Tag Archives: hospitality industry

Restaurant Industry

HSMAI prepares next generation of hospitality leaders

To create the perfect meal, preparation is key. The same might be said for creating the perfect employee in the hospitality industry.

“Though some things like a friendly smile and a well-prepared meal will never change, the hospitality industry has gone through major changes in last few years,” says David R. Landau, program chair for Hospitality and Restaurant Management at Le Cordon Bleu College in Culinary Arts in Scottsdale. “Guest expectations have changed. We are seeing a more food knowledgeable and casual-minded guests. The industry has changed and hospitality education has changed along with it.”

Landau says today’s hospitality industry workers need be comfortable with technology, from creating a profit  and loss statement in Excel or creating a training program in PowerPoint to being familiar with point-of-sale cash registers. To prepare the next generation of hospitality industry leaders, the Arizona chapter of the Hospitality Sales and Marketing Association International (HSMAI) is partnering with colleges and universities to stress the importance of education and training for the future of the industry. HSMAI’s impact is already being fealt. Arizona State University, Northern Arizona University and Scottsdale Community College are all offering classes in hospitality sales.

“Our core curriculum focuses on a diverse range of topics in hospitality; guest services management, marketing, information systems, human resources, accounting, food production and beverage management, property management and industry law,” says Janelle Hoffman, professor in the Hospitality & Tourism Management Program at Scottsdale Community College.

Hoffman says changes in hospitality educations have been influenced by technological advancements, the evolution of customer relationship management programs, societal marketing approaches, sustainability issues and international growth.

“I stay current in my research area of hospitality group sales,” says Richard McNeill, a professor at the School of Hotel & Restaurant Management at Northern Arizona University. “Just this semester, I have integrated new research findings into my classes — for example, the rising power of third-party intermediaries and disruption on traditional selling methodologies. My sales classes involve B2B selling since group salespeople are involved with big-ticket items. It’s not unusual for a meeting or group to bring $300K revenue to a hotel.”

In addition to keeping a eye on the pulse of current trends like McNeill does, Hoffman says the changes in the hospitality industry that have had a biggest impact on education include:
• Every sector of the industry is reliant upon the efficient use of technology. Reservation systems, point of sale, property management and in-room technology are just a few areas in which the implementation and effective use of both custom and pre-designed software make a vital contribution to customer service, employee satisfaction and monetary success.
• Today, customer relationship management (CRM) programs that add value to the product and service are extremely beneficial to cultivating the life-time value of our patrons.
• Understanding how new approaches in areas of societal marketing and sustainability are trending in a response to customer demands and how these efforts assist us differentiating our products and services.
• The hospitality industry works in a global environment. In the last 10 years, new places have opened up to travel and development, providing new opportunities to international employment and community growth.
• The hospitality and tourism industry is one of the world’s largest employers.

“Many years ago, if you worked hard, you could work your way up in this industry, but times have changed,” Hoffman says. “Everyone is still working hard, but education has assisted in professionalizing the service industry. An individual’s education is something that can never be taken away and helps differentiate them in a competitive professional environment.”

Hoffman advises today’s aspiring hospitality industry to try to understand how diverse the industry has become and identify your specific area of interest. Also, it’s important for students to have real work experience in the area of customer service to balance the concepts and skills they will be exposed to in the education experience.

“Work experience is what employers are looking for,” says Lynne Wellish, an adjunct faculty member in the Hospitality College at Scottsdale Community College. “Find a mentor in the industry and start building a network of contacts. Meet other students in your classes and nurture your relationships.”

As hospitality education grows and is offered as a program of study by more schools, educators say the bar for the industry’s workforce will be raised.

“The hospitality profession will grow in respectability as more individuals see it as a career choice not just a job,” Landau  says. “I also believe for those looking to enter the industry or for professionals who are already there, online education will provide the pacing and flexibility to meet the needs of these learners.  At Le Cordon Bleu, we work closely with our advisory boards on the local and national level to identify what skills employers want our graduates to have. So it works both ways: the industry informs education and vice versa.”

LOOKING TO HIRE?

