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Deliver on Your ROI, Business Meetings

AzMPI Announces 2013-14 Board

The Arizona Sunbelt Chapter of Meeting Professionals International (AzMPI) recently installed their 2013-2014 slate of Officers for the chapter.

Officers include incoming President Jill Longfellow,  Enterprise Holdings Inc.; President-Elect Cristin Barr, The Ritz-Carlton, Dove Mountain; Vice President of Finance Penny Allphin, Hassayampa Inn Prescott; Vice President of Communications Chip Headman, Williams & Associates; Vice President of Membership Julia-Isabel Davenport, Maximize Your Publicity; Vice President of Education Susie Molinich, American Express Meeting & Events, and Immediate Past President Donna Masiulewicz, Timeline Meetings & Events.  The Chapter Directors are: Director of Leadership Development Lynne Wellish, Triage Meetings & Events; Director of Fundraising & Special Events Tiffany Higgins, The Tiffany Event; Director of Strategic Alliances Dave Rosenbaum, Carefree Resort & Conference Center; Director of Monthly Programs Lee Smith, Hotel Valley Ho; Director of Recruitment Dave Borsheim, Hotel Palomar Phoenix; Director of Retention Jacqi Marth, Destination and Details; Director of Information Technology Danielle Adams, KCA; and Director of Public Relations and Marketing James Eggimann, The Ritz-Carlton, Phoenix

“We strive to promote excellence within the meeting industry through education, certification, advocacy and business-to-business networking opportunities for our members,” said incoming 2013-2014 AZMPI President Jill Longfellow.  “Anyone who plans or supports meetings in any capacity, whether an administrative assistant or a caterer, can benefit from what AZMPI offers.”

The 375-member Arizona Sunbelt Chapter of Meeting Professionals International was established in 1979.  Meeting Professionals International is the meeting and event industry’s largest association for the $102.3 billion meetings and events industry.  AZMPI offers monthly events providing education, and networking opportunities.  MPI membership is comprised of more than 24,000 members belonging to 80 chapters and clubs worldwide.  To learn more about AzMPI visit www.AzMPI.org or call 602-277-1494.

brand_vignette

Kiehl's Since 1851 Arrives in Scottsdale

The Store

Kiehl’s Since 1851, the venerable New York-based purveyor of fine quality skin and hair care preparations, opened its very first retail store in at Scottsdale Fashion Square. Kiehl’s is proud to offer visitors and the Scottsdale community the opportunity to discover the brand’s efficacious skin, hair and body care products, personalized customer service and 162-year-old heritage.

BB Cream_SPF 50“Scottsdale has long been on our wish list for a new store, and our new space at Scottsdale Fashion Square is the ideal location to fully introduce Kiehl’s to Arizona,” said Chris Salgardo, President, Kiehl’s USA. “Our new store allows us to bring Kiehl’s further into the Southwest and share our New York heritage with a whole new community. Each element of our new store, from the design of the fixtures explaining our skin, hair and body formulations, to the historical photographs, mementos and Kiehl’s icons, helps tell the extensive story of our unique company that began as an old-world apothecary at the corner of 13th Street and Third Avenue in New York’s East Village. From design, to customer service, to the high-performing natural ingredients that are the basis of our products, we did everything possible to bring a modern version of our original store to Scottsdale, and I look forward to introducing our new community to our skin care, our customer service and our story.”

Kiehl’s at Scottsdale Fashion Square mirrors the unique ambiance found in the company’s original New York Flagship, which began as a neighborhood apothecary in 1851. The new store brings a modern New York apothecary to Scottsdale, referencing the company’s original East Village roots and blending vintage and antique apothecary fixtures with a modern neon flare. The interior design advances Kiehl’s longtime commitment to the environment with the use of natural, sustainable materials and energy-efficient light fixtures, while enhancing the overall service experience for Kiehl’s patrons.

Kiehl’s at Scottsdale Fashion Square also utilizes natural, sustainable materials and energy efficient light fixtures – and encourages patrons to recycle Kiehl’s packaging with a specially designed recycling bin, promoted through Kiehl’s Recycle and Be Rewarded! program. The program offers customers the opportunity to return empty Kiehl’s jars, bottles and tubes to the store for recycling, in exchange for complimentary products.
Kiehl’s commitment to education through attentive service is accentuated through a dedicated personal consultation area. The enhanced space provides an opportunity for customer representatives and patrons to converse privately about products best suited for the customer’s individual needs. A separate men’s destination offers specialized educationActivatedSun_LotionSpray_SPF50 tailored to the specific concerns of male patrons.  All customers receive the kind of attentive service for which Kiehl’s is known around the world today. In addition, simple, no-frills packaging allows Kiehl’s to formulate its products with high quantities of the most efficacious natural ingredients available.

Generous sampling through Kiehl’s “try before you buy” program offers the complete Kiehl’s line of skin and hair care for men, women, children and babies with a generous offering of its traditional product samples. To assure its customers always find exactly what they need, Kiehl’s offers a 100% money back guarantee on all purchases, and guarantees that customers will see revitalized skin in 28 days or their money back.
Custom gifting 365 days a year allows customers to create personalized gifts year-round. A Kiehl’s Customer Representative will help the customer assemble a personalized, custom gift box, choosing items based on recipient, theme, ingredient or price, from any and all products in the store.

Design

  • A 6-ft table provides patrons a comfortable station for complimentary Healthy Skin Consultations by Kiehl’s Customer Representatives, which helps them determine the formulas best suited for their personal needs.
  • A  space for specialized shaving and grooming education and demonstrations is designed for men. Specially designed accents such as military-style lockers, black subway tile, and props to demonstrate the perfect shave, bring this relaxing stop to life for Kiehl’s male patrons.
  • Black Nero Marquina marble highlights the shop’s exterior façade, honoring the marble exterior of the original Kiehl’s New York Flagship.
  • Carrera marble tables, counters and trim provide a utilitarian, functional approach.
  • Natural, sustainable materials, such as tabletops made from paperstone, a waterproof material made from 100 % post-consumer recycled paper.
  • Energy-efficient LED lighting illuminates Kiehl’s products in an environmentally friendly way.
  • Reclaimed wood floors and exposed brick walls evoke the old-world quality of Kiehl’s East Village neighborhood.
  • A bronze and crystal chandelier is inspired by the crystal chandeliers that have adorned Kiehl’s Flagship store in NYC for years.
  • A custom-painted motorcycle, an icon of Kiehl’s heritage, will be on permanent display, evocative of the passions and adventurous spirit of Kiehl’s founding family.
  • Antique apothecary glassware and vintage props  reference the company’s early years as a neighborhood apothecary.
  • Vintage photographs and mementos – take customers on an exciting journey through Kiehl’s 162-year history.
  • Pop-art inspired graphics – the late Andy Warhol was a long-time Kiehl’s fan, purchasing Blue Astringent Herbal Lotion in bulk from the Flagship, and special graphics were created in his honor.

About Kiehl’s Since 1851: Kiehl’s was founded as an old-world apothecary in New York’s East Village neighborhood. After years as an ambitious apprentice, John Kiehl purchased the business and began operating under the Kiehl name, serving the burgeoning New York community with unique herbal remedies. In 1921, John Kiehl’s apprentice, Mr. Irving “Doc” Morse, purchased the business and expanded it to a full-service pharmacy, stocking medicines, tinctures, and the first Kiehl’s-branded products. Doc Morse, a pharmacist and herbologist, passed the business on to his son, Aaron, himself a chemist and avid motorcyclist and aviator. Aaron’s daughter, Jami, was raised at Kiehl’s amongst the “family” of employees, who together fostered a tradition of attentive, personalized service for every patron. Over the generations, the Morse family committed Kiehl’s to serving the community uniquely efficacious skin and hair formulations made with the finest natural ingredients in the apothecary tradition.

Store hours are 10 a.m. to 9 p.m. Monday through Saturday and 11 a.m. to 6 p.m. Sunday.  For more information about Kiehl’s, please visit www.kiehls.com.

british airways

British Airways Adds Additional Flight Between Phoenix And London

British Airways announced that the nonstop service between Phoenix Sky Harbor International Airport and London Heathrow Airport will increase from six to seven days per week beginning December 5, 2012.

“This is great news for Phoenix and our entire region,” Mayor Greg Stanton said. “Intercontinental flights are huge contributors to the success of our Phoenix airport system, our city’s economy and our region’s overall economic future. Building upon the $33 billion the airport pumps into our economy each year, this new flight is a boost that shows how our economy continues to improve.”

This community has seen an economic benefit from the nonstop British Airways flight since it first arrived in Phoenix on July 1, 1996. Adding the seventh day of service is estimated to bring the total economic impact of this flight to $100 million per year.

“International air service development is a focus for us at the city of Phoenix because it’s good for jobs, business and our overall economic development,” said Phoenix City Councilwoman Thelda Williams, who serves on the Downtown Aviation Economy and Education subcommittee.

Airports compete for air service and Phoenix city manager David Cavazos is keenly aware of how important flights are to the vitality of the city and the State. “My goal is to continue to gain additional international routes, while ensuring that this British Airways flight remains successful,” he said.

This European service is important not only to the business community, but to the tourism industry as well. Sherry Henry, director of the Arizona Office of Tourism, said, “International visitors tend to stay longer to explore the state and more flight options from London will give travelers from the UK and Europe additional opportunities to visit Arizona.”

