Study Shows Promise For Corporate Leads For CVBs

Though attracting corporate meeting business is a perennially challenging task for convention and visitors bureaus, particularly in a recessionary economic climate, a recent survey by one industry association indicated that some CVBs' corporate leads grew in the first quarter of 2003. It is far too early to point to that statistic as unshakable evidence of an industry recovery, but, for CVBs, it is better than the alternative.

The International Association of Convention & Visitors Bureaus in late April surveyed 127 member CVBs, representing a fair cross-section of its overall membership, and found 22 percent reported corporate meeting leads are higher than they were in the first quarter of 2002. That percentage falls short of increases in association meeting and citywide meeting leads. On the whole, more than 60 percent reported all leads and definite bookings have at least remained stable.

"While there is certainly room for improvement, we regard these results as extremely positive," said IACVB president and CEO Michael Gehrisch. "The fact that business has remained stable, and, in some areas, increased, is remarkable news for our industry and indicates the beginning of a recovery. Also significant is the fact that these bookings reported from our members are for the next several years—not just the next six months—and indicate a long-term positive outlook."

While many CVB executives are somewhat less ebullient about the immediate future of corporate meeting business, they still feel that some optimism is warranted.

"It's below the level of interest we have seen in the past, but we're cautiously optimistic, because it's not as down as we thought it would be," said John Reyes, vice president of sales at the San Diego Convention & Visitors Bureau.

The San Diego CVB receives a fairly high percentage of its leads from typically small corporate meetings, Reyes said. That percentage currently stands at about 45 percent, up about 5 percent from last year. The marketplace has changed dramatically in recent years, he said, as buyers have heightened concerns about attrition and cancellation damages and perceptions of extravagance, all of which the CVB needs to address.

"San Diego is a great resort destination, and though we have other great products, resort meetings are going to be doubly scrutinized because of shareholder perception," Reyes said. "They're concerned about attrition and cancellation, they must get approval from management and they book only when dollars are released, usually by quarter."

Yet, the services requested by corporate meeting buyers have remained consistent, Reyes said: Corporate planners, pressed for time, are looking for hotel space and looking for it quickly.

"They are seeking the best value in time, money and quality, and they have no time to review proposals," Reyes said. "If you don't have an offer for them in 24 or 48 hours, you lose."

To that end, the San Diego CVB recently has experimented with meeting packages, culled from services provided from several members, for the small corporate meetings market. The package includes value dates from member hotels during which rates are lower. Flexible attrition and cancellation contracting could be offered, combined with group rates from a handful of airlines and a guaranteed 24-hour turnaround time, he said. "It's hassle-free, and it provides speed and value to the market," Reyes said.

Other executives point their initiatives toward emerging corporate meeting market segments.

"The corporate market is not one that requires as much service as the association or religious markets," said Mike Butts, senior vice president of sales for the Charlotte Convention & Visitors Bureau. "The corporate planner is accustomed to doing their own thing, because they can compel attendance. We don't have new services for that market not because of the economy and the struggles of corporate business, but because we detect it's not generating new business."

In fact, Butts said, the Charlotte CVB sees business development as the most effective corporate meeting service it can provide its members. "We pursue corporate business in vertical markets," he said. "For example, meeting business from technology companies has decreased. We are very involved with that industry, because of the nearby Research Triangle, but the automotive industry is growing that business. The automotive industry is not big in Charlotte, but it's not big anywhere outside of Detroit, so we're getting some at-bats with them."

Still, the Charlotte CVB, like many of its ilk, has developed online tools designed to help planners quickly find hotel and meeting space, which fits well with the short-term nature of the corporate meetings market. "We're still doing that," Butts said. "Even if it is only for two days and 20 room nights, hotels love and need that business—and that same group could eventually bring another group."