Az Business magazine asked Arizona educators what advice they would give to hospitality industry employers who are looking to hire new workers.
Jessica Shipley, academic advisor in the School of Hotel and Restaurant Management, Northern Arizona University: “Take chances on students. If employers took more risks in hiring someone who didn’t necessarily have a lot of experience, but the student showed the employer that they were outstanding in other areas, they might be surprised by how well that student ended up being a good fit for their company.”
David R. Landau, program chair for Hospitality and Restaurant Management at Le Cordon Bleu College in Culinary Arts in Scottsdale: “Don’t wait for graduates to knock on your door. Go to the source; contact an accredited culinary and hospitality school. We have a career services office that exists for employers to reach our student and graduates. Put new hires at ease; help that recent graduate see how their entry-level position is part of the overall mission. In order to be motived to succeed, Gen Y and Millennial workers need to know how their job is important.”
Janelle Hoffman, hospitality program advisor, Scottsdale Community College: “Look to hire a hospitality student, someone who has already made a commitment to the industry. Also, take good care of your team members. Word of mouth in our industry is strong. Happy employees create happy customers.”

social media tweet bird

Social Media: Turning Tweets Into Tourists

Used correctly, social media can pay off for the hospitality industry

Over the holidays, the JW Marriott Desert Ridge built a giant village out of 800 pounds of gingerbread and 250 pounds of chocolate to display in its lobby. For four weeks, the cookie town was posted on the JW Facebook page and fans were invited to guess how many gumdrops, pounds of dough, poinsettias and twinkling lights were decorating the resort. Winners received a weekend stay.

Did the campaign succeed?
Definitely, according to Jennifer Whittle, account supervisor with the Lavidge Co., which represents the resort. The goal was to increase fans on Facebook, a figure that doubled in a month. “Additional objectives were to drive traffic to the resort’s website and property,” she said, “and to position the resort as a fun place to visit.”

But still, just as with traditional advertising, marketing or public relations, it can be tough to measure how social media translates into revenue in the tourism industry.

Measuring whether this new medium is working depends on what a business wants to achieve, said Rebecca Seymann, Lavidge director of interactive campaigns. Some businesses believe that the more people who “see” them on Facebook or on a blog or in an app, the more awareness of their brand will grow, thus driving up sales.

But businesses do try to compute results. “Many hospitality businesses use social media, email, their websites and aggregators to promote special offers and then measure direct sales using a variety of tracking tools,” Seymann notes. And many use social media to respond to customer complaints as well.

One attraction of social media is that the cost of use seems minimal. Facebook, YouTube, and Twitter are all free. Writing the copy and getting the photos or videos for social media do cost something; as does monitoring the site. A cottage industry has grown to help businesses interpret the data from social media; but some measuring systems are still free.

“Facebook has metrics built in that don’t cost anything,” says Christine Carlson, advertising manager at Las Vegas-based Allegiant Travel, which flies out of Phoenix-Mesa Gateway Airport. “And we also use Google Analytics, which is free as well.”

So Allegiant can find out how many Web users click on its Facebook page and repost the page to other fans; how many viewers like the company’s site; even how many viewers switch from Facebook to the Allegiant Web site to book a trip. But if a Facebook user looks at the company’s website, signs off and then comes back four days later to book a trip, Allegiant can’t easily track that. In its brief time using social media, Allegiant has attracted more than 50,000 fans on Facebook.

social media icons

For some hospitality businesses, such as W Scottsdale, the main objective of a social media campaign is to “engage in conversation with our fans,” according to Joe Iturri, director of sales and marketing. The hotel uses Facebook and Twitter particularly to promote W happenings to fans first. The events often involve fashion design and music. “W often gives fans insider access, like sending information to them first about our big New Year’s Eve event,” he says.

But W’s use of social media can be even more up-close and personal in pursuing contact with potential customers. When fans post messages saying they will visit the hotel soon, W’s social media rep tries to chat online with them about their likes and dislikes. “We’ll ask what wines they like, for example, and when they arrive, we have a bottle of a great wine in their room. Or we’ll find out whether they like foam or feather pillows,” Iturri says. Facebook and Twitter get top billing. Other channels used: YouTube, FourSquare, Yelp.

When favorable posts come in about a past visit, W responds, too. Or if there is a negative review on TripAdvisor, “we contact the poster and try to resolve the problem to the best of our ability,” Iturri says.

In 2009, the hotel hired a full-time social media person to answer postings around the clock, Iturri says. That employee checks Twitter, Facebook and other channels several times — both night and day — on a laptop and responds to questions and postings both favorable and unfavorable. The first person to hold the job was so successful that she was transferred to the W Hotel headquarters to start national programs.

That all might work for a national or international company, but what about the little guy — the independently owned restaurant or boutique or small resort?

For smaller businesses, social media can pay off, too, says Josh Kenzer, online marketing manager for the Scottsdale Convention and Visitors Bureau. The big issue for a smaller business, though, might be the labor costs in maintaining an up-to-date Facebook page, for example, adding pictures and news regularly.

