Trends and research mapping out the future of small to mid-sized meetings, including the recovery and changes to attendee behaviours and needs.
IACC Meeting Room of the Future Barometer
August 2022 / iaconline.org
OFFICIAL REPORT PARTNERS
RESEARCH PARTNER DEVELOPMENT COUNSELLORS INTERNATIONAL
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Report Partners 2022 »
Introduction & Report Scope »
Industry Pace of the Recovery » Room & Group Demand RFP Activity Levels Meeting Planner Statistics » Confidence Meeting Booking Lead Times
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Report Contents
09 11 12 13 14 15 16 17
Room Rates »
Balance Between Live, Hybrid & Virtual Meetings »
Inflationary Factors »
The Event Attendee Experience »
Future Demand for External Meetings »
The Future of Digital Meetings »
The Appetite to Serve Up Sustainable Meetings »
Hospitality & The Great People Reset » Job Openings Wage Growth in the Hospitality Sector The Role of Automation in Solving Staff Shortages
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Report Conclusion »
OFFICIAL REPORT PARTNERS
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2022 Meeting Room of the Future Partners
IACC Global Project Group Neil Gardner - Division President Conference Centers & Hotels, FLIK, US Joe Santo, Group Vice President, Encore, US Alan Corlett – Chief Commercial Officer, De Vere, UK Benjamin Abittan, Experience Leader, Chateauform’, Europe Ellen Sinclair, Vice President, Benchmark, US Robyn Domber – VP Research, Development Counsellors International
Report Contributors Aran Ryan, Director, Tourism Economics.
Mariela McIlwraith, CEO, Events Industry Council Joe Santo, Group Vice President, Encore Global, US Sandy Albrecht, Director, Partner Marketing, Cvent Rik Husken, Managing Director, Kapellerput Hotel & Conference Center Simon McMahon, Operations Director, Wyboston Lakes Resort Dan Tadros, Hospitality Leader, FLIK Hospitality Group, US Susan Liston, SVP, Aramark Destinations, US
Link to Meeting Room of the Future webpage
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Introduction & Research Scope Since 2016, through the Meeting Room of the Future™ initiative, IACC has been the leader in advancing research on how meeting spaces will look and function in the future. While this research has consistently been a valuable resource that has brought together research, innovation, and trends with the single purpose of predicting, creating and shaping the future of meeting environments, this thought leadership is taking on a newfound importance in light of the global public health crisis that has disrupted the meetings industry more than any other event in modern history. The recovery of the meetings industry is now well underway wherever we look, in each of the 23 countries where there are IACC certified venues. During this recovery, it is more important than ever to uncover new insights on how those in the meetings and events industry are responding to the changing needs and expectations of meeting planners. To meet this objective, IACC is committed to conduct research and surveys with top global meetings focused hotel and venue operators and meeting professionals, to understand the pace of recovery, levels of optimism gained from the actual recovery so far and the operational hurdles such as recruitment of venue staff and the effects these are having on the recovery.
This next quarter’s barometer report, covers several key emerging topics including: • Pace of recovery • Client priorities in the new meetings landscape • Property & product investment
• Workforce development and staffing • Social & environmental responsibility
As participants in the meetings industry emerge from the pandemic, there will be new challenges but also new opportunities. Understanding this new landscape including when and how meetings will return is critical as venues look to prioritise resources to most successfully meet the needs of clients and attendees, to support the wellbeing of participants, and to foster stronger collaborative and learning environments. This report will explore some of the top-of-mind questions among venue operators and also provides a benchmark against which future activities, initiatives and behaviours can be measured.
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The Industry’s Pace of Recovery Room & Group Demand Indicators show the level of business events being held globally, such as conferences and meetings, are still very much in recovery mode but there is also reason for optimism on the industry’s return to levels experienced prior to 2020. During the IACC Americas Connect conference at the end of May, Aran Ryan, Director of Lodging Analytics Tourism Economics at Oxford Economics reported STR group demand data that places group demand 19% behind 2019 levels in March 2022. This is an improvement from a 45% deficit reported in January 2022.
