meeting and after the AIG announcement we saw a spike in cancellations. After that, it got quiet a little bit, then the Wells Fargo coverage hit and it spiked again. After that, President Obama's comment caused a spike, then the Northern Trust story led to another spike. Then the meetings coalition had that meeting with the President and after that it quieted down. There is a direct correlation to every major story that has come out in the media that can be tied right back to cancellations.
DARREN GREEN: I think the wheels were already in motion for companies that had made the decision prior to that statement. I do not think it had a direct effect—of perception, probably—but those companies that were going to change direction or shift focus probably had decided to do so before the statement was made, so how much of an impact it had is hard to say.
MICHAEL MASSARI: I kept reading the President's retraction statement looking for the positive in it and I could not find it. I do not know if the rest of you guys can find it. But it certainly did not say, 'meetings are good for business and have those meetings in the places that are going to be most successful for your company.' And that is what I would have liked it to say.
RICHARD HARPER: Here lies the issue, and I heard a little bit about that meeting from a couple of folks who attended. The issue now is, someone has got to reach out to him, one-on-one, in a press conference, on camera, and ask the questions. And then he is going to be in the position to have to say it himself directly. We all need to find a way to get him to come to Las Vegas to attend an event.
MICHAEL MASSARI: I think the argument with the most merit is not that it is going to hurt us, it's that this legislation is going to hurt the companies that are not having these meetings. And that will lead to more unemployment.
CHRIS MEYER: Giving the average person, who is not affiliated with our industry, a talking point about what meetings contribute is key. The best one that I can come up with is that a job fair is an example of a meeting. In fact, it is almost an example of a tradeshow, because you have two people engaging in a discussion about commerce—whether they are going to hire you or not—across a table. It is set up in a conference room, usually in a hotel, and somebody has to coordinate it. Everybody gets that, because every community in the United States has job fairs. So, if you go to that basic level, then people understand why meetings are important.
BRIAN HARDEE: We have to tell the story. Our industry has done so many amazing things over the years, but what we have not done is invest the time, money, resources, and talent into educating planners and corporate executives about the ROI attached and the value to doing a meeting or event. Now, how do you measure that? By how many people showed up, by the post-con surveys, by the CEO saying, 'I had a great time'? That does not cut it anymore.
There is an effort under way to do specific training with all of our properties—bipartisan training on what ROI means for meetings. There is an actual ROI case study model that has been proven that I think we need to add to our vocabulary and educate our customers on what that means for them.
CHRIS FLATT: That is the stuff people need to hear. They need to see what the return is when they go home and their sales go up. CEOs and meeting planners know the value of having face-to-face meetings. But they are getting cremated in the press. So, I think the message is: Focus on what the importance is from the company's perspective, and the impact on economy. But we have to be out there saying the same thing as a city. We have to work closer together and I think that this is a great start.
CHRIS MEYER: We need to find our 'all clear' message or our 'all clear' vehicle and our 'all clear' timeline. The moment that will get planners to say, 'Okay, I am not going to get ridiculed, or chastised for bringing a meeting to Las Vegas.' That 'all clear' signal would be either having the President or the Vice- President come to Las Vegas and have a photo-op at a meeting or a tradeshow or something that shows that they are in a business environment.
RICHARD HARPER: Or a major Fortune 500 financial company, TARP or no TARP, that stands up and says, 'I am doing Vegas.'
CHRIS BOND: The damage was done up top. It needs to be rectified from up top. If the President or someone directly below the President were to come out and put a new spin on the administration's official position on meetings it will help us out a whole lot.
CHRIS FLATT: It's not just political, it is the economy, too. Everyone is trying to figure out how to stimulate the economy and how to fix all these problems that we are having. And with people staying home or people not having meetings and spending money in all of these industries, it is not going to go anywhere and somebody has got to step out there and to say 'it is okay', talk about all of the positives and all of the things that are going to happen when organizations do start to have meetings again.
The True ImpactKINLEY LEVACK: Right now the face of the story is corporate greed, how can we shift that to the impact meetings cancellations have on communities?
MICHAEL TONEY: The first step is to communicate that the pool of meetings where there is a problem is quite small. We need to isolate the 1 percent, where it is frivolous and then we can start to make the case for 99 percent that use meetings and incentives as strategic tools.
JORDAN CLARK: I think the companies in our city are working hard. Our company is taking an aggressive stand and I know several of our competitors are as well; the LVCVA is also doing an amazing job. You know, when Congress is in session they're essentially having a meeting. I think when you educate the general public about that, and things like the job fairs Chris mentioned that demonstrate what meetings make possible, we will start to get a little traction towards shifting perception.
TOM PAGE: And we've got to tell the story of our destination too. It has built itself up into a tremendous meetings destination, from the airport, to ground transportation, to the hotels rooms, to the greatest facilities and dining experiences, on and on. Three of the world's greatest convention centers are located in Las Vegas and this is what we do. This is what drives business.
ERIC BELLO: We have invested a tremendous amount in infrastructure to make it the most user-friendly destination in the world. Macao, China, Singapore, Europe—I have yet to see the destination that is anything like Vegas. There is nothing like this place when it comes to facilities for serious meetings.
VINCENT ALONZO: What effect has curtailing meetings had in terms of jobs for the community here?
