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The State of LA's Hotel Industry May 7 th , 2009

The State of LA's Hotel Industry May 7 th , 2009. Tourism is LA’s Number One Industry. Industry 1. Tourism and Hospitality 2. Professional and Business Services 3. Direct International Trade 4. Entertainment 5. Wholesale Trade and Logistics. LA Visitor Spending by Category.

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The State of LA's Hotel Industry May 7 th , 2009

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  1. The State of LA's Hotel Industry May 7th, 2009

  2. Tourism is LA’s Number One Industry Industry 1. Tourism and Hospitality 2. Professional and Business Services 3.Direct International Trade 4. Entertainment 5. Wholesale Trade and Logistics

  3. LA Visitor Spending by Category Economic Impact of Meetings, Events and Incentive Travel •Create 1 million jobs to the American workforce in local communities. • Generates $27 billion in wages for Americans that are critical to local economies across the United States, and can play a critical role in our nation’s economic recovery. • Provides $16 billion in tax revenue at the federal, state and local level • Contributes $101 billion in spending to the U.S. economy. • Supports over 200 local convention centers around the country • Are responsible for nearly 15 percent of all travel in the United States Source: US Travel Association

  4. Overseas Arrivals Overseas point of entry (POE) arrivals at LAX and ONT decreased (-15.5%) year over year for February Total US Overseas passenger POE arrivals was down (-11.2%) in February 2009 Source: CIC Research, I-94 DHS Data

  5. LAX Total Passenger Traffic Trend- By Month2007-2009 LAX total passenger traffic was down -12.6% year over year in March 2009 Source: LAWA Traffic Report

  6. LAX Domestic Passenger Traffic by Month2007 –2009 LAX domestic passenger traffic was down -9.94% year over year in March 2009 Source: LAWA Traffic Report

  7. U.S. Consumer Confidence by Month2007- 2009 Source: Conference Board

  8. LA’s Occupancy Ranks Sixth Among Top US Markets Source: Smith Travel Research

  9. LA’s Average Rate Among Top US Markets Source: Smith Travel Research

  10. Los Angeles Lodging Data

  11. Weekly Lodging Trend- Los Angeles CountyOccupancy & Room Rates Period: Week Ending 21st February- Week Ending 11th April 2009 Source: Smith Travel

  12. Weekly Lodging Trend- Los Angeles RegionsOccupancy & Room Rates Period: Week Ending 21st February - Week Ending 11th April 2009 Source: Smith Travel

  13. Weekly Lodging Trend- Los Angeles & Major Cities in CaliforniaOccupancy & Room Rates Period: Week Ending 21st February-Week Ending 11th April 2009 Source: Smith Travel

  14. Weekly Lodging Trend- Los Angeles & Major U.S MarketsOccupancy & Room Rates Period: Week Ending 21st February- Week Ending 11th April 2009 Source: Smith Travel

  15. Hotel Occupancy LA and Competitive Set- March YTD 2009 Source: Smith Travel Research

  16. % Change in Hotel Occupancy LA and Competitive Set – March YTD 2009 Source: Smith Travel Research

  17. % Change in Hotel Occupancy LA and Other High-Occupancy Metro Areas March YTD 2009 Source: Smith Travel Research

  18. Average Daily Room Rates LA and Competitive Set – March YTD 2009 Source: Smith Travel Research

  19. % Change in Average Daily Room Rates LA and Competitive Set – March YTD 2009 Source: Smith Travel Research

  20. LA Occupancy by RegionMarch 2009 vs. 2008 Source: Smith Travel Research

  21. LA Average Daily Room Rates by RegionMarch 2009 vs. 2008 Source: Smith Travel Research

  22. CitywideConventions Conventions 13 15 13 21 19 22 22 19 22 23 Source: Production Report, VP of Sales As of March 2009

  23. CitywideConventionBookings * Forecast Fiscal Year July-March Source: Aptify, Gross production

  24. Citywide Cancellations Source: Production Report

  25. Average Citywide Booking Room Nights Source: Production Report

  26. Citywide Cancellations FY 2008 / 2009 Citywide cancellations listed by month cancel was received.

  27. List of Citywide Cancellations Fiscal Year 2008/2009 Cancelled in September 2008 Room Nights September 2009 Amer. Society of Clinical Oncology - Breast Cancer Symposium 4,720 Cancelled in October 2008 April 2010 Int’l Truck and Engine Corporation 5,125 Cancelled in November 2008 September 2010 World Airline Entertainment Association - Annual Conference 6,540 Cancelled in December 2008 June 2012 Book Expo America 24,000 Cancelled in February 2009 September 2009 Urban Expositions 4,446 April 2009 Domino's Pizza Convention 4,635 February 2010 World Financial Group - Annual Convention of Champions 10,840 March 2011 World Financial Group - Annual Convention of Champions 10,840 November 2011 CA Inc. - CA WORLD 30,000 April 2010 CA Inc. (CA WORLD) 30,000 April 2012 Domino's Pizza Convention 4,635 Cancelled in March 2009 September 2010 SAP Tech Ed 2010 20,872