“A business owner needs to be honest about the time he can devote to it,” Kenzer says. “Here at the bureau, someone has to spend about 30 minutes to an hour a day adding new content. You also don’t want someone to post a message on your page that says, ‘I’m here this weekend and what can you do for me?’ and then you don’t reply to them.”

Social media is also not a silver bullet. “Like website management, pay-per-click, SEO and banner campaigns — and like print, radio, public relations — social media should become a regular recurring marketing activity and a budget line item that incorporates key marketing messages to target audiences,” says Seymann of the Lavidge Co.

Arizona Business Magazine March/April 2012

Harrah Ak-Chin Casino Resort

Spend The Holiday At The Harrah's Resorts

A Holiday To Be Waited On, At The Harrah’s

We do it every year; the entire family comes over, we spend all week prepping the house, putting up the lights, followed by a day or two of cooking and a mess of leftovers and holiday wrapping paper strewn across the house. This ultimately leads to the question, why not have someone else do all of this for us?

A growing trend in the hospitality industry is the holidays. Not just for out of town guests or for those who want to get away for the holiday, but also for families who would rather enjoy Christmas dinner at their favorite resort or have a Hanukkah stay-cation.

No matter the rhyme or reason, it’s a time to enjoy the company of those we love, and this year, resorts across the region are inviting guests to celebrate.

Some examples of resorts spreading the holiday cheer, aside from serving up some delicious holiday cocktails, include:

Harrah’s Ak-Chin Casino Resort

Guests can stay, play and celebrate at this 40,000-square-foot casino, which recently underwent a $20 million expansion with the addition of a 152-room hotel tower.

Holiday dining is available in Agave’s Restaurant, the Copper Cactus Grill, as well as the the famous seafood buffet is available every Friday and Saturday, including Christmas Eve.

For the family that plays and stays together, Harrah’s also boasts the largest selection of reel and video slots, video poker, table games from blackjack to World Series of Poker®, Keno and the Ak-Chin Bingo Hall, which provides the latest in Bingo technology.

Harrah’s Rincon San Diego North

Winner of the AAA Four-Diamond Award, three of the Harrah’s Rincon restaurants will be serving holiday feasts to please any palate. For an upscale dining experience, guests can indulge in a four-course Christmas dinner prepared by Executive Chef Jon Palsson. A four-time winner of the Wine Spectator Magazine Award of Excellence, this fine dining fare will be available for $75 per person on Christmas day.

For a more casual atmosphere, guests are invited to indulge in The Buffet, where holiday traditions meet modern food theatre, or enjoy the Christmas Special for $28 per person at The Café.

A top resort-gaming destination, the casino also offers state-of-the-art amenities and the unparalleled customer service — a sure fire holiday success.

Harrah’s Laughlin

The holidays are a magical time and because of that Harrah’s Laughlin is featuring various Christmas dining specials in addition to featuring a live magic show complete with animals, dancers, escapologists and comedy magicians, called Masters of Illusion, performing every night at 8 p.m., December 26-29 for $25-$35 per person.

In addition, The Fresh Market Square Buffet, voted best in Laughlin for seven years; the Range Steakhouse, which features first-class service and spectacular views; and Harrah’s Beach Café will all be featuring Christmas menus this holiday season.

 

Whether guests are staying or going, the holidays are trending at resorts across the nation — and Valley-wide. While Scottsdale has only gotten a few sprinkles of snow this year, resorts are going all out to bring more holiday cheer and less holiday chores.

 

woman sitting on a red chair on stage - AZ Business Magazine Sep/Oct 2010

Q&A With Laura Scheller, President Of Arizona Sunbelt Chapter MPI

Laura Scheller, CMP
President of the Arizona Sunbelt Chapter of MPI
President and CEO, Solomonte Hospitality

How has MPI responded to the economic downturn?
It has been a difficult year for the hospitality industry. Not only have we had to overcome the poor economy and negative media, but here in Arizona we also added controversial politics. The MPI Foundation is focusing on research that provides hard facts about the return on meetings. For instance, for every dollar spent in business travel, companies realize $12.50 in incremental revenue.

MPI as an organization is working to educate local and national business, politicians and media about the positive impact strategic meeting management makes on the economy, not just statewide, but nationally. Obviously the whole issue of SB 1070 is extremely frustrating. Regardless of where you stand on the issue, boycotting meetings is not the answer. This is affecting 300,000 employees whose families’ lives are dependent on our industry jobs — many of whom are immigrants whose only goal is to work hard and provide excellent service. … Certainly, we as a chapter are encouraged to hear that the governor is looking into creating an ad campaign in support of travel to the state.

What are your members experiencing?

