Tips to Get Maximum Hotel Value in Any Market
If you’ve kept up with the meetings press over the last six months, you’ve probably come across conflicting reports about the hotel market in 2017. Carlson Wagonlit Travel’s “Meetings and Events Forecast” said meeting planners will enter a buyer’s market for the first time since 2009 as hotel supply is expected to outpace demand in the United States. The Tisch Center for Hospitality and Tourism at New York University also predicted a more favorable market for buyers as occupancy rates are expected to decrease from 2016. However, the American Express Meetings & Events’ “2017 Global Meetings and Events Forecast” said meeting planners will be challenged by limited hotel supply as new midscale and luxury hotel openings are expected to decline in 2017.
Predicting the short-term fluctuations of the hotel market is a difficult game, especially when rates vary by region, type of hotel, and other factors. But there are opportunities to find maximum value for annual meetings in any market — regardless of whether it’s considered a buyer’s or seller’s market. For board members, the key is to examine potential changes in the annual meeting that staff may recommend through the following criteria: Does it map to our strategy? Does it fit our culture? Does it make sense financially? If a change does not achieve all three, it’s really not a value. Here are some scenarios where associations obtained maximum value through creative solutions.
Scenario 1: A New Location
One association found that its Las Vegas meeting destination was attracting a primarily West Coast audience, so to broaden the meeting’s reach it considered new locations. After researching membership data, the team discovered that eight states with the highest concentration of members were within a six-hour drive of Nashville. So, the association changed the location of its 2016 event from Las Vegas to Nashville and achieved its goal of driving greater engagement, experiencing the meeting’s highest attendance since the economic downturn. It was such a hit that the association committed to return to Nashville in 2019, 2022 and 2024. By making these early commitments, the association was able to negotiate better terms.
Scenario 2: Flexibility Brings Options
The Clinical Laboratory Management Association targets annual meeting dates between February and May. Such broad parameters allow the staff to consider a range of options to find optimal dates and locations for the meeting. When boards authorize such flexibility on dates, it may, in some cases, open the door for better deals and more concessions, particularly if the association is filling a venue’s available dates.
Scenario 3: Leveraging Partnerships
Strategic relationships with partners — and other associations — may drive value for an association. For example, the boards of the American Society for Bone and Mineral Research, the American Urogynecologic Society and the National Association Medical Staff Services all agreed on a plan to hold three back-to-back-to-back events in Seattle over a period of two weeks. They each used the same convention hall, which meant they could use the same general services contractor as well as other services. Through their collective purchasing power, they obtained more concessions at significant cost savings. More importantly, however, the Seattle destination proved to be the right cultural and strategic fit for all three organizations.
Of course, what works for one association may not work for another depending on the specific circumstances of each situation. But the key for board members is to look beyond short-term market fluctuations for solutions that offer maximum value in any market.
APRIL 2017 EDITION
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