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Convention Bureau prepares for tough economic climate

Friday, October 31, 2008 by Kimberly Reeves

The Austin Convention and Visitors Bureau – noting a slow economic year ahead and little change in the current marketing climate – is setting a 5 percent growth goal in the coming year, according to a presentation at Monday’s board meeting.


ACVB is in fairly solid financial shape going into the new fiscal year. The city’s contract with the bureau is up by $500,000, to $7.7 million. And the bureau’s own business has generated some additional growth, mainly in merchandise sales. That is about 20 percent of ACVB’s total budget. The only loss on the balance sheet will be minor, about $5,000, from investment losses.


However, that was the fruit of last year, and this is a new year, one where convention business is expected to be more competitive. Vice President Roy Benear, in his presentation to the board, noted the tightening economic climate.


“Landing meeting and convention business is getting harder and harder and increasingly competitive in trying to book business,” Benear said. “Knowing that it would be a bit of a challenge this year – given the historical trends and past production – we decided to dig into more data on what the trends are and where the business is coming from.”


The bottom line is that ACVB met its goal for last year, booking just over 411,000 room nights in Austin. Of those nights, about 223,000 were tied to “A,” or top tier, business. The bureau generated more than 1,500 leads through marketing and sales trips.


Next year, the sales production goal will be 420,000 room nights, up from the goal of 400,000. The top-tier business is set at 258,000 room nights. Overall, the ACVB wants leads on at least 2 million room nights. That kind of goal is achievable, but aggressive, knowing the current dynamics of the market, Benear said.


The creation of a sports commission at the ACVB has paid off with an upward tick in more sports bookings, Benear said. Association marketing also is up. For local hotels and venues, a top ranking in college football is good for business.


The ACVB has realigned its sales markets to reflect growing interest from what is labeled on the map as Midwest. The sales office also has a Southeast/East and Texas territory. New hires will strengthen recruitment from the national African-American market and also the Southeast territory. The ACVB currently has offices in Chicago and Washington DC, with the intention of adding an office in Atlanta.


Asked by ACVB CEO Bob Lander for feedback, hotel managers were positive about the ACVB’s new sales direction. The combination of hotel and ACVB teams to draw in business had yielded good results for a number of venues.


Lander said the ACVB would not forget “how we got here” and would continue to look for new opportunities to grow business in Texas, too.


Key new business has included a John Deere convention in 2010 with 18,600 attendees; a Prudential Real Estate Convention the same year with 9,400 attendees; the National Hurricane Conference next year with 4,500 attendees; and the Association of College and University Housing, with 4,100 attendees.


All that business was a direct result of trade shows and sales missions, said chamber staff.  The ACVB continues to make specific trade industry and association conventions, along with multi-day sales trips to Chicago and Washington. The meeting planner industry’s own trade association will meet in Austin next June for a leadership event, which Lander called a “huge vote of confidence.”


When it comes to attracting convention business, Texas cities also have come together to build a single large sales pavilion for various meeting planner and association trade shows, said Rob Hampton. The pavilion combines eight Texas destinations. It is a better way to showcase the eight cities, as well as exchange leads. During a recent trade show, 400 people came through the pavilion, and the display was voted best of show, Hampton said.


Lander said the ACVB continues to make some “maintenance placement” in various trade magazines to keep Austin at the top of the mind. The final sales, however, are typically landed in face-to-face meetings, Lander said. To that end, the bureau will schedule sales trips that coincide with other events, such as an upcoming sales trip in Washington DC and Denver at a Coldplay concert.


Mary Kay Hackley presented an overview of the two-year met on the bureau’s Customer Advisory Board, which is culled from industry experts. Hackley said feedback from the group had led to a number of initiatives: a more cohesive approach between the Convention Center and ACVB; a newly launched enhanced website; and a new “green” bid book for business.


The committee also has recommended a need for one more large-scale hotel in the city to remain competitive, Hackley said. Even today, Austin sometimes struggles to compete. Whereas bigger cities can put together a package with two hotels, Austin sometimes has to package up to 10 hotels to accommodate a meeting.


The group also considered Austin challenged by the perception that it lacked direct non-stop flights. They recommended avoiding the “college town” label in favor of “university center.” They also supported an enhanced marketing budget, as well as various upgrades to safety, sidewalks and the convention center to maintain competitiveness with other similar markets.


ACVB is working to put together a joint meeting between the Customer Advisory Board and members of City Council in February. That way, Council members can hear directly what might be expected to keep the city competitive when it comes to meeting and convention business, Hackley said.

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