The Las Vegas tourism industry continues to show signs of a steady recovery. For only the second time in history, Las Vegas will welcome 39 million visitors in 2011. Visitation numbers have been increasing for more than a year-and-a-half, convention attendance is up almost 10 percent through the first three quarters of the year and hotel occupancy is more than 85 percent, 20-plus points above the national average.
Attracting 39 million visitors is significant given the challenges the industry has faced nationwide the last three years.
Although many residents may understand that tourism is the No. 1 industry, few people may understand how it impacts everyone in Southern Nevada and the state. Nearly half of all the revenues that flow to the state’s general budget fund come from the tourism industry and our resort partners. Tourism accounts for more than 350,000 total jobs in Southern Nevada. Since the worst of the recession in November 2009, tourism has added nearly 16,000 jobs.
Tourism also generates hundreds of millions of dollars every year through the visitor paid room tax — at no cost to the residents — for the construction of schools, roads, parks and other government services. As an example, the tourism industry has generated nearly three-quarters of a billion dollars for the construction or renovation of Clark County schools since 1998, enough revenue to construct 47 elementary schools.
The Las Vegas Convention and Visitors Authority (LVCVA) and our resort partners understand the responsibility we have as the industry that drives the state economy. It is a responsibility we take very seriously.
On Nov. 17, the convention authority introduced the Destination Innovation and Leadership Plan, a three-year business strategy designed to further strengthen the recovery of Las Vegas tourism. One of the core elements of the plan is to enhance the overall experience throughout the Las Vegas Convention Center and the area surrounding and leading to the convention center.
The convention authority will introduce the initial concept in the first quarter of 2012. We are determined to maintain the competitive position of Las Vegas as the No. 1 trade show destination in North America, a ranking we have held for 17 consecutive years.
We also have made a commitment to double sales, public relations and marketing efforts overseas, targeting Brazil and China for their strong emerging economies and the growing spending power of their middle classes. Additionally, we will launch consumer advertising campaigns in select international markets and begin comprehensive research in Brazil, Canada, Mexico and the United Kingdom.
International travelers, who typically stay longer and spend more than domestic travelers, represent the largest potential growth market for Las Vegas. International travelers make up 18 percent of overall visitation. Our goal is to increase the market share to 30 percent over the next decade.
Other elements of the three-year business strategy include increasing airline lift — or the number of flights — to Las Vegas by hosting prominent major airline conventions such as Interline 2012 and Routes 2013. The opening of the $2.4 billion Terminal 3 at McCarran International Airport in June will further complement this strategy. The convention authority has a collaborative working relationship with McCarran, one that gives us an advantage over many other destinations.
Las Vegas will also leverage its leadership positions with industry associations such as the U.S. Travel Association, the Corporation for Travel Promotion and the U.S. Department of Commerce Travel and Tourism Advisory Board, and continue to work closely with the Nevada congressional delegation to help shape public policy that impacts the tourism industry, both domestic and international.
Visa waiver reform and new transportation infrastructure and technology are critical to the long-term success of the industry, as well as the safety of travelers.
Another key strategy is to capitalize on the popularity of Las Vegas for various holidays and special events. The goal is to market at least one special event or branded weekend each month. Branding targeted weekends builds upon how we have positioned Las Vegas on New Year’s Eve by hosting “America’s Party.” Branded weekends give visitors another reason to come to Las Vegas and stimulate dialogue among potential travelers.
Special events attract visitors too and generate national, even international, media coverage.
The “What Happens Here, Stays Here” advertising campaign is as popular as ever and will remain part of the brand marketing strategy. It was recently selected as the No. 1 campaign in North America by the voting public and will be inducted into the Madison Avenue Advertising Walk of Fame. Simultaneously, we will continue with the very successful “Vegas Means Business” campaign introduced several years ago that targets executives at major corporations to bring their meetings and conventions to Las Vegas. The two campaigns reach different audiences and can coexist. Many companies, such as Coca-Cola, Southwest Airlines and GEICO Insurance have multiple advertising campaigns with different messages to various target audiences.
The convention authority is a research-based organization. Every marketing, advertising, sales and public relations program is driven by research. The Destination Innovation and Leadership Plan was developed to keep Las Vegas top of mind with our “core” audience, a group of travelers that represents 42 million people. However, the plan also targets what we define as a “persuade” audience, a group of 45 million potential travelers who are a bit more cautious about travel. They need to be re-introduced to Las Vegas and be reassured they are making the right choice when they commit to taking any trip.
At the same time, the convention authority will continue to look for strategic partnerships within the community. The convention authority formed an alliance in May 2010 with the Nevada Development Authority (NDA) that provides the NDA with space in the Las Vegas Convention Center and the opportunity to interface with representatives from Fortune 500 companies. The recently formed Las Vegas Host Committee — chaired by former Mayor Oscar B. Goodman — will further engage the local business community when major conventions or special events are in town, and is another example of community partnerships. The host committee will launch initiatives beginning with the National Finals Rodeo and MAACO Bowl Las Vegas.
The Las Vegas tourism industry is in recovery. We have learned from the past three years and have even more insight into our markets and consumers. There is much work left to do, but we are in a much better position today and prepared to tackle the challenges that still remain. Historically, the tourism industry has pulled the community out of a recession and we are ready to lead the way again.
Rossi Ralenkotter is president and CEO of the Las Vegas Convention and Visitors Authority, incoming chair of the U.S. Travel Association Board of Directors and immediate past chair of the U.S. Department of Commerce Travel and Tourism Advisory Board.