Conference center hotels rely on incentives to win back corporate businessMarch 29, 2011 6:00 AM
by Elizabeth Cooper
Photo courtesy The Homstead
Attending a conference at a luxury resort isn’t usually associated with philanthropy. In fact, during the recent economic downturn companies risked social stigma if they planned sumptuous gatherings while millions of Americans didn’t have jobs.
Now, though, groups meeting at The Homestead can feel good. To win back corporate business lost during the recession, the Hot Springs resort launched an incentive program in January that gives groups the opportunity to combine meetings with charitable contributions. Under the Meet and Give Back program, The Homestead will donate 5 percent of guest room revenues from groups booking at least 75 rooms per night by June 30 to a 501c (3) charity of their choice. Meetings must be held during the 2011 calendar year.
That’s just one example of the creative incentives being offered in Virginia as resorts try to tap into what is expected to be a boost in business travel this year. Like other resort conference centers, The Homestead saw a dip in corporate business after the 2008 economic fallout. Now with the economy on the rebound, corporate groups are again scheduling meetings outside the office.
The Alexandria-based National Business Travel Association says business travel is expected to increase by 5 percent in 2011, after a 2.3 percent rise in 2010. That follows a dismal 2009 when business travel fell by more than 14 percent.
“We’re looking for a modest increase this year,” says Mike Aylmer, director of sales and marketing for The Homestead. “Business for us this year will be up 10 to 12 percent with the return of corporate meetings, which really had gone quiet in 2009 and 2010.”
Corporate meetings accounted for 45 percent of the resort’s business in 2009 and 2010. Aylmer is looking for that figure to climb to 55 percent this year. He notes that $35 million of The Homestead’s total projected revenue for 2011 will come from the meetings market.
Aylmer describes the Meet and Give Back approach as “a unique way of partnering with companies to have meetings. This is looked upon as potential goodwill.” Other meeting enticements include team-building activities such as a high-low ropes course and a scavenger hunt to enhance camaraderie and stretch participants’ mental and physical acumen.
The new Mason Inn Conference Center and Hotel also is trying to set itself apart in the race to attract corporate meeting planners. The $50 million, 179,000-square-foot facility, which opened in July on the George Mason University campus in Fairfax, offers 15-minute stretch and pose breaks led by GMU athletic trainers and coaches and a complimentary two-hour jazz trio or guitarist for receptions. “We’re looking at ways of partnering with the university in making the experience more unique,” says Lesly Connolly, the hotel’s sales manager.
The 26-room lodge at Primland in Meadows of Dan is another newcomer to the resort industry. Opened in August 2009 near the end of the recession, Primland still is working to achieve its goal of 50 percent rentals from businesses and organizations. “We’ve all been affected by the economy,” acknowledges Ann Walker, the resort’s director of sales and marketing. “Planners certainly seem to be more optimistic about their plans for this year and in the future, but people are still planning in the short term.”
Set on 12,000 acres, Primland caters to corporate board retreats and customer-entertaining events with 25 to 50 participants. “Businesses can get off site and come to a place where there are no distractions, and they can focus on the issues at hand,” Walker says. “We seldom have more than one group here at a time, and all of our staff is focused on the meeting that is presently in the house.”
Despite some encouraging signs, a lingering uncertainty about the economy’s overall performance has forced many businesses to scale back plans for long-range conferences. “We were seeing bookings over one year, a year and a half, two years out,” says Rick Butts, director of sales and marketing for The Jefferson Hotel in Richmond. “Now the trend is short term. People are really dealing in a six-month window.”
After experiencing a drop off during the recession, The Jefferson’s corporate business started to improve during the fourth quarter of 2010. Butts says the venerable hotel’s reliable service allowed it to weather the recession. “We’ve tried to remain very consistent and focused on delivering the best service. We’re a luxury hotel, but in this market we’re a tremendous value.” Conference guests typically receive a 10 to 25 percent discount on room rates at The Jefferson.
