By Kevin Iwamoto: Chief Customer Officer | Head of Enterprise — GLP, GTP
Every aspect of planning meetings has been thrown into uncertainty for the better part of two years, but one thing is clear as we enter 2022: Demand is back. Nearly eight in ten companies plan some kind of business travel in the next 90 days, according to the January 2022 Travel Recovery Insights Dashboard, a monthly report compiled by the U.S. Travel Association, and hotel demand in December 2021 rose to 2019 levels — the first time we’veseen that level of recovery in the pandemic period.
The end-of-year demand surge was driven by holiday leisure travel, of course. But business travel and group travel are set to take off next. We’re already seeing it here at Bizly, where inquiry actions on our platform have increased week over week for the past four weeks. Companies that have been on the sidelines are exploring in-person events again. Hotels, meanwhile, say many rebooking from 2020 and 2021 will operate in 2022,starting around mid-February. The combination of new and rebooked events, increased traveler confidence, and pent-up demand means the compression we’ve been expecting is here. That’s good news for the recovery of meetings and business travel, but a challenge for meeting planners looking for space — especially in key meeting markets and warmweather destinations. Exacerbating the space crunch is the number of restaurants and other unique venues that closed because of the pandemic, giving planners even fewer options.
Rising RatesWith higher demand comes higher rates, but there’s more to this story, too. Hotels across the board are also facing pressure to raise rates because of higher operating costs coming from inflation and greater competition for workers. As leisure demand comes back sooner than group demand, planners will find rates rising fastest in resort areas. It’s worth noting that the recovery in group demand could remain uneven and unstable through 2022, and you might well find that venue or period where there’s a hole to fill. Cast a wide net and do it sooner not later.
As always, flexibility and creativity are planners’ friends when it comes to dates, rates, and space. How might you shift your attendee numbers or meeting location to adjust to current circumstances? One event planner I know broke apart their annual companywide summit into three regional meetings. All three were hybrid events, to accommodate those who were unwilling to travel and meet. The overall attendance and participation ended up being greater than at the typical annual conference. Another industry friend said that until further notice all of their mainstay conferences would be in a virtual or hybrid format. The organization made a major investment in a digital-on-demand content library and has found the number of people accessing the content post digital event is extremelyhigh.
Managing the Lack of LaborPlanners’ challenges don’t end when they find appropriate space. The hospitality industry continues to struggle with the fact that a lot of service and operations folks who were laid off due to the pandemic chose not to return to their former jobs. The most recent Bureau of Labor Statistics report revealed that leisure and hospitality accounts for fully one-third of all jobs lost and not yet recovered. The labor shortage adds a new layer to site searching and hotel negotiations, meaning planners should ask specific staffing questions.
For example:• Which departments (front desk, security, housekeeping, on-site restaurants, shops) have the most staffing shortages?• What specific measures have been put into place to mitigate the impact of the staffing shortage?• What is the percentage gap between fully staffed and current staffing? Anything above 30 percent should trigger concerns about service and the attendee experience.
This isn’t the first time our industry has faced supply compression and it won’t be the last. As an industry we’ve always endured and adjusted throughout the years to accommodate whatever challenges manifested and impacted the events world. This too will eventually pass and, like always, we will adjust and prevail. That’s a bet I’m willing to wager.