For more information on British Airways, visit British Airways’ website at britishairways.com.

Algae Industry

Could The Algae Industry Become Arizona’s No. 1 Industry?

Arizona would benefit from a strong new industry that provided more revenue than housing or hospitality, more fascination than sports, more food than agribusiness currently produces and more energy than has been produced in the history of the state. It would be nice too if the industry aligned with the current focus on biosciences. The industry should also employ engineers and scientists and other high salary professionals.

Arizona needs a new industry with a strong competitive advantage and a business model that is sustainable. Sustainability requires a green industry that is minimally consumptive―requiring little land, water or other resources. A sustainable industry should provide more energy than it consumes and provide a positive ecological footprint.
The business model should strengthen with growth and demonstrate a vitality and versatility to support a variety of niches. The industry should also integrate with the high technology associated with Arizona’s $600 million investment in genomics, medical information systems and biosciences.

The new algae industry might be called the “Green Gold Rush.” The analogy has validity because the attraction to gold mining is finding a free resource at one’s feet. Similarly, algae production takes nearly free resources: sunshine, waste water and desert and creates high value foods, fuels, nutraceuticals and medicines.

Declining industries

Arizona’s economy flourished for decades with the 4C’s: cattle, citrus, cotton and copper. More recently, electronics and semiconductors were added to the economy mix. However, resource constraints and global competition have taken a toll and key Arizona industries have been diminishing in employment, revenues and prospects.

Arizona’s migration from historical industries to new industries has occurred for a variety of reasons. Water availability, land and costs limit agribusiness. Heavy irrigation requirements, often three acre-feet, 36 inches, per crop, drive up costs. Many farmers must also pay for the energy to pump water from surface sources or most often from underground aquifers. Aquifer levels are declining requiring bigger pipes and stronger pumps. Heavy irrigation also imparts salts to the soil which reduces crop vitality.

The severe summer heat makes some crops impractical to grow and others develop poisonous toxins such as aflatoxin due to the heat. Population growth has consumed the prime farmland in and around cities which has benefiting the housing industry but damaged agribusiness. As communities expand, outlying land becomes increasingly more expensive as speculators take options on development.

New farmland becomes increasingly expensive as infrastructure such as laser leveling, pipelines and irrigation systems must be put in place in remote locations. New farmland tends to be more costly yet less productive than already developed land. Consequently, agribusiness becomes a continually less attractive investment. Currently, business models show that even gifted new land may not be profitable for agriculture due to the increasing capital costs necessary to manage a farm.

Many of Arizona’s agricultural products that historically had high value have become commodities. Early or late season crops that were possible to grow only in Arizona due to early spring warmth and late fall sunshine gave growers a competitive advantage. Now, many fruits and vegetables are imported year-round.

Copper, electronics and semi-conductors have felt the impact of global competition and especially cheap foreign labor, Figure 1. While each industry will continue in Arizona, the scale will reduce along with revenues and employment.

Figure 1. Arizona’s Old and New Industries

Algae Industry

Unfortunately, some Arizona industries have not been sustainable because key resources were insufficient to sustain the industries. Arizona’s strategic resource is water.

Water strategy

Water availability and use hold the key to Arizona’s future. Failing sufficient clean water, Arizona cannot sustain its valuable tourism industry, industrial businesses or growing population. Only three sources of water are available:

1.    Surface water – from the seven reservoirs and the Colorado River water that flows through the CAP aqueduct
2.     Groundwater – from underground aquifers
3.    Reuse water – from wastewater treatment plants

Surface and groundwater are largely committed under contract to existing users. Therefore, a new industry must be water efficient and able to use wastewater or grey, partially purified water.

Algae have the capacity to become a critical part of Arizona’s water strategy as algae can thrive in most kinds of wastewater such as city sewer water, industrially polluted water with heavy metal such as mining or even saline water. In addition to growing in mucky water, algae can be used to clean wastewater for reuse by citizens, industry or agriculture.
Agriculture cannot use saline water because the salt kills land plants by blocking water absorption from the roots. Algae have no root structures and some strains simply absorb water pollutants. Those pollutants can be separated from the algae during processing. The clean water has value and the metals can be collected and resold for reuse in industry.
Algae are robust, water-based plants that grow at an extremely high rate, often doubling or tripling their biomass in a single day. They need only sunshine, warm temperatures, impure water and modest nutrients to flourish. Algae grow so fast in commercial production that biomass harvest occurs daily or even continuously. Once the green biomass is removed from the water, the water and remaining nutrients may be recycled in a continuous growing loop.

CO2 conversion

Algae grow biomass quickly in a wide variety of conditions. Plants use the sun’s energy through photosynthesis to convert sunlight into chemical energy. They convert inorganic substances such as carbon, nitrogen, phosphorus, sulfur and other nutrients into organic matter such as green or blue-green biomass.

Algae feed on the greenhouse gas, CO2, and convert it to simple plant sugars and lots of O2, Figure 2. Water stores little dissolved CO2 naturally so cultivated algae need added CO2 for food. Photosynthesis takes in CO2, nutrients and water and produces the algae biomass with proteins, carbohydrates and lipids (oils). The process releases considerable oxygen to the atmosphere.

Figure 2. Algae Takes in CO2 and Produces O2

Algae Industry

Even though algae represent only 0.5% of total global biomass by weight, algae produce about 40% of the net global production of oxygen on earth – approximately equal to all the forests and fields combined.Algae, often called microscopic phytoplankton, grow in most bodies of water and provide the foundation for nearly all marine food chains. Subtract algae and phytoplankton from the water column and fish, shellfish and other aquatic creatures cannot survive.

The Arizona algae industry has extraordinary potential worth billions of dollars because with advanced technologies, algae can produce a wide variety of high-value foods, medicines, nutraceuticals and biofuels as shown in Figure 3.

Figure 3. Algae Products and Use

Algae Industry

The lipids can be removed and made into biofuels such as jet fuel, JP-8. The remaining starches and proteins can be made into a limitless variety of human and animal foods and other coproducts. Since there are over 30,000 known algae strains and probably several million in nature the product and coproduct possibilities for this biomass are nearly limitless.

The harvested algae are extremely malleable in the sense that they can be stored in the same form as corn, wheat, rice or soy products. These include protein-rich milk, soft mash of any size, shape or texture, tortilla, cracker or flour. They can be made into texturized vegetable protein with added fiber or extruded to make additives for meats that improve moisture retention and increase protein while lowering fats.

Processing can match the form of nearly any food such as peanuts, pesto or protein bars. Fortunately, years of food processing for land-based plants that have an unappealing natural taste such as soybeans make it easy to add flavors, textures (fibers) and aromas.
Algae are currently used in hundreds of products such as beer, gum, cosmetics, nutraceuticals and medicines. Newly discovered or genetically engineered strains hold potential for mass production of vaccines, vitamins and other high-value nutrients.

Arizona’s advantage

Arizona stands alone in competitive advantage for algae production. No other state offers the unique combination of sunshine, warm weather with few frosts and low-cost flat, non-cropland. Arizona even has numerous saline aquifers with water that cannot support agriculture. Compared with cattle as a protein source, for example, algae need less than 0.001 the land and water.

Iowa won the non-sustainable corn ethanol sweepstakes and Iowa benefits from all the subsidies for corn and ethanol refining. Government subsidies for ethanol in Iowa amount to $640 for each citizen due to the “Presidential Caucus Effect.” Every presidential campaign begins in Iowa and every candidate supports larger corn ethanol subsidies.

However, the industry is not sustainable because Sierra Club calculates that the 44 new Iowa ethanol refineries will crash Iowa’s freshwater aquifers. An average ethanol refinery uses the water equivalent of about 5,000 households. In addition, 326,000 acres in Western Iowa use irrigated corn for ethanol, further depleting their groundwater. Irrigated corn requires about three acre-feet of water which translates to about 3,000 gallons of water to produce each gallon of ethanol. Several cities in Iowa also have found their groundwater contaminated and undrinkable due to Nitrites from cornfield fertilizer run-off.

Many states can grow corn but only a few can grow algae productively without the prohibitive costs of controlled environment buildings. Algae can be grown anywhere but are far less productive in many climates as they stop growing on cloudy days. The biomass also grows more slowly with cooler temperatures. Sustainable commercially scaled cultivation requires the climate and terrain associated specifically with Arizona and parts of Southern California. Other locates in the U.S. south may build production systems that produce only in the summer similar to existing land crops.

Algae are sustainable because growth requires only a tiny fraction of the inputs – energy, water, land, fertilizers, herbicides and pesticides required for land-based plants like corn, citrus, cotton or cattle. The industry is ecologically positive because algae can take flue gasses from coal-fired power plants and sequester the CO2; use the excess heat for growth while producing tons of O2. Algae can remediate the nitrogen and other pollution from agriculture in groundwater and wastewater. Algae production is ecologically positive because it has minimal input needs and no waste products are produced to leach into the soil or fill waste dumps.

Arizona State University also offers a competitive advantage in the knowledge workers needed for the algae industry with excellent engineering and business schools and the only Laboratory for Algae and Biotechnology in the U.S.