Our membership is down. The hotels and resorts are cutting staff in response to lower operating budgets. Meeting planners are being laid off as companies minimize the number, size and scope of their meetings and events. On the positive side, the relationships created by our fellow MPI members are more critical than ever in securing business and jobs. The chapter’s Career Connections is an active job bank completely free to our members.

Is MPI working with other organizations?
One of our goals as a chapter this year is to bring an elevated level to our membership. We hope to work more closely with the Fiesta Bowl Committee and the Arizona Tourism Alliance to create more opportunities for our local members. We have some outstanding talent and expertise, yet often, when large events such as the Super Bowl come to town, outside companies are brought in rather than utilizing local products and services.

How is MPI helping its members?

One of the programs we are very proud of is the Global Community Challenge. … The challenge, developed from the expressed needs of chapter members, encourages members to use their MPI connections to supplement their current business. Through the program, over 286 business-to-business meetings took place, 87 lead referrals were produced and more than $1.3 million in sales was credited to the business relationships developed.

What trends are you seeing?
While some properties are starting to increase rates, others are still focusing on occupancy. Programs are being streamlined. Meeting planners are more accountable to the C-suite for budgets and measured results. Also, while room rates remain somewhat level, food and beverage pricing continues to rise. Of particular note are the gratuity fees that are as high as 25 percent at some resorts. That can make a significant impact on a budget.

Any predictions?
What I see is that there has been a pent-up demand for meetings, and thus things are starting to happen again in the industry. However, I also believe the economy will remain stagnant for the next couple of years. I recommend keeping an organization’s booking window as short as possible.

Arizona Business Magazine Sept/Oct 2010

Q&A With Debbie Johnson, Executive Director Of The Arizona Tourism Alliance

Debbie Johnson
Executive Director, Arizona Tourism Alliance

Debbie Johnson, executive director of the Arizona Tourism Alliance, is a major force in the Valley and state’s tourism and hospitality industry. She also serves as president and CEO of the Arizona Hotel & Lodging Association and the Valley Hotel and Resort Association. Johnson also represents the tourism industry by serving with the following organizations: American Hotel & Lodging Association; Arizona Film and Television Commission; the Governor’s Tourism Advisory Council; International Society of Hotel Association Executives; Arizona Sports & Tourism Authority; Civic Plaza Task Force; and the Phoenix Tourism and Hospitality Advisory Board. In 2003, she was named the Arizona Tourism Champion of the Year at the Arizona Governor’s Conference on Tourism, and in 2006, she was given the Phoenix Visitor Industry Champion Award by the Greater Phoenix Convention & Visitors Bureau.

How badly did the recession affect the state’s tourism and hospitality industry, and could it have been worse?
The tourism industry was particularly hard hit in 2009 by several factors, including the recession, the negative perception of travel and meetings, the fear of the H1N1 virus, and some misplaced political rhetoric. While our industry suffered unprecedented occupancy and revenue losses, I’m sure it could have been worse, although I shudder to think of what that would have meant to so many of our residents who rely on tourism for their livelihoods.
What we learned this year was the importance of the meetings industry to our state. Group and business travel accounts for more than 70 percent of revenue for most of our larger properties, and when we saw mass cancellations in that market due to fear of negative media coverage and public perceptions, it resulted in tens of millions of dollars missing from our state, city and county budgets. We’re still feeling those effects today as the Legislature grapples with how to deal with the deficit because of less than expected tax revenues.

What do you foresee for 2010?
We’re hearing mixed messaging as far as what the tourism industry can expect in 2010. While we anticipate having another challenging year, we are optimistic that the worst is behind us, and feel that we’ll make some inroads toward recovery.

What initiatives is the Arizona Tourism Alliance taking to help strengthen the state’s tourism and hospitality industry?

The Arizona Tourism Alliance’s most important roles are to advocate, educate and unite our industry. Bringing the industry together through annual events and monthly updates is key to keeping our members engaged and informed, and educating elected officials on the value of tourism revenues is an ongoing process that requires constant attention. With the current crisis that our state budget is in, tourism’s return on investment ($8 returned to the state budget for every $1 spent on tourism marketing) provides a positive and short-term solution toward lowering our deficit; so it’s critical for us to provide that positive message.

You are involved with several other tourism and hospitality organizations here in the Valley. How have all of those groups been working together to ride out the recession and prepare for recovery?

