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Conventions bring cash in but they need it, too
By: TODD GOTTULA, Kearney Hub
KEARNEY — Not too long ago, Roger Jasnoch says, you could impress meeting and tradeshow planners with a few perks.
“Our financial contribution to conventions was simply giving groups name tags, free coffee, portfolios with writing paper and pens to take notes and lining up the mayor to give a welcome. It was fairly simple stuff.”
Today, the nametags, coffee and handshakes with the mayor are the norm. If you want convention business now, you better bring your checkbook.
“They want hard cash,” says Jasnoch, president of the Kearney Visitors Bureau. “Giving hard dollars used to be almost unheard of and definitely was the exception. Today, it is an exception if they don’t ask for cash. That’s the way the game is played.”
In recent years, there has been a rapid expansion across the state of hotel developments with conference rooms and convention centers. As a result, groups are shopping their events around and demanding more from host communities and the facilities hosting them.
Discounts on rooms, meals and meeting space are among items often negotiated when trying to bring convention business to town.
“Those things are negotiated constantly,” Jasnoch says. “Groups will ask for anything. They’ll start with a free coffee break or complimentary breakfasts. Then they move on to asking for free rooms for the keynote speakers or complimentary sleeping rooms and hospitality rooms for board members.
“They might ask for free transportation while they’re in town. Really, all gloves are off.”
From Scottsbluff to North Platte, Kearney, Grand Island, Lincoln and Omaha, the competition for convention business is heated, mostly because it helps boost cities’ restaurant business and other spending in the hospitality and retail sector.
It is not uncommon for hotel properties in competing communities to offer group room rates for $10 or $20 less in an attempt to steal an event away from another host city.
“Sometimes that’s all it takes,” Jasnoch says. “You’d be surprised how far a free coffee break goes in this business.”
Sounds silly, but it’s true.
“Competition has progressively gotten tougher and tougher. As a result, visitors bureaus and host properties we are up against are throwing more and more at groups to convince them to come to their communities,” adds Jasnoch.
Craig Link, who helps book events at Kearney’s Holiday Inn Convention Center, said some hotels will do almost anything to land new convention business.
“Some hotels feel they have to give away the farm to get business at their properties,” he says. “They’ll give 10 or 20 rooms away to a group using 50 rooms for two nights, and that’s with a $50 rate. That is just ridiculous and almost unheard of, but it’s happening.”
Link and Jasnoch agree that organizations have higher expectations every year.
“Some groups go as far as putting all the complimentary features hotels offer on these large spreadsheets with all these formulas,” Link says. “In the end, it all comes down to one figure in the right hand column, and that is price.”
Says Jasnoch: “Many times, the meetings are sources of revenue for the host organization. So anything they can do to cut costs is good for them in the end. The more they can get given to them, the easier it is on their bottom line.”
As a result, many visitors bureaus are worried about their own bottom lines.
“It’s forced us to prioritize even more. We have to take a hard look at where we spend our dollars. In Kearney’s case, that is the convention market, special events, motor coach tours and annual events Kearney is known for such as Cruise Nite,” Jasnoch says. “We are always asking what is important to us and what level of spending should be used.”
KVB’s current annual budget is about $1 million, which comes from Buffalo County’s lodging tax and the city of Kearney’s hotel occupation tax.
The visitors bureau asked the Kearney City Council earlier this year to approve a 1 percent food and beverage occupation tax, but the visitors bureau tabled the item when it lacked city and community support. Revenue from the tax was expected to generate $600,000 annually.
If approved, the tax would’ve been used to help pay for and recruit new and existing tourism-generating events in the city.
“This type of proposal is going to surface in many other communities,” Jasnoch said of the restaurant tax. “Everybody is being forced to take a look at ways to come up with more funding. Long term, we are going to need more resources to attract successful tourism-generating events.”
In today’s environment, Jasnoch said no amount of money guarantees success in the convention business.
“You can have an attractive bid and put all of your resources on the table, only to have another community come in unexpectedly and offer them even more,” he said. “Just like that, you can lose an event that was going to bring 1,000 people to town for two days.
