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Meeting Planner Voices Concern Over Demand Return


David M. Brudney, ISHC, October, 2010

More on this return of meeting demand . . . Readers have responded to my recent articles where I’ve been writing about the return of demand, group bookings are up and the window for bookings is getting longer.

HotelNewsNow.com’s Patrick Mayock’s recent series about group recovery served as additional validation, pointing out the improvement in group demand in 2010: 5 million more roomnights sold in March than February “with promising monthly upward bumps through June and strong numbers throughout the summer, according to Smith Travel Research.”

Mayock’s survey of major hotel companies confirmed a strong improvement in weekday demand and a considerable jump in year-to-date bookings “driven by a return of corporate meetings.”

Bob Gilbert, CEO of Hospitality Sales & Marketing Association International, restated a quote of his from summer: “Looking ahead, bookings for corporate meetings are up 5.2% for the first two quarters of 2011.”  Gilbert articulated then what other industry observers believe intuitively, “Meetings have to happen.  It was just a matter of time.”

A strong voice of caution, however, came in a response from a highly regarded, well-respected meetings industry icon.       

Expressing real concern and a warning to all hoteliers who may be “licking their chops” in anticipation of a banner year in 2011 was meeting planning guru Joan Eisenstodt, moderator of Meetings Focus Forum (www.meetingsfocusforum.com) and principal of Eisenstodt Associates, LLC, Washington, D.C.

Eisenstodt, who has influenced thousands of meeting planners through her extensive teaching, mentoring and speaking, contends that unemployment numbers might remain high well into 2011.  That alone will impact corporate meeting bookings in particular.

She envisions more cancellations in 2011 - - and those meetings that remain booked to suffer lower attendance and room block attrition.

More so with association conventions and meetings, a recessionary trend might continue with attendees more likely to bypass the host hotel in favor of those “around the block” that offer lower room rates, according to Eisenstodt - - a former moderator of MiForum, which boasts 1,800 meeting planner participants.

Another concern voiced by Eisenstodt - - perhaps more relevant to large conventions booked at municipal convention centers - - is that cash-poor cities are cutting back and even eliminating critical-for-attendee-event public services.  Will new tax increases cover necessary municipal emergency services?

Nationwide, nearly nine in 10 municipalities are in worse shape than in 2009 and about 79% of cities are cutting personnel, according to a survey by the National League of Cities reported in the Los Angeles Times.

Going forward, hotel sales professionals would be wise to take note of Eisenstodt’s warnings.  I recommend:

  • Become mindful of the residual effect on group bookings from a more prolonged recovery and high unemployment.
  • Be prepared to address those concerns even when and if meeting planners choose not to do so. 
  • Be prepared for any likelihood that group bookings made now might be subject to cancellations or, at the least, room-block attrition, more so with the association and professional society groups.
  • Rate transparency: Monitor pricing for rooms within your neighborhood over dates of groups booked in the future, and develop appropriate strategy to protect your room blocks.
  • Do your homework to get up to date on any and all municipal cutbacks on emergency and standard services so that you can be better informed, speak more intelligently, and stay on top of all issues facing meeting planners today.
A positive note to add to the discussion . . . The airline industry appears to be back in the black for the first time since 2007 and “demand for air travel, both business and leisure, began to bounce back in the last few months.  Planes are full,” reports the Los Angeles Times.  The nation’s airplanes flew on average 87% full in July, the highest level in a decade, according to the Bureau of Transportation Statistics.

“In September, the total miles flown by passengers on U.S. carriers was up 7% and passenger revenue up 19% compared with the same period last year,” the Times said.

Robert Herbst, an independent airline analyst cited in the newspaper’s report, added “The single biggest factor in the industry’s improved financial picture is that demand has increased but capacity has remained flat.  They are basically selling every seat”.

This airline industry news bodes well for all hoteliers with hopes for a strong return in demand.

I will be addressing the collaborative relationships between planner and hotel in my articles to follow.  Meanwhile, your feedback will be particularly welcome. David@DavidBrudney.com

© Copyright 2010



 
David M. Brudney, ISHC, is a veteran hospitality sales and marketing professional concluding his fourth decade of service to the hospitality industry.  Brudney advises lodging owners, lenders, asset managers and operators on hotel sales and marketing “best practices” and conducts reviews of hospitality (as well as other industry) sales and marketing operations throughout the U.S. and overseas.  The principal of David Brudney & Associates of Carlsbad, CA, a sales and marketing consulting firm specializing in the hospitality industry since 1979, Brudney is a frequent lecturer, instructor and speaker.  He is a charter member of International Society of Hospitality Consultants.  Previously, Brudney held hospitality sales and marketing positions with Hyatt, Westin and Marriott.
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Contact: 

David M. Brudney, ISHC, Principal 
David Brudney & Associates 
Carlsbad, CA 
760-476-0830 Fax 760-476-0860 
(c) 760-994-9266
David@DavidBrudney.com
www.DavidBrudney.com

www.ishc.com
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Also See: Value of Face-to-Face Meetings Resonates Even More Today / David Brudney / September 2010
Expect Hotels to Pare Back on Perks in 2011 While Implementing Modest Increases in Room Rates / David Brudney / September 2010
Good News for Meetings-Driven Resorts: Site Inspections and Bigger Group Bookings are Back! / David Brudney / August 2010
Kimpton Is Bullish on Fourth Quarter 2010 / David M. Brudney / June 2010
Landmark Decision by Arbitration Panel on Aviara Resort / David M. Brudney / April 2010
Group Business Comeback in the Cards / David M. Brudney / March 2010
Applying Five Tenets of Hotel Sales and Marketing in These Tough Times / David M. Brudney / January 2010
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