Growth

Algae grow high-value biomass at speeds 30 to 100 times faster than land plants for one reason: they do not waste energy on structures like trunks, roots and leaves. Land plants have to withstand all the forces of nature – wind, weather and predators. Algae are water plants that are supported by the water in situ, in which they grow. For algae, it’s like being in a womb; all support systems are local and focus on growth and development.

In nature, algae’s greatest strength acts as a weakness. Fast growth shades new and prior plants from sun light. The underlying plants are shaded or receive too little light for photosynthesis and die. Cultivated algae require constant mixing to enable all the cells sufficient access to light.

Another unusual strength works against algae in natural habitats. The high protein composition, often around 50% of the biomass, means the plant begins breaking down faster than shrimp – which for practical purposes means immediately. Cultivated algae harvest occurs daily but algae in natural settings begin to rot quickly and give off the associated gasses and fragrances.

Consequently, people tend to think of algae based on its natural settings where it often presents itself as smelly green slime. In contrast, cultivated algae give off rich O2 which smells similar to walking through a redwood forest (without the trees).

Algae are infamous for causing problems in public waterways and in personal pools, ponds, pots and aquariums. Algae’s tolerance for a wide range of growing conditions means it demonstrates its resilience and fast growth in any moist or wet area that gets sunlight. As a result, algae research has focused nearly 10:1 on trying to kill, control or remove the productive green biomass versus cultivation. As a consequence, our survey research indicates 98% of people view algae as a pest.

Biomass production

Cultivated algae grow quickly and display continuous growth in sunshine where the biomass may double or triple daily. Algae slow their growth on cloudy days and go into respiration at night.

Algae grow similar to other plants and grow faster with increasing sun or heat. Algae grow within the boundaries of the “law of the minimum.”

Algae Industry

Figure 4. Arizona State University Polytechnic Laboratory for Algae Research and Biotechnology, LARB

The plant grows quickly to the maximum it can until it hits a mineral, chemical, nutrient, light or temperature limitation. When the last of the limiting nutrient is absorbed, N for example, the plant stops growing until more of the minimum constraint becomes available.

The challenge for algae cultivation becomes insuring that sufficient nutrients are continuously available to the fast growing plant.

Algae differ widely in the levels of chemical, light and temperature parameters that limit their growth. For example, some algae flourish in low pH water (high acid) while others prefer high pH. Laboratory analysis can determine the concentrations of major nutrients and other growing parameters. Nutrient concentration ratios such as N/P can predict which algae strains should predominate under stable resource conditions.

Biomass composition varies by variety but may be 60:30, oil to foods, with about 10% waste. Therefore, it offers a solution to both fuel and food. The biomass is demoistured and stored in a convenient form such as a cake. The biomass does not require refrigeration and has a two-year self-life.

Algae are clean and healthy. The natural product has a hint of the fresh green smell of alfalfa and a soft organic taste. Several newly discovered varieties are odorless and tasteless and take on the smell and taste of the food they accompany.

Algae cultivation typically occurs in tanks or ponds, so no soil tilling, heavy equipment or pesticides and herbicides are required, although light tractors are common. Algae grow all over the Earth, so its range substantially exceeds corn. However, cultivated algae grow best in sunny, warm regions. Algae can grow where other crops cannot grow, such as deserts, mountains and rooftops.

Productivity

Algae do not have the cellulosic trunk, tassel, leaves, roots and cob – the structural overhead – necessary for land plants like corn to withstand the land environment. Algae invest their growth energy in creating oils and proteins with light carbohydrates for the cell walls. An algae strain with 60% oils produces over 55% net oils that can be made into liquid fuel like high-powered jet fuel or biodiesel.

Biodiesels are typically about 33% more energy producing per unit than gasoline. In contrast, corn produces 98% non-energy producing cellulosic biomass called stover and yields less than 2% energy biomass. Most of the plant is waste in an energy sense and the stalks are left in the field. The corn energy biomass can be converted into a low-powered fuel that has only 64% the energy per unit as gasoline.

Some power companies such as Arizona Public Service have turned their problem with CO2 emissions into an opportunity. The Redhawk 1,040 megawatt power plant recycles greenhouse gases into renewable biofuels and uses algae to capture the CO2 gas emissions. The power plant exhaust is routed through algae growing systems and can eliminate part of their CO2 emissions during the day. Power plants run 24/7, so this presents only a partial solution.

Some power plants also use waste heat from power generation in the growing systems that increase the velocity of biomass growth. The only company supplying these systems currently, Greenfuels Technologies, associated with MIT, claims that using algae-fed CO2 and warm water from the power plant could potentially create annual yields of 8,000 gallons of biodiesel plus about 8,000 gallons of ethanol per acre. These production levels may be theoretically possible but are well beyond any current operational systems.
However, some power plants are operating their biofactories at a profit on a stand-alone basis. Reducing emissions may earn the power plants CO2 emissions credits and tax credits.

Compared with corn, algae offer substantial productivity, ecologic and economic advantages as shown in Table 1.

Table 1. Algae Advantages Compared with Corn

Algae Industry

Challenges

Unfortunately, R&D on algae has taken a hiatus since 1995 when the U.S. Department of Energy decided to close down the Aquatic Species Project and algae research to focus on the politically expedient biofuel – corn ethanol. Since then, the majority government biofuels funding and subsidies has gone to support corn ethanol and ignored other renewable fuel sources.

The most pressing challenge lies in scaling up algae biofactories for continuous commercial production. Sparse R&D means the favored technologies have not been tested on a large scale. Fortunately, much of the necessary production knowledge comes from hydroponics and aquaculture where R&D has moved those technologies forward.
The challenges presented by algae production are nontrivial. Commercial biofactories producing the health food Spirulina currently operate in California, Hawaii, South Africa, Japan, India, Thailand and China where algae products are used for food. Focused R&D can have scaled algae production systems operating in Arizona within several years.

Algae industry: A new Arizona industry?

An algae industry would employ primarily high-technology knowledge workers because the business models substitute advanced technologies for labor, similar to wind turbines or solar collectors. Research in progress at ASU Polytechnic is examining ways to combine solar collectors and algae production. Quite possibly, the same land footprint could support wind turbines in the right location.

Early entrants to the algae industry will employ numerous engineers and scientists to solve the fascinating technical challenges for large scale production. For example, algae production business models often include labs for selecting productive strains and monitoring strain vitality and quality in the growing systems. Fortunately, Arizona is blessed with many capable technical brains who are no longer employed in electronics and semiconductors.

The algae industry is unlikely to match the 12,000 jobs created in the existing Arizona bioscience industry. Algae production will use relatively few high-tech managers orchestrating largely automated growing and harvesting systems. Food, fuel and coproduct manufacture and refining will employ a substantial number of people. Salaries will probably be around the current bioscience levels, averaging about $50,000.

The revenue generated from an algae industry could exceed the other bioscience niches. It is too early to predict which algae products will produce the most revenue but several appear very promising, including:

Liquefied energy – biodiesel, jet fuel, ethanol or methanol
Foods – high protein replacement for grains such as wheat, corn and soybeans
Health foods – Spirulina, vitamins, special nutrients
Medicines – nutraceuticals, vaccines and high-value medicines

The algae industry business models are very attractive because with relatively modest investments, high value products are possible that can be sold for substantial profits. However, Arizona has seen failed attempts before at building industries around new crops such as guayule, a weed that can be made into a rubber product, and jojoba, a bean than produces oil. Similarly, early attempts at new growing systems such as hydroponics never lived up to their hype.

Algae businesses will have to prove their ability to scale-up to commercial production levels and also show they can sustain high production to take advantage of Arizona’s 360 days of sunshine. The initial cultivated algae production systems will need to be a public and private partnerships to share the risks associated with early R&D.

The combination of biofuels, foods, nutraceuticals and medicines all delivered from a renewable resource that is ecologically positive means Arizona can look forward to a strong new industry. Some may call this the green gold rush because the products and coproducts offer such high value.

The path to build this exciting and high value industry begins with a first step: focused R&D on sustainable scaled algae production systems.

Mark R. Edwards has taught food marketing and entrepreneurship in the Morrison School of Management and Agribusiness at Arizona State University Polytechnic for more than 30 years. This article is derived from his recent book “Biowar I: Why Battles over Food and Fuel Lead to World Hunger.” Biowar I algae as a case study to illustrate the foolish waste associated with the corn ethanol industry.
Monument Valley in Arizona, part of the Arizona Office of Tourism's new marketing campaign - AZ Business Magazine Jan/Feb 2011

Arizona Launches Innovative Media Campaign To Bring Back Tourists

Arizona has gotten a bad rap as of late, with the added national backlash from the passage of SB 1070 making it even tougher for the state to climb out of the recession. But the Arizona Office of Tourism is fighting back, and it has only one word for you — monumental.

It’s part of the Arizona Office of Tourism’s “In One Word — Arizona” marketing campaign that launched Nov. 8. The campaign couples iconic images of Arizona with one word describing the image. Bet you can guess which image is paired with “grand.”

The campaign’s eight images, ranging from the Grand Canyon and Monument Valley to Sedona and Flagstaff’s distinctive terrains, will run from November 2010 to May 2011 primarily in Chicago and Los Angeles, the two major markets for Arizona tourism.

This campaign features traditional print, TV and radio ads, but also includes innovative strategies, such as video-on-demand, “wallscapes” on buildings in Chicago and Los Angeles, and versions of the ads appearing on the print-out boarding passes of eight major airlines.

