Visitor traffic from two of the larger business meetings of the year has given Waikiki hoteliers an opportunity this month to carry strong rates into the start of the slower "shoulder" season and bolster neighbor island traffic.
Forever Living International, an Arizona-based health and wellness company, kicked off a 4,000-person incentive meeting on Sunday that will run through Monday. The meeting, which is expected to draw attendees from about 50 countries, represents the first time in the company’s 35-year history that it consolidated all of its global events into one large-scale gathering.
"This is our first meeting of this magnitude, and we chose Hawaii," said Carl Zander, Forever Living’s senior vice president. "We wanted an exotic place that was easy to get to and would be considered a great vacation place. All of our distributors have heard of Hawaii and how beautiful it is. We wanted people to be inspired to go there."
While the organization considered other destinations before deciding on Oahu, Zander said the deciding factor was the proximity of the Hawai‘i Convention Center to Waikiki and the organization’s host hotel, the Hilton Hawaiian Village Waikiki Beach Resort.
"Our goal was to get over 3,500 attendees, and we did that fairly easily," he said. "In the end about 3,000 people qualified to come, and another 1,000 are paying their own way. We’ve got people coming from all over, but the bulk of them are coming from the U.S., Canada, Brazil, India, Japan, the United Kingdom, Turkey and Nigeria."
Randall Tanaka, Hawai‘i Convention Center interim general manager, said the Forever Living event could prove to be one of the larger meetings of the year. While the convention center has hosted larger meetings, Tanaka said that this event and others like the American Association of Endodontists (AAE) are the right size for the current market.
"The leisure market is doing extraordinarily well, so there is a greater desire to have events that bring in about 3,500 to 5,000, which can comfortably fit in two or three hotels," he said.
Hawaii was a natural choice for AAE, which held previous meetings in 2000 and 2006, said AAE President Dr. James C. Kulild. The venue is popular with attendees who enjoy bringing their families to share in the great weather and range of unique activities, Kulild said.
"We held an event on the USS Missouri. Where else in the world could you do that?" he said.
Additionally, Kulild said AAE appreciated Hawaii’s ability to draw talented participants from all over the world. This time, 2,800 attendees came for the group’s annual session held Wednesday to Saturday. While most attendees came from the U.S., Kulild said they were joined by endodontists from Europe, Asia, South America, Canada, Mexico and other nations.
"We have educational sessions given by cutting-edge presenters on cutting-edge topics," Kulild said. "Attendees can apply those principles in their own practices in order to increase their quality of care and value to their referrers and patients."
Lars Andersson, incoming president of the International Association of Dental Traumatology, who traveled more than a day to get to the annual session from his home base at Kuwait University, said he was impressed with the event and with Hawaii.
"The theme of this program was exceeding expectations," said Andersson, who was shopping for a location for his upcoming association meeting. "Hawaii definitely delivered."
The feeling is mutual in Hawaii, where business travelers are a welcome alternative to the state’s bread-and-butter leisure tourism. Even this smaller event was expected to fill 22,512 hotel room nights and pump $13.2 million in visitor spending and $1.3 million in state tax revenue into Hawaii’s economy.
"The stronger your group business, the better you can manage your hotel inventory," said Joe Toy, president and CEO of hotel consultancy Hospitality Advisors LLC. "During the 2008 downturn we saw the virtual disappearance of business travel in Hawaii and nationally, and it really hurt."
Hawaii saw group business bookings begin to return at the end of 2010 and 2011, Toy said.
"The MCI groups that are here now were probably booked in that earlier time frame," he said, adding that the booking pace for meetings, convention and incentive (MCI) travel has continued to improve and will be even stronger in 2014 and 2015.
Groups like Forever Living and AAE help boost business even outside of the convention center and their host hotels because they create room compression and narrow the gap between tourism’s peaks and valleys, Toy said.
"A significant benefit of having large programs at the resort is that they increase occupancy and therefore provide the hotel with the opportunity to manage its remaining inventory for maximum yield," said Jon Conching, Hilton’s regional vice president of sales and marketing for select resorts and Hawaii, which includes the Hilton Hawaiian Village Waikiki Beach Resort, which hosted attendees from both groups.
The return of Hawaii’s MCI business benefits hoteliers across the board, said Barry Wallace, executive vice president of hospitality services for Outrigger Hotels and Resorts.
"Once the business hotels fill, other hotels will get overflow business," Wallace said. "While 4,000 people isn’t enough to fill up the whole of Waikiki, it certainly helps."
Once Waikiki fills up, Toy said MCI traffic tends to spread to Maui, Kauai and Hawaii island, where it can have a significant impact on each island’s visitor industry. Toy said that a 71.2 percent gain in travelers attending a meeting or convention or taking an incentive trip bolstered Kauai’s hotel performance in February to the best it’s been since the recession hit in March 2008. Since MCI is typically a higher-yielding market, Toy said it contributed to gains in the isles’ average daily rate, which rose 12.3 percent, and its revenue per available room, which rose 23.1 percent to set a record.
While Toy said the booking pace for groups is still a little uneven across the islands, he expects to see Maui and Kauai, to a lesser extent, continue strengthening this year.
"The Big Island will start strengthening in 2014," he said.
Overall, Hawaii’s group business has stabilized, and bookings are strengthening for 2014 and 2015, Tanaka said.
"These are not our best years, but they’ll be better than 2012," he said. "They are going to be pretty good years."
Conching said Hilton is looking forward to a "very promising 2014 and 2015."