CHRIS BOND: Starting with the airlines, people working at the airport, the cab drivers. Obviously, our line employees were just so near and dear to us—the trickle-down effect is almost infinite with everything that is going on right now. I'm not sure anyone can truly appreciate the trickle-down effect this attack on us will ultimately have. So, it is a scary time.
CHRIS FLATT: In addition to what we are seeing on The Strip and in our own buildings, just living here when you are driving down the street and you see all these projects that are just stopped. All these apartment complexes, all these store franchises that are empty, and on and on and on. So, I agree. We do not know what that true impact is on our city. It is huge.
MICHAEL MASSARI: I think I read somewhere that 200,000 travel-related jobs were lost in 2008 and they expect nearly a quarter-million travel-related jobs [lost] in '09. And that is an awful lot of jobs, when I hear about GM, Ford, and Chrysler in the auto industry, those are numbers in that same range. We focus a lot of attention on the auto industry and seemingly less attention on the hospitality industry. We just want a fair shake.
ERIC BELLO: I will tell you about lost tax revenues. Last year, in 2008, $116 billion was raised nationally for taxes by the hospitality industry. That will be down dramatically in '09. And by the way, the average hotel in the United States, is 100 rooms. So this attack is hurting a lot of small businesses across America—the travel industry is that vital.
BRIAN HARDEE: And let us not forget the more underlying, more subtle impact of that trickle-down, aside from the people that are affected by this. The base of our business, the foundation upon which we can drive a recovery, is gone. That trickle- down effect and the impact it has on our market segments is enormous.
ERIC BELLO: That is true. The Nevada Tourism Commission budget has been cut in half this year. That budget shortfall is mainly due to the decrease in the room revenue and room taxes that they get. So there have been slashes across the board. And it goes beyond our tourism efforts. It affects our residents too. The state has to cut education and other services. So this has a huge ripple effect.
BRIAN HARDEE: At every meeting I have been to, we have brainstorming sessions and we always come full circle to 'Okay, now what do we do?' There is this fear about promoting ourselves as a value destination in this difficult economy. And the fear is causing us not to go out there and say it, and at least stimulate our own market at the expense of our competitor markets, because there is very limited market share out there. Not just convention but in all the market segments.
And I think that we have our own internal fears on the county, city, and state level concerning sending the message out to the world that we are a value destination again. The reality is we are. And that might just be our best message.
VALERIE MOON: Yes, and the irony is this has always been a value destination because at one time, we were not taken very seriously as a meeting destination. When we started out convincing people that they should come here, it was so they could save money. And actually, as luxurious as Las Vegas has become, and as professional as it has become, that fact has not changed over the years.
DARREN GREEN: But, the consumer, and even meeting planners, still have to overcome the perception of the gaming and the nightlife being a distraction to the meetings. So is it a place to have fun or is it a place to do serious business? It's both. We've got to emphasize that.
The Real Las VegasKINLEY LEVACK: Have any of you been able to get your corporate clients who have continued to hold meetings here to do any type of testimonial that will go beyond just saying Vegas is a great place to meet, but also talk about saving money by staying in Vegas or—
VALERIE MOON: We used to maintain a file of letters that the LVCVA call the "Good Guy File" and it was for meeting planners who would send in comments to the Convention Center because more people showed up at the meetings here. And they would actually claim that their percentage of attendees rose.
CHRIS MEYER: Well, it is not even a claim. We have empirical data through our third party research firm that shows when you hold an event in Las Vegas, your attendance increases. If it is a voluntary type of participation, it increases by 14 percent and you spend more time in your events than you do in any other destination. It is because nothing closes here. Beyond that, we have a testimonial, actually a couple of them, from organizations that were able to increase sales and now are hiring more people and it was all because they came to Vegas.
BRIAN HARDEE: We have a press release that was drafted representing several of our properties that contains planner testimonials on why they chose Vegas. Why they are here, the ROI, the whole message.
CHRIS MEYER: If you go to the macro level, the National Association of Broadcasters actually measures the economic activity that happens as a result of its show. It is $68.6 billion. That is one event that spreads that much commerce all around the world. And they measure it. They are the only ones we found that actually measure that. We were stunned when we got that number. We have actually been using it in the press releases that we are doing. That is a huge amount of commerce off of one tradeshow. And we do 22,000 events in the city.
DAVID SUKALA: Absolutely. Again, we have said here a few times that Vegas has never been a better value that it is now. If you have not been able to come to Vegas, now is the time to come.
JORDAN CLARK: I think the value has increased. So, I mean, let's face it, we are blessed in my opinion to have so many awesome competitors in the city. The hotels and the meeting facilities in the city are second to none, our competitors do an amazing job, we would like to think we do an amazing job as well, but the principle of completing that task and helping the customer meet the objectives has not changed.
ED COFFEY: I believe that organizations have spent every bit as much money today promoting meetings and trying to drive attendance. And the idea of meeting in Las Vegas where you can increase your attendance by 10 percent helps on that ROI front and it also gives organizations the justification to go ahead with that meeting, to spend the current types of marketing moneys required to build attendance. And, I know the hoteliers here around this table are providing additional collateral, additional e-mail, amenities, and arrangements, to help build attendance. I think there is no city like Las Vegas for providing proper justification for selecting a city as a meeting site. Whoever has a meeting here is going to have a better-attended meeting and the revenue driven versus the expense is definitely advantageous to corporations, associations, whomever it may be.
Originally published May 1, 2009For more ideas, tips, and tools for better meetings and events,
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