Cvent Research Points to Lasting Group Booking Slowdown

Even as demand for experiences rise, pressure is mounting on the meetings and events sector in an era of consolidation and increased costs.

The latest Group Business Outlook report from Cvent shows a decline in future group booking on the company’s platform, as bookings for the coming year continue to drag when compared to the last few years. Cvent’s data pulls from the 255,000 venues in its supplier network in North America, and it doesn’t bode well for the health of the meetings sector amid high costs and increased consolidation.

Every quarter from now until the second quarter of 2021 is in negative territory, signaling a potential multiyear downturn in group booking pace. While most of the lag is minor, around a percentage point or two, advance data for the first quarter of 2021 shows a 3.4 percent year-over-year downtick in bookings.

“The data continues to suggest that we’re going to see a decline in group occupancy over the next couple of years,” said Jeffrey Emenecker, Cvent’s senior director of analytics. “Growing group business isn’t going to be easy as demand is pretty flat, and supply is increasing. We have seen time and time again that the winning strategy in an uncertain or declining market is for hoteliers to optimize their group mix for the changing environment and focus on highlighting their unique points of difference in their sales efforts.”

Request for proposal activity growth slowed too, from 17.3 percent in the fourth quarter of 2018 to 9.8 percent in the first quarter of 2019.

Groups are getting bigger, as evinced by a 4.4 percent uptick in block size year-over-year, while average peak room nights and average booking window also increased. Event duration decreased, though, by 2.8 percent to 3.3 days.

Cvent suggested that a huge boost in bookings at the end of last year was the result of planners trying to lock in commissions at major hotel chains before they were slashed to begin the new year.

“We saw a drop in RFP activity through the Cvent network this quarter,” said Emenecker. “We attributed Q4’s significant increase in activity to one-time factors including pending commission policy changes that were set to go into effect this year. Based on this prediction, we were already anticipating a weaker start to 2019, so the reduction in activity does not come as a surprise, and we expect it to even back out in the coming months.”

Check out the full report below.

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