The advertising is “layered to continue to drive home the wonders and the diversity of Arizona,” says Sherry Henry, director of the Arizona Office of Tourism.

Spreading the message of Arizona’s allure is not limited to the Hollywood Hills and Chicago’s Magnificent Mile. An extensive digital media campaign also will run in San Francisco, Denver, New York City and other major markets, as well as Mexico and Canada.

But the biggest accomplishment of AOT’s new campaign is the fact that despite intense budget cuts that practically erased the marketing budget, the campaign is forging ahead, focused on bringing in much-needed tourism to the state.

The state Legislature removed revenue from the tourism formula from AOT’s budget and placed it in the general fund. Because of this shift, the AOT will receive approximately $14 million less in the 2011 fiscal year than it received in the 2010 fiscal year.

“We have this budget, and we are going to make this budget stand like it is 10 times what we have,” Henry says, adding that AOT’s mission is “to use the dollars we do have to drive as much revenue as we can.”

The budget stress isn’t the only issue facing Arizona’s tourism industry. The recession, which caused the budget decrease, is the No. 1 issue, Henry says. The swine flu epidemic of 2009 hurt, as well as the “AIG effect,” in which big businesses cut down on holding corporate meetings at resorts. Then, boycotts from the passage of SB 1070 gave a further beating to an already crippled industry.

However, Henry says Arizona’s tourism is going to surge back because of the state’s well-established image and the strong partnerships within the tourism industry.

“The branding of Arizona hasn’t changed,” Henry says. “There are some misconceptions of what’s happening here, but it hasn’t really affected the Arizona we all know and love.”

AOT has partnered with local convention and visitor bureaus and the Arizona Tourism Alliance to reach the group-and-meeting tourism market. The relationships between all sectors of Arizona’s tourism industry are “stronger than any other state we know of,” Henry says.

Although 2009 saw a 10.2 percent decrease in travel expenditures and a 2.1 million decrease in overnight visitors, 35.3 million visitors still made Arizona their destination of choice.

Statistics show that in 2010, top-of-the-line leisure traveler numbers are up, Henry says. AOT identifies leisure travelers as Arizona’s target visitor.

“We’re finally beginning to see it creep up again,” Henry says of visitor numbers.




Arizona Office of Tourism's new campaign

Images courtesy of the Arizona Office of Tourism




AZ Business Magazine Jan/Feb 2011

Steve Chucri, president and CEO Arizona Restaurant Association - AZ Business Magazine Jan/Feb 2011

Q&A Steve Chucri, President and CEO Arizona Restaurant Association

-In 2002, Steve Chucri was lobbying at the state level when the Arizona Restaurant Association president and CEO position was presented to him. Chucri now uses his political and lobbyist backgrounds to help Arizona’s restaurant industry navigate today’s tough issues. An executive committee board member with the Arizona Tourism Alliance, Chucri discusses strategies to create workable solutions to many issues affecting his industry.

Could the recession have been worse for the restaurant industry?
I always think it can be worse, because you don’t know worse unless you’re in it. That being said, yes, the economic hit, the recessionary hit to our industry was substantial. It may not be as substantial as to other elements of the tourism industry, but when you have the closing of restaurants double from normal times during this recessionary time, that’s pretty substantial. … I’m not going to say we were the worst or we were the most impacted, but there has been a huge impact from the most experienced restaurateur to the novices of the industry. Both were equally hit.

How have the arizona restaurant Association and the arizona tourism alliance been working together to get through the recession?
Restaurants over the recent years have become more and more dependent on tourist dollars. The receipts show that. About 25 percent of our receipts from restaurants are coming from tourists. … I think what we’ve been able to work on with both organizations is how do we continue to work together and make Arizona a destination? We’re becoming more and more known for our culinary fare.

Second to that, we’ve also worked legislatively together to ensure we’re not being targeted for miscellaneous taxes and we’re not getting targeted as an industry when it comes to funding issues, especially the Arizona Office of Tourism.

What challenges do you see facing the restaurant industry in 2011?
I see an increase in costs. We’ve been fortunate to maintain costs at a low level because of the recession, but I’m getting concerned that if things do start to pick up we will see costs starting to rise. I feel as though the smallest of things, the profitability of a restaurant, is very, very low and it doesn’t take much. You can’t just go to your menu and start raising prices in an economy like this. … I think we’re going to make a real push to see how we can get rid of that CPI (consumer price index) component with the minimum wage, but I don’t want to dwell too much on that, as we’re still in the strategic phases.

On the good side too, I believe that people are going to realize, yes we’re in a recessionary time but restaurants essentially are on sale right now. … I see people also realizing, like I said on the positive side, that it isn’t all that expensive to go out to eat.

How has Arizona’s restaurant industry been recovering from the recession?
In many, many ways, across many segments of our industry, it’s been at a snail’s pace. … I will tell you that 2010, from the quick-serve industry all the way to fine dining, it has been better than 2009. Now, that’s not universal, but the increases we are seeing are at a snail’s pace.

I think the wish, if there was one, of the industry would be that growth would pick up a little more quickly. Not at the crazy pace we were going at back in 2006, 2005, but something that is more meaningful and can be measured. … I think that restaurants are doing all they can to make sure that happens by offering these terrific deals and really using a lot of ingenuity and happy hours.

Restaurants are really good at incentivizing and getting people to come in. I think we’ll always continue to see that happen. … If restaurants can grow and if our industry can grow back up to the 4 percent or 5 percent and it’s sustainable each month and it’s sustainable on a consistent basis, you’d see a lot of smiles on restaurateurs’ faces.

Arizona Business Magazine Jan/Feb 2011

Misgana Kebede Company - Accent Transportation Services - AZ Business Magazine Nov/Dec 2010

A Dream Becomes A Reality for Ethiopian-Born Small Business Owner Misgana Kebede

Misgana Kebede
Company: Accent Transportation Services
Title: Owner | Est.: 2008
Web: www.transaccent.com

In May 2008, during the roughest stretch of the recession, a husband-and-wife team made a bold decision to start their own transportation business. Misgana Kebede and his wife, Bilen, started Accent Transportation Services, which specializes in executive car service around the Phoenix area.

Kebede moved to the U.S. from Ethiopia and was drawn to the tourism industry early on. In fact, he worked at various hotels and theme parks after high school and during college. Kebede eventually earned degrees in finance and logistics, transportation and supply chain management.

Prior to the creation of Accent Transportation Services, Kebede was working for Honeywell Aerospace in the supply chain department. Although he was learning a lot about the business, Kebede realized he wanted something more than to work in a cubicle.

“I had the dream of becoming a business owner, and a desire to serve others from the heart,” Kebede says.

When Kebede first started his business, the transportation industry was being hit hard by the economic downturn.
Companies were cutting down on travel costs, and car and limo services weren’t in demand. Despite the challenges, Accent Transportation managed to stand out to clients. Accent Transportation gains most of its business from repeat customers, and has grown from one vehicle to a seven-vehicle fleet within two years.

“Building a repeat customer base tells us we’re doing something right,” Kebede says. “Seventy to 75 percent of our business is repeat customers.”

Accent Transportation retains its customers because it continually focuses on improving the level of service it provides. It offers easy, online registration and account management. Customers can choose from Lincoln sedans, SUVs, stretch limos and a mini-coach. Kebede also emphasizes the importance of being on time.

Another major part of customer retention is that Kebede’s employees have excellent customer service skills. When looking to hire new employees, Kebede looks for people who already have spent time working in the hospitality business.

“If you know how to serve people, anything else can be learned,” Kebede says.

Kebede knows that building a business from the ground up is especially hard right now, but he is committed to his work.

“The first and foremost thing is to have a passion for what you do,” Kebede says. “Plan your days, weeks and months. Think about what will grow your business, not just what will help you get by.”

Arizona Business Magazine Nov/Dec 2010

Meeting Planners Are Learning To Be Advocates - AZ Business Magazine Sep/Oct 2010

In Troubled Times, Meeting Planners Are Learning To Be Advocates For Their Industry

Politics, economic setbacks and disasters of all kinds pose constant threats to the meetings industry. But increasingly, MPI, its members and others associated with meeting planning, are taking steps to be advocates for their industry before problems arise. Christine Duffy, president and CEO of Maritz Travel Company in St. Louis, wants her peers to “pay attention to what’s happening politically in Washington, as well as the effects of current events.”

Disasters such as an erupting volcano in Iceland or the massive oil spill in the Gulf of Mexico affect travel and have a trickle-down effect on every area of the industry.

“Now more than ever, there is a heightened sense of awareness of how connected we are in the world,” Duffy says.

An example of that are the boycotts against Arizona resulting from the state’s tough new immigration law, SB 1070.

Roger Rickard has been an MPI member for almost 20 years and is a partner in the California-based consulting firm REvent. He has dedicated his career to advocacy since Arizona’s Martin Luther King Jr. Holiday controversy in the early 1990s led to boycotts similar to today’s SB 1070 backlash.

While Rickard is clear that he does not represent MPI, he does believe that “we need to do more as an industry … if we don’t, we’ll become extinct.”

To that end, he has created Voices in Advocacy, which defines a strategy of how meeting and travel planners can advocate for themselves, including promoting and raising awareness for the industry using various tactics. In particular, the strategy details the significance of educating elected officials on the importance of the tourism industry, as well as the value of meetings.

