Cvent’s most recent group business outlook report reveals a softening market based on fourth-quarter data from 2019. Both duration and event size decreased slightly, a trend that is expected to continue through 2020 when coronavirus will surely have an impact as well.
The latest Cvent data, however, did not come as a surprise as the general market has been either flat or slightly down for the last 18 months. Last year’s fourth-quarter data, and the general trend of tepid demand for group bookings, is a reflection of a plateau in overall business investment. Event duration, peak size, and the size of group room blocks all decreased and were the lowest they have been since the launch of the group business outlook in 2018.
This may be an additional sign of flat results in 2020 and tepid growth in 2021. As sustained growth levels off and the market experiences moderated growth, there is a need to be more competitive. “Hoteliers are being more aggressive about putting reservations on the books so they have a base of business to count on for upcoming quarters,” Jeffrey Emenecker, senior director of analytics at Cvent said. In other times, they might feel more comfortable holding inventory in the booking window, but they’re now trying to book groups much earlier.
As more hotels shift to Instant Book solutions, however, Cvent continues to experience increased request for proposal (RFP) volume. Unique meetings/RFPs in Q4 2019 saw a 9 percent jump year-over-year.
Potential Impact of Coronavirus and 2020 Elections
Group bookings data in 2020 is expected to remain flat or slightly down, but there are other factors that create uncertainty.
“While current projections aren’t alarming, global incidents like the coronavirus have the potential to amplify the slow down and create an increasingly competitive market dynamic,” said Emenecker. It’s too soon to predict the full impact of coronavirus, but venues on the West Coast would most likely to be affected because of inbound visits from Asia.
“(Next year) is looking slightly better, and it will be interesting to see how the primaries start to play out and what candidate rhetoric may impact how businesses are feeling about investment,” Emenecker said. These factors are expected to become more relevant in the fall of 2020.
Check out the full report below.