Feature Stories - October 2004

Convention-al Economics

Meetings Bring Big Bucks to Nevada

by Sharon Rorman

Conventions draw consumers. According to the International Association of
Conventions, people who attend trade shows and conventions spend far more than mom-and-pop visitors. A leisure visitor’s non-gaming expenditures average $634, while the convention delegate spends an average of $1,053, and trade show delegates average $1,395. Reasons to attend a convention or trade show vary from launching a new
product, to finding out what your competitors are doing, to generating sales leads.

There’s no wonder, then, that competition is intense to win the favor of trade
show organizers. Las Vegas consistently hosts more of the largest trade shows in North America than other locations, followed by Chicago, Orlando, Atlanta, New York, Anaheim, Dallas, Los Angeles, New Orleans and San Francisco.

Part of Nevada’s extraordinary success in the convention industry is its ability to provide desirable lodging for visitors from around the world. Nearly 130,000 hotel rooms in Las Vegas, plus world-class restaurants, shopping and after-hours entertainment, all in close proximity, provide a foundation allowing Las Vegas to host large trade shows more easily than other destinations.

Las Vegas Number One

Convention space in all regions of Nevada has blossomed in the past few
years. Las Vegas alone now offers more than 9 million square feet and that number is growing. "When you are set up (for conventions) like we are, Las Vegas has an advantage over many other destinations," said Erika Yowell, public relations manager for the Las Vegas Convention and Visitors Authority (LVCVA). "Nationwide, Las Vegas routinely tops the list for booking the most square feet. This year we are hosting 38 of the largest trade shows, for a 19 percent market share."

By year’s end, those 38 top trade shows will have leased 16.7 million square feet of Las Vegas’ convention space, nearly double the closest competitor, Chicago, which is hosting 27 major shows in 8.8 million square feet for a 13.5 percent market share. "We are on track to break a record in visitor volume this year with a year-end estimate of 37 million," Yowell said, which will best the all-time peak in 2003 of 35.5 million people.

Vigorous growth in the neighborhood of a 6.5 percent increase over last year
for conventions shows a strong rebound to the slump experienced by the travel industry after the Sept.11 terrorist attacks. "The trade show industry was hit hard, but it bounced
back more quickly in Las Vegas than in other markets," said Paul Dykstra, chief executive officer of GES Exposition Services, a leader among service contractors for the convention industry. "Trade shows go as the industries they serve go. When companies are hitting their numbers and the economy is strong, they have more events. At present, An upward trend is continuing."

Visitor numbers for the first six months of 2004 are up 1.5 percent in Las Vegas over the same period last year, and non-gaming revenue from visitors, who spend in excess of $4 billion, increased by 5.9 percent.

Large conventions like MAGIC, Consumer Electronics and National Association of Broadcasters are the bread-and-butter shows for Las Vegas. "The big shows and Las Vegas conventions in general are showing better growth than the overall industry,"
Dykstra said. COMDEX, the annual technology mega-show, however, recently pulled out of its planned Nov. 14, 2004 date with Las Vegas after a lower-than-normal attendance last year. A COMDEX news release cited the reasons to postpone the event this year were to "reshape the event with the cooperation of information technology leaders," and to determine how COMDEX "can best meet the future needs of the industry." The cancellation will not adversely affect the local economy, according to the LVCVA. "Las Vegas [hotel rooms] will be filled even without COMDEX," Yowell stated.

Reno Going Strong

Reno is up and coming in the convention industry, according to Dykstra. With
a strong hotel base of approximately 20,000 rooms, Reno is poised to increase
its convention market share. "Reno’s convention center expansion and increased marketing has given it an advantage over other cities," he said. The city’s convention facilities were expanded about two years ago and now offer 500,000 square feet of meeting and exhibit space.

Deanna Ashby, executive director of marketing for the Reno-Sparks Convention
and Visitors Authority (RSCVA) reports business is up since January and looking
positive for the future. "The convention industry has a direct correlation to the economy," she said. "Our convention industry has picked up in recent months because the economy is better."

Reno is what Ashby calls a "value destination." She said, "The biggest marketing challenge we have is that people don’t necessarily think of Reno as a ‘hip’ location. That’s where attractions like the Truckee River Whitewater Park make us special and different."

Two recent events in Reno, a volleyball festival, billed as the world’s largest women’s sporting event, and a convention hosted by the International Reading Association are good examples of a special event’s ability to fill rooms, especially mid-week. "The Authority is committed to using the convention business as a platform to build room base and give flexibility to travelers," Ashby said. "We are promoting Reno as a ‘gaming-plus’ destination."

Rural Communities Seeing Growth

Rural Nevada is seeing positive and consistent growth as well. Elko’s convention
center pulls in more than 250,000 people a year, who attend a wide range of shows, including international events such as the National Cowboy Poetry Gathering and the National Basque Festival. Both events continue to grow in size and popularity, according to Ralph McMullen, executive director of the Elko Convention and Visitors Authority.

Celebrating its 25th anniversary this year, the Elko Convention Center hosts
mainly local meetings and events. "This started as a municipal auditorium," McMullen said. "About 75 percent of our convention center use is for local activities like Ruby Mountain Symphony concerts, mining safety meetings and the Morrodders Car Club." The convention center totals 50,000 square feet of meeting space. Convention attendance averages between 200 and 300 people, while the auditorium holds 1,000.

Elko schedules a lot of fun and unusual bookings like the "Banging Bones"
four-wheel drive event, Motorcycle Jamboree, Festival of Trees during the holidays and horse racing at the county fair during Labor Day weekend.

The White Pine County Tourism and Recreation Board’s Bristlecone Convention
Center in Ely snagged the prestigious Global Mural Conference, an international
event held biannually, according to Ed Spear, executive director. Seven countries are represented at the conference. On display in downtown Ely are the artistic creations of world-renowned artists who were commissioned to paint 24 murals over the past four years. "A typical convention in Ely has about 300 in attendance," Spear said. "Overall, the increase in our convention industry has been in small meetings, which show the most potential for growth."

Nevada Commission on Tourism (NCOT) Executive Director Bruce Bommarito explained, "The Commission enjoys an excellent relationship with all convention and visitors authorities. In fact, we administer a grant program to help rural Nevada towns market themselves. NCOT becomes actively involved in even the smallest towns, offering seminars and other support."

What’s the Statewide Outlook?

GES’s Dykstra sees two distinct trends in the future. First, using high-tech means to make sure attendees and exhibitors are getting the best bang for their buck. "I see a trend toward matchmaking – using technology to get the right people together," he said. "For example, conventions of the near future will have badges with data chips to help people connect." Advanced use of technology will maximize the value of trade shows for both exhibitors and delegates. Secondly, Dykstra predicts an increase in the number of corporate events. "Private events are similar to other trade shows, but are limited to a single company’s products," he explained. "This type of show works best when targeting existing customers to foster new sales."

NCOT’s Bommarito sees a bright future for the convention industry, explaining, "Nevada is a great state for entertainment and continues to be a good travel value."

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Leading convention cities for the top 200 trade shows ranked by Tradeshow Week

Las Vegas
Chicago
Orlando
Atlanta
New York
Anaheim
Dallas
Los Angeles
New Orleans
San Francisco