As Mark Theis, vice president of the San Francisco Convention and Visitors Bureau’s conference division says, "The business travel segment is essentially gone. The leisure market is just starting to climb back up. The convention market is the one leg of the three-legged stool that’s not wobbling."

But some segments are still a little wobblier than others. Meetingsnet surveyed CVBs around the country to get their take on how various meeting markets are faring during this difficult time.

Corporate Meetings
The National Business Travel Association’s latest survey found that 70 percent of the more than 200 corporate travel managers surveyed anticipate a short-term recovery in business travel, but CVBs say it’s still slow on the corporate front.

Dave Keamy, vice president, sales, with the Boston CVB, says, "Corporate in general has taken a big step back. They’re the ones who’ve had the biggest layoffs, and meetings have been canceled."

"Corporate meetings are just starting to surface again," says Theis. "I think they all unplugged their phones the weeks after September 11. Now the phones are starting to ring again, and we’re starting to see more smaller, in-house hotel meetings sign on the dotted line. They’re certainly not doing the volume of meetings they were a year ago. I like to think we have positive momentum, though."

"In my opinion, a lot of the corporate meetings that were canceled shouldn’t have been booked to start with," says Deborah Sexton, executive vice president of the Chicago CVB. "Others were canceled because they needed to regroup, to set up a new strategy." She says Chicago has already seen meetings being rescheduled for this year, although she believes the majority will be rescheduled for the first quarter of 2002. "It will take them the remainder of the year to get their arms around how they’re going to tackle the next six months to a year."

In Florida, which has been hard-hit by recent events, tourism officials are forecasting that the state could be down $7 billion in hospitality-related revenues by June; some of that is because of a downturn in corporate meetings. Bruce Davis, corporate sales manager for the Holiday Inn Select and Homewood Suites Hilton, told the Tallahassee Democrat that his hotels usually have training meetings booked in the fall for Morgan Stanley and Merrill Lynch. These meetings were canceled for this year.

Bill Peeper, president and CEO of the Orlando, Fla., CVB, says that the sour economy will continue to have a negative effect on corporate meetings. "Corporations are working to cut their costs to shore up their declining profits," he says. "Frankly, I believe the impact is going to continue through next year, and probably spill over to the year after that. I hope I’m wrong, because some years 50 percent of meetings in this city comes from corporate America."

Tom Muldoon, president of the Philadelphia CVB, also says that "corporations are holding fewer meetings and spending less money." Still, he says, "A company has to run that corporate meeting to get its business done. They’re starting to rebook." One bright spot, he says, is pharmaceutical company meetings: "The largest users of hotels now are the pharmaceutical companies in this region," This is good news for Philadelphia, which, like many other cities, is concentrating its corporate marketing efforts close to home. "One definite change we’ve seen recently is a move toward holding meetings closer to corporate headquarters," says Muldoon. "We’re seeing some pharmaceutical companies, along with other corporations and high-tech companies, book regional meetings here. I can still count them on my hands—no need to take off my shoes yet—but we are beginning to see it happen." Jim Herrmann, Philadelphia CVB’s vice president of convention sales, adds, "We’re getting regional meetings we hadn’t gotten before."

Muldoon also sees incentives changing, with many international trips becoming domestic. "We have a major local corporation that might pull out of Florida for a January incentive and book with us instead. Even I will admit that Philadelphia in January is not exactly an incentive destination, but they think that many people may feel more comfortable staying closer to home. It’s not as if they’re just pulling the candy bar out of the little kid’s mouth. It’s more like maybe an apple would taste pretty good this year."

High-Tech Meetings
"The high-tech field is hurting most in terms of business travel," says Peter Hedlund, vice president of sales with the Minneapolis CVB. "But it doesn’t have anything to do with fear of flying—companies are restricting travel for economic reasons." Theis agrees. A high-tech show at San Francisco’s convention center a week after the attacks had slippage of about 24 percent. While pre-registration numbers for the Oracle show in early November are good so far, Theis says he would attribute most of any slippage they end up having to "the overall bust of the dot-com world" rather than to the September 11 events.

