Meetings Outlook: Redefining the Meeting Experience
By Bruce Fears, President, ARAMARK Harrison Lodging
This year is going to be one of the most exciting times in the meetings and conference industries to date. With all the changes taking place, it can also be daunting if you're not on top of the competitive arena. The following article outlines some of the most significant trends and opportunities in the industry as projected by myself and my team at ARAMARK Harrison Lodging, a leading provider of professional services to 50 conference and corporate training centers, specialty hotels, national and state parks, resorts and other tourist destinations throughout the United States.
The meetings and conference industry will continue to expand
Over the past few years, we've seen significant sustainable growth in the meetings and conference industries. A recent study conducted by PhoCusWright, and partially funded by ARAMARK Harrison Lodging, reported that the group and meetings revenues will develop into a $175-billion industry by 2008 - up from $164.1 billion in 2007. While much of the expansion is associated with a rebounding economy, it can also be attributed to a number of other factors.
Overall, we are seeing bookings stretching out from two to four months in advance instead of one or two months; that is always a sign that the economy and meetings market is getting better. Additionally, a survey conducted by the Wall Street Journal querying 60 economists forecasted that the U.S. economy is poised for rebound this year - offering another optimistic outlook for 2007.
The leisure meetings industry represents the best potential for revenue growth
We are predicting that the social/leisure group travel business will represent the most significant market opportunities in the meetings industry this year. The PhoCusWright study backs this up by reporting that this segment, representing a $47.2 billion market in 2006, is projected to reach $51.3 billion by 2008.
In order to capture this business, conference centers and hotels need to be both strategic and creative in how they market to this segment to bring in and tap this growing revenue stream.
Competition is going to be as fierce as ever
While the hotel business is still strong, the market is going to cool down from 2006, and hotels are going to look to the meeting business to keep profits on the rise.
Online bookings are also going to draw from revenues that traditionally would have gone to conference centers and hotels, more so than ever before. These online third-party entities are trying to become a one-stop shopping center for meeting planners. Suppliers will need to simplify and streamline business processes as well as leverage online bookings and the Internet, or else risk revenue loss to competitors and/or new entrants.
Conference centers will also need to incorporate these online entities into their sales repertoire to stay on top of the market. Forefront leaders like AHL may even decide to take a "hybrid approach" and work with online booking agents and/or companies to garner additional revenue, yet keep their existing client database satisfied with quality customer service.
The good news is that more and more meeting planners are choosing venues that offer one point of contact that caters to their individual needs. They are selecting conference facilities that are modern and include scrumptious dining, excellent customer service, and nearby attractions to make their experience more enjoyable and productive-and they can easily find these amenities by interacting with dedicated sales staff.
Pure conference centers like AHL will also need to continue to be creative and take a holistic approach to stay competitive, exceed individual customer needs and keep clients. They will need to offer customized packages and excellent customer service in order to keep and grow business.
Business travel and meeting expenses will continue to rise
The American Express Global Business Travel Forecast recently reported that the cost of business travel will increase across the board in 2007 as a result of continuing demand without a proportionate increase in supply.
The report also found that the average domestic North America trip inclusive of air fare, car rental, and hotel stay is expected to increase by 4.5 percent in 2007, while the cost of an average international trip with its air fare and hotel stay will increase by 4.6 percent.
Additionally, the report found that the United States and Asia will be the top destinations for European meetings in 2007. Not only will this increase the competition but the old standby of supply and demand predicts that this is also going to fuel rising costs of meetings.
Meeting budgets will increase as a result
High passenger traffic, lack of hotel room availability and expensive room rates continue to drive meeting costs and budgets higher.
Additionally, training is in demand, especially with Asian companies hiring more and more individuals from the U.S. and the proliferation of Generation X and Y into the workforce. And, with a larger number of baby boomers set to retire; and a younger generation moving into the management ranks, has led to the need for more meetings in the form of succession planning as well as new employee training.
The current landscape has procured opportunity for conference centers to expand their client base and target audiences.
Technology will lead the charge this year
Furthermore, technology is going to continue to be an important factor in the meetings industry in 2007. Traditionally, companies have not yet seen a reason to support technology initiatives, but I see that changing this year.
Conference centers will now need to not only offer state-of-the-art meeting technologies for their clients, but will need to stay on top of new technology as it becomes available. The AHL-managed Babson Executive Conference Center, for example, is one such center that offers advanced technology including simultaneous translation services and video conferencing abilities.
New, technologically-savvy market entrants will give attention to upgrading technology in order to educate the consumer and promote online bookings. In order to remain competitive, conference centers are going to have to centralize inventory and rates and incorporate them into other systems to enhance offerings while also optimizing resources.
While the conference center industry is predicting a high growth yield, it is important for companies seeking conference center facilities to understand the amenities offered. We recommend that meeting planners utilize International Association of Conference Centers' (IACC) Certified Centers. IACC, a not-for-profit, facilities-based organization whose mission is to assist members in providing the most productive meeting facilities around the world, utilizes a certification program for member conference centers and mandates that its active members comply with the 30 stringent standards of the universal criteria. Certainly, IACC recognizes the role venue plays in enhancing the learning process.
"IACC member facilities represent the highest-quality venues on a global basis," says Tom Bolman, IACC Executive Vice President. "The whole objective of our 30 universal standards is to provide the most productive environments for adult learning."
IACC-certified conference centers are required to include amenities such as ergonomically designed chairs, tables that are non-reflective and allow at least 30 inches of space per occupant, a controllable level of lighting, and a dedicated conference planner. IACC certified conference centers are required to have dedicated conference rooms that are separated from living and leisure areas and are available to clients on a 24-hour basis for storage of materials.
As President, ARAMARK Harrison Lodging, Bruce Fears is responsible for operations at over 50 conference centers, corporate training centers and specialty hotels in educational environments, as well as 14 state parks and other resort operations. He assumed his current position following the integration of ARAMARK’s conference center, corporate training business with its parks and resorts business. Mr. Fears received a BA from Bridgewater College and participated in programs at University of London’s School of Economics and University of Florida’s School of Management. Mr. Fears can be contacted at 425-957-9708 or email@example.com Extended Bio...
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