Tuesday, April 27, 2004

Luring visitors more than just expansion


Cities nationwide offer giveaways and deals galore to land conventions

By Ken Alltucker
The Cincinnati Enquirer

Today is the construction kickoff of a $160 million expansion and renovation of downtown's convention center. But it also begins a challenging two-year stretch for the agency that must fill the building.

A LOOK AT THE CONVENTION CENTER

Click on thumbnails to view a larger image.

rendering

rendering

rendering

rendering

For more images, click here.

Renderings courtesy the Greater Cincinnati Convention and Visitors Bureau.

The Greater Cincinnati Convention and Visitors Bureau faces sharp competition from cities nationwide that also are adding meeting space and offering large groups incentives to fill that expanded space. The giveaways have become even more generous over the last couple of years as the convention business nationwide has struggled.

Convention center construction last year in the U.S. and Canada yielded a 6.6 percent increase of available exhibit space while the total space rented by groups declined 5.3 percent, according to the industry publication Tradeshow Week.

It's a basic law of supply and demand that can give larger groups the upper hand when negotiating deals with host cities and hotels.

How have cities responded?

Tucson's "You're Flying, We're Buying" promotion treats convention planners to a complimentary weekend getaway that includes free airfare, hotel and meals just for visiting the desert city.

The "Great Tampa Bay Giveaways" include a free $1,000 shopping spree, tickets to a show or Devil Rays baseball game for those who bring a large meeting to Tampa. And in Detroit, convention pros have been offered a chance to win a Mustang Convertible or Chrysler Crossfire - free of charge - for two years.

"We tried to figure out a way to bonk (meeting planners) over the head and tell them to come to Detroit," said Michelle Fusco, spokeswoman for Detroit Metro Convention & Visitors Bureau.

Luring groups here

This game of convention incentives isn't unknown in Cincinnati, either. Just this year, Cincinnati snared the nation's largest African-American religious group for a 2008 meeting after throwing in thousands of dollars in incentives. The package included free use of the expanded downtown convention center and up to $220,000 in hotel and banquet reimbursement. Also offered: a limousine, a driver and six luxury sedans for conference bigwigs.

Convention bureaus across the U.S. say economic incentives play a critical role in the high-stakes game of landing lucrative conventions and business meetings.

Whether enticing meeting planners to visit cities with the offer of free trips and meals or nailing down conventions through room rebates and travel perks, convention bureaus and their members in Cincinnati and elsewhere are willing to spend thousands of dollars up front with the expectation that the conventions will return millions in economic activity later.

Incentives aren't offered to every group. Smaller meetings or those with less economic clout aren't given the same red carpet treatment.

Incentives "are more commonly offered to the largest convention and trade shows ... the cream of the crop," said Michael Hughes, director of research for Tradeshow Week in Los Angeles.

Hughes said 29 percent of trade shows and groups polled by his organization have been offered free space to book a show. For some larger groups, incentives can be as important as hotel room supply, airfares or quality of meeting space when choosing a destination.

Incentives also can be an attention grabber for cities that don't have the panache of a New York, Los Angeles or Las Vegas.

Two years ago, the Metropolitan Tucson Convention & Visitors Bureau launched its offer of a free weekend visit just to convince meeting planners to tour a city they often knew little about. About 100 meeting planners have visited Tucson on the bureau's dime.

"It's been very successful," Tucson bureau spokeswoman Barbara MacDonald said. "Other cities are starting to copy us."

Hotels and tourism officials in Cincinnati have complained for years that the outdated Albert B. Sabin Cincinnati Convention Center was a chief barrier in Cincinnati's ability to compete with other cities. Larger conventions skipped Cincinnati because the center's 160,000 square feet of exhibit space was simply too small.

The expansion will add 40,000 square feet of exhibit space when it's completed in 2006. The center's existing space also will be renovated with more high-tech accommodations.

Incentives needed

But even after the expansion is finished, seven of 10 Midwestern cities that Cincinnati competes against will have larger convention centers.

Lisa Haller, president of the Greater Cincinnati bureau, said local hospitality interests recognize that a top-notch marketing campaign laced with incentives will be needed to make Cincinnati more competitive.

"Cities are putting more on the table up front," Haller said. "We've learned that we need to do more of that."

The bureau's sales and marketing budget for 2004 is about $500,000, a 30 percent decline since 1998. A report by Chicago-basedC.H. Johnson Consulting Inc. ranked Cincinnati at the bottom compared to Midwestern peers in the amount of marketing dollars for recruiting new conventions.

Haller's vision calls for doing "more with less" by spending the bureau's limited budget wisely.

Of the nearly $500,000 in this year's budget, the Greater Cincinnati bureau will dedicate $166,500 for direct sales. The bureau has earmarked another $35,500 this year to host, entertain and wine and dine meeting planners.

Other initiatives call for $40,000 that will produce a new logo as part of a Cincinnati branding campaign and $35,000 to hire a retired, yet-to-be-named Cincinnati sports legend as the convention center spokesman.

Falling short

Still, the Greater Cincinnati bureau's incentive offerings often fall short of some competing cities. For example, Kansas City dedicates nearly $200,000 a year to lure national conventions. Cleveland offers a 10 percent room rebate for groups that generate at least 300 hotel room night bookings. Pittsburgh waived convention center rental fees during the initial year of that city's expanded, riverfront convention center.

Some downtown Cincinnati hoteliers question the need to spend a large amount of money on incentives here.

"If you come out and say to the world that it's free, there's no value attached to it and everybody assumes they can get it for free," said Michel Sheer, who manages the Hilton Netherland Plaza Hotel.

Sheer also said he recognizes that incentives won't disappear anytime soon. "I think it's a fact of life," he said.

---

E-mail kalltucker@enquirer.com




BUSINESS HEADLINES
Luring visitors more than just expansion
Ashland's 2nd-quarter loss less than last year's
Cincy Financial board vote varies
Most call gas prices 'hardship'
Humana's earnings rise, but stock price down nearly 7%
Milacron plans to manage its debt
P&G offers more to control Wella
Realty firm relocates

TECHNOLOGY
Let your mouse do the walking
Voting systems prompt questions
Can the Google culture survive?