Room Demand Relative to 2019 Monthly, Actual
-3.1%
0%
-19.3%
-20%
Total Demand (STR)
-24.8%
-40%
-60%
DMO Group Room Nights
-80%
Group Demand Upper-Tier Hotels (STR)
-100%
Jan Mar May Jul Sep Nov 2020
Jan Mar May Jul Sep Nov 2021
Jan Mar 2022
Adam Sacks, President of Tourism Economics reported in June that ADR in the US in May was +13%, but this is pretty flat in real terms. Susan Liston , SVP Growth, Aramark Destinations comments “We find buyer confidence has been increasing over the past 12 months but hasn’t reached 2019 spending levels in the corporate, education, and other non-affinity segments. Lead times are consistently shorter for small to mid-size meetings with more emphasis on regionality in the selection of a location or venue. With the increased price of airfare, car rental, and fuel, planners are looking to “hub” locations near their attendees to reduce both travel time and cost. Hybrid technology is especially relevant for small sessions or board meetings but we’re finding more attendees want to connect in-person and enjoy networking and the delightful food & beverage options offered at our IACC venues.
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RFP Activity Levels The Events Industry Council’s Global Business Events Barometer reported in May that over the period January to March 2022, RFP activity globally still only represented 56% of 2019 levels, suggesting there is still a long way to go before we experience RFP levels similar to 3 years ago. Western Europe has much further to recover, as the continent sees RFP levels at just 45% of 2019 levels, however IACC members in Scandinavia report a very different trajectory with many experiencing significantly stronger income this year compared to 2019.
Global Business Events Barometer 2021 Q3 (index 2019=100)
Central and Eastern Europe
Western Europe
41 79
Americas
35 45
Middle East
67 78
80 79
Asia Pacific
Africa
Latin America and the Caribbean
Global
62 34
54 51
65
55 56
Hotel group room nights
RFP activity
Source: Events Industry Council, Oxford Economics, STR, Amadeus, Cvent
More recent intelligence from Cvent compiled from April & May data confirms that the momentum remains positive with RFP’s sitting at least 80% of 2019 volumes for corresponding weeks. For the same period, the number of RFP’s for groups of 51+ rooms increased from 22% pre-covid to 26% in April and booking windows are only marginally shorter at an average of 160 days.
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Spotlight on the US Market Looking more specifically at the US market as a possible indicator of more global trends, CBRE reported in July that they continue to reduce cumulative GDP forecasts, this time by 5.3 percentage points, citing the impact of inflation among other factors creating elevated risk.
Figure 1. Since hotel forecasts were published in May, CBRE EA’s GDP outlook softened
CBRE EA’s GDP Forecasts by Release Month vs. Current Demand Growth Forecast Y-o-Y Change (%)
12
9.1%
8
5.9%
4.6%
4.5%
3.5%
3.1%
4
3%
2.1%
2%
0.2%
2022F 2023F • January • March • May • June • Demand Growth Forecast*
CBRE Hotels Research, CBRE EA *Represents CBRE’s Demand Forecast as of May 16
In February 2022, IACC member venues surveyed in the US, gave a conservative prediction that it would take until 2024 to reach 2019 revenue levels for group business. However, by late May during polling the IACC Americas members conference in Las Vegas, the widely held opinion of conference hotel operators was that 2019 levels could be beaten as soon as early 2023, a full year earlier.
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Meeting Planner Statistics Confidence Levels
In June 2022 Cvent Business Insights reported that for the very first time Meeting RFP’s for the week of 22nd May 2022 surpassed 2019 levels for the corresponding week. This is a significant moment in the recovery, with RFP’s +10%. Encore Global have been conducting planner confidence surveys each quarter for the last year and in their summer 2022 report have surveyed 750 global meeting planners and made important comparisons to their March 2022 survey.
