This year, for the first time, Carlson Wagonlit
Travel Meetings & Events included pricing expectations for
meetings and events in its annual "Travel Price Forecast." The
2013 study is the first travel price forecast available within
the meetings industry.
According to the report findings, while the economies of both
the United States and Canada continue to show slow signs of
improvement, there are no expectations for major growth in the
foreseeable future. Although low economic growth will help
contain travel price increases for most categories of spend in
2013, limited new or renovated venue supply and increasing
demand for meetings and events will result in continued rate
pressures. As a result, CWT Meetings & Events forecasts
moderate growth in cost per attendee per day in 2013 in North
America.
But it's not all bad news. Meetings and events will see more
measured growth opposed to what has been experienced in 2012,
as a slight increase in new construction or renovation of
meeting-related venues is expected to force suppliers to hold
back slightly on price increases. The average cost per attendee
per day will increase by 4.3 to 5.3 percent, while
upper-upscale and luxury hotel properties may increase prices
by up to 5.5 percent or more, as the four- to five-crown
category is expected to see the largest increase in demand.
Economic recovery in meetings and events will forge ahead in
2013 as companies invest more compared to pre-recession levels.
With corporate confidence continuing to build along with
performance results, organizations are investing in more
meetings and events to drive business. As a result, average
group sizes are expected to increase 4 to 8 percent in 2013.
Booking windows have also increased by 5 percent as
organizations feel more confident about the future. Given this,
advance bookings for 2013 are already strong as of mid-2012,
which is a trend that is expected to continue throughout the
remainder of the year. Domestic bookings are particularly
strong in North America, and while international demand for
North American-based meetings is also performing well, given
the declining strength of the euro over the U.S. dollar, this
could change with the economic uncertainty throughout Europe.
Organizations have increasingly embraced strategic meetings
management (SMM) over the past year. In 2013, even more
organizations will follow suit by tackling meeting registration
and venue sourcing as the entry point to bring more event spend
under management. Next year, companies are also expected to
develop more meeting-specific policies and leverage transient
travel with meetings and events spend when negotiating with
suppliers.
Global Outlook
Per-attendee-per-day cost increases will be the highest in the
world in Latin America, at a 10- to 12-percent increase. To
offset this expected rise in cost, group sizes will likely
decrease by 5 to 9 percent and meeting durations will also
decrease. Not surprisingly, Brazil is the top market to watch
next year, as significantly higher prices will be the norm
until new hotel inventory, which is currently under
construction in anticipation of the 2014 FIFA World Cup and
2016 Summer Olympics, actually becomes available for meetings
and events use.
In Asia Pacific, meeting and event cost per attendee per day
will increase 5 to 7 percent while group size is expected to
decrease by around 4 percent, though conditions will vary
considerably by country based on the pricing power of local
hoteliers.
Finally, meeting spending throughout Europe, the Middle East,
and Africa (EMEA) will increase less than in other regions,
with flat to 2 percent increases in average cost per attendee
per day. As a result, there will be less pressure on EMEA-based
organizations to reduce group sizes in order to offset higher
prices, which will produce slight increases of about 3 percent.
Likely due to uncertain economic conditions, CWT Meetings &
Events is observing that many EMEA-based planners are
containing costs by planning meetings closer to home, with
international bookings expected to decrease.