Meeting lead times plateaued in 2009 for many planners after they witnessed several years of planning cycles becoming increasingly abbreviated. Some planners and third party executives said that some lead times have shrunk to just a few weeks as planners aim for lower prices and more concessions from hotels and venues that are keen to fill space in a hurry during the economic downturn.
According to a MeetingNews survey of 201 planners, 73 percent said lead times are about the same in 2009 as they were last year, while 15 percent said they are shorter this year.
Forty-one percent of 198 planners in the survey said their lead times for meetings of less than 100 attendees are 30 to 90 days before the event date.
Global Conference Associates president Jim Fausel Jr. said projects that used to take eight to 12 months of planning now are being turned around in 30 to 90 days. Much of that tightening has come from constant budget reevaluations and the quick allocation of funds that were not available a few months ago.
"Once budgets are reviewed and the value of meetings and business is recognized by companies, we are getting the call to action," Fausel said.
Strategic meetings management consultant Kathy Rust, president of Rust & Associates, said that during her planning days at Washington Mutual, lead times for large companywide annual meetings and incentive programs typically were more than a year out. Smaller meetings tended to be about three months or less.
In some cases, planners let lead times shrink because prices can drop even lower or their uncertainty about holding the meeting due to negative perception or budgets being pulled.
One company asked travel and meetings management company HRG to plan for a meeting in Pittsburgh for 160 people on Sept. 24 just three weeks prior, said HRG North America president of events and meetings management Paul Salvatore. HRG booked a 300-person meeting in Boston for another client, but the client won't announce the meeting until a week before, in case it gets a more favorable deal or has to cancel.
"Even though we made them aware of the penalties—both on air, using nonrefundable tickets, and on the deposit at the hotel—they factored all that into their budgeting and are willing to forgo their deposit and take the penalties," Salvatore said.
While the shortening of small-meeting lead times has slowed, except for mad scrambles to close a deal, larger conference and incentive program planning cycles continue to be shaved. According to Dave Sonricker, BCD Meetings & Incentives senior vice president of MICE for the United States and Mexico, average large program lead times are 70 days less than they were in 2007, a drop of 12 percent. They now average about 17 months before the event date.
Salvatore said the window from sourcing to signing the contract is the shortest it has ever been, with many hotels delivering their best offers first. "In the past, we would have to bring up additional features and benefits, concessions on F&B, meeting room rental and other things, and they seem to be thrown on up front," he said.
Just because lead times have shortened doesn't mean there always is an uncoordinated dash to sign contracts. Some planners are "waiting to see if the optics change and see if prices come down before they commit," said Debbie Grossi, Egencia Meetings & Incentives director of North America. "They see the longer they hold off, the more desperate the hotel gets and the lower the price is going to go."
With lead times being shortened and hotels and other meeting venues eager to get business, planners can bide their time as prices for the most part continue to fall.
"Businesses know it's a soft marketplace. They don't need to negotiate rates this far out, so we can go inside of 90 days and still get good pricing," Fausel said. "Most of inventory is still there within 90 days, at least for 2009."
Originally published Sept. 21, 2009