71% of planners are booking or sourcing new in-person or hybrid events
Figure 2. % of Planners Booking or Sourcing New Events Highest Since 2020
What is your current primary focus as its pertains to in-person or hybrid events?
55%
I am booking new events
I am actively sourcing new events with RFPs
16%
I am researching potential new events, but not ready for RFP I am not currently focused on in-person or hybrid events
16%
8%
I am re-scheduling on re-booking events
5%
Encore Global Summer 2022 Planner Pulse: More planners booking or sourcing new events than at any point since 2020. Planners focused on re-scheduling or re-booking is also at its lowest.
Figure 3. RFP Volume Exceeded 2019 Levels for Last Full Week of May
% Weekly Change in Americas RFP Volume, YTD May 2022 vs. 2019
10%
-10%
-18% -19%
-19% -21%
-20%
-21%
-22%-21%
-24%
-27%-27%
-28%-28%
-33%-32%
-35%
-37%
-42%
-50%
Wk of Jan 2
Wk of May 22
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Cvent reported that from meeting planners surveyed in June, over 70% of group buyers anticipated in person levels in 2022 to at least be the same or surpass 2019 levels. Only 29.4% predicted a decline against 2019.
Figure 4. Most Planners Expect In-Person Meetings at 2019+ Levels
How will the number in-person meetings you expect your organization to hold in 2022 compare to the number of in-person meetings held in 2019? (n=661) • Increase • Stay the Same • Decrease
29.4%
39.5%
31.1%
Source: Cvent 2022 Planner Sourcing Report: North America Edition
Meeting Booking Lead Times Lead times for groups are also falling into line with average lead times seen in 2019, with just over half of RFP’s being for the next 3 months and then longer term lead times beyond 6 months being at a similar level to 2019 booking patterns. Lead Times for Small to Medium Meetings Appear to Be Improving In Encore’s research planners indicate that lead times seem to be improving (extending), to a point where 43% of meetings up to 50 participants are booked 1-2 months prior and 27% 3-6 months prior.
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Room Rates Cvent also reported in June that room rates were on average 14% higher than in January 2021, following a long-term trajectory of increasing rates.
Figure 5. Demand Drives Room Rates Higher
Weighted Average ADR by Week Across Hotel Proposals in CSN, Jan 2021–May 2022 vs. 2019
Source: Cvent Supplier Network
79% of planners expect increases in rates from venues.
Figure 6. Event Planners Expect Higher Costs
For a meeting of the same size/complexity, how do you expect the costs in 2022 to compare with the costs in 2019? (n=661)
35.3%
40
26.9%
30
17.1%
15.9%
20
4.8%
Increase > 20% Increase 11–20% Increase 1–10% Stay the Same
Decrease
Source: Cvent 2022 Planner Sourcing Report: North America Edition
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But in the same survey, planners expected increased rates to correlate to increased services; especially in the areas such as offering creative and flexible meeting spaces, diverse food choices and spaces suitable for streaming.
Figure 7. It’s Not Just Inflation: Planners Expect More from Hotels & Venues
Which of the following event services and features do you expect hotels/ venues to offer? (Top 5 Responses) (n=602)
Creative use of meeting spaces within hotel/venue
55.3%
Diverse food choices
54.2%
Event space designed for streaming
41.7%
Intimate, flexible event spaces
40.4%
Outdoor space
36.9%
Source: Cvent 2022 Planner Sourcing Report: North America Edition
Venues Adopting Airline Pricing Strategy UK based IACC venues shared their approach to pricing for longer lead bookings, where like airlines, they reward early bookings with the lowest rates. For shorter lead bookings, pricing is more dynamic and there is evidence of venue rates increasing 8-10% and sometimes more to address increased costs.
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Balance Between Live, Hybrid & Virtual Meetings
Asked specifically about the future mix between in-person, hybrid and virtual events, Encore’s research shows a greater prediction for in person events in the 2nd half of 2022, compared to the Spring surveying of buyers.
