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CVBs use the lure of incentives

Boulder’s many breweries were only part of the attraction when a group of beer bloggers chose to bring its first conference to the Colorado town. The bloggers were also drawn by a financial incentive offered to the organization by the Boulder Convention and Visitors Bureau.

Although it was not a huge sum, the incentive was significant to the meeting’s success. It  helped pay for a shuttle to an event held at a brewery.

Awarding it to the group also achieved one of the Boulder CVB’s goals: to entice new business to the city’s hotels during its November-April period, the off-season for Boulder, a foothills town that is not a wintertime ski destination.

Financial incentives have become part of many cities’ strategy for luring meeting business. Incentives vary in size and scope, but the principle is the same: Money or services are offered to convention or meeting groups in the hope of booking their business.

Approaches vary
Most offers are for a limited time. Some require planners to submit a request for proposal to the CVB; in other cases, CVBs work with local hotels and provide them with monies that are then used to offer additional convention services, such as transportation and audio-visual rental.

“A lot of CVBs are doing it,” said Tracy Ward, director of sales for the Kissimmee, Fla., CVB, which has an incentive program. “If you go on their websites, you’ll see they are offering an incentive for booking a meeting. It is a very competitive way to create value for stakeholders.”

In most cases, incentives are based on the size of a meeting, with larger meetings receiving larger rewards. For example, the Central Pennsylvania CVB’s Green World Incentive Program offers $500 to groups that use 50 to 75 room nights. For meetings  of  501 room nights or more, the incentive can be as much as $5,000.

Some CVBs target a particular type of business. In Plano, Texas, for example, an incentive is aimed at short-term meetings, typically those booked and held within six to 12 months.

Others, like Boulder’s, are aimed at attracting meetings during a time of year when business is needed.

Incentives pay off

The incentives do work, CVBs say. In Kissimmee, groups that have not met in the city in the past can get up to $1,000 toward their master bill, depending on the size of the group. The program has been in place a short time; so far, 15 groups have taken advantage of it, according to Ward.

In the Quad Cities, 14 events have been booked as a result of an incentive program that was launched in 2011. Through the program, groups save 4 percent off their master bill and choose additional incentives — such as suite upgrades, onsite registration staff or beverage breaks — based on room nights. In some cases, hotels match the CVB’s 4 percent rebate.

The power of small meetings
The Plano CVB’s incentive recognizes the cumulative power of small, short-term meetings, said director Mark Thompson.

Plano’s hotels apply for the incentive, which can help them stand out in the highly competitive Dallas-Fort Worth market.

Meetings must be new to the area to be eligible. Hotels can apply for and receive funds for up to 75 percent of the hotel occupancy tax generated by a group.

“The program is for short-term business within our current year. It has helped our hoteliers go after business they could not get in the past,”  said Thompson.

The program caps at $5,000; most of the incentives are in the $1,200 to $2,000 range, according to Thompson.

Hotels use the incentives to provide additional, complimentary services for the meeting or convention, such as a welcome reception or transportation.

The program isn’t limited to Plano’s three full-service hotels. Because it applies to meetings that generate as few as 10 room nights, the program can also work for Plano’s many limited-service properties, which typically have limited meeting space.

“A small hotel might have a group of tax accountants coming in to meet, and they will bring in 25 room nights,” said Thompson. “That might generate $150 in incentives. The hotel could use that to hire a car to pick up the meeting planner at the airport.”