San Antonio Express-News (Sunday)
Telling the city’s story on a reduced budget
COVID a challenge for new Visit San Antonio leader
Visit San Antonio’s new top executive plans to broaden visitors’ perceptions of the city by telling stories about familiar landmarks such as the Alamo and River Walk, as well as lesserknown tales highlighting San Antonio’s cultural diversity.
But Marc Anderson’s challenge will be storytelling on a reduced budget — while convincing tourists and conventioneers to visit even as COVID-19 is still raging.
The City Council on Thursday is expected to approve a budget of $27.2 million for Visit San Antonio for the fiscal year beginning Oct. 1, up more than 28 percent from this year. But it’s still $6.5 million less than prepandemic funding because revenue from the city tax on hotel rooms, which funds the budget, is down about 30 percent from levels before COVID-19 hammered the city’s tourism industry.
The council could also renew its five-year agreement with the tourism organization and add reporting requirements that could result in more transparency into how it’s spending the millions in public funds it receives.
Though Anderson has been president and CEO of Visit San Antonio only for a little more than three months, he knows the damage wrought on the city’s third-largest industry by the coronavirus.
“At the blink of an eye, it all stopped due to the global pandemic we are still living in,” he told the City Council at a budget hearing late last month for the public-private tourism organization.
Anderson has compiled a list of dozens of stories he wants to tell, including the diverse ethnic influences that help define San Antonio, the city’s Western history displayed in cowboy culture and rodeos, the largest Martin Luther King Day march in the U.S. and the only nighttime LGBTQ+ Pride Parade in Texas.
His storytelling plan charmed a City Council that got to know Anderson on a personal level in recent weeks, as he met with members in their districts, touting stories that would extend beyond downtown’s traditional tourism hub and bring visitors to their areas — and patrons to local businesses.
Mayor Ron Nirenberg remarked that one of the challenges the city has failed to meet is this: “How do we brand San Antonio?
“For many people outside of San Antonio, we’re a very static brand associated with the Alamo, but there is so much more to San Antonio than that,” he said, citing the arts and the city’s cultural and culinary scenes.
Thin on details
But optimism about bringing more visitors to San Antonio through stories was tempered by realism. Anderson said visitor levels year-round won’t rebound to pre-pandemic levels until 2024.
Also missing from the budget hearing were details. Anderson didn’t tell the City Council how much of the $27.2 million he plans to spend on the storytelling efforts — formally called marketing — and how much will be spent rebuilding staff, such as salespeople to lure conventions. Much of the storytelling plan is expected to be launched online, but that also wasn’t detailed.
The 80-person organization laid off about half its staff in May 2020, including staff responsible for booking conventions at the city’s Convention Center.
Anderson refused requests for an interview.
“We are currently evaluating the potential to increase staffing based on role, demand and sustainability. There are key roles that are important to our future success,” Visit San Antonio spokesman Richard Oliver said without offering more details.
The City Council is also expected to give renewed life for Visit San Antonio on Sept. 16.
The city used to run its own Convention and Visitors Bureau, but in 2016 outsourced tourism promotion to Visit San Antonio, which has its own board of directors. The five-year agreement ends Sept. 30, and the council is expected to renew it for another five years.
The idea was that Visit San Antonio would have more promotional dollars to spend than the city tourism office because it won’t be reliant solely on the city’s tax on hotel rooms for funding. Hotels, motels, restau
rants and tourist attractions also contribute funding, making it a public-private organization.
Little private funding
But it never worked that way. Visit San Antonio has received only a fraction of its funding from partners the past five years, instead relying almost exclusively on funds collected through the hotel room tax. City Council members didn’t ask Anderson why more funding from partners hadn’t come through, particularly before the pandemic.
Visit San Antonio has 500 partner members.
A Visit San Antonio official, speaking on background because he was not officially authorized to share details, said Anderson’s goal is to reintroduce the organization’s membership program and eventually reach 625 members. Visit San Antonio had put the program on hold in spring 2020 and not asked for dues from current members, the official said.
As part of the new five-year agreement, Visit San Antonio will also be required to provide more metrics to city officials about its operations beyond number of rooms booked and cost of media placements. Data highlighting convention center performance, other event activity and general tourism and hospitality industry conditions will also be required, per a consultant’s recommendation.
A Visit San Antonio spokesman said the organization has begun to provide the new data.
The tourism organization will also be required in the future to submit its business plan before the city approves its budget by the end of September, another recommendation of the consultant. The consultant’s report noted that Visit San Antonio has been providing the report as late as November.