80% of H2 2022 events expected to have an in-person audience
Figure 8. In-Person Events Expected to Increase for H2 2022 and Beyond
For the upcoming calendar quarters, what delivery format do you expect your events to take?
Q3 2022
22% 22%
56%
19%
Q4 2022
22%
59%
18%
Q1 2023
22%
59%
• Virtual • Hybrid • In-Person
Encore Global Summer 2022 Planner Pulse: More in-person events expected in H2 2022 than in Spring results 4 out of 5 events expected to have an in-person audience with 1 out of 5 being hybrid.
One IACC venue in the UK when interviewed for this report, cited a move away from offering full hybrid venue support beyond providing the AV and AV support, due to unmanageable levels of pre-conference client meetings to discuss all aspects of streaming related to the event. It was not viable to support in areas such as event production. Dan Tadros , Hospitality Leader for FLIK Hospitality Group highlights “Digital meetings will continue to grow for us as an account. Year on year we’re projecting to exceed last year’s virtual support in addition to a large in crease in on-site events”.
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Inflationary Factors Consumer prices ramped up to a 40-year high pretty much in every one of the 23 countries IACC have members in, with energy topping 30% year on year and food prices +10%. Analysts predict May to be a high point in the US, with a gradual descent in CPI inflation to around 6% by the end of 2022. Other countries are likely to experience similar levels. IACC member venues around the globe continue to report challenges with managing fast changing cost of goods, services and utilities. Dynamic pricing is being widely adopted in the short to medium term and as events begin to increase lead times, longer lead time bookings can be a double-edged sword, as pricing challenges negate to some extent the assurances that come from a fuller long term event diary for venues. Not surprisingly, Encore’s Planner Pulse reports budgets have been increased in areas such as guest rooms and food and beverage and technology. Careful menu planning and clever approaches to inclusive menus is paying dividends for venues when it is carefully thought out and executed. One example being to replace two separate dishes for vegan and vegetarian, with dishes that use the same base staple suitable for both, with variations to garnishes and secondary ingredients, thus reducing the labour involved.
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The Event Attendee Experience Meeting professionals expectations related to the richness of the meetings experience for attendees is a popular place for creative venue leaders to focus their attention, as meeting the needs of the buyer and attendees from an event experience and satisfaction perspective can be the single most important difference between venues. From Spring to the latest Encore Summer 2022 Meeting Pulse report, already high levels of expectation around more networking and stronger attendee engagement indicate that venues which have more offerings around these areas, will be considered more highly by buyers over the coming months. Team development, group social activities and attractive settings for networking style meals are just some examples that IACC venues might develop further.
Better engagement and more networking & personali s ation will be more prominent
Figure 9. Future In-Person Events Will Aim to Enhance Participant Experience
How will future in-person events compare to pre-pandemic in-person events? (Select all that apply)
Better Attendee Engagement
29%
45%
25%
More Networking
38%
Larger Remote Audiences Smaller In-Person personali s ation More Advanced Content Delivery More Attendee Personali s ation
25%
37%
36%
35%
22%
28%
28%
27%
• Spring ‘22 • Summer ‘22
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Future Demand for External Meetings The IACC global external meetings demand study conducted by a student research group from the Hotel Management School Maastricht (see the full report here), interviewed 77 leading c-suite leaders of national and global organisations who are directly involved in their strategic people development. One survey element, linked to the effects of de-centralising workplace environments as it relates to demand for external meeting venues, looked at changes to the number of daily, weekly, monthly and yearly external meetings under 50 attendees. The report found that post pandemic there has been a sizable increase in weekly and monthly meetings and a corresponding decrease in daily meetings. It might be assumed that this has the potential to increase demand for external meeting spaces due to decentralisation and reductions in office space held by major organisations.
