Meeting planners this year and next are facing meetings cancellations, budget cuts and sloping attendance, according to a survey of 516 planners released this month by advertising and public relations firm Ypartnership in conjunction with the Professional Convention Management Association and American Express.
According to the survey results, about 40 percent of meeting planner respondents said they plan to postpone, cancel or rebook a meeting in 2009 or 2010, largely due to the economy—with less than 10 percent "planning to postpone, cancel or rebook because of media coverage about the industry," said Ypartnership chairman and CEO Peter Yesawich said this month.
Of the respondents, 44 percent said they are planning fewer offsite meetings this year and next than they did in 2008, and about 47 percent said the number of meetings would remain flat in 2009 and 2010.
Despite ongoing concerns meeting planners shared about negative rhetoric swirling in Washington and the media in recent months, "The primary force that is impacting adversely the meetings and conventions business in America today is the current economic environment," Yesawich said. "That is clearly more so than some concerns about negative publicity in the past couple of months."
Still, Yesawich said, "The meetings that were cancelled because of the media environment and concerns about imagery and public policy issues tended to be larger meetings defined by the number of attendees. As a result, therefore, those cancellations tended to have greater financial impact on both the host hotels, resorts and destinations."
Yesawich said resorts and upper upscale and luxury properties likely will take the hardest hit from business meeting cuts and cancellations, while urban hotels and airport hotels could be the beneficiaries.
The average meeting planner respondent expects to cancel or postpone the equivalent of more than $500,000 in room revenue between now and the end of 2010, representing a net loss in total room revenue of $780 million among them.
Noting that for every dollar spent on rooms, an additional $3 goes to food, entertainment and other meeting services, the report estimates hotels and host cities will lose $2.5 billion in revenue for meetings-related services from this respondent base alone.
"This estimate is by no means an industrywide estimate, but rather an
estimate exclusive to this audience," Yesawich said, noting, "There's a substantial multiple beyond this number."
According to the survey, 56 percent of respondents expect meeting attendance to be down through 2010, compared with last year. Two-thirds are dealing with slashed meeting budgets this year, by an average of around 20 percent. "About half of those planners expect that trend to carry well into 2010," Yesawich noted.
Yesawich said that before the economy bounces back, it has to hit bottom.
"As we're all looking at the same measures and reading the same reports, probably there's a degree of optimism that has emerged in the analysis of the economy in recent weeks that perhaps we're scraping the bottom, with the light at the end of the tunnel in the next six to 12 months," Yesawich said. "As soon as the economy begins to take that turn and improve, I think the industry is going to be the beneficiary of that fairly quickly. It is unlikely, however, a lot of that positive turn will occur in 2010. It is more likely that will be 2011 and beyond."
Ypartnership surveyed American Express clients and Professional Convention Management Association members in April and May, limiting respondents to professionals with at least five years of meeting planning experience. Association meeting planners comprised 55 percent of the respondents, with the remainder made up of corporate or independent meeting professionals.
Originally published June 22, 2009