AIG’s spending spree at a St. Regis resort last September, just days after receiving federal bailout money, continues to send aftershocks throughout the resort and luxury segments of the industry. The opening session of the virtual Resort Conference—a webinar titled “The Voice of Customers”—gave resort owners and operators a chance to hear from meeting planners (corporate, incentive, etc.) earlier this week. 

Moderator and HSMAI President and CEO Bob Gilbert called the current landscape “dismal” and talked about the media firestorm and the “collateral damage” still being felt after AIG’s junket. Some of the damage: $1 billion in U.S. company cancelled bookings in the first quarter because of outrage over AIG; 56 percent of corporate planners reported canceling at least one meeting or incentive trip; 40 percent less group business at Starwood during the first quarter; a $50 million estimated statewide loss for Hawaii. A bit of irony: The Resort Conference went online because of lack of attendance due to travel costs and cutbacks.

Nearly simultaneous to the Resort Conference was a webinar with Four Seasons founder and president Isadore Sharp, who talked about many of the same challenges in the luxury segment. “For most companies,” he said,” the perception is of frugality. It happens in all recessions, people tend to not want to be ostentatious.” Sharp, who was promoting his new book, “Four Seasons: The Story of a Business Philosophy,” said he expected a very soft year and maybe in early 2010 there would be “a little light at the end of a very long tunnel.”

At the Resort Conference webinar, Angie Pfeifer, assistant vice president, corporate meetings, travel & incentives for Canadian-based Investors Group Financial Services, spoke directly to Sharp’s point. She said a meeting and conference her company canceled was based on perception and sensitivity to clients: “Our financial planners were having a hard time saying I’m going to ‘x’ place for a meeting while talking to clients looking to cut back.”

The panel agreed resorts must focus on providing and demonstrating value to win back business. The prospects don’t necessarily look good the rest of this year. “Have we bottomed out and when will we?” asked Katie Callahan-Giobbi, executive vice president, Meeting Professionals International Foundation. “No one knows the answer. It’s a very pessimistic outlook for meeting attendance and spend over next sixth months.”

The PGA National Resort & Spa in Palm Beach Gardens, FL was scheduled to host this year’s Resort Conference, but instead will next year. Gilbert thanked the resort and nine sponsors who continued their support, which allowed for the three webinars and complimentary registration to the first 100 interested parties.