“It used to be a pretty friendly business, but I’m worried that environment is changing faster than what I’d like to see.”
“Our financial contribution to conventions was simply giving groups name tags, free coffee, portfolios with writing paper and pens to take notes and lining up the mayor to give a welcome. It was fairly simple stuff.”
Today, the nametags, coffee and handshakes with the mayor are the norm. If you want convention business now, you better bring your checkbook.
“They want hard cash,” says Jasnoch, president of the Kearney Visitors Bureau. “Giving hard dollars used to be almost unheard of and definitely was the exception. Today, it is an exception if they don’t ask for cash. That’s the way the game is played.”
In recent years, there has been a rapid expansion across the state of hotel developments with conference rooms and convention centers. As a result, groups are shopping their events around and demanding more from host communities and the facilities hosting them.
Discounts on rooms, meals and meeting space are among items often negotiated when trying to bring convention business to town.
“Those things are negotiated constantly,” Jasnoch says. “Groups will ask for anything. They’ll start with a free coffee break or complimentary breakfasts. Then they move on to asking for free rooms for the keynote speakers or complimentary sleeping rooms and hospitality rooms for board members.
“They might ask for free transportation while they’re in town. Really, all gloves are off.”
From Scottsbluff to North Platte, Kearney, Grand Island, Lincoln and Omaha, the competition for convention business is heated, mostly because it helps boost cities’ restaurant business and other spending in the hospitality and retail sector.
It is not uncommon for hotel properties in competing communities to offer group room rates for $10 or $20 less in an attempt to steal an event away from another host city.
“Sometimes that’s all it takes,” Jasnoch says. “You’d be surprised how far a free coffee break goes in this business.”
Sounds silly, but it’s true.
“Competition has progressively gotten tougher and tougher. As a result, visitors bureaus and host properties we are up against are throwing more and more at groups to convince them to come to their communities,” adds Jasnoch.
Craig Link, who helps book events at Kearney’s Holiday Inn Convention Center, said some hotels will do almost anything to land new convention business.
“Some hotels feel they have to give away the farm to get business at their properties,” he says. “They’ll give 10 or 20 rooms away to a group using 50 rooms for two nights, and that’s with a $50 rate. That is just ridiculous and almost unheard of, but it’s happening.”
Link and Jasnoch agree that organizations have higher expectations every year.
“Some groups go as far as putting all the complimentary features hotels offer on these large spreadsheets with all these formulas,” Link says. “In the end, it all comes down to one figure in the right hand column, and that is price.”
Says Jasnoch: “Many times, the meetings are sources of revenue for the host organization. So anything they can do to cut costs is good for them in the end. The more they can get given to them, the easier it is on their bottom line.”
As a result, many visitors bureaus are worried about their own bottom lines.
“It’s forced us to prioritize even more. We have to take a hard look at where we spend our dollars. In Kearney’s case, that is the convention market, special events, motor coach tours and annual events Kearney is known for such as Cruise Nite,” Jasnoch says. “We are always asking what is important to us and what level of spending should be used.”
KVB’s current annual budget is about $1 million, which comes from Buffalo County’s lodging tax and the city of Kearney’s hotel occupation tax.
The visitors bureau asked the Kearney City Council earlier this year to approve a 1 percent food and beverage occupation tax, but the visitors bureau tabled the item when it lacked city and community support. Revenue from the tax was expected to generate $600,000 annually.
If approved, the tax would’ve been used to help pay for and recruit new and existing tourism-generating events in the city.
“This type of proposal is going to surface in many other communities,” Jasnoch said of the restaurant tax. “Everybody is being forced to take a look at ways to come up with more funding. Long term, we are going to need more resources to attract successful tourism-generating events.”
In today’s environment, Jasnoch said no amount of money guarantees success in the convention business.
“You can have an attractive bid and put all of your resources on the table, only to have another community come in unexpectedly and offer them even more,” he said. “Just like that, you can lose an event that was going to bring 1,000 people to town for two days.
“It used to be a pretty friendly business, but I’m worried that environment is changing faster than what I’d like to see.”
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