A strong dollar, high fuel prices and economic storm clouds south of the border dogged B.C. tourism operators through this summer. Advance bookings were soft as tourists put off making plans until the last minute – and even then, favourable exchange rates sent domestic travellers south of the border. “For the first time in my recollection, we have a travel deficit with the U.S.,” says Frank Bourree, principal of the Chemistry Consulting Group Inc. in Victoria and a long-time observer of B.C.’s tourism sector.
While the province has attracted a growing number of visitors from other parts of Canada in recent years, the absence of U.S. visitors (which account for 80 per cent of B.C.’s foreign visitors) highlights the challenges the tourism sector faces, particularly in the lucrative business trade. “These trends are going to make it very difficult for the convention business. Very, very difficult,” Bourree says. He sees the greatest challenges facing the province’s smaller convention centres – effectively, everything outside Vancouver.
The Victoria Conference Centre, the second-largest convention centre in the province, offers 48,000 square feet of event space plus an additional 25,000 square feet at the Crystal Gardens across the street. (The Vancouver Convention & Exhibition Centre, by comparison, has more than 150,000 square feet of space.) Competition among small-scale convention centres is already a fierce battle, and the economic pressures gathering steam only promise to make it more so.
Signs of the current challenges were already present when the Victoria Conference Centre began sending its senior sales staff to Washington, D.C., in 2003 to attend the spring show of the American Society of Association Executives and meet with potential clients one-on-one. Washington, with its nexus of national association headquarters, seemed like fertile ground for raising the profile of the city and drumming up business. But a weakening U.S. dollar and an abundance of U.S. convention centres proved too much for the visiting Victorians, with conference organizers increasingly telling the delegation that they could snare better deals closer to home – and without the hassle of a transcontinental flight.
Victoria currently hosts about 30 major conferences a year (those averaging 600 participants and requiring more than one hotel), but as tourists have disappeared from the city, the number of available rooms increased and hoteliers looked to the conference centre to fill the gap. Victoria hoteliers used to look at conferences as an added bonus, since they had little trouble filling their rooms with tourists, explains Jocelyn Jenkyns, the Victoria Conference Centre’s new general manager. “In the last couple of years, things have changed here in Victoria,” she explains. “We have been under increasing pressure to produce conference bookings year-round.”
Smaller cities also face risks to visitor access as airlines trim capacity and eliminate underutilized routes to save money in response to rising fuel prices. “If I were looking to book a convention five years out, I would be looking at larger destinations,” says Deborah Sexton, president and CEO of the Professional Convention Management Association (PCMA) in Chicago. “Clearly, Vancouver falls into that category, because I would assume that my air availability would be greater than it might be in a second- or third-tier city.” Sexton feels that uncertainties in the travel environment are making people think twice about long-term conference plans. And that will only increase the pressure on smaller centres to offer incentives and price to attract business.
It’s something Bourree says Victoria is doing successfully, whereas smaller centres with less to offer will have less traction. He notes that a major drag on Nanaimo and Penticton, for example, is the lack of hotel rooms to support larger conferences; no matter how hard such centres work to attract U.S. business, a lack of rooms to support a major conference will force them to rest content with smaller events. Nanaimo, with just over 900 Tourism BC-approved hotel rooms, has had to settle for smaller conferences than its new 38,000-square-foot conference centre is able to accommodate. “We’d love another hotel; we’d love another two,” says Denise Tacon, director of operations at the Vancouver Island Conference Centre on the city’s waterfront.
The centre’s ballroom has a capacity of 1,300 people, but Tacon’s efforts are targeting conferences of between 200 and 600 delegates. The centre’s first major meeting this past July attracted almost 100 participants. “We can essentially work with those numbers and facilitate them very well,” Tacon says. “Anything more than that, we have to make sure we have something else in the works.” The centre has booked 44 conferences through 2014, and Tacon is optimistic that business will grow despite the challenges the tourism business faces.
Back in Victoria, Jenkyns isn’t so sure. While she believes people want to come to the city, she also knows it is vulnerable if people don’t – or can’t – find a convenient flight in. She says the airlines need to see planes 85 per cent full to maintain service. Delta Air Lines Inc. cancelled a direct service it launched between Victoria and Salt Lake City in summer 2006, and Jenkyns knows a new service United Air Lines Inc. launched between San Francisco and Victoria in June will have to measure up or face the same fate. While the connections from within Canada and even Seattle are good, Jenkyns says more direct flights from larger centres provide the certainty a conference destination needs to thrive in the long term. “We would dearly love to be confident and consistent about talking to people about air travel and how they’re going to get here,” she says. “People are still going to be able to get here. It’s just that it may be more arduous.”
And therein lies the trouble for B.C.’s smaller conference destinations. While travellers to the conferences of regional and national associations stay longer and can count on writing off a portion of their travel costs, what the PCMA’s Sexton calls the “hassle factor” could quash the hopes of even the most ambitious destinations. “If someone’s on the fence and saying, ‘Do I really want to go or do I not want to go?’ those kinds of obstacles that are being thrown in our paths are giving reason to individuals to decide not to participate in what we do for a living,” she says. “That is very problematic, and that is not just a pricing issue.”