On the Road: New Rivals Compete For Convention Business

Two things struck him about this. One, the banner indicated just how competitive the $117 billion-a-year meetings and conventions business is becoming in the United States. And two, it shows just how local and fragmented segments of it are, even as the overall meetings business grows nationally and internationally.

During the recession, companies, professional organizations, universities and government entities all cut back on meetings spending, but for most, recovery has been slow but persistent. Yes, there were 4.9 million convention and meetings attendees among the 39.7 million visitors to Las Vegas, a convention giant, last year, while at the same time there were more and more smaller events held at a growing number of cities, hotels and other meetings centers.

The huge conventions and trade shows still rack up Super Bowl-level attendance in cities like Las Vegas (where the Consumer Electronics Association trade show alone draws more than 150,000 annually), Orlando, Chicago, Atlanta and others. But even in the city that claims to be No. 1, Las Vegas, the overall numbers have been declining slightly in the past few years, according to data from the Las Vegas Convention and Visitors Authority.

As the competition intensifies and expands globally, other cities have been spending on improving convention and meetings sites, and so have hotels of all sizes. At the same time, many planners are booking smaller meetings locations closer to home — even if there are more meetings over all. “There has been an increase in the sheer number of hotels with meetings facilities, and now midsize hotels are more aggressively pursuing small meetings,” said Professor Dev, who teaches marketing at Cornell’s School of Hotel Administration.

A new report by Cvent, the big technology-based meetings-management company, underscores some of the changes occurring in the meetings business. Its annual list of the top destinations in the United States is still dominated by the big traditional convention towns like Orlando, Chicago and Las Vegas. But the list has also been churning, reflecting more aggressive marketing by other cities in the lower tiers. Among the cities new to the top 50 list this year are Coronado, Calif.; National Harbor, Md.; Tucson; and Naples, Fla., Cvent says.

“The biggest reason is because of the investment that a city itself makes, whether it’s the convention and visitors bureau, the hotels themselves, and even cities that are doing major improvements to their downtown areas like Tucson,” said Eric Eden, the vice president for marketing at Cvent. On a larger scale, he cited the $950 million CityCenterDC downtown project on the site of the former convention center in Washington.

As the meetings business expands beyond the traditional locations and mammoth convention halls, individual hotels making major capital improvements are gaining a bigger share of the business. Over the last decade, according to the International Congress and Convention Association, a global trade group, “the usage of meeting facilities in hotels has been gradually increasing at the expense” of big convention centers.

In the United states, with cities and hotels spending again on improvement projects, the game is changing quickly, Mr. Eden said. Meetings planners, who typically negotiated and selected locations by phone or on personal visits, can now employ sophisticated technology to make selections and negotiate terms, even as the hotel industry itself is recovering strongly and better able to seek higher rates.

Though hotels now have more negotiating traction, those meetings planners who use new technology are also on firmer ground, and not “going to hotels and negotiating one-by-one with a phone call or an e-mail,” Mr. Eden said.

The meetings industry is also growing globally.

A recent survey by the consulting firm Frost & Sullivan estimated that the meetings and events industry accounted for a total of $565 billion globally in 2012. Still, the report noted, the majority of the planning process for meetings is done “manually,” rather than with newly available technology.

Domestically, meetings and trade shows represent over 40 percent of the total $273 billion that will be spent on all business travel in the United States this year, according to the Global Business Travel Association. And as the meetings business expands internationally, and global cities compete for more share, the industry will undoubtedly become a bigger part of the overall global business travel market, which the Global Business Travel Association estimates will account for a total of $1.12 trillion this year.

Incidentally, total business-travel spending is growing especially strongly in the Asia-Pacific region, where the market doubled in size to $393 billion last year, the trade group says. By 2016, the trade group estimates, China alone will surpass the United States in overall spending on business travel, and a considerable chunk of that will be spent on meetings and trade shows.

“It’s a huge industry, and it has become very, very competitive,” Mr. Eden said.

Jobs Compete With College in Montana Oil Country

It is a lucrative but risky decision for any 18-year-old to make, one that could foreclose on his future if the frenzied pace of oil and gas drilling from here to North Dakota to Texas falters and work dries up. But with unemployment at more than 12 percent nationwide for young adults and college tuition soaring, students here on the snow-glazed plains of eastern Montana said they were ready to take their chances.

“I just figured, the oil field is here and I’d make the money while I could,” said Tegan Sivertson, 19, who monitors pipelines for a gas company, sometimes working 15-hour days. “I didn’t want to waste the money and go to school when I could make just as much.”

Less than a year after proms and homecoming games, teenagers like Mr. Sivertson now wake at 4 a.m. to make the three-hour trek to remote oil rigs. They fish busted machinery out of two-mile-deep hydraulic fracturing wells and repair safety devices that keep the wells from rupturing, often working alongside men old enough to be their fathers. Some live at home; others drive back on weekends to eat their mothers’ food, do loads of laundry and go to high school basketball games, still straddling the blurred border between childhood and adulthood.

Just as gold rushes and silver booms once brought opera houses and armies of prospectors to rugged corners of the West, today’s headlong race for oil and gas is reshaping staid communities in the northern Plains, bringing once untold floods of cash and job prospects, but also deep anxieties about crime, growth and a future newly vulnerable to cycles of boom and bust.

Even gas stations are enticing students away from college. Katorina Pippenger, a high school senior in the tiny town of Bainville, Mont., said she makes $24 an hour as a cashier in nearby Williston, N.D., the epicenter of the boom. Her plan is to work for a few years after she graduates this spring, save up and flee. She likes the look of Denver. “I just want to make money and get out,” she said.

The shift appears to be localized around centers of oil production like Sidney. School counselors in western Montana, far from the boom, said that few of their students were abandoning college for energy jobs. And even here, a majority of graduates are still choosing universities and community colleges.

But school officials in eastern Montana said more and more students were interested in working for at least a year after graduation and getting technical training instead of a four-year degree.

Last year, one-third of the graduating seniors at Sidney High School headed off to work instead of going to college or joining the military, a record percentage. Some found work making deliveries to oil rigs, doing construction and repairing machinery. Others decided to first seek training as welders or diesel mechanics, which pay more than entry-level jobs.

Meanwhile, enrollment at Dawson Community College in Glendive, about an hour from Sidney, has fallen to 225 students from 446 just a few years ago, as fewer local students pursue two-year degrees.

“It’s the allure of the money,” said Thom Barnhart, a guidance counselor at Sidney High.

As more families arrive from Florida and Michigan and throughout Montana, seeking a new start after bankruptcies and layoffs, schools in places like Sidney are buckling. School enrollment leapt to 863 students from 723 in three years. The district is scrambling to hire good teachers who can get by on a $32,000 yearly salary in a town where apartments can rent for $1,500 a month. Freshmen are sharing lockers, and the district reopened a school that had been shuttered for years.

But every year, hundreds of those new students depart within a few weeks, tugged along by parents heading off to another job in another town.

“It’s a revolving door,” said Daniel Farr, the district’s superintendent.

At the end of a gravel highway in northeastern Montana, graduating seniors in Bainville are asking similar questions about their future. Should they get an education and pursue their interests? Or should they stick close to home and surf a wave of cash and jobs that will only grow as companies begin to build a new industrial rail terminal and worker camps, forever transforming this quiet farm town where residents say the population has doubled since the 2010 census found 300.