Corporate retreats return to California Wine Country, but COVID concerns are changing their scope
Almost nonexistent for more than two years because of COVID protocols, business travel in the North Bay is resuming.
“I think the combination of not being able to travel for two years and recognizing it is so special to do so that there is a focus and commitment to make these trips productive for them and profitable for everybody,” Honore Comfort, vice president of international marketing at Wine Institute, told the North Bay Business Journal.
In April, the statewide wine advocacy group hosted nine sommeliers from Mexico for two days each in Sonoma and Napa counties; the first promotional trip in more than two years.
In a normal year, Wine Institute brings as many as 25 groups from around the world to the various wine regions in California — not just Sonoma and Napa counties. This year the organization is taking it slow, with trips only booked through June.
Even so, Wine Institute in October plans to host a new event — a global buyers’ market that will bring 80 wine buyers from 26 markets to the Napa Valley Marriott for two days to meet with 200 vintners.
While the goals are the same as in the past — to build relationships and boost the international sales of California wines — it’s not completely back to business as usual.
“Our groups are smaller. We are also making sure we have activities planned out of doors,” Comfort said while traveling via bus to Paso Robles with a group in early May.
“We are building regular testing regimes into our visits. We’ve lined up COVID tests for visitors during their visits and at the end when they leave the U.S.”
Even the bus she was on was bigger than 2019 standards in order to offer more space for everyone.
Looking at the data
The U.S. Travel Association reports increased interest in business travel, with almost all companies surveyed anticipating getting some people back on the road in the next three months.
However, it still projects business travel revenue for this year to be 23% less than it was prior to the pandemic. This equates to $20 billion less in revenues compared to 2019.
While the economic impact of business travel on local communities is self-evident, this sector has a large role to play in the overall recovery of travel industry.
“A return to a thriving travel industry — and American economy — is dependent on the return of business travel, meetings, events and conventions,” the U.S. Travel Association said in a March report.
“Business travel has a disproportionate impact to our businesses. Despite making up 20% of prepandemic trip volume, business travelers account for 40-60% of lodging and air revenue in the U.S. Domestic leisure travel is now fully recovered to 2019 levels, but business travel remained at less than half of 2019 levels in 2021.”
The association predicts San Francisco, New York, Washington and San Jose business travel revenues for 2022 will be off by 50% compared to 2019.
“We really need San Francisco to recover. If the city is busy, business moves out. It helps everybody,” said Christine Bohlke, sales and marketing director with the Marin Convention & Visitors Bureau.
While the bureau doesn’t break down room nights based on leisure and business travelers, the hotel occupancy rate in Marin County is climbing. It was at 60.1% for the first quarter of 2022, while for that same time span in 2021 it was 45.4%.
“Anything under 70% is considered low occupancy. March was 67.2%, so we are getting close to hitting 70%,” Bohlke said.
Sonoma County Tourism, the agency responsible for promoting the county to all travelers, is considering this a rebound year after 2020 being incredibly slow for groups and 2021 seeing a slight increase.
“Request for proposals have significantly increased year-over-year for Sonoma County conference hotels,” said Jonny Westom, vice president of business development for the agency. “While the number of RFPs has increased, the overall size of the group has reduced 30-75 rooms vs. larger programs before the pandemic.”
“Conventions are the best for tourism overall because they tend to be extended stays, they tend to come with banquets, lots of dining, they are really what is the best for the California hospitality industry,” said Pete Hillan, spokesman for the state association.
“Conventions for the most part we have been forecasting are not going to see a tremendous uptick until 2024.”
The lag time for conventions to recover, he said, is because annual gatherings rotate locations and California has had stringent COVID protocols so companies have gone elsewhere. Then there’s crime — real or perceived — about San Francisco. It hurts the North Bay because business travel often spills out. If people aren’t at Moscone Center, they aren’t spending money north of the Golden Gate Bridge.