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Salt Lake City convention bookings look promising in recession-tinted picture

Published: 10/20/2009
Les Roka, The Selective Echo -- There is no doubt that Scott Beck, president and CEO of the Salt Lake Convention and Visitors Bureau, relishes a challenge. In competing with other venues to host association conventions and meetings, corporate business gatherings, and city-wide events, many of which have had their budgets severely curtailed in the recession, Beck sees a long-term payoff in building the destination value of Salt Lake City especially once the economy rebounds.

"While the numbers in our short-term corporate meeting bookings are down by roughly the same numbers (17 percent) as in markets throughout the country, we're running ahead of last year's numbers in long-term booking for association events and city-wide meetings," Beck says. And, SLC is just beginning to see the front-end halo effects of hosting last July's World Education Congress of Meeting Professionals International (MPI). As reported in the blog in July, Beck explained that "if the leading international organization in this industry says our city is good enough for its international meeting, then it also is good enough for any group planning its next large meeting."

And, the long-term picture suggests that the SLCVB may enjoy an incremental bump of five percent to seven percent in bookings as a result of the MPI event. Next year, among some of the most recent bookings, SLC will host the annual meeting of the Western Association of Convention and Visitors Bureaus, representing more than 140 organizations throughout the West and Canada. In 2011, for the fourth time in history, the city will host the high-profile National Governors Association's annual meeting.

In 2012 and 2016, the city will host the annual conference of the Association of Computing Machinery/Institute of Electrical and Electronics Engineers, Inc. Supercomputing (ACM/IEEE SC). During this conference, the Salt Palace will be home to the most powerful unclassified computing network in the world. Recently, the Hearth, Patio and Barbecue Expo, which had scheduled its meeting in Reno for 2011, switched to Salt Lake City and may do so again in 2013 and 2015.

There are other fresh bookings. In 2017, the Lutheran Women's Missionary League will hold its biennial convention in SLC. Other freshly booked meetings include the American Association of Equine Practitioners and the Porsche Club of America.

The long-term economic impact is enormous. For example, just two runs of the ACM/IEEE meeting alone are projected to generate 29,480 combined room nights for the area with a total estimated economic impact of more than $14.36 million. SLCVB estimates this year's impact on the economy from the direct spending of 2009 convention delegates in Salt Lake City alone will top $200 million.

The "good karma," what Beck says was generated by the positive impact of the MPI gathering, also has put the SLCVB in a good position to make a bid to host the annual meeting of the American Society of Association Executives, another major player in the meeting industry, in 2015 or 2016. The event, representing an association of more than 22,000 members, would be bigger in scale and impact than this year's MPI congress.

There also is the extremely significant presence of the two annual outdoor retailer gatherings which generate millions in economic impact during each of the weeklong visits. And, the local convention business continues to be supported by the presence of Novell, Usana, Xango, Stampin' Up, and other local entities which continue to draw solid attendance numbers to their meetings.

The recession, however, has changed the competitive picture as large destination venues, normally thriving on corporate meetings and events, are now going head-to-head with convention and visitor bureaus like Salt Lake for association and city-wide meetings. Big venues have lost once-guaranteed events. For example, sensitive to criticism that now was not the appropriate time for incentive meetings during the economic downturn, Wells Fargo canceled a Las Vegas corporate event in 2009, going to the unprecedented tactic of announcing its decision in full-page ads in national newspapers.

In the changed landscape, Sacramento is being outbid by San Francisco and Las Vegas is going after the same clients being courted by Salt Lake. For the first time, Beck and his staff are seeing competing bids from huge resort hotels such as Mandalay Bay.

Vegas is a remarkable case study of a giant catching the flu, while smaller destinations may have just caught a cold. In 2008, just as the economy collapsed, the city added more than 8,600 hotel rooms and 210,000 square feet of meeting space. This year, another 8,750 hotel rooms and more than half a million square feet of meeting space are coming online. In other words, in just two years, Vegas has added nearly as many hotel rooms as what are available in the total current stock of Salt Lake county.

Add in an aggressive, albeit an extraordinarily risky, strategy on the part of Vegas hotel executives who have slashed room prices drastically as an incentive to draw conventions. This includes Mandalay Bay, which is trying to cushion the impact of cancellations totaling more than $131 million just in the first quarter of 2009.

In the long run, Beck and his staff will not only weather the storm but also will see a strengthened position of value as the economy rebounds in the hospitality industry, which like unemployment is a typical lagging economic indicator, come 2011.

What Beck and his staff have going is being in the right place at a time when public perceptions about corporate waste and profligacy are widespread enough to make meeting planners hesitate about holding their event in a venue such as Las Vegas.

The potential advantage has been acknowledged. Writing in Smart Meetings, an industry trade publication, John Anderson notes:

"Enter Salt Lake City. Perceived as a quieter city in a conservative state, the area has all the airlift and infrastructure to handle meetings and events of almost any type and size, without the over-the-top flashiness of a resort or vacation destination that some planners are currently wary of. The city took a big leap forward by playing host to the 2002 Winter Olympics, and now has more hotel rooms, revamped meeting space and an expanded world-class venue in the 675,000-square-foot Salt Palace Convention Center."

And, with all of the nearby amenities widely recognized by consistently loyal groups of tourists, skiers, bikers, hikers, mountain recreation enthusiasts, and amateur and professional genealogists, Salt Lake City stands to more than hold its own through this changed convention and hospitality market.

Also count the new era of liquor laws, which did away with the private club memberships. Just days after the law went into effect July 1, MPI delegates gathered in SLC and Beck recalls visitors noticed the change frequently and prominently, many of whom cited the significance of the impact for SLC's hospitality industry.

One example cited by Beck was an alert doorman at the Sand Bar on Pierpont Avenue in downtown who noticed the steady stream of people walking along the street and sporting MPI badges. The bar employee arranged for a tweet on MPI's Twitter feed, inviting all conferees with VIP badges to take advantage of the free and easy VIP entry into the Sand Bar. Not having to deal with the question of club membership has made visitors feel relaxed and has reinforced the positive friendly atmosphere consistently cited by convention guests, including the 9,000 retailers, suppliers, and associates who recently attended the True Value Company convention in SLC. The group will return to SLC in 2012 and 2014.

And, other advantages get quickly noticed, such as the airport's proximity to downtown, which translates into a cab fare one-third to one-fourth of what's available in other venues. A recent Brookings Institution research report sweetened the airport amenity even further: Salt Lake City ranked the best for metropolitan airports in on-time performance.

It then becomes quite easy to see why Beck and his staff wisely avoid the "Chicken Little" approach that has spooked some of the biggest players in the nation's meeting and hospitality industries.