Figure 10. Attendance at In-Person Meetings
80
67
60
36
40
33
33
27
25
20
12
11
9
7
7
5
5
4
1
Before the Pandemic During the Pandemic • Never • Daily • Weekly • Monthly • Yearly
After Pandemic
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The Future of Digital Meetings The IACC global external meetings demand study conducted by a student research group from the Hotel Management School Maastricht also asked respondents about their appetite to include virtual access to live meetings and conferences. Surprisingly, very few predicted a future for live meetings without a virtual component. Mark Cooper , IACC CEO commented “I believe we should be mindful of how far technology for hybrid meetings has progressed. Although there may be short term high demand to attend live, the longer-term picture may see more digitally charged live meetings taking place. Especially if the cost to travel and attend the meetings remains high. Hybrid Ready Meeting Rooms at IACC Venues IACC approved conference venues, particularly non-marketed corporate venues continue to stage many hybrid meetings. Venues with their IT and AV partners to develop increasingly effective digital ready meeting rooms.
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The Appetite to Serve Up Sustainable Meetings
The April 2022 Meeting Room of the Future Barometer reported that 87% of venues are not receiving more requests today than in the past for the measurement of the carbon footprint to run their meeting at a IACC member venue. This was a global percentage.
During IACC Americas Connect, Mariela McIlwraith , Chief Sustainability Officer for the EIC Centre for Sustainability and Social Impact and SVP Industry Advancement for the Events Industry Council noted that very often questions about sustainability and social impact practices are not included in RFP because event organisers are expecting to see this information automatically included in proposals. Moreover, the requests for sustainability reporting are coming later in the planning process, including after the event taken place. As more organisations work towards drawing down their carbon emissions, we should, as an industry, expect to see the requests for carbon measurement to increase. The Events Industry Council’s Sustainable Event Professional Certificate and the EIC Sustainable Event Standards offer guidance and education regarding how to improve our sector’s environmental and social impact. For more information, visit eventscouncil.org/sustainability IACC Venues Seeing Greater Demand for Electric Vehicle Charging Points Some IACC venues report a noticeable increase in demand for car charging at the venue for attendees. Rik Husken , owner of IACC venue Kapellerput Hotel and Conference Centre nr Eindhoven has 10 charging bays and they are often all in use. The growth in EV’s has been significant over the last 3 years, so this demand is not surprising.
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Hospitality & The Great People Reset Alongside consumer confidence and inflation, sits the self-leveller people; or rather lack of them to serve returning business event attendees. The recruitment problem for IACC venue leaders is a global one. When asked “do you anticipate staffing challenges in the future?”; Hendrik Karsten , owner of Karstens Training Venues in Australia and New Zealand commented “Absolutely, there is a smaller pool of trained and experienced staff available, especially in sales and operations management, with hardly any overseas students and back packers in the country. Government is looking into speeding up visa applications. In addition, the entry level operations positions are also hard to fill. Currently MacDonald’s is offering floor staff a $1,000 sign up bonus, the recruitment market is extremely tough! Aran Ryan of Oxford Economics spoke at IACC’s Americas Connect event in late May, sharing the stark reality that in March 2022, 1 in 10 accommodation and food service positions were unfilled. However the same measurement in June, saw a reduction to 1 in 9 job openings rate for Leisure and Hospitality.
Job Openings Rate Share of Job Openings As a Percent of Total Available Jobs
14%
12%
10%
Leisure & Hospitality
8.9%
8%
7%
6%
4%
Total
2%
0%
2016
2017
2018
2019
2020 2021
2022
Source: BLS
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Adam Sacks of Oxford Economics also highlights the concerning data that reports ‘job quit rates’ remaining elevated for the leisure and hospitality sector.
Jobs in food and beverage remain challenging to fill, as are sales and conference planning roles, with some salaries increasing 30%.
