Occasionally, Karen Gonzales, senior vice president of membership and operations at Destination Marketing Association International (DMAI), has a meeting planner request the list of first, second and third tier cities. “Planners are always surprised to learn that an official list doesn’t exist and there are no specific tier qualifications. While there are general characteristics that apply to each tier, in reality it’s all about perception,” Gonzales explains. “You know the saying ‘beauty is in the eyes of the beholder’? That’s kind of how it is with cities — since there are no official tier designations, a first tier city to one planner may be a second tier to another.”
Perception v Designation
Where does this leave the planner whose board has decreed their association’s annual convention will be held only in 1st tier destinations, board meetings and specialty conferences will go to 2nd tier cities, and all committee and regional meetings will be in 3rd tier locations? How can the planner feel secure that a particular destination qualifies as third tier rather than second? There are generalizations that loosely apply to each tier, the most obvious being size related: first tier = big, second tier = medium, third tier = small, but even those distinctions are blurred. A “small” meeting of the National Association of Broadcasters might be “large” to the National Association of Hispanic Journalists; a Fortune 500 corporation may host a 400 person shareholders meeting requiring only one hotel but the amenities of a world class city.
Unlike hotel rating systems that award 3, 4, or 5 stars to properties based on their quality, services, and amenities, no such system exists for rating meeting and convention destinations. Although tiering is subjective, there are generalizations that apply to each group.
So-called first tier cities are easiest to define. No one would argue that Chicago, Las Vegas and Orlando are first tier cities, yet they couldn’t be more different in location and personality. They join at least another 12 US cities that can be labeled “first tier” because all are characterized by the following:
- Metropolitan hub
- Major airport with large airlift and easy national and international access
- Strong travel infrastructure (rail, public transportation, taxis)
- Convention center with a minimum of 500,000 gross square feet exhibit space
- Minimum committable 10,000 sleeping rooms
- Hotel inventory that includes a large number of chain convention hotels, luxury properties and a spectrum of rates
- Abundant dining, entertainment, attraction options
- Reputation for world class services and amenities
- Connotes an element of glamour, cachet, desirability
Tier descriptions get more complicated from here.
As unfair as it seems, a large destination lacking any one of the above criteria becomes part of the amorphous second tier, often characterized by
- Smaller population
- Smaller convention facilities
- Less direct airlift
- Opportunity for better value
Interestingly, the APEX (Accepted Practices Exchange) Industry Glossary includes a definition for second tier destination. It defines a second tier city as “A city where the space limitations of the convention center, the hotels, or the airlift make the city more appropriate for smaller meetings and events.”
While a second tier destination may have less sleeping rooms, meeting/exhibit space, or airlift capacity it doesn’t necessarily have lower quality facilities and amenities. “Inaccurate perceptions of what second tier cities offer is one of the challenges we are working to overcome,” says John Leinen, vice president convention & tourism sales for Reno Tahoe USA, the Reno Sparks Convention and Visitors Bureau. He wrestles with the practice of designating destination tiers. In fact,the RSCVB’s website states “Reno Tahoe may be a second tier convention destination, but prides itself on first tier amenities and service.”
Evidently, Safari Club International, who held its 21,000 person convention in Reno in January, agrees. Leinen explains, “in spite of Reno Tahoe’s 16,000 committable hotel rooms, large convention center, dynamic dining and entertaining, and variety of things to do, it’s difficult to get the right perception out there.” He advises, “In choosing a site, planners should ask themselves, ‘What am I really giving up?’ by selecting a second tier city. Outside of the recognition of the first tier city, what’s the difference?” In a clever play on words, Reno Tahoe recently launched an advertising campaign called “No More Tiers” in an attempt to eradicate the unwarranted negative connotation that cities other than tier ones may have.
As a result of the economic downturn, and the booking/pricing flexibility of many second tier destinations, they have surged in popularity. Tier II destinations can be a great choice for planners that prefer having their convention be “the big fish.” It can be a special experience for the attendees when they own the city instead of being one of multiple conventions taking place in a Tier I city. Similarly, adding second tier destinations to the schedule can provide a fresh and exciting change to the often-visited, sometimes overexposed, first tier cities.
This is where a lot of destination egos get bruised, but remember: third tier does not mean third class. It’s strictly a matter of size, not quality or even cost. In fact, some of the country’s most luxurious resorts are located in destinations labeled third tier simply because of overall destination size. Generally, third tier destinations have:
- More limited airlift, usually requiring connections
- No convention center, a smaller conference center, or meeting and exhibit space contained within a hotel rather than a dedicated facility
- Distinctive leisure travel appeal
- Regional drive market
There should be no stigma attached to the third tier label. Often, they are the destinations of choice for incentive travel. As a matter of fact, third tier destinations may find themselves competing for a piece of business with first and second tiers; a 200 person international meeting of rocket scientists meeting in California may seek proposals from Sonoma County, Newport Beach, Palm Springs, San Diego and San Francisco.
A Different Take
Doug Price, president & CEO of the Colorado Springs Convention & Visitors Bureau, emphasizes the unreliability of the perception factor when it comes to assigning tiers, pointing out that the only destinations that benefit from the three labels are the undisputed first tier cities. “Every other destination is always striving to be perceived as part of the next tier up,” Price observes. He suggests that a more valuable and realistic designation system would be:
- First Tier – with the parameters described above
- Second Tier – all other meeting and convention focused destinations, regardless of size
- Leisure Market
With these distinctions, destinations such as Colorado Springs, Savannah, and Palm Beach, which offer meeting facilities, resort properties, and have wide attraction appeal, can classify themselves as both second tier and leisure market destinations.
Making Your List
When it’s time to create your own list of first, second, third (and leisure market) destinations, empowerMINT.com’s Destination Finder is invaluable. empowerMINT.com is the virtual national sales office for destinations of all sizes, and will save you countless hours of research. Find and compare exhibit space, meeting capacities, and hotel information for more than 130 meeting destinations, and use the contact information to reach out to CVB sales professionals for even more information.
Then proceed to book that annual convention, those board meetings and committee meetings with assurance!