“I aim to bring together members of all segments of this industry and help them set up meetings with officials to educate them,” Rickard says. “We want them to understand who we are and our value, and answer any questions they may have about what we do.”

Duffy adds that after 2008’s corporate meetings backlash, the US Travel Association became instrumental in advocating for the industry. The group released an ad pointing out the number of jobs lost in the industry (an estimated 1 million) due to the backlash. The association now serves as a powerful lobbyist on Capitol Hill.

Rickard notes that it’s important to get out the hard facts about the positive benefits of the meetings industry. He points to an Oxford Economics study that found that for every dollar spent on business travel, the return to a company’s bottom line is $12.50.

Theresa Davis, director of strategic communications with MPI national, adds that the organization’s research-based initiative, Meetings Deliver, “provides a comprehensive analysis of independent research conducted during the past two years on the value of meetings.”

She says it is critical for MPI members to “commit to speaking the ‘language of business’ by providing solid business arguments that speak to strategic meetings management from procurement and programming to measuring ROI, and being compliant with corporate CSR policies.”

Debbie Johnson, CEO of the Arizona Hotel & Lodging Association, says many controversies surrounding the meetings industry have been blown out of proportion. It’s her challenge, she says, to “change people’s minds by providing facts and getting correct information out there.”

Johnson notes that additional marketing, public relations and direct communication efforts can provide event and meeting planners with talking points they can use to inform their clients about everything Arizona has to offer.

“We need to remind people about the benefits of the state and the reasons to visit,” she adds.

Thanks to MPI, Arizona’s meeting planners don’t have to fight this fight alone.

“When you bring the collective know-how and buying power of 23,000 members from more than 80 countries around the world, affiliation with a leading organization of MPI’s breadth and depth often helps drive our collective point home,” Davis says.

Arizona Business Magazine Sep/Oct 2010

Civic Space Park - AZ Business Magazine Sept/Oct 2010

Local CVBs Sound Off On Boycotts And Why Arizona Is Still A Top Meeting And Travel Destination

It’s no secret that the meetings industry, and travel in general, has taken quite a few hits in Arizona over the past few years. As a result, local convention and visitors bureaus — the ones who promote travel to and meetings in the state — have had to overcome new obstacles in their quest to make the Valley a top destination spot.

Steve Moore, president and CEO of the Greater Phoenix Convention and Visitors Bureau (GPCVB), notes that while room night consumption was up nearly 11 percent from January through May (versus those same months last year), future business-lead production since this past May has dropped to 40 percent below the year-over-year pace.

“And remember,” he adds, “we were in a severe recession and also a key target of the (corporate meetings backlash) last year.”

While the corporate meetings backlash has abated, the state’s tourism industry was hit again this spring when the state Legislature passed, and Gov. Jan Brewer signed, the nation’s toughest immigration law, SB 1070. The media firestorm that ensued caused cities, companies and individuals to boycott doing business in and traveling to Arizona.

Stephanie Nowack, president and CEO of the Tempe Tourism Office, is aware of just two groups that decided not to meet in Tempe due to the immigration law. However, the combined economic impact of those cancellations was a loss of $385,000 to the city.

Pam Williams, CTA, convention sales manager for the Mesa Convention and Visitors Bureau, notes that the immigration law may be having a greater negative impact than can be seen on the surface.

“We have had a few groups express their concerns about this bill, and some organizations have specified that their group will not be considering Arizona as a destination in the near future for their conferences and meetings due to SB 1070,” Williams says. “However, industrywide, it’s the meetings we don’t know about that have silently chosen to exclude Arizona on their RFPs and short lists that will have the greatest impact. This will make calculating the monetary effects to our industry next to impossible.”

But, believe it or not, there is some good news to report on the tourism front. According to Rachel Sacco, president and CEO of the Scottsdale Convention and Visitors Bureau, “Scottsdale’s January through April 2010 occupancy and revenue per available room (is) ahead of last year … This past year, 50 percent of our meetings leads were for new business.”

In addition, a Metropoll XIII study, conducted by the market research firm Gerald Murphy and Associates, recently found that “meeting planners rank Scottsdale first for its romantic atmosphere, friendly residents, green policies, outdoor recreation, and great shopping and restaurants.”

The positive outlook is not contained in Scottsdale, but is being felt all over the metro area.

Moore notes that “the GPCVB typically books between 600,000 to 700,000 hotel room nights per year, and last fall we doubled our meeting planner fly-ins, targeting those groups with a peak block of 200 rooms. Most were over 1,500 rooms on peak, and we were very successful in showcasing the ‘New Phoenix,’ as too many planners had not been to our destination in many years.”

Over in Tempe, voters recently approved Prop. 400, which increased the bed tax by 2 percent.

“It is our job to promote the area and drive traffic to Arizona,” Nowack says. “With this additional funding, we’ll be able to put into place a strategic initiative to market the area in a consistent and positive way.”

Nowack also is proud to announce a new event in the Tempe/Scottsdale area, the Women’s Half Marathon. It will begin in Scottsdale and end at Tempe Beach Park, and is expected to draw 5,000 participants on Nov. 7. Nowack says the event is “a perfect example of new business still looking to Arizona.”

“They chose us because of our knowledge, experience, and success hosting events,” she adds. “We are known for hospitality.”

It is this local hospitality that Nowack would like to remind meeting planners of when it comes time to schedule their travel and events.

“(The immigration law) has given us a challenge to rebuild Arizona’s brand,” she says.

But Moore says this may be easier said than done.

“Because our hard-earned brand has somewhat been hijacked, this effort will take longer than many suspect,” he says. “Substantial marketing resources from both the public and private sectors must be enhanced and maintained. Tourism/meetings (have) been impacted far more than any other sector in the state, and our industry needs to create a compelling reason for the state’s business leadership to better appreciate how visitors and conventions impact them.”

Arizona Business Magazine Sept/Oct 2010

Jill Longfellow - AZ Business Magazine Sept/Oct 2010

Jill Longfellow, Convention Group Sales Manager At EnterpriseHoldings Inc.

Jill Longfellow
Convention Group Sales Manager
Enterprise
Holdings Inc.
www.enterprise.com

Jill Longfellow is grateful for her membership in the Arizona Sunbelt Chapter of Meeting Professionals International, and now she is helping others see the benefits as well.

As the chapter’s director of Membership Retention and Global Community Challenge, Longfellow spends time speaking to members who want to cancel their memberships because of downturns in the economy and the tourism industry. The decline in membership is why the chapter created a global community challenge that encourages members to learn about each other’s businesses in order to create referrals, she says.

“(The global community challenge) has been a terrific way for our members to truly see the ROI from their MPI membership above and beyond the education we receive at our monthly meeting,” says Longfellow, the convention group sales manager for Enterprise Holdings Inc.

A referral is also what piqued her interest in MPI. She joined in 2000, after a former Enterprise employee explained to her that MPI is a “terrific association.”

In her time with the Arizona Sunbelt Chapter, the group has created a return on investment receipt program. This program allows members to see what their MPI membership has done for them in the past.

“It is a goal of our chapter this year to make sure that every member sees the ROIs from their local involvement with our local chapter,” Longfellow says.

“My MPI membership has allowed me the opportunity to meet with hoteliers and meeting planners that I would not have been able to meet with in the past without the exposure I receive from my involvement with my local chapter.”

The exposure Longfellow has created for Enterprise through MPI is “critical” to her job, she adds.

“My involvement and membership with MPI helps to ensure that the meeting planner committee understands Enterprise’s commitment to community service and customer service,” Longfellow says.

MPI also has allowed the business and meeting planning community to better understand all that the rental car industry can do for companies holding gatherings in Arizona, she says.

Just as MPI has had a big impact on her career, Longfellow says the Arizona Sunbelt Chapter of MPI has a major role to play in the business community in the years to come, especially in this current economic climate.

“I believe it’s very important that our board and our members get the word out to the public and to our elected officials about the large effect that group conventions, meetings have on Arizona as a whole,” she says. “As a destination state, we need to keep our local hotels and resorts and convention centers full with meetings, so we can keep our Arizona residents employed through these businesses — and to keep meetings happening in our beautiful state, from the northern pinecap areas of Northern Arizona to the Valley here in Phoenix, and south all the way through to Tucson.”

http://azbigmedia.com/tag/september-october-2010-2

State’s Tough, New Immigration Law - AZ Business Magazine June 2010

Business Leaders are Concerned About the Repercussions the State’s Tough, New Immigration Law Will Have on Arizona’s Still Struggling Economy

Opponents of Arizona’s toughest-in-the-nation immigration law charge that it is unconstitutional and will lead to racial profiling, specifically targeting Hispanics. Supporters counter that the state statute corresponds with federal law and is designed to deal with those who break the law by entering the country illegally. Caught in the crossfire is Arizona’s fragile economy.

Regardless of where one falls on the SB 1070 debate, there is no doubt that it is having negative repercussions on the state’s economy. How severe those repercussions will be is unknown, and Valley and state business leaders are working hard to head off any further damage.

“It’s a negative and it’s not helping us,” said Barry Broome, president and CEO of the Greater Phoenix Economic Council.

The Phoenix City Council was told the city alone could lose up to $90 million in hotel and Phoenix Convention Center business over the next five years. At press time, city officials were monitoring at least 19 upcoming events, including some that already had pulled the plug on Phoenix, said Deputy City Manager Dave Kreitor.

