As they prepare for the fourth and final quarter of 2019, meeting venues in the United States face opportunities as well as challenges, suggests a new report published last week by IACC and the Society for Hospitality and Foodservice Management.
Based on 2018 operating data collected from 69 U.S. venues, IACC's and SHFM's Trends in the Meeting Venue Industry
report is available in two versions, focusing on residential and nonresidential venues, respectively. Together, they paint a rosy picture of the meetings industry, even as the global economy continues to flirt with the idea of a coming recession.
For example, IACC and SHFM found that meetings have gotten longer at both residential and nonresidential venues. From 2017 to 2018, 44 percent of residential and 63 percent of nonresidential venues saw an increase in meeting duration. An identical number said meeting duration has stayed the same, while only 12 percent of residential and 14 percent of nonresidential venues report that meetings have gotten shorter.
"The outlook for the U.S. economy is strong, with predictions that meetings business will continue to grow, including 50 percent of those surveyed feeling conference and meeting duration will increase in the next 12 months," said IACC CEO Mark Cooper.
Other key findings:
• Among residential venues, most business comes from local/state groups (67 percent), followed by national (16 percent), regional (16 percent) and international (1 percent) groups. Among nonresidential venues, however, national groups (49 percent) dominate, followed by local/state (41 percent), regional (8 percent) and international (2 percent) groups.
• At both residential (92 percent) and nonresidential (94 percent) venues, most business is booked directly by the end client. Only 8 percent and 6 percent of bookings at residential and nonresidential venues, respectively, come from third parties.
• Breaks consumed the largest share of meeting spend for internal meetings, while A/V consumed the largest share for external meetings. For internal meetings, package rates were allocated as follows: breaks, 31 percent; conference services and planning, 22 percent; A/V, 17 percent; lunch, 24 percent; other, 4 percent; and meeting room, 2 percent. For external meetings, allocation of package rates was slightly different: A/V, 35 percent; lunch, 21 percent; conference services and planning, 19 percent; breaks, 18 percent; meeting room, 4 percent; other, 4 percent.
• Total revenue per occupied room -- $321 across all venues -- was highest for corporate groups, at $334. That was followed by university and executive groups, at $329 and $295, respectively.
• At nonresidential venues, 60 percent of university groups conducted videoconferencing. Only 15 percent of corporate and 10 percent of executive groups did so.
• Sixty percent of venues offer incentives to groups that book during low-demand periods.
• The most productive marketing techniques, ranked "highly effective" by venues, are repeat customers (100 percent), word-of-mouth referrals (88 percent), website leads (50 percent) and personal sales calls (50 percent).
"A strengthening U.S. labor market, coupled with peak occupancy levels, brings challenges for venue operators looking to hire the talent needed to grow their businesses," Mark Cooper noted. "Having access to salary data for evaluation and benchmarking was fundamental to this research."
Both versions of IACC's and SHFM's Trends in the Meeting Venue Industry report are available for purchase from IACC's website.