Tuesday, July 17, 2001 | 10:42 a.m.
SUN STAFF AND WIRE REPORTS
Smaller cities and suburbs are luring business meetings and conventions from top destinations by offering cheaper services.
"A lot of people are trading down," says Bill Peeper, president of the Orlando Convention and Visitors Bureau.
Bookings by meeting planners interested in Orlando as a meeting site fell 7 percent in the first half of this year compared with the like period in 2000. The number of people attending meetings at the Orlando/Orange County Convention Center dropped 3 percent January through April of this year from the like period a year earlier.
In Las Vegas, convention attendance was down 13 percent to 331,903 in April, the first decline in convention attendance since December 2000, said Jason Ader, a gaming analyst with Bear Stearns.
The Las Vegas Convention and Visitors Authority's Kevin Bagger cautioned against making month-to-month comparisons because convention schedules vary. For example, last year some conventions were held in May that were held in June this year.
Fewer meetings and fewer attendees are evident at many major convention centers across the United States, says Heywood Sanders, a professor at the University of Texas at San Antonio who studies the convention business.
Major conventions are booked years in advance and their locations are rarely switched. But some smaller meetings are being canceled or moved to less expensive sites this year as companies and business groups cut costs in reaction to the weaker economy.
About 40 percent of meeting planners say they have selected or are considering convention centers in less expensive cities to save money, according to a July survey of 436 meeting planners by Equation Research and Meeting News.
"The pendulum has swung, and swung faster than any of us anticipated," says Mark Theis, vice president of the San Francisco Convention & Visitors Bureau.
What's boosting the small-cities' meetings business:
* A construction boom. About 25 percent more convention and exhibition space will be added in the next five years, says Tradeshow Week magazine.
Of the 22 new meeting centers and 72 expansions planned nationwide through 2005, many are in smaller cities such as Sandy, Utah; Springfield, Mass.; and Kissimmee, Fla.
"You don't have to be in a city that you can't afford," says Mark Roysner, a legal consultant to meeting planners.
Another way smaller cities are competing is by investing in the latest conference technology and amenities that large city venues offer.
The Greater Columbus Convention Center in Columbus, Ohio, for example, added 80,000 square feet of retail space this year, including a food court, business center and cigar shop.
"New available space is giving meeting planners many more options now," says Michael Hughes, director of research at Tradeshow Week.
"They are finding high-quality amenities in their own backyards," he says.
* Cheaper convention and hotel rates. When computer equipment company Unisys went on a product announcement tour with Microsoft this year, it avoided many of the cities where it used to stop.
Unisys chose San Jose, Calif., instead of nearby San Francisco, and Fort Worth over Dallas for a five-city tour to tout its product announcements this year.
Instead of repeating last year's stop in New York, Unisys skipped it altogether, and it also chose suburban Lisle, Ill., instead of downtown Chicago.
"Not being in the city is the smartest way to go," says Peter Nagel, a meeting planner at Unisys.
* More complimentary services. The Simmons Center in Duncan, Okla., is landing corporate and government business for the first time, says event services manager Debra Burch.
Spectrum Field Services, a gas-purchasing company, chose to hold its annual conference in Duncan instead of Tulsa or Oklahoma City, in September because it will cost half as much.
Spectrum will get complimentary parking, audio-visual equipment and electrical help, says Lynn Flener, Spectrum's project coordinator. Many convention centers in bigger cities charge separately for those services.
Such practices are creating opportunities for midsize and smaller cities to aggressively market themselves as more affordable alternatives.
The Greater Fort Lauderdale Convention and Visitors Bureau is inviting meeting planners for golf and fishing weekend trips to attract business to its city, less than an hour's drive from Miami.
"We are bringing them here and daring them not to come back," says Nicki Grossman, bureau president. "That's a new strategy for us."
Meetings booked so far this year are up 5.5 percent over the like period last year.
But industry analysts say some of the new meeting facilities may not outlast tougher competition.
More space, fewer meetings and a slowing economy make "a recipe for market problems," Sanders says.
"The question becomes who's going to get creamed," he says. "I suspect we will be seeing a number of centers competing on price."
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