Last month, Los Angeles became the largest city in the nation to prohibit its local government from doing business in Arizona unless the immigration law is repealed. There are estimates that the L.A. boycott could affect up to $8 million worth of contracts with Arizona. About two-dozen groups already have pulled events from Arizona, which tourism officials say has cost the tourism industry millions of dollars.

SB 1070
On April 23, Gov. Jan Brewer signed Senate Bill 1070 into law, making it a crime under state statute to be in the country illegally. Wording in the original law directed local police to question people they had made “lawful contact” with about their immigration status if there was reason to suspect they were illegal. Amendments to the law days after Brewer signed it included changing “lawful contact” to “lawful stop, detention or arrest”; and adding that officers cannot base their reasonable suspicion on race, color or national origin. The law goes into effect on July 29.

Although boycotts already have begun impacting the state’s tourism industry, Brewer said she has no intention of backing down. The state had to act, she said, because the federal government failed to secure the border with Mexico.

In a statement titled “Misguided Boycott,” Brewer said that when she signed the legislation, “I stated clearly I will not tolerate racial discrimination or racial profiling in Arizona.”

In response to a question about what Brewer can and will do to turn around the spread of boycotts and meeting cancellations, the Governor’s Office released this statement: “Governor Brewer will continue to aggressively oppose economic boycotts as a thoughtless effort that harms innocent families and businesses. Both proponents and adversaries of SB 1070 in Arizona have come out in staunch opposition to an economic boycott, including most recently Congresswoman (Ann) Kirkpatrick and the Tucson Hispanic Chamber of Commerce.”

Brewer went a step further in May when she announced the formation of a task force charged with rebranding the state as a tourist destination. Brewer said it was time to “get the truth out there” about the law.

Meanwhile, polls taken before and after the law’s passage show Arizonans’ support of the statute is fluctuating. A Rasmussen poll taken a week before the law was signed showed 70 percent of residents supported the measure. A survey taken a week after the law was signed showed support dropping to 52 percent. National polls have consistently shown strong support for the law.

“When you think of Arizona now, you think of this immigration law.  That’s not the first thing you want people to think of.” – Barry Boome, Greater Phoenix Economic Council

Threat to tourism
Debbie Johnson, president and CEO of the Arizona Hotel & Lodging Association, released a statement saying the tourism industry is “deeply concerned about the repercussions that will result from the debate around Senate Bill 1070.”

The statement from Johnson, who also leads the Valley Hotel & Resort Association and the Arizona Tourism Alliance, continued: “Arizona tourism is currently in a very fragile state of recovery and the negative perceptions surrounding this legislation are tarnishing Arizona’s image and could easily have a devastating effect on visitation to our state.”

Any loss of business negatively impacts the tourism industry and “directly affects the paychecks and health benefits of our most vulnerable tourism employees as well as their families,” Johnson added. She also stated that the tourism industry provides 200,000 jobs and $1.4 billion in tax revenues to state, city and county budgets.

Kristen Jarnagin, communications director for the Arizona Hotel & Lodging Association, said that as of the first week of May, 23 groups had cancelled meetings in Arizona, resulting in a loss of up to $10 million.

One group that pulled out is the American Immigration Lawyers Association, which canceled a fall conference in Scottsdale. Another is the African-American Alpha Phi Alpha Fraternity Inc., which was supposed to hold its convention in Downtown Phoenix in July, bringing an estimated 5,000 attendees and as many as 10,000 visitors. Instead, it’s going to Las Vegas.

Corporate impact
Some Arizona companies also are feeling the sting generated by the controversy. Some opponents of the law are urging people not to fly Tempe-based US Airways or to rent trucks from Phoenix-based U-Haul.

Even the state’s professional sports teams have been affected. Pickets urging a boycott of Arizona took place outside of Wrigley Field in Chicago when the Arizona Diamondbacks were playing the Cubs there. In addition, Sen. Charles Schumer (D-NY), has called on Major League Baseball to pull the scheduled 2011 All-Star game out of Phoenix.

Derrick Hall, president and CEO of the Diamondbacks, said he was concerned, but noted that planning for the game has advanced to the point where “it would be difficult to back off … for 2011.” MLB Commissioner Bud Selig has been ignoring the boycott calls.

Phoenix Suns Managing Partner Robert Sarver stepped into the middle of the debate in May, by announcing that the team would wear its “Los Suns” jerseys in recognition of playing on Cinco de Mayo. Then he added that “frustration with the federal government’s failure to deal with the issue of illegal immigration resulted in passage of a flawed state law.”

But has the federal government’s failure to secure the border with Mexico cost Arizona business? Some of the state’s top economic development experts say no. Shortly after the law was signed, Broome of GPEC said he had never heard of any businesses that were considering relocating to Arizona expressing concerns about the state’s porous border with Mexico.

“In our discussions with companies looking to move to Arizona, we want to begin and end with good things — the emergence of (Arizona State University), quality of life and a talented work force,” Broome said. “The biggest hardship is on the brand. When you think of Arizona now, you think of this immigration law. That’s not the first thing you want people to think of.”

David Drennon, director of communications for the Arizona Department of Commerce, agreed with Broome that the flow of illegals across the border has been a non-factor in business relocation decisions.

“Actually, the proximity to Mexico is advantageous, giving businesses access to markets in Mexico and even South America,” Drennon said
As Arizona’s No. 1 trading partner, Mexico imported $4.5 billion worth of Arizona products such as semiconductor chips, machinery and plastics in 2009, according to the Arizona Department of Commerce.

What needs to happen next, Broome said, is for business and government leaders to clearly communicate the law’s intention.

“This law was signed without a clear understanding of how we are going to get involved in a communications strategy,” he said. “People need to understand that this is a law that mirrors federal law. That’s been lost.”

While the experts say the illegal flow of immigrants into Arizona has not chased away relocating companies, the storm over the new law is causing some out-of-state corporate anxiety.

Laura Shaw, senior vice president of marketing and communications at Tucson Regional Economic Opportunities (TREO), noted that officials with two major relocation prospects for the Tucson area say they are concerned about the uproar the immigration law has sparked.

“But they haven’t said no,” Shaw quickly added. The two prospects are in aerospace and bioscience, and would provide hundreds of jobs.

“Businesses looking to relocate or expand don’t like controversy,” she said.

Politicians, pundits and stars
It was precisely controversy that attracted high-profile celebrities to Arizona, including civil rights leader the Rev. Al Sharpton, actor Danny Glover and Colombian singer Shakira. And, in protest, comedian George Lopez canceled an appearance at an Indian casino just south of Phoenix.

As the Arizona bill was making its way through the capitol, the state’s two U.S. senators, John McCain and Jon Kyl, announced a 10-point border security plan. Among other things, it calls for deploying 3,000 National Guard troops along the Arizona-Mexico border and permanently adding 3,000 more Custom and Border Protection agents in the state.

McCain, who came out in support of the immigration law, said the current wave of protests and what happened after Arizona voters rejected a paid Martin Luther King Jr. holiday in 1990 are completely different.

“One was about honoring a civil rights hero who a majority of Americans held in extremely high esteem,” he said. “The other is about an issue of national security and the security of our citizens, where we have broken borders and are literally overwhelmed with both human smuggling and drugs.”
After the King vote, which was reversed in another election two years later, the NFL pulled the 1993 Super Bowl from Arizona. Estimates of lost convention business in the Phoenix area alone topped $190 million.

J.D. Hayworth, a former U.S. congressman and McCain’s opponent in this year’s hotly contested GOP primary, had urged Brewer to sign the law. In 2005, while still in Congress, Hayworth introduced the Enforcement First Act, which focused on border security. The bill did not pass. Hayworth’s press secretary, Mark Sanders, said the former congressman is continuing his efforts to seal the border.

“That’s where we start,” Sanders said. “And no amnesty. No reward for illegal behavior.”

U.S. Rep. Raul Grijalva, a Democrat who represents Southern Arizona’s 7th Congressional District, created an uproar of his own when he called for a boycott of a large chunk of the state’s tourism industry.

In a statement made a few days after the law was passed, Grijalva said, “This is a specifically targeted call for action, not a blanket rejection of the state economy … we are calling on businesses and organizations not to bring their conventions to Arizona until it recognizes civil rights and the meaning of due process. We don’t want to sustain this effort any longer than necessary. It’s about sending a message.”

Boycotting boycotts
James E. Garcia, director of communications for the Arizona Hispanic Chamber of Commerce, said his organization does not support the boycotts, but it is concerned about civil rights issues.

“We believe passage of this bill sends a message to the country and world that Arizona is somehow under siege by immigrants,” Garcia said. “That kind of message tells people: don’t start a business in Arizona and don’t be a tourist here.”

David Roderique of the Downtown Phoenix Partnership said the organization had arranged to have several individuals ask Brewer to veto the bill, fearing an economic backlash. After the law was signed, partnership representatives were involved in pitching Phoenix to the Democratic National Committee as the host city for the 2012 Democratic National Convention.

“The likelihood of the Democrats coming here now is zero,” Roderique said. “We have a definite concern that this will create a significant economic impact when we can least afford to have another major disruption.”

