As the outlook of the coronavirus pandemic begins to improve ever so slightly with vaccine distribution, mask wearing and social distancing, many sectors of the economy in California are reacting with small improvements. With the assistance of county and state health departments, guidelines have been set for re-opening businesses under certain parameters. However, convention and group business, an integral piece in the Greater Palm Springs tourism industry that provides tremendous economic impact, is faced with uncertainty from the same state administration that has allowed other business sectors to re-open.
Data provided by the Greater Palm Springs Convention and Visitors Bureau (GPSCVB) and CVENT (the industry’s primary channel for distributing leads of groups interested in coming to the area) provide a glimpse into the economic impact of group and convention business in the destination. GPSCVB accounts for approximately 40% of group business booked throughout the region, while the remaining 60% is booked directly by sales teams within hotels. Combining these two sources of business together, and understanding COVID’s impact, the area has lost 365 groups that cancelled business, representing more than 310,000 hotel room nights and a staggering $208 million in economic impact to the collective cities. This has resulted in the loss of 57% of the hospitality workforce within Greater Palm Springs since 2019.
Of those groups that have cancelled, 107 have rebooked into future months and years, but the lack of state guidelines has presented a formidable challenge. Sales teams book months to years in advance, and the lack of current direction have put these opportunities into jeopardy.
“Other states, such as Florida, Arizona, and Nevada have been proactive working with their state administration, health departments and business leaders to build plans for eventual re-opening,” says Scott White, CEO of GPSCVB. “We are selling our destination for the last quarter of 2021 and beyond. Each day that we don’t have direction is one that we lose business for the future. Once this business goes to other destinations, it can take several years to win them back.” This sentiment is reflected on a national level, as Northstar Meetings published their most recent Pulse Survey from meeting planner research gathered February 2 – March 4. The results found that 81% of meeting planners intend to hold an in-person event sometime in 2021, with almost 60% planning for the second half of 2021.
More than 150 California cities have joined together to form the California Convention Coalition, sending a strong letter to Governor Gavin Newsom to work with the group in distributing guidelines. “We have been communicating with the Governor and requesting to be a part of the tier system since last year,” Mr. White stated. He explained that the same concept that has been put in place for restaurants can work for convention centers and hotel meeting space. “Following capacity guidelines, safe parameters can be distributed now, so that we can communicate with our customers who look to return to this destination. These groups have decided to meet, and because we can’t give them a timeline, they are choosing destinations others than ours. Meeting planners can’t take the chance if they don’t know what the State of California is planning to do. We need to give our industry a chance to hold on to interested groups.”
Rob Hampton, General Manager of the Palm Springs Convention Center, concurs. “Meetings and conventions are being viewed in the same way as events and gatherings, but they are fundamentally different,” he states. “It is easier to plan for a group, as details such as number of people, arrival dates, etc., are known in advance. Traffic flow, distancing, food service and even testing can all be planned in advance and monitored.” He added that Convention Centers have historically followed protocols that are some of the safest in the industry, such as proper ventilation and designated seating. “Meetings are actually one of the safest ways to create business and jobs, especially compared to many of the businesses that have been allowed to remain open. We are prepared to follow any guidelines necessary to safely host conventions and meetings here in the future.”
Adding to the frustration is that demand for the destination by the conventions and meetings market is again strong. In 2018 and 2019 demand was robust, with competition for quality space and rising prices as a result, indicative of expanding companies. Now in 2021, interest and bookings are again on the rise, and cancellations are declining. Air service has continued to improve, with coveted airlines like Southwest having chosen PSP to bring their customers. “We need groups this fall to help fill the planes and keep the airlines here,” Mr. White stated. “That’s one of the reasons we’re so urgent to receive guidelines, such as capacity, to start booking again. We have leads and nowhere to put them.”
In a press release from CalTravel (the association which advocates at the state level to generate support for policies that protect and advance the tourism industry in California), President and CEO Barb Newton states that “We’re not asking Governor Newsom to open California to business meetings and events tomorrow, we’re asking for a plan today to safely hold events in the future. They bring people who spend money on hotel rooms, restaurants, local shops and services.” Conventions create a ripple-down effect, because exhibitors hire a wide range of local companies and individuals such as caterers, audio visual and rental companies, performers and others to support the activities of their delegates.
There may be light at the end of the tunnel, however. Mr. White foresees that, with direction and guidelines such as capacity, the group business in the GPS cities could see a faster rebound than some other destinations who rely almost exclusively on individual business and leisure travel. “We want to be safe,” Mr. White states, “But the silence is frustrating for all, and is delaying the recovery significantly. Once the majority is vaccinated, this should be obsolete, but the need is now.”