The cancellation of a SunMicrosystems 3,000-delegate conference in Denver in January and February 2002 equates to $4.5 million in lost revenue for the city, according to a spokesperson for the Denver Metro Convention and Visitors Bureau. Fortunately, the CVB says, this is the only cancellation it has had thus far. SunMicrosystems is continuing with a February 2003 meeting.

"High tech and corporate in general has taken a big step back," says Boston CVB’s Keamy. "We hope they’ll be back by the end of the year." Bob Bedell, president and CEO of the St. Louis Convention and Visitors Commission, says he believes that the corporate market as a whole will continue to be soft until the economy turns around.

However, organizers of a Microsoft meeting scheduled for early October in Orlando were "very pleased by the significant number of late registrations," according to Peeper.

Some cities are seeing an increase in high-tech meetings. Bill Howard, vice president of marketing, tourism, and communications with the Atlanta CVB, says "a large portion of the meetings we’ve had the fortune of booking in Atlanta deal in high technology. Recently we’ve seen considerable increase in technology and technology-related meetings." He credits the number of dot-coms that have headquarters in the Atlanta area for the increase. "We’re still seeing a healthy trend in booking dot-com meetings."

Associations,br> "We’re lucky in Philadelphia because we are an association-driven city," says Herrmann. "Eighty-five percent of the business that comes to the convention center is association-related. What’s bearing true as we speak is that the association market is somewhat buffered in an economic downturn or a national event. They’re still going to meet. So we think we’re well-positioned to ride out the current economic crisis."

According to Washington, D.C., Convention and Tourism Corp. spokeswoman Rebecca Pawlowsi, the city hasn’t seen any falloff in convention business yet. "Fortunately, our convention center business has held strong in the wake of the attacks. We haven’t had any major cancellations (aside from IMF/World Bank). The cancellations we have seen have been meetings at individual properties." One of the city’s biggest 2001 events—the Congressional Black Caucus Foundation 2001 Annual Legislative Conference—took place as scheduled at the end of September.

"We’re starting to feel better about the midterm prognosis on the association side," says Orlando CVB’s Peeper. The National Association of Black MBAs was adamant about holding their meeting in Orlando this fall, he says. "They said they were absolutely not going to cave in. We’re seeing a lot of that."

San Francisco CVB’s Theis says, "Medium to large association meetings are holding strong, because they’re the bread and butter for the association, revenue-wise." Back in Boston, Keamy says an association convention in the first week of October was only off about 10 percent from the previous year. "The associations we’ve seen generally are holding up pretty well."

Not everyone is so gung ho on association meetings, though. "Is there going to be a drop-off in attendance at association meetings? Probably," says Muldoon, adding that most of Philadelphia’s association meetings are scheduled in the second quarter of 2002, while most of expected slippage is forecast for the first quarter of the year. "Every city is making the assumption that attrition will be 10 percent to 20 percent higher than it was before September 11. My opinion is that it’s going to take two years, if nothing else happens, to build attendance numbers back up again at conventions and trade shows."

"Association markets seem to be holding up, although delegate attendance is down," agrees Atlanta CVB’s Howard, adding that "the farther people have to travel to get to the meeting, the bigger the impact on attendance." As is the case with the corporate market, cities such as Atlanta are focusing on associations based within a three- to four-hour drive. It also depends on who their constituents are, says Minneapolis’ Hedlund. "Professional trade associations’ attendance is down about 30 percent, but they’re certainly not canceling their meetings anymore."

St. Louis also is concentrating on national, state, and regional association segments. "We’ve booked 70 meetings from the local marketplace since our fiscal year began," says Bob Bedell, president and CEO of the St. Louis Convention and Visitors Commission. "Focusing our efforts on corporate and association markets close to home already has paid dividends," he says, adding that the emphasis, both short- and long-term, will be on the association market, which is less vulnerable to economic fluxes.

One change that Howard has noticed is that entertainment and extracurricular activities "are taking a beating. A lot of our meetings are sticking to business, and the social hours are falling by the wayside. A lot of that has to do with associations forecasting for fewer attendees and adjusting their budgets before attendees even get here. The good news is that the further we get from September 11, the less of that we’re starting to see. Attendance is starting to creep back up."

