Excerpt from CoStar
Thursday Nights Shaping Up as Battleground Between Leisure and Group
Group business is beginning to pick up slowly, but capturing wallets and loyalty from this potentially profitable sector comes with a few extra challenges.
The consensus among hoteliers is that the conditions around group demand pre-pandemic are not the same today.
Speaking at the Accor Global Meeting Exchange, Markus Keller, Accor's chief sales and distribution officer, said during the pandemic it was easy to forget hotel industry trends were still developing and changing.
“It was time when [Accor] could be more fundamental. Not everything was at pace. We took opportunity to look at ourselves and focused on authenticity,” he said.
Scot Hornick, partner, travel and leisure, at business advisory Oliver Wyman, said for business travelers, loyalty is becoming more important.
Hoteliers needed to “ensure authentic delivery of experiences to earn loyalty,” he said, and group agendas and itineraries need to have a leisure component.
“Our research reveals strikingly similar need patterns for business and group leisure travel. The need for fun stands out,” Hornick said.
But it's still challenging for groups and meeting planners. Jayson Hodgkinson, director at Venue Choice — a Leek, England-based site-selection company — said the biggest challenge his clients face is availability.
“There is nothing being confirmed verbally. It takes weeks for replies, by which time the event could have already ended. Some events are for 4,000 people or more. It’s a lack of staff,” he said. “Rates will increase, but do not expect service to get better, and we’re taking the flak for that."
Building rapport has been critical in procuring contracts, Keller said.
“People work with people they like,” Keller said.
Jan Freitag, national director of hospitality analytics at CoStar, said group business is coming back faster to North America than it is to other world regions, especially in higher-priced segments. Around the globe, luxury hotel occupancy is 58% in the Americas, 48% in Europe and 40% in Asia-Pacific, with average daily rate at $376 in the Americas, $422 in Europe and $231 in Asia-Pacific.
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