In May, the Republican National Committee bypassed Phoenix as the host of the 2012 Republican National Convention. AZGOP Chairman Randy Pullen immediately issued a statement saying that many would cite the new immigration law “as one of the reasons that Phoenix was not chosen (and) nothing could be further from the truth. Members of the RNC overwhelmingly support the immigration bill signed … and Republicans from coast-to-coast stand with Arizonans as we fight to secure our border.”

To that end, Roderique noted that if several other states pass similar laws, some of the spotlight might be shifted away from Arizona.

“If we’re not the lone wolf out there and other states are doing this, the feds are going to have to act,” he said. “It should not lie in individual states or individual municipalities to try to enforce immigration laws. We need a comprehensive federal reform package.”

At the Greater Phoenix Convention & Visitors Bureau, Doug MacKenzie, director of communications, said it was “misguided to bring the tourism industry into the crosshairs of this political issue.”

The CVB, which is trying to dissuade groups from considering boycotts, stated that “we may never know the full impact that all the publicity surrounding the passage” of SB 1070 will have on decisions by visitors and organizations choosing convention sites.

Michael Stawiarski, president of the Arizona Sunbelt Chapter of Meeting Professionals International, released a statement from the organization’s national president, Bruce MacMillan, blasting the boycotts: “Using travel boycotts as a political weapon in Arizona (or anywhere) only hurts the local communities and the 200,000 workers in the state that benefit from the meeting and event industry.”

gpec.org | azhla.com | aila.org | azcommerce.com | treoaz.org | azhcc.com | visitphoenix.com | tucsonchamber.org

Arizona Business Magazine June 2010

ATA Profile: Jim Prueter, Senior Vice President of AAA Arizona

Jim Prueter
Senior Vice President, AAA Arizona
www.aaaaz.com

As senior vice president of AAA Arizona, Jim Prueter is part of a company that provides automotive, insurance and travel services to nearly 800,000 Arizona members. He’s no stranger to AAA, having worked as vice president of AAA Mid Atlantic in Philadelphia, and as executive vice president of AAA Chicago Motor Club. But he didn’t get his first taste of the travel industry side of the company until 1998, when he arrived in Arizona.

In his current post, he is responsible for heading up the largest leisure travel agency in Arizona, AAA Travel Agency. In addition, he is the publisher of AAA’s member magazine, Highroads Magazine. With a subscription of nearly half a million, the magazine is the largest in the state. In his various professional affiliations and as current chair of Arizona Tourism Alliance’s board of directors, Prueter recognizes the importance of tourism advocacy efforts.

“It is vitally important that the Arizona travel industry has a voice that is heard by our elected officials, the business community at large and the public. Tourism has a huge economic impact on our state, that is largely unknown, that must be heard,” Prueter says.

The ATA, Prueter says, is a driving force in spreading the message about the enormous impact the travel industry has on the state’s economy.

“The ATA serves as a catalyst and voice for the Arizona tourism industry dedicated to providing advocacy and generating awareness of the industry by providing education and leadership to the industry,” says Prueter. “Over 37 million domestic and international overnight travelers visited our state in 2008, spending some $18.5 billion. That equates to more than $51 million pumped directly into our economy every day. It is the only industry that brings prosperity to all 15 Arizona counties.”

He adds that taxes paid by visitors have a direct and measurable benefit on Arizonans, generating $2.6 billion in local, state and federal tax revenues in 2008.

“The point is, out-of-state visitors spend money that benefits businesses far beyond traditional travel entities. The purchases travelers to Arizona make generate taxes that create tax revenue that fund jobs and public programs, such as police, firefighters, teachers, road projects and convention centers,” Prueter says.

The dismal economy certainly put a strain on the industry, as did the faltering state budget and bad press regarding corporate meetings (Meetings account for more than 70 percent of resort revenues in the state).

To counter this, Prueter encourages individuals to join organizations such as the ATA, the Arizona Hotel and Lodging Association, the Arizona Restaurant Association, local convention and visitors bureaus and other industry organizations. His goal is to continue to work with the ATA on advocating tourism to all industries. With events such as the Unity Dinner and the Governor’s Conference on Tourism, the ATA will continue its efforts on behalf of travel and tourism in Arizona.

Getting the industry back on track will take some time, but Prueter offers this advice: “Don’t sit on the sidelines wringing your hands … Let them know what the economic impact of the Arizona tourism industry means to their business and the positive impacts travel has to the benefit of all Arizonans.”


Arizona Business Magazine

February 2010

ATA Profile: Deborah Ostreicher, Deputy Aviation Director At Sky Harbor International Airport

Deborah Ostreicher
Deputy Aviation Director, Sky Harbor International Airport
www.skyharbor.com

As deputy aviation director of Sky Harbor International Airport, Deborah Ostreicher has a hands-on grasp of the travel industry. A typical day at the airport includes more than 1,200 aircrafts arriving and departing and more than 100,000 passengers coming and going. It’s no surprise that Sky Harbor is one of the 10 busiest airports in the world and has a $90 million daily economic impact.

Ostreicher’s professional background is in international business and marketing. She lived in Europe and the Middle East for about 10 years before coming to Phoenix. Although the travel industry always interested her, it wasn’t until 1996 that she became a travel professional. She joined Sky Harbor as the air service development manager, working to recruit airlines to Phoenix. The industry has certainly seen its share of changes since Ostreicher entered the scene.

“When I joined the industry, it was booming like crazy. With the economic downturn and post 9/11 era, things are certainly slower; and so is the cash flow that was once available for promotions and marketing,” Ostreicher says.

Yet Ostreicher sees her roles at Sky Harbor and as an executive committee member of the Arizona Tourism Alliance’s board of directors going hand in hand.

“As the area’s main airport and one of the largest in the entire Western region of the U.S., our role is to provide data and support to the efforts of the alliance,” she says. “Working together is critical, since a huge number of tourists come to Arizona by air and a large part of the airport’s business is the leisure market.”

Sky Harbor was not immune to the detrimental economic climate. Yet, the airport fared better than many others across the country.

“There has been an overall decrease (in passengers) of about 10 percent in 2009, but this is significantly better than many airports across the country. It’s important to keep in perspective that, rather than about 100,000 passengers a day, now we have about 90,000 per day,” Ostreicher says.

The demanding pace of keeping up with security changes, coupled with economic difficulties, is an ongoing challenge for the airport. Yet, it’s a challenge that Ostreicher is confident Sky Harbor can and will overcome. The recently announced Sky Train is one major project in the pipeline that is sure to bring growth and development to the airport.

“The Sky Train is by far the biggest project that will serve tourists, as well as the local community,” she says. “This will be ready for use by 2013, making it much easier for people to travel to, through and from the airport well into the future.”

Ostreicher recognizes the need to advocate the long-term benefits that a strong and vital tourism industry will have on the state. Though things may be difficult now, she says it’s still wise to invest in an industry that will be integral in Arizona’s economic recovery.

“The demand for tourism and air travel will undoubtedly bounce back,” she says. “But we can’t wait for that to happen to construct services necessary to serve this rebound. We have to do it now; and if you come to Sky Harbor, you’ll see that at America’s Friendliest Airport we are working to serve not only today’s customers, but tomorrow’s.”


Arizona Business Magazine

February 2010

ATA Profile: Mark Grenoble

Mark Grenoble
President, Enchantment Group
www.enchantmentgroup.com

Not many professionals can say they grew up in their industry. Mark Grenoble is one of the few who can. He has worked in some capacity in the tourism industry since he was a teenager, and aside from a few years in real estate, he has never left the industry.

From humble beginnings as a hotel banquet waiter, Grenoble has risen to the ranks of president of the Scottsdale-based Enchantment Group, a company that provides spa and resort property development and luxury hotel management services. He founded the firm with senior executives of Enchantment Resort and Mii amo, a destination spa that has been ranked No. 1 in the world by Travel & Leisure. Yet, Grenoble doesn’t think his story is very unique.

“There are so many stories just like mine; started at 15, 16, 17 and have grown up in the business, have a passion for it and enjoy it,” he says. “I like the resort side of the hotel business even better. Everyone wants to be there. The business is fun in general. Most people in this business are very passionate about what they do.”

That passion has helped Grenoble etch out a successful career in an industry that has undergone many changes during his 25 years and counting. All his hard work and dedication has not gone unnoticed. Last year, Grenoble was named the Tourism Champion of the Year at the Arizona Governor’s Conference on Tourism.

Though he thoroughly enjoys the industry and his role within it, Grenoble is very frank about the future. Recent challenges have plagued this industry and Grenoble’s role in the Arizona Tourism Alliance is to educate the public on the value of tourism.

“Our leadership in the industry needs to be active and advocate. We need to educate business leaders and elected officials on the value,” he says. “We’re a major industry in the U.S. and the state. Millions are employed nationwide. It’s an industry that is an economic driver; it’s a career path and we need to educate people on the value of it.”

Tourism is a huge part of the state’s economy, especially in smaller, rural communities. Sedona is one example. The city does not have a property tax because tourism funds services for the town.

“Tourism drives the economy for the town and real estate values. It adds a quality of life. Sedona has a population between 10,000 and 15,000 people. All the activities, art galleries, etc. — as a resident you would never be able to do that without the tourism aspect of it,” Grenoble says.

One positive thing that has occurred as a result of this downturn, he adds, is that communities, and even some elected officials, are willing to invest in tourism dollars. They have begun to understand the value of it and the long-term benefit of the cities and the state as a whole.