Medical Meetings
"Medical is about 38 percent of our meetings business in Philadelphia, and if there’s one type of attendee that comes to the meeting, it’s the doctors," says Herrmann. "We have 27 citywides booked for next year, and about half of those are medical or medical-related. We’re excited about that, because we’re confident that their attendance is going to hold steady in 2002."

The Washington, D.C., Convention and Tourism Corp. also says that the medical field has been hanging tough. "Our biggest wave of cancellations has come from school groups and student organizations, although we had a wonderful showing from the Smithsonian’s Young Scientists program in early October," says Pawlowski, adding that D.C. has several medical meetings scheduled for 2002.

Until fairly recently, St. Louis was not the first city to come to mind for medical meeting planners, but, according to Bedell, it’s starting to grow.

"Medical is definitely a growing segment for us, and it’s happening in large part because of the full-service hotels that have opened recently or are scheduled to open in 2002 and 2003. It’s allowing us to focus on some of the professional markets instead of the SMERF [social, military, educational, religious, and fraternal] markets we traditionally have gone after. We just concluded the American Dietetic Association, which had 7,100 people and used 3,200 rooms peak night. They had some slippage, but they were very happy with their attendance. I can’t say medical groups are the major segment for us, but they’re growing."

Medical meetings are still holding up in Chicago as well, says Sexton, adding that those with a large international component may suffer a slight reduction in attendance. "That’s because of visa issues," she says. "It’s a tougher process short term, which hopefully will be straightened out before too long."

Atlanta’s Howard also acknowledges that the international component can be an issue. "Some of our medical conventions tell us that 50 percent of their attendee mix is international. The thing that makes it work for us is that we have a large international airport with accessibility to virtually every city in the world."

In San Francisco, "We’re finding that for every domestic person who cancels, there are probably two international people who aren’t getting on the plane to the conference. We’re seeing slippage of 15 percent to 24 percent, and it’s definitely higher for international than for domestic delegates," says Theis. For example, the American Society of Nephrology’s mid-October meeting was off about 4,000 from its anticipated 13,000 attendance. "Of that 4,000 … about 60 percent was international delegates," he says. The American Academy of Pediatrics, also held in San Francisco in mid-October, saw only about a 10 percent slippage.

"Meetings, particularly medical meetings, are relatively healthy," he says.

SMERF Meetings
The SMERF market is famous for its steadfastness in good times and bad—and it’s living up to its reputation, according to Minneapolis CVB’s Hedlund. "Generally speaking, the SMERF market seems to be holding up pretty well." Now that the rainy days are here again, cities are welcoming their SMERF meetings with open arms.

"St. Louis has always done well in the religious market, and it always will do well," says Bedell. "It’s primarily a summer business, and we’re excited to have it." A large religious meeting in the city in October did have some cancellations, but, he says, "Their pickup was very strong They used more than 3,000 rooms a night."

"I was at a seminar recently on how hotels can best attract government business. I can guarantee you that two years ago, I wouldn’t have had a soul show up. We had 50 hoteliers come this time. What a difference a couple of years makes," says Philadelphia CVB’s Herrmann.

"The SMERF market is about 11 percent of everything we do," he adds, saying that they’re looking forward to a large gathering of National Baptist Convention USA next August and several other sizable religious meetings. "It’s not a short-term market, so we don’t think we’re going to be the beneficiary of a lot of new SMERF business in 2002." But, he adds, "It’s a strong market for us; it’s a segment that produces even in the worst of times."

"Interestingly enough, because of the slowed economy and the decrease in business travel, the availability of lower rates has been tremendously beneficial to some of the SMERF groups who are looking for rated opportunities," says Chicago’s Sexton. "They are finding opportunities in major cities that they may not have been able to get before, relying instead on second-, third-, and fourth-tier cities because of their rate needs. They’ve had a much greater interest in Chicago now that they know they may be able to afford us at this point in time. Frankly, that’s good for Chicago."