The coming year should be a solid one overall
The following are among next year's trends, according to the forecasters.
More local and regional meetings.
Due to budget challenges, as well as compliance and travel time, planners will tend to hold more meetings within their own regions and/or facilities, according to the American Express Global Business Travel Forecast 2014.
Increased focus on SMM.
Strategic meetings management will continue to be a major objective of many organizations in the coming year, says CWT M&E, and will continue to spread beyond the U.S. and U.K. Companies should start with manageable SMM program pieces, suggests CWT's forecast, such as centralized sourcing of meeting venues, contract review and implementation of technology.
Continued supply strain.
With demand continuing to outpace supply in most parts of the world, planners can't afford to wait until the last minute to book venues. "Decide on a venue bid quickly," advises the Advito 2014 Industry Forecast, "or risk losing the space." CWT M&E suggests booking at least 45 days in advance for smaller meetings, to get the best availability and price. That lead time should increase for larger meetings, or for those with unique requirements. - M.J.S.
for meetings industry suppliers, say the experts, as the demand for venues continues to outpace the fairly limited supply growth in most areas. Cost increases for sleeping rooms, meeting space, food and beverage, and more should be moderate in most regions, according to the M&E Supplement for Carlson Wagonlit Travel's 2014 Travel Price Forecast.
Just how these generally higher costs will affect the size of meetings and events varies according to region, per forecasts from both CWT and American Express Meetings & Events.
In North America, where the cost per attendee is expected to rise by between 4 and 5.5 percent, group size is likewise predicted to go up by 1 to 1.5 percent. "We're expecting people will inch back on the scope of their events," says CWT M&E vice president Tony Wagner, "while increasing the number of attendees." Companies will look to maximize their return with more cost-efficient meetings that reach more people.
American Express Meetings & Events likewise expects the number of attendees per event to go up, though at the slightly slower pace of 0.6 percent, and the number of meetings held by each organization to go up by 1.5 percent. Particularly telling, however, is that Amex expects overall meetings spend in the region to remain completely flat. That means companies will rely more on fine-tuning their meeting strategies, notes Amex M&E vice president and general manager Issa Jouaneh, "to achieve meeting objectives, increase efficiency and control costs." That should lead to a bump in the demand for local and regional meetings, which planners dubbed a key trend in 2014, according to Amex.
Per-attendee cost increases are expected to be highest in Latin America, finds CWT, where a 4 to 7 percent hike is predicted. Amex calls for the number of meetings held in the Central and South American region to remain flat.
CWT forecasts a 3 to 5 percent increase in group size for the fast-growing Asia Pacific region, despite a 4 to 5 percent rise in the cost per attendee, per day. Yet American Express predicts that cost controls will play a more significant factor, resulting in a 2.4 percent decline in the number of attendees per meeting, a 1.2 percent drop in the number of meetings and a 3.6 percent decrease in meetings spend per organization.
Meetings budgets in much of Europe are being scaled back, notes CWT, which predicts that group size will fall by as much as 3 percent next year, despite costs remaining relatively flat (a 0 to 1 percent increase). The Amex forecast calls for drops of 1.8 percent in both number of attendees and overall spend per organization. - M.J.S.
HOTELS: GROUP DEMAND, ROOM RATES, OCCUPANCY KEEP TRENDING UP
"We continue to believe what we have been saying consistently since 2011," declares R. Mark Woodworth, president of PKF Hospitality Research, "that the year 2014 will be a great year for the U.S. lodging industry."
How great? In terms of revenue per available room, PKF-HR foresees a 5.9 percent uptick for 2013, followed by a 7.2 percent RevPAR gain next year and additional 8.1 percent growth in 2015. Compare that to the Smith Travel Research long-term annual average RevPAR increase of 2.9 percent. "If you look at the factors that historically have derailed the good times for hotel profit growth," Woodworth said in September, "very few, if any, exist today." Rates will climb…a bit.
Woodworth's consultancy is forecasting a 1.9 percent rise in occupancy for 2014, as well as an average daily rate hike of 5.2 percent. Planners should note, however, that the surge in average room rates will not necessarily have too great an effect on their negotiating leverage for 2014. The fact is, notes PKF-HR's fall 2013 forecast, that group demand has been slow to recover, and therefore negotiating leverage hasn't shifted completely in the hotels' favor.