  28. List of Citywide Cancellations Fiscal Year 2007/2008 Cancelled in August 2007 Room Nights April 2010 California Association State Convention 2,500 Cancelled in December 2007 July 2011 California Schools Annual Conference 6,150 Cancelled in January 2008 October 2009 CTIA – The wireless I.T. 8,335 Cancelled in June 2008 October 2008 IDG World Expo 6,800

  29. List of Citywide Cancellations Fiscal Year 2006/2007 Cancelled in September 2006 Room Nights May 2007 Entertainment Software E3 Show 18,100 May 2007 Entertainment Software E3 Show 7,000 May 2007 Entertainment Software E3 Show 8,963 May 2007 Entertainment Software E3 Show 23,862 May 2007 Entertainment Software E3 Show 23,862 May 2007 Entertainment Software E3 Show 23,862 Cancelled in February 2007 November 2007 Gen Con, LLC 3,500 November 2007 US Green Building Cities 13,180 September 2010 League of California Cities 4,085 Cancelled in April 2007 February 2008 IPC Association Connecting 6,495 February 2009 IPC Association Connecting 7,450 Cancelled in May 2007 September 2007 Microsoft Corp. 29,630

  30. LA Visitor Spending by Category Citywide Convention Direct Sales Focus • Focus on Protecting what we have 2009/2010: • Work in partnership with LACC and Hotel Partners to ensure Licensing and Contracts are completed more rapidly to protect against cancellations. • Review with customers currently booked to ensure stability of convention in place. Communicate effectively to all member partners outcomes of these reviews and as a team determine required actions if any. • Work with customers to ensure they are effectively utilizing all accessible attendance building programs, via LA INC. Sales, Client Services, City and LACC. • Utilize the benefits of Los Angeles in all we communicate, ensure the customer is getting the message to convention participants, such as airport accessibility (frequency, number of international and domestic flights) and overall cost reductions to an organization and other areas such as LACC and hotels to name a few.

  31. LA Visitor Spending by Category Citywide Convention Direct Sales Focus • Resolve date availability due to Cancellations: • February and April 2010, March and November 2011, April and June 2012. • Review any and all lost business which occurred over these dates and attempt to revisit all account possibilities. • Utilize other resources available to solicit this business such as MINT (DMAI system) and competitive city calendars. • Self Contained Hotel Sales has been advised of the hotels effected by these cancellations and is also focused on business opportunities available over these dates.

  32. LA Visitor Spending by Category Citywide Convention Direct Sales Focus • Areas of Opportunity: • Las Vegas, Banking and Financial Cancellations • Boston, Pharmaceutical and Medical due to impending Pharma Code changes and cancellations as a result. • San Diego, Manchester Hyatt owner political move causing cancellations in some segments, most recently Union market. • San Francisco and Chicago, Economy and cost issues prohibiting attendance growth and or bookings. • New Orleans, Accessibility, safety and security issues have been growing presenting a new solicitation opportunity. • Anaheim, Costs within the center and overall leisure destination issue. • Note: we regularly obtain all convention calendars from these destinations.

  33. New Sales Promotion

  34. Hotel Sales Leads Declined Beginning Fourth Quarter 2008 • Month to month lead production began to decline in November 2008, forecasting no improvement March-June 2009

  35. Hotel Sales Room Production FY 07/08 – 08/09 • Hotel Sales team began the year 120% over same time last year, market began to weaken in November and bookings have continued to soften

  36. LA Summer Promotion

  37. Airline / Hotel Package: • LA INC.; JetBlue Airways and Travelocity • ONE WEEK SALE (May 4 -10) • SAVINGS up to 40% • 12 key markets: • San Francisco; San Jose; Portland; Seattle; Salt Lake City; Las Vegas; Sacramento • New York; Boston; DC - (Reagan Airport & Dulles Airport); Fort Lauderdale • Promote special offers: • Attraction discounts • Museum offers, concerts, etc. • Free things to see and do • Summer events

  38. Landing Page

  39. On Line Strategies • Display advertising • Contextual • SEM • e-communications • 30MM ad impressions – one week flight

  40. Summer Promotion – DRIVE MARKET • Hotel Package Only: (June Sale) • Only on discoverLosAngeles.com • Limited time hotel offer including: • Lowest hotel rate • FREE breakfast • FREE parking • Promote special offers: • Attractions • Museums, concerts, etc. • Free things to see and do • Summer events/festivals • Media Tactics: • Online: Display, e-communications, SEM and contextual • Travelocity; Travel Network; Budget Travel; etc. • 22MM est. impressions • Radio promotions/giveaways • 2MM est. impressions

  41. The State of LA's Hotel Industry May 7th, 2009

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