Grenoble also was instrumental in adding a communications position to the Arizona Hotel & Lodging Association, a move that proved itself to be an excellent resource during last year’s trying times. The position bridged the gap between the industry and the public, and helped communicate the value of tourism.

“We’re trying to engage the public, elected officials and our membership, all the constituents of the tourism industry. We need to understand what we’re doing as an industry,” Grenoble says.

One way that Grenoble hopes to accomplish this is to include outside industries in tourism advocacy. The goals and missions for all industries is to bring economic stability to the state, and the best way to do so is to recognize the value of each industry and work together.

“We’re all intertwined, and that’s why we need to build alliances and bridges with those outside industries,” he says.

Another cause that Grenoble thinks could be helpful in aiding the tourism and travel industry in its recovery is a regulated school calendar that doesn’t begin until after Labor Day.

“It’s had a very positive uptick in taxes for states that have mandated school start after Labor Day,” Grenoble says.

He is currently lobbying supporters for this, but he remains focused on the main goal of tourism helping lead the state out of the economic downturn.

“I think the state has a lot going for it and I see the lights at the end of the tunnel,” Grenoble says.


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


Laura Scheller

Laura Scheller: CMP, President And Founder, Solmonte Hospitality

Laura Scheller, CMP, not only is a member of the Arizona Sunbelt Chapter of Meeting Professionals International, she also is the chapter’s president-elect. In the course of the 18 years Scheller has been involved with MPI, she has held numerous other roles, including chair of various committees and director positions within the organization.

Scheller says the biggest benefit by far of her involvement with MPI is the relationships.

“MPI provides three things: world-class knowledge for our industry, a marketplace to promote our services and products, and, probably the most important to me, a human connection for both personal and professional development,” she says. “In an economy like this, where the entire profession has been knocked to its knees, through no fault of its own, relationships are critical to my success. MPI provides a platform to increase our contacts and tools and provide the maximum ROI for every meeting and event we touch.”

As president and founder of Solmonte Hospitality, which offers full meeting planning services, Scheller says MPI has been critical to the development and expansion of her business.

“Without the support of my fellow MPI members, my company would not be in existence today,” she says. “We are running a business and our members are our clients. We have to provide value to our members through education and opportunity and still be profitable. All of these skills help me to be a better businesswoman in my company.”

Scheller admits that the economy and the “AIG affect” have decimated the meetings and event market. The AIG effect refers to the public backlash to corporate meetings and events following the disclosure last fall that insurance giant AIG was still planning lavish get-togethers for employees even after it received a massive bailout from the federal government. The public and media outrage did not take into account that corporate gatherings make up an important part of the tourism industry — especially in places such as Arizona.

With the help of MPI, Scheller is hopeful the AIG effect will disappear.

“There are significantly fewer meetings occurring, and those that do still exist are often cut back dramatically in scope. MPI, along with other industry organizations, has created a campaign called Meetings Mean Business,” she says.

“Our goal is to dismiss the notion that meetings are fluff and to help educate the business community on the value of meetings and events, and to create guidelines and best practices that support positive impact to our economy. As a chapter leader and local businesswoman, I am proud to be a very small part in this endeavor.”

As The Valley And State’s Hospitality Industry Has Grown So Has Its Contribution To The Economy

As The Valley And State’s Hospitality Industry Has Grown So Has Its Contribution To The Economy

Tourism is a vibrant and diverse industry, and I have been fortunate to be part of it for the past 25 years. This exciting industry encompasses culture, history, natural wonders, state parks, sports, resorts, spas, restaurants and shopping. And it’s supported by a variety of other industries such as laundry services, food services and transportation — all of which help to keep Arizona’s economy moving forward. As one of the state’s major economic generators, contributions by the travel and tourism industry have been immense. In 2007, more than 35 million visitors traveled to the Grand Canyon State and contributed $19.3 billion to the state’s economy. Additionally, tourism has generated millions in tax revenue and has employed directly and indirectly thousands of residents. 

Twenty-five years ago, tourism wasn’t nearly as lucrative. There were fewer than 20,000 hotel rooms throughout the Valley, and no spas. Visitors came to Arizona because of its scenic beauty and outdoor adventures. But the Valley, more often than not, served as a gateway to other Arizona communities and attractions. Phoenix was rarely seen as the “main” attraction for a family vacation. In 1984, Phoenix Sky Harbor International Airport had only two terminals available for travelers. The freeway infrastructure consisted mainly of the I-10 and I-17 freeways. And the Phoenix Suns were the only major professional sports team playing in the Valley.

However, because of the dynamic growth and development of the Valley, we have been able to greatly expand our tourism marketing efforts. In addition to the state’s signature beauty, outdoor adventures and Wild West history, we now market arts and culture, culinary opportunities, resorts with spas, and plenty of great shopping.

What the Valley now offers has helped define the Phoenix area and Arizona as premier travel destinations. To accommodate the growing number of domestic and international travelers, the airport has added Terminal 4, increasing passenger traffic to 40,000 travelers annually. The addition of the loops 101 and 202 has eased traffic, and the Valley now boasts 55,000 hotel rooms. The new Phoenix Convention Center has more than tripled in size, expanding from 300,000 square feet to an incredible 1 million square feet, allowing for more conventions to take place. 

The Phoenix Suns now have plenty of company — the Arizona Cardinals, the Arizona Diamondbacks and the Phoenix Coyotes — that bring visitors to the state. We have also become a featured destination on the national sports scene by hosting two Super Bowls, Cactus League spring training, the FBR Open and the Fiesta Bowl, including the Bowl Championship Series.

While we can be proud of the way tourism has evolved, like many other industries we have been hit with challenges. As a result of the struggling economy, people are traveling less. The unfortunate misconception about corporate meetings and events has had a negative impact on the industry, as well. However, it’s important to understand that although people are traveling less they are traveling closer to home, giving us opportunities to promote the wonders of Arizona to our own residents and neighbors. 

The tourism industry is resilient and will continue to be so. It is the only export industry that drives revenue to all 15 Arizona counties, and is second only to microelectronics in generating earnings that benefit Arizona’s residents. The earnings generated from tourism are spread throughout the state and have shown consistent growth, helping to create a stabilizing effect on the Arizona economy. It’s vital to our economy to continue promoting Arizona as a vacation destination.

We are fortunate to live in such an incredibly diverse state with breathtaking scenery, culture and heritage, sports, fine dining and shopping. It’s what people from thousands of miles away want to experience.

Craig Jackson of Barrett Jackson

Craig Jackson – CEO Of Barrett-Jackson

When Craig Jackson took control of his family’s business, Barrett-Jackson, following the death of his father and brother in 1993 and 1995, respectively, he inherited a company that took in $15 million from one automobile auction. He was ready for the challenge, however, having grown up in the business and working in various roles. Today, the company has grown to three auctions — one in Scottsdale, one in Palm Beach, Fla., and one in Las Vegas — and made roughly $135 million at its 2008 auctions. But to achieve that growth, Jackson had to make several changes.

“My goal was to make it more inclusive and more of a family-oriented lifestyle event, whereas before, you’d call it the boys club,” Jackson says. “(It wasn’t) something the wives felt like they had their own place.”

Live television coverage on the SPEED Network, an active Web presence, myriad vendors of food, clothing and accessories, and a fashion show were all among the auction’s new image. Jackson also broadened the core of the auction — its selection of automobiles.

“Car collecting now isn’t just classics,” he says. “It’s everything that’s got collectability and uniqueness to it. It’s a much broader hobby and industry.

“To have sustainability in this business, you need to have new collectors and a much broader assortment because some things are hot one year and some things are cold another,” he continues. “We’re like the New York Stock Exchange — we sell commodities from all sorts of different types of cars to all sorts of different types of buyers in an open arms-like transaction.”

The current economy, Jackson says, has not had too much of an impact on the business as of yet. The auctions are still garnering a lot of attention. The 2008 Scottsdale auction alone had an attendance of 286,000 people, 30 percent of whom flew in from out of state. However, he is planning some cutbacks in regard to logistics for the auction, including ending the auction earlier than usual. This year’s Scottsdale auction runs from Jan. 11-18 at WestWorld of Scottsdale.

The tourism industry in Arizona is heading in the right direction during this time, Jackson says, but it needs everyone to work together in order to make it stronger.

“Tourism is one of those things that needs constant looking after,” he explains. “There’s constantly a game plan by other states and cities to whittle away at it; this one should have a game plan how not to allow that to happen and not take it for granted. … There are other communities that are very aggressive and their job is to come steal what we have here, and if there’s nobody making sure we’re all getting the support we need, then all of the sudden (moving an event) seems pretty attractive.”

It’s especially important that Arizona municipalities work together, considering that other destinations don’t consider the state a threat, Jackson says. He attended a meeting in Las Vegas when the city government was voting on funding for a new convention center, and while there he saw a chart that listed other cities considered to be their competition — and Phoenix wasn’t listed.

“They’ve already discounted us,” he says, “and that was pretty telling. … It’s in Scottsdale’s best interest, it’s in Phoenix’s, it’s in Paradise Valley’s, it’s in everybody’s to work together collaboratively. … I think it’s turning in the right direction. We’ve let it atrophy for a while, but it needs, actually, an infusion of capital and attention.”

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