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Sunday, 09 December 2012 23:18

Optimism dominates meeting and travel outlook for 2013

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GRAND RAPIDS — The clouds seem to be finally lifting on the travel industry.

That is the projection both nationally from the American Society of Travel Agents and locally from Experience Grand Rapids.

According to an ASTA survey conducted during the summer of 2012, most travel agencies in the United States saw an increase in both revenue and transaction volume, largely because of strong sales in the cruise and group/tour segments.

The strongest performing market segments among ASTA members were cruise, group/tour, insurance and individual travel, all of which grew by more than 40 percent, the report stated.

These numbers fit with what Doug Small, president at Experience Grand Rapids, has seen in the past few years. As the country has pulled out of the recession, companies have started to travel more, especially to so-called second-tier cities like Grand Rapids.

“What is the most volatile of the three segments (corporate, group/tour, leisure) is the corporate market,” Small said. “This year, we saw corporations start to get out and travel again, in my opinion. Talking to my hotels here, I would say that they would support that. Their average corporate transient (business) increased fairly significantly over the last 12 months.”

Small credits events such as ArtPrize for boosting individual tourism numbers in 2012, but specific numbers for leisure travel are harder to come by compared to corporate meetings and conventions.

“It’s very easy for us to gauge our convention and group business,” Small said. “In Grand Rapids, our leisure business — the people who are coming in for those one and two nights just to enjoy something going on in the city — you anticipate a bump around ArtPrize.”

Small said that finding data on leisure travel is much more difficult, since leisure travelers today typically rent rooms and buy plane tickets online as opposed to using an agency. Corporate groups and meetings, by contrast, are much easier to track, he said.

However, Experience Grand Rapids is trying to work with local hotels to at least get data on where leisure travelers are originating.

“One of the things we just discussed with our hotel advisory committee was how they can help us start to track where our guests are coming from, whether that’s through ZIP code analysis or what have you, because we want to start to get a better feel for that,” Small said. “I do know this: Our leisure travelers are starting to come from farther away. It’s no longer just east Michigan. It’s no longer just Midwest ... and that’s just based on conversations we’ve had with cultural attractions.”

The improved outlook nationally has travel agents projecting better industry performance in 2013.

When asked how they would compare performance in 2012 to last year, more than 70 percent of ASTA members said revenue, transactions and their client lists were the same or better. While these results were comparable to the results of the same survey conducted in 2011, they were markedly better than the results in 2010.

Nationally, ASTA members surveyed were optimistic in their projections for 2013. While average profit is projected to be 9 percent this year for both agencies and corporate agencies, both groups said they expect that figure to grow to 10 percent next year. The projections follow slower profit growth for both groups last year.

Locally, Small is also optimistic about Grand Rapids’ outlook for 2013, forecasting 5-percent growth in occupancy.

“I think it’s a combination of international travel coming into this country and Michigan getting some of that, as well as the corporate transient business improving,” Small said.

But Small cautioned his outlook was based on continued economic recovery.

“My projection of 5-percent growth in 2013 could easily be 3 percent if we see another downturn in the economy and corporations pull back again and say, ‘We’re going to do less travel,’” he said.

Read 2017 times Last modified on Sunday, 09 December 2012 14:50

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