The Arizona Tourism Alliance, Arizona Hotel & Lodging Association, Valley Hotel & Resort Association and Southern Arizona Lodging and Resort Association have always been strong partners, but 2009 was the year that truly brought our industry and all of our advocacy organizations together. With all challenges come opportunities, and the bright spot of 2009 was that it united our members in the resolve that we’re all in this together. We have emerged from this crisis as a stronger and more resilient industry. And the theory that a vibrant Arizona tourism industry equals a healthy Arizona economy is undeniable.

www.aztourismalliance.org | www.vhra.net | www.azhla.com


Arizona Business Magazine

February 2010

The State’s Tourism Industry Puts A Face To Those Hurt By The Corporate Meetings Backlash

The image the word tourism often brings to mind is of fun, sun, and beautiful destinations and resorts. But with the industry under siege last year, those who work in the sector here in Arizona decided it was time to give tourism a new face — that of a relative, a friend, a neighbor, someone you know, even you.

In 2009, the tourism industry across the nation was hit by the recession and the fevered backlash against corporations that had received billions of dollars in taxpayer bailout money. To those in tourism, this became know as the “AIG effect,” so-called because the foundering insurance giant went ahead with lavish retreats after getting an initial $85 billion bailout in September 2008 under the federal government’s Troubled Asset Relief Program (TARP). The Valley became connected to the controversy when ABC News reported in November 2008 that AIG had spent more than $340,000 on an event at an area resort. AIG countered that the event was not a corporate retreat, but rather a conference for independent financial advisers. But the damage was done.

“For us, to be in a destination that just happens to be lovely, that just happens to have nice weather, that happens to have those beautiful structures that are really good at providing a great amount of business opportunities inside them in the form of meetings — we got really hit,” says Rachel Sacco, president and CEO of the Scottsdale Convention and Visitors Bureau.

The result was plunging occupancy rates, declining tax revenues, curtailed employee hours and even layoffs at Valley resorts and hotels.

In an effort to diffuse the hostility, the U.S. Tourism Association began a Face of Tourism media campaign to spotlight the people who were directly hurt by corporations canceling all manner of events — the millions who work in the tourism and hospitality industry. Over the past summer, the various players in the state’s tourism industry, including the Arizona Tourism Alliance, joined forces to launch the Face of Arizona Tourism campaign.

“The Face of Arizona Tourism campaign was really about trying to make sure that there is an understanding of how personal this industry is,” Sacco says. “ … it’s people at all different levels that are doing work that is meaningful and important, and frankly is their livelihood. I think the campaign was really successful to see that there is a face, that I might even know that face, and I might even be that face.”

The person selected to embody the Face of Arizona Tourism campaign is Mia Yates, a banquet server at the Westin Kierland Resort & Spa in Scottsdale.

“My story is this is my full-time job, working in the banquet department at the Westin, and I’m a single mom with three children.” Yates says. “When businesses stopped coming to Arizona, and more specifically the Westin, my hours were affected. They don’t need me to work, so I don’t work, I’m unable to hold onto my health benefits that allow my children to go to the doctors. I guess the Westin felt that I had a story. I was pretty close to the average working bear.”

Yates acknowledges that the Westin weathered the worst of the downturn better than other resorts, and she credits the efforts of management to look after its employees.

“They opened up positions around the resort and allowed us to cross train to help us keep our hours,” she says. “We only had to do that during the summer months, and pretty much we’ve been back up to nice hours in the banquet department.”

Bruce Lange, managing director of the Westin Kierland, says getting out Yates’ story — and all the others she symbolizes — was critical in short-circuiting the AIG effect.

“I’m absolutely certain we reacquainted our elected officials with where the rhetoric was hurting our economy, specifically if you know that one out of every eight people in the nation is engaged in the industry called tourism,” Lange says. “We are able to put the faces of the Mia Yates of the world and say, ‘Here’s your victim. Your intended victim may be the CEOs of those organizations, but here is where it’s really coming home to roost.’ I’m absolutely certain it’s had a positive impact.”

As a result of the recession and the AIG effect, Lange says the Westin Kierland’s business was off 25 percent in 2009 as compared to 2008. But the numbers only tell part of the story.

“If I tell you that our business is off 25 percent and we send, from a tax revenue standpoint, to state and local government $12,000 a day, is that impactful?” Lange asks. “Or is it more impactful for me to say that our average employment is about 1,000 people and if we’re down 25 percent we have 25 percent fewer folks? I think where the rubber meets the road is the human aspect much more so than the statistical aspect.”

Sacco adds that it’s important to educate the public as a whole about how hard times in the tourism industry have a far-reaching effect.

