It’s a seller’s market for hotels in the group business – the strongest in more than a decade. While new hotel construction in North America is experiencing a healthy jump, the focus is on limited service and boutique offerings without a meetings product, leaving supply stagnant at a time when purse strings are loosening on meeting budgets across all regions. In fact, demand is now growing at up to four times the rate of supply, according to Carlson Wagonlit Travel’s 2016 Meetings and Events Forecast, which reports that hotels are finding themselves in a position to raise group room rates by as much as 4.3%.
A few related stats from American Express Global Business Travel:
- Globally, the number of new hotel openings in 2016 will decline, with the most substantial drop occurring in Europe – 404 hotels compared to 587 last year. North and Central America, meanwhile, will see a significant jump, with 732 new properties slated for 2016.
- As larger locations continue to experience limited supply, meeting planners are turning their attention to mid-tier properties in smaller cities.
- North America will see a 1.9% rise in spending on 2016 meetings compared to last year’s 0.3%. Europe and Asia’s 2015 declines should reverse this year, with projected increases of 1.8% and 2.1% respectively. Per-attendee spending is also expected to increase.
What will all those new meetings look like? A recent Travel Market Report article points to the following trends:
- More VR technology. Not only are virtual reality headsets increasingly showing up at trade show booths as a way to engage attendees and demonstrate products, but they are also giving planners the ability to conduct site inspections remotely, reducing travel expenses.
- Attendee-centered content. Personalized experiences are as important in the meetings market as they are on the transient side, and planners are responding with on-the-spot adjustments to everything from programming to meeting room configuration based on real-time feedback.
- More experiential F&B: The personalization trend continues with interactive meal options, from build-your-own sandwiches and desserts to noodle bars.
As Rainmaker gears up for ROC in New Orleans next month, I’d love to chat more about the state of the meetings market and how it’s impacting your revenue management strategies. I look forward to seeing you there!