Meeting planners opt for cheaper venues
By Roger Yu
Meeting planner Ronni Epstein is giving her cost-saving effort the old college try.
Epstein, regional director of development for Crohn's & Colitis Foundation of America, has a slashed budget this year. So returning to the Millennium Biltmore Hotel in downtown Los Angeles for the foundation's annual convention would be out of the question. Instead, she's going to an unlikely venue: the University of California-Los Angeles.
UCLA leases its conference center to groups looking for places to meet and at the right price for Epstein —about half what she spent last year.
"I'm surprised we didn't think of it sooner," she says. "I went to college, too, and I don't remember the school having conferences."
University campuses, such as UCLA and the University of Maryland, do host conferences. And they're increasingly appealing places for businesses, associations and other groups to have conventions as meeting planners face tight budgets and low attendance during the economic slump. They're less expensive than the fancy hotels, resorts, big convention halls and exotic locales they met in before the recession.
And they're less controversial. Companies have been taken to task for extravagance during hard times. Insurance giant AIG, for example, caught grief from Congress for having a luxurious incentive meeting at a St. Regis hotel in Southern California in 2008 after being bailed out by taxpayers.
So planners like Epstein are working overtime to find increasingly creative ways to slash costs.
"After AIG and what Congress said, meeting planners, if they still have a job, are charged with saving as much as they can," says meetings consultant Joan Eisenstodt. "There is no organization not trying to save money on meetings."
CHANGES MAY STICK
The changes could have lasting effects on the conventions and meetings business if groups decide they can stick to lower-cost affairs when the economy rebounds.
"I don't think we're going to go back to what we've had in the past in the next four or five years — or ever," Eisenstodt says. "There's the pressure to save. We're using more virtual access than ever. And airline cutbacks are making it harder and harder to get there. But in order to have a good meeting, you have to spend an appropriate amount of money. If we cut everything that makes it good, why bother going?"
Some of the changes meeting planners are making are obvious: shorter conventions, going to less-expensive cities or choosing suburban locations rather than higher-priced downtown venues. Others are more subtle but can save thousands of dollars: fewer coffee breaks to save on catering costs, minimal stage sets, even eliminating bottled water.
The cutbacks are having an effect on the travel industry. Companies, associations and nonprofit groups' spending on meetings, conferences and trade shows constitutes about 12 percent of total travel spending. And last year, spending fell by 15 percent to $85 billion compared with 2008, according to the U.S. Travel Association.
And it hasn't come back. A survey by Meeting Professionals International of its members last fall indicated members would spend about 3.5 percent less per meeting this year than last. That's on top of a 6 percent drop in spending last year compared with 2008, members estimated.
Larry Luteran, Hilton Hotels' senior vice president of group sales, says the recession's impact on group meetings is more pronounced than in previous down cycles.
"This has been very unique," he says. "In this downturn, everything has been scrutinized. You need to sell the meeting before (it takes place). You need to have good business reasons."
Planners aren't afraid to cut hotel costs by going to outside suppliers for convention supplies, equipment and staff. And some bypass full-service hotels altogether.
Colorado-based Unique Venues, which matches meeting planners with non-traditional meeting venues, has seen the number of leads grow 30 percent in the past year, says President Chuck Salem.
In addition to university campuses and suburban conference centers, even camps and cruise ships are generally more affordable than full-service hotels in city centers, Salem says.
An overnight meeting at UCLA, for example, can start at about $135 a person, including a meeting room with audiovisual equipment and three meals, he says.
Lisa Block of the Society for Human Resource Management says she has scheduled 40 seminars this year in conference centers, most of which were at hotels in previous years. Another bonus: Conference centers don't charge attrition penalties, she says. "We're watching our pennies but trying to be careful not to impact quality and experience."