“The impact tourism had of losing hundreds of millions of dollars in our community gets back to the Face of Tourism, because when you start losing money and business, it hurts that face of tourism, it hurts the small business that isn’t getting all of the trickle-down impact, it hurts all the galleries that have closed,” she says. “It didn’t just hurt people in the tourism industry.”

www.scottsdalecvb.com | www.kierlandresort.com


Arizona Business Magazine

February 2010

ATA Is Promoting The Message That Tourism Will Bolster The State’s Economic Recovery

Tourism is not an expense — it’s an investment.

That’s not an official slogan for advocates of Arizona’s tourism and hospitality industry, but it is a message they are working hard to imprint in the public consciousness as legislators eye further cuts to the state’s budget. As in past budget crises, funding for marketing the state’s tourism and hospitality industry is vulnerable once again.

“Too often, public officials wrap up tourism with the other cost sectors rather than looking at it as an economic engine that can help bring new spending, support new jobs, support incremental tax revenues,” says Mitch Nichols, president of the Nichols Tourism Group and treasurer of the Arizona Tourism Alliance.

Nichols says the ATA is developing an advocacy program to better explain the role tourism can play in the state’s economic recovery.

“Tourism helps Arizona’s economy on two levels. One is its role as a base industry where it can bring new spending which will support new jobs and new taxes. So it’s role as a base industry is really critical,” he says. “The other element with tourism is its role across the state. A couple of years ago when the state did an economic development plan and looked at the various clusters, they looked at tourism as the common denominator. It was the only base industry that has applications in all 15 Arizona counties.”

According to a report prepared last year by the Portland, Ore.-based economic and marketing research firm Dean Runyan Associates for the Arizona Office of Tourism, the total direct and secondary impact of the Arizona travel industry in 2008 was 310,000 jobs and $10.2 billion in earnings.

The report also found that in 2008, direct travel spending was associated with $1.4 billion in state and local tax revenues and $1.2 billion in federal tax revenues. That was the equivalent of $1,080 per household in Arizona.

In other findings:
Total direct travel spending in Arizona in 2008 was $18.5 billion, a 3.2 percent decrease over 2007.
Travel-related employment, earnings and tax receipts declined in 2008.
The collapse of the housing market and recessions in Southern California and Arizona contributed to the travel decline.

Nichols warns that while it may seem easy to cut state funding for tourism marketing, the result could be long-term damage to the industry and the derailing of a fragile economic recovery. The effects could be even more troubling as competitor states such as California hold firm despite their own economic difficulties.

“There are other states that do see the full potential of tourism,” Nichols says. “California doubled its tourism budget up to $50 million a few years ago. The state is maintaining that budget despite cuts.”

Quite a lot is at stake, according to Nichols. Citing the Dean Runyan study, Nichols says U.S. leisure and business travel spending is expected to increase 4.5 percent and 5 percent in 2010 respectively. That has the potential to create 90,000 new jobs nationwide.

Nichols says Arizona needs to step up — not back — if it wants to bring a portion of those jobs and tax revenues to the state. In order for Arizona to compete against California and Nevada, the state needs to aggressively market at both a state and regional level.

Nichols points to Flagstaff as an example of how substantial the ROI on marketing tourism can be for a community. Last spring, as the economy continued in freefall, the Flagstaff City Council acted on a recommendation by the city manager to provide a $250,000 tourism “stimulus.” The money went toward marketing Flagstaff during its traditionally slow months of May and June.

The effect on Flagstaff’s tourism industry was positive and immediate, says Heather Ainardi, director of the Flagstaff Convention & Visitors Bureau.

Ainardi says Flagstaff’s hospitality tax collections dropped almost 10 percent in March, compared to 15 percent for the state. In April, when the city began its tourism marketing push primarily in the Valley and Southern California, hospitality tax revenues fell just 1.5 percent for Flagstaff, compared 11 percent for the state. In May, Flagstaff’s hospitality tax revenues were flat and dropped 7 percent in June.

“So, although we were still down, we were doing well compared to the state. Where everybody else was seeing double-digit declines (in tax revenue), we were either flat or saw small declines. Our occupancy actually went up in May and June,” Ainardi says. “I think people look at marketing and don’t understand the return. It’s not something where you can put in a quarter and a dollar comes out. It truly is something where you put in a quarter and you see an across-the-board impact.”

According to a study the city conducted with the Arizona Office of Tourism, the tourism and hospitality industry has a $501 million annual impact on Flagstaff and creates 5,400 jobs every year.

And Ainardi and other tourism supporters in Flagstaff are on a mission to educate residents about how those tourism dollars affect their lives.