Convention managers across the state are hoping that the economic recovery will lead to more bookings. “Looking back at 2010, we were probably down about 10 percent over 2009,” says Michael Meyers, general manager of the 10-year-old Greater Richmond Convention Center. “We feel that we fared a lot better than most of our counterparts across the country, though.” The center averages more than 500 events annually. Meyers expects 2011 to be flat and is setting his hopes on 2012. “The early indication is that 2012 is really going to pick up. There’s a lot more activity and more interest in people booking the building for 2012.”
There are some bright spots on this year’s convention center’s calendar. Wineries Unlimited, the nation’s second largest trade show for the wine industry, came to Richmond for the first time in March, drawing approximately 2,000 people. “That’s a good sign for us,” says Meyers.
Not all convention facilities experienced a drop in business in 2010. The Virginia Beach Convention and Visitors Bureau reports a strong year with more than 190 meetings and conventions in the city, an 8 percent increase over 2009. “However, 2011 is projected to be somewhat soft,” says Pamela M. Lingle, the bureau’s communications manager. To increase business, the convention and visitors bureau offers rent incentives to conventions that book during the off-season.
Large events scheduled at the Virginia Beach Convention Center this year include the National High School Coaches National Championships and the USA Table Tennis National Championships. Together, the two sports events are slated to bring more than 3,500 visitors to Virginia Beach and generate an estimated $1.8 million in spending. Also, the Presbyterian Church in America’s 2011 General Assembly in June will bring more than 4,000 delegates to Virginia Beach and is projected to inject an estimated $1.7 million in direct spending.
Norfolk’s business and convention bookings dropped about 6 percent during the recession, but officials at VisitNorfolk, the city’s marketing organization, are confident that things will improve this year. “We have a lot of new developments, including new restaurants and a light rail system,” says Erin Filarecki, media relations manager with VisitNorfolk, referring to The Tide, a transit system scheduled to begin operating this year.
Many conventions coming to Norfolk reserve rooms and meeting space at the downtown Sheraton Norfolk Waterside Hotel. Martha Fraser, the hotel’s director of sales and marketing, is cautiously optimistic about 2011 and has even higher hopes for 2012 when OpSail, an international economic development event of tall ships, is expected to visit Norfolk. Just over 40 percent of the hotel’s bookings come from meetings and conventions. “We’re far ahead of where we were last year at the same time,” she says.
Fraser notes that more groups are booking if promised an incentive. The Sheraton recently offered a free Kindle to groups reserving a certain number of rooms. Fraser chuckles as she adds that planners already are inquiring about the hotel’s next incentive. “There’s always a deal to be had.”
Affordability is one reason Fairfax County is considering building a 55,000- to 60,000-square-foot conference center. Visit Fairfax, the county’s tourism agency, recently conducted a feasibility study that indicated a conference center would pay off for the state’s most populated jurisdiction. “We want to augment and complement what we have but with the ability to reach a much larger market,” explains Barry Biggar, president and CEO of Visit Fairfax.
The price tag on an $80 million conference center, including land, would be far less than a $250 million to $300 million convention center. Besides, Fairfax isn’t interested in competing in the convention center market. “Why would we want to compete with Washington, D.C., and Baltimore that have major convention centers when that business is already tough to get into?” asks Biggar.
Fairfax hotels have scheduled a variety of large conferences in 2011. Those meetings are expected to bring more than 2,000 participants to Fairfax and generate more than $1.7 million in revenue. “Our proposition here is value oriented,” says Biggar. “You can take advantage of everything the national capital region has to offer but pay 20 percent less in facility and hotel fees.”
The area also welcomed its first new hotel development in 20 years with the March opening of two side-by-side Marriott properties in Crystal City. The 300-room Renaissance Arlington Capital View and the 325-suite Residence Inn Arlington Capital View are the first hotels to be certified under green building standards in Arlington.
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