River Walk takeover
Visit San Antonio has also taken over the financially struggling River Walk Association, the organization that staged various barges, parades and other events along the San Antonio River for decades.
It ran into financial trouble because River Walk parades and festivals were canceled during the pandemic, depriving the association of revenue from event sponsors and people purchasing seats to watch events.
Nine members of the River Walk Association, including several board members, objected to the absorption of Visit San Antonio into the River Walk association earlier this year in a letter, demanding to examine association financial records.
But the boards of both organizations approved the deal early this year.
The River Walk Association’s chairwoman, Maria Martinez, told the San Antonio ExpressNews last February that “the overwhelming majority of our members are supportive of the unanimous decision by our board to take the step on a possible merger.”
Visit San Antonio spokesman Oliver said the River Walk events are self-supporting. They will cost about $1 million to stage, he said, with revenue in the same amount coming back to Visit San Antonio.
“No city funds have been or will be used,” he said.
Oliver also said Visit San Antonio is going through the schedule of San Antonio River events for the foreseeable future, with an eye toward improvements to visitor experiences.
Oliver said Anderson is already adding enhanced entertainment options at the events.
For the Armed Forces River Parade on July 3, for example, he said Anderson introduced more confetti cannons on the floats, stickers for folks attending, selfie stations and an extended performance by a military band.
Hopeful signs
One hopeful sign for Anderson in his efforts to bolster San Antonio tourism is that leisure travelers are returning to the city. Increases have been noticeable since Spring Break in
March, with visitor numbers peaking in July.
Information from hospitality industry data firm STR show that overall hotel occupancy in San Antonio in July averaged 74 percent, the best month since the pandemic began and falling just short of pre-pandemic levels. In July 2019, the occupancy rate was 76.6 percent.
But with the start of the slower fall season, as children head back to school and vacation season ends, hotels are reporting plenty of empty rooms. That’s the case particularly during the week, said Chris Hagee, CEO of the Hagee Hospitality Group, a local hotel management company.
And, he said, many of the conventioneers that typically replace vacationing families during the week are still missing in action.
Anderson acknowledged the challenges of rebuilding the conventions and meetings business at the City Hall budget hearing.
He said his goal by 2024 is to reach 43 citywide convention events. That would still be down from 2019, when the city hosted 51 such events. This year, San Antonio is scheduled to accommodate 24 groups, with most scheduled for the fall — assuming no more cancel.
A citywide convention is defined as an event that would fill at least 1,000 hotel rooms on its largest night.
In 2020 and 2021, the city has lost 292 meetings, big and small.
Focusing on tourists
Consultants say it’s difficult to assess when the conventions and meetings market will fully recover.
“Over the past 18 months, convention and business travel have been slower to recover than leisure travel,” said Chelsea McCready, senior director of hospitality market analytics for the CoStar Group. “Prior to the pandemic, the group segment (mostly conventions) accounted for a third of all hotel rooms sold in the city, so it’s safe to say that the San Antonio hotel market will struggle to reach full recovery without significant improvement in this segment.”
McCready said the rise of the coronavirus’ delta variant over the past few months has stopped what was beginning to be a recovery in the meetings market. She said meeting sponsors, attendees and convention speakers will all need to feel comfortable about the health risks before a full recovery can be achieved.
Even with an uncertain full recovery, Anderson has one piece of positive news to tout. Consultants say San Antonio is outpacing other major Texas cities such as Austin, Houston and Dallas in the number of tourists visiting in recent months. They say the convention business is a smaller piece of the overall pie in San Antonio than in those cities, meaning San Antonio is reaping more the benefits of pent-up demand for leisure travelers.
San Antonio has also more leisure attractions than the other major Texas cities, said Randy McCaslin, founder and CEO at McCaslin Hotel Consulting in Houston.
He said Anderson is smart to be building his new storytelling efforts beyond the River Walk and The Alamo.
“They are wonderful places to go. But after about 10 times to the River Walk and the Alamo, you want more,” McCaslin said. “And San Antonio has a lot more. You’ve got the mission trails, SeaWorld, Six Flags. It’s just got so many leisure attractions.”
Anderson spent his entire life in Chicago until moving to San Antonio in June. He was the chief operating officer of Choose Chicago, that city’s tourism marketing organization.
He replaced Visit San Antonio President and CEO Casandra Matej, who took the top job at Visit Orlando in Florida.