“We really promote that revenues from that tax don’t just go toward marketing,” she says. “They actually go toward parks and recreation, they go toward public beautification, economic development and the arts and sciences. In Flagstaff, we have a system developed where we can help people understand that the 47 miles of urban trails that they utilize on a daily basis are built and maintained through tourism dollars.”

As a member of ATA, the Flagstaff CVB has worked closely with the group in its efforts to save funding for the Arizona Office of Tourism. Ainardi says her organization plans to continue its partnership with ATA to further the alliance’s advocacy mission.

“Tourism is amazingly important and it’s been one of the traditional backbones of some of our economies,” she says. “It’s not everyone’s favorite industry, but it is one that continues to grow and benefit our communities.”

www.nicholstourismgrp.com | www.flagstaffarizona.org


Arizona Business Magazine

February 2010

Panel of MPI Students

The Meetings Industry Is On The Offensive To Counter Negative Perceptions

When individuals and organizations meet, solutions are created, ideas are shared, business initiatives are crafted and skills are learned. Such meetings are crucial to North American business success, even more so in a dynamic, faltering, global economy. In an increasingly faceless world, effective human connections are a powerful business weapon.

The EventView 2009 study reveals that for the fourth year in a row senior sales and marketing executives in North America believe meetings and events have the highest ROI of any marketing channel. EventView is produced through a collaboration of the Meeting Professionals International Foundation, the Event Marketing Institute (EMI) and the marketing agency George P. Johnson (GPJ). EventView is the meetings industry’s longest-running global report on event marketing trends.

“This first report of the 2009 series shows that CMOs (chief marketing officers) and senior marketers believe events are the most effective medium to engage customers and move them to purchasing behavior,” says Bruce MacMillan, president and CEO of MPI. “While we’ve seen event marketing mature as an effective marketing channel for several years, the benefits become heightened in an uncertain economy. Marketing decision makers have clearly taken notice.”

Of the company executives questioned in the 2009 Business Leader Survey commissioned by the U.S. Travel Association (USTA), 82 percent say they believe business travel is important to achieving their businessresults.

“It’s a classic trade-off between short-term cost reductions and long-term value,” says Daniel Diermeier, a professor at the Kellogg Business School at Northwestern University. “During times like these, many companies will go too far, and actually cut back on the activities that would best position them to compete in the future.”

Another study from USTA shows that 87 percent of Americans who have attended an out-of-town meeting or convention for work say it is important to running a strong business. Meetings are far more than a collection of speeches or talking points. They are an opportunity for people of similar interests to come together and share their stories about how they are coping, as well as what they are doing to increase business, says leadership coach John Baldoni, who writes the Leadership at Work blog for Harvard Business Publishing.

Meetings and events are also strategic tools that deepen employee relationships and contribute to the overall health of companies. According to a Harvard Business Review survey, a 5 percent increase in employee retention can generate a 25 percent to 85 percent increase in profitability. Travel events show employees they are valued. If employees are only committed to the paycheck, their allegiance can be compromised when they are offered a higher salary elsewhere.

Additionally, meetings and events are essential to motivating sales forces, rewarding high performers, communicating new company initiatives and attracting top talent. According to a 2008 study by the Wharton School at the University of Pennsylvania, responsible, well-designed and well-executed meetings and training sessions have yielded significant benefits. Such benefits include improved company culture, increased employee retention and more highly engaged and satisfied employees. These companies generate better overall returns in the stock market, with firms on the list of the 100 Best Companies to Work For earning up to five times as much return as their competitors.

According to USTA, business travel in general has become a $240 billion industry due to the real value and measurable benefits derived from the collaboration and cooperation that can only occur when people meet face-to-face.

Phoenix, which covers 517 square miles, is the fifth-largest city in the country with a population of more than 1.57 million people. The Greater Phoenix Convention & Visitors Bureau (GPCVB) has accreditation from the Destination Marketing Accreditation Program, an international accreditation program developed by the Washington, D.C.-based Destination Marketing Association International.

“We are pleased to be recognized in the destination-marketing community for providing outstanding services in accordance with international standards and benchmarks in this field,” says Steve Moore, president and CEO of the GPCVB.

Unfortunately, adds Brent DeRaad, executive vice president of the Scottsdale Convention & Visitors Bureau, “the positive Arizona attributes we worked so hard to promote as a business destination are being used to portray Arizona in a less positive light. Our meeting planners are telling us they’re hard pressed to ‘sell’ our destination up the chain of command since there is a perception that the Valley is a hotbed of negative media activity, as well as a desirable leisure destination. Regardless of our state-of-the-art meetings facilities, easy air accessibility and the great values our resorts are extending, we’re losing business to destinations facing less scrutiny.”