Ellen Sinclair , Senior Vice President of Benchmark, a Global Hospitality Company highlights “We have seen the significant impact on attracting and retaining new staff members, particularly those new to the hospitality industry, through providing educational opportunities both through our company and by partnering with colleges/universities to earn degree credits. IACC plays an important role here, through the training and events they run and their mentoring programme. Expanding personal skills to advance staff careers make hospitality so much more than a transitional job. It can be a personally and financially satisfying career, creating staff longevity while continuing the advance through the hotel/conference center company ranks”.
IACC members can post their job vacancies cost free on the IACC Job Opportunities page.
The Role of Automation in Solving Staffing Shortages Automation in the hospitality industry can be viewed by some as the enemy of hospitable customer service. However, there are others who manage venues who feel differently. Sean Anderson , Vice President of Operations for Sodexo Conferencing has formed the opinion that to attempt to get back to the staffing levels of 2019, is likely an unrealistic goal. Sean comments “You may need a strong stomach, but this recovery is unprecedented and exciting. Small to mid-midsized meetings momentum is strong and the best and brightest operators are reinventing the guest experience; aggressively targeting rock star talent for newly created roles and introducing automation in creative ways to support improved levels of service”. Instead citing good examples of automation in hospitality where it does not detract from the customer service experience, he encourages IACC members to seek efficiencies in areas that will reduce reliance on humans to carry out process heavy and low contact roles, such as check in and food ordering.
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An IACC member in Wyboston Lakes Resort in the UK has attempted to employ robotics to facilitate the movement of food and beverage back of house. Simon McMahon , General Manager at Wyboston Lakes highlights barriers to automation “There are very good systems in operation for factory environments, but when we explored their adoption for a hospitality environment, manufacturersare unwilling to invest in developing their products for our industry as they have in others.” Sky Hotels, South Africa is one example where technology and robotic combine to offer a more streamlined guest experience. The hotel app not only accesses your room, but also manages room service and spa bookings and the hotel has three AI powered and autonomous worker robots handle guest enquiries.
Micah, the autonomous hotel worker robot at Sky Hotels Santon Hotel, South Africa. Micah can tow luggage up to 300kg and handle room service items up to 70kg.
https://www.youtube.com/watch?v=L4IF4PW_u0M
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Wage Growth in the Hospitality Sector IACC members globally report the reality of increasing salary rates, improving benefits and offering flexible working contracts more than in the past, to compete directly with other sectors such as retail.
Figure 11. Wage Growth by Industry
% Change Relative to May 2019, Industries Ranked by Hourly Wages
Utilities
Information
Financial Activities
Wholesale Trade Construction Mining & Lodging Professional & Business Services Education & Health Services
Total Private +14.7%
Manufacturing
Other Services Transportation & Warehousing
Retail Trade Leisure & Hospitality
0% 5% 10% 15% 20% 25%
IACC members in 2022 reference approaches to talent attraction which includes bonus payments triggered when monthly service milestones are reached or increased hourly rates for staff working longer hours. There are also examples of IACC members offering levels of flexibility where staff work exactly the days and hours they choose. In addition, IACC members in Sweden are looking at traditional job titles and currently specific to a task and changing them to be more attractive while also accommodating the need for flexibility. We may see less ‘Restaurant Supervisors’ and more roles such as ‘Head of Smile Creation’!
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In Conclusion Many respected economists predict a mild recession by the end of 2023. The challenges of managing supply chain disruptions, wild pricing swings and job vacancies experienced today, may well shift to the more predictable, yet still damaging effects a recession has on business events and business travel. IACC members around the globe will have one eye on delivering services and repairing financial wounds in 2022, and the other on watching for first signs of a slowing economy on their buyers’ booking meetings. IACC will support it’s members and community over the next year, by providing important personal and professional development opportunities as conference and meeting venues repair the skills and knowledge shortfall that exists today and maintains a position of offering the top 1% meetings experiences for attendees that IACC venues are renouned for.
Information on how to become a IACC certified meeting venue can be found at IACConline.org/become-a-member
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