As the economy shakes, rattles and rolls into unknown waters, planners wonder where they can go for good value—deals that carry not only favorable hotel rates, but also destination amenities and benefits that combine for a great package.
Though cities in the Midwest have traditionally offered some of the nation’s most affordable rates, some have suffered from outdated public perceptions of Rust Belt urban areas in a grey industrial north. The reality is, however, that many Midwest destinations have invested heavily in first-rate tourism infrastructure in order to attract 21st century business groups.
In the wake of large municipal investments, one might expect rates to rise and value to diminish. However, according to industry analysts and planners, this is far from the case.
Affordability Holding
“The Midwest remains the best place to go for value meetings today,” says Mark Eble, regional vice president for PKF Consulting in Indianapolis. “In general, groups find better value in the region than they get elsewhere in the country, with the possible exception of Chicago, which is a market unto itself. In 2007, the national average daily rate (ADR) for the nation was just over $104. That compares with a Midwestern rate of around $80, including all hotel sectors.”
And even Chicago can be affordable, according to consultant Hans Detlefsen, director of HVS Global Hospitality Services in Chicago, who says there have been some good rate deals in his city since the beginning of this year.
“Hotel managers have been hesitant to push rates as aggressively as they used to,” he notes. “The early months of 2008 were softer than last year, probably reflecting that we are likely in a recession. And as a result of that, general managers are shifting strategies for pushing rates up slower than they wanted to, or they are looking more to international customers who can get good exchange rates on the dollar.”
Detlefsen adds that high-end properties throughout the Midwest are continuing to raise rates because they are targeting international business or clients who aren’t rate sensitive. However, limited service hotels and others on the lower end of the spectrum are likely to cut any deal they can get, he suggests.
“Outside Chicago, I would say Indianapolis is always a good deal when compared to Chicago, and that will probably continue for a while as they add more room inventory, expand the convention center and build a new stadium for the Colts,” he says.
American Academy of Nurse Practitioners conference planner Debra Parr, CMP, agrees. The 25,000-member association held its annual national conference in Indianapolis last year, with 4,200 people in attendance. Parr says she did have to sell some members on the city, but the end result brought high satisfaction levels.
“Some of our people did ask why we were going to Indianapolis, but afterwards, they said it was the best destination we’ve ever been to,” Parr says. “They found its central location to be very accessible, and our mostly women attendees said they felt safe going out to restaurants and shops downtown in the evening, alone or otherwise. Also, they found the people there to be very friendly.”
Parr was pleased with the Indianapolis hotel and convention center rates.
“We are space hogs for our sessions and the city ended up giving us rebates on rooms, plus an allowance for an off-site event,” she says.
Value More than Rates
Planners understand destination value usually turns on much more than hotel rates, Detlefsen notes.
“Planners know the name of the game is to meet or beat attendance and attendee satisfaction goals, so price is only one factor,” he says.
“I find that most second-tier cities such as Indianapolis, St. Louis and Cincinnati have everything to offer that first-tier cities have, just on a smaller scale,” says Kelly Ball, regional director for the site selection firm HelmsBriscoe. “There are usually areas of the city—downtown or close to downtown—that offer top-notch restaurants, shopping, entertainment, and hotels at significantly lower costs, and that tends to be a good fit for a lot of clients.”
Marcia McIntyre, meeting manager for Lettuce Planet in Chesterfield, Mo., says she believes value comes from the feeling that you are getting a great return on your dollar, something she recently found to be true in Cincinnati for a medical surgical group.
“We just returned from the Hilton Cincinnati Netherland Plaza Hotel. We found the hotel to be a very good value because they were really innovative and creative with both service and the food and beverage events,” McIntyre says. “Also, Cincinnati is an up-and-coming city with lots to explore right downtown, so you avoid bus transports. There was one drawback in air rates from Chicago and elsewhere, but most of our attendees drove in.”
Value Winners
The Hotwire.com Travel Value Index recently shined its spotlight on both Kansas City, Mo., and Milwaukee as two of the top 10 U.S. cities where visitors find the best value and entertainment options for their spend. Hotwire.com ranks cities in several categories, including discounts on air, car rentals and hotels. Affordable entertainment, overall appeal and choice of accommodations are also on the list.
Kansas City got Hotwire.com’s high marks for low prices and discounts. It also received kudos for its jazz clubs and sites where Charlie Parker and Count Basie used to hang out, along with its public spaces and museums. On the list of noteworthy attractions were the Kemper Museum of Contemporary Art; Union Station, a hub for entertainment and culture; and The Truman Presidential Museum & Library.
For John Dirba, associate regional vice president for HelmsBriscoe, Kansas City is a personal favorite that he recommends to clients.
“I love the hotels and area near The Plaza,” he says. “The city’s restaurants are great, and there is good shopping right out the front doors of hotels.”
Hotwire.com also praised Milwaukee for “some of the best breweries and sports in the nation” and declared it “a powerhouse for performing arts, dynamic exhibitions, and even a casino. The city earns high marks with visitors of all ages looking to explore the city on a dime.”
Bringing even more destination cache to Milwaukee is the new Harley-Davidson Museum on 20 acres of downtown land. Scheduled to open later this year, the site celebrates the company’s history and passion of its riders as well as stories of its employees, dealers and suppliers. Significant cycles, like Elvis Presley’s 1956 model KH, will be on display. The museum will welcome private events into its 130,000 square feet of space extending to the green edges of the Menomonee River.
Along with Milwaukee’s attractions, Marty Tirado, executive director of the Snow and Ice Management Association, likes the way his city keeps the lid on budget costs for meetings.
“Our association moves around the U.S. for meetings, so I’ve compared Milwaukee to larger cities. What we’ve found is that F&B costs at both hotels and the convention center here are of good quality and very reasonable when you compare them to those in tier-one cities and elsewhere,” Tirado says. “Also, Milwaukee has good air connect on several airlines—including Air Tran, which began flying here in the last few months.”
While Tirado does not recommend his home city for winter dates, he believes Milwaukee compares favorably overall with most other destinations.
“We have lots of good restaurants downtown, and a great art museum right on Lake Michigan. There just aren’t that many good destinations around the Great Lakes region, but this is one of them,” he says. “Yes, we suffer sometimes from a Rust Belt, beer and brats image. But once people come here, they realize how wrong that perception is. What they find is lots of green space and all the other things groups need for a great meeting or event.”
Factor All Costs
So while Midwestern cities have worked hard to change perceptions left over from the industrial era, some planners cite the lingering need for good promotion and a calculating eye to transportation costs.
“The drawback to many Midwestern destinations is usually air access and attendee perception,” Ball says.
“Most of these cities have good air access,” she adds, “but depending on where attendees fly from, they often cannot fly in directly. The other drawback can be the idea that people have about certain destinations. Attendees often do not want to spend their time and money on what they perceive to be a mediocre destination. I find, however, that working with the CVBs to showcase the city can be the key to turning what people think is an average destination into a great one.”