Since October 2008, four national news stories have featured TARP (Troubled Assets Relief Program) recipients or federally funded organizations holding meetings at resorts. Three out of the four meetings scrutinized on the national stage were held at Phoenix-Scottsdale properties. As a result, planners charged with staging legitimate, privately funded meetings are fearful to bring them to Arizona and are canceling and downsizing programs. In fact, ArizonaGuide.com reports that some planners are willing to spend more to host their meetings in alternate destinations that are not receiving negative media scrutiny and are not perceived as leisure markets.

In a June letter to White House Chief of Staff Rahm Emanuel, Senate Majority Leader Harry Reid (D-NV), asked for assistance to reverse an informal federal policy prohibiting and discouraging government meetings and conferences in cities that are too leisure oriented. Emanuel agreed by saying “federal policy should not dictate the location where such government events are held. Our view on the issue of government travel is not focused on specific destinations, but rather on the justification for and the cost-benefit ratio of the individual exercise.”

The USTA declares that companies receiving taxpayer dollars need to be responsible, transparent and accountable. To that end, the travel community has developed a clear meetings-and-events policy these companies should adopt. Although this policy is intended for companies receiving emergency lending from the federal government, other companies interested in adopting these guidelines may choose to alter metrics based upon industry size, company size and market sector. The general USTA policy statement says “the CEO shall be responsible for implementing adequate controls to assure that meetings, events and incentive/recognition travel organized by the company serve legitimate business purposes and are cost justified.”

USTA President and CEO Roger Dow says “… corporate and government meetings have come under attack in the media and among some members of Congress seeking to portray meetings as excessive and unnecessary. The net effect has been cancellation of thousands of meetings, the termination of tens of thousands of jobs and the loss of billions of dollars of spending for the American economy.”

According to MeetingsMeanBusiness.com, each meeting and event traveler spends an average of $1,000 per trip.

“(Travel for business meetings and events) drives the whole hospitality industry in America, and that industry isn’t fat cats; it’s waiters and dishwashers, maids and cooks, event staff and hotel clerks — blue-collar workers who belong to unions,” writes New York Times columnist Thomas L. Friedman. Investor’s Business Daily columnist Kathy E. Read adds, “Those who get hammered — the reservation clerks, maids, baggage handlers, waiters and tour guides — are the little guys and gals whom (President) Obama’s stimulus package is supposed to put back to work.”

The tourism industry is one of Arizona’s largest revenue generators. The Arizona Office of Tourism (AOT) reports that in 2008, the state hosted 37.4 million visitors, including 32.4 million domestic and 5 million international travelers. AOT Director Sherry Henry explains that although the combined visitation equates to a net decrease of 3.3 percent, or 1.2 million fewer visitors from 38.6 million in 2007, the travel and tourism industry is resilient and continues to generate billions of dollars for the state’s economy.

Based on Arizona Department of Revenue data, gross sales for four key sectors of the meeting and travel industry are down 13 percent year-to-date as of May 2009, with corresponding state tax collections down almost 14 percent.

“Arizona’s visitor spending brought in $18.5 billion in direct travel expenditures in 2008, underscoring the fact that the travel and tourism industry is a major economic driver for our economy,” Henry says. “In the wake of our current economic situation, our industry brings revenue into the state that supports the quality of life of all Arizona residents.”

Last year, visitor spending generated $2.6 billion in local, state and federal tax revenues. Furthermore, the tourism industry is critical to both job creation and revenue generation for the state, supporting nearly 170,000 jobs and generating $5 billion in direct earnings.

According to Henry, unlike other industries, taxes generated by travel industry spending are paid by visitors rather than residents. These visitors bring new money to Arizona’s economy and generate revenue in all 15 counties, validating the economic importance the travel and tourism industry has across the entire state.

The Arizona Hotel & Lodging Association (AzHLA) conducted a poll of select members in the Phoenix-Scottsdale area and determined that canceled or downsized meetings have resulted in lost revenue easily topping $100 million — equating to a minimum of $11 million in tax revenues not funneling to city and state budgets or critical public programs such as education.

“Meetings account for more than 70 percent of most resort revenues,” says Arizona Hotel & Lodging Association President and CEO, Debbie Johnson. “When we lose those revenues, all Arizona taxpayers suffer; our pools are closing early, we’re losing our precious teachers and we’ll likely face a tax increase on the next ballot election. Many of those issues could have been avoided with the tax revenues from those lost visitors.”

www.eventmarketing.com
www.mpiweb.org
www.tia.org
www.visitphoenix.com
www.experiencescottsdale.com
www.azot.gov
www.azhla.com