As the calendar pages turn, we bid farewell to 2023, a year that saw our steady stride back to normalcy within the hospitality sector. But as we look to 2024, we’re not just walking; we’re poised to leap into an era marked by the potential for unparalleled growth. The once turbulent waters of the hospitality industry have calmed, and now it’s time for hotel brands to chart a course for uncharted territories of opportunity.
The spotlight shines on the group sales and meetings sector, which is anticipated to accelerate in the coming year. In the world of hospitality, group business isn’t just a segment; it’s a cornerstone of revenue potential for any hotel that effectively harnesses its power. Bearing this in mind, we’ve distilled the quintessential hotel group sales trends and statistics for 2024 you’ll want to embed in your strategic playbook.
Group Sales and Meetings: A Surge in Demand
The narrative of recovery has evolved into one of resurgence. Reports suggest a robust recovery for group and business travel segments, with group sales in the hotel industry projected to reach $190 billion by 2024. Group room nights are projected to scale new heights in the first half of 2024. The global business travel sector is on track to recover and flourish, with forecasts indicating a significant uptick of 14% over the previous year. The US and China are pegged to be at the forefront of this growth, with each expected to see leaps of approximately 30%.
Industry insights reveal that group demand is on a trajectory not only to match but potentially exceed pre-pandemic levels, thanks to a projected year-over-year increase in group rates.
Investment in Experiences Grows
The event landscape is changing, with spending on live events seeing a notable boost. Corporates and planners are pivoting their budgets towards live events, a testament to the rejuvenated value placed on in-person experiences over virtual formats, with around 80% citing that face-to-face meetings are essential for building strong relationships.
Corporate meetings and events account for approximately 70% of the overall meetings and events market, while the average size of a corporate meeting is expected to be around 100 attendees in 2024. The average length of a meeting is projected to be 2.5 days.
An Era of Automation
The increased volume of RFPs, coupled with the ongoing labor shortage, highlights the critical role of automation and technology in the competition for group business. Emerging technologies geared towards streamlining and automating group sales are taking center stage. Hotel sales teams recognize that time saved from administrative tasks can be channeled into more strategic and revenue-generating activities. A study by the Cornell Center for Hospitality Research found that In 2020, 65% of hoteliers reported using a sales and catering system for group sales. With the consistent increase in the volume of RFPs, coupled with the ongoing labor shortage, this trend is expected to continue, with more hotels adopting event management technology by 2024. The utilization of technology correlates with higher proposal win rates and manageable stress levels among sales teams.
Hotels also leverage virtual tools to showcase their event spaces to potential clients. According to a report by Cvent, 58% of event planners find virtual site visits and 3D event plans to be extremely or very valuable in the decision-making process. This indicates that hotels are recognizing the importance of providing immersive and interactive experiences in proposals to attract group bookings – and a trend that won’t be going away anytime soon.
Cost Management Under The Microscope
With the cost per attendee predicted to rise again, the impact is evident across various expense categories. However, planners are looking to optimize their budgets without diluting the attendee experience, focusing on cutting costs in selective areas such as the number of nights and off-site activities. In 2024, the top three factors influencing venue selection are location, cost, and flexibility.
The CWT/GBTA forecast says the ADR for group hotel bookings will rise from $297 in 2022 to $321 in 2024, with food and beverage costs seeing a similar jump.
Hotel sales teams are also feeling the pinch with the rise of inflation, energy costs, food prices, supply chain challenges, and, of course, labor issues. Many hospitality companies are already paying workers well beyond minimum wage to attract and retain workers—the average hourly wage of all employees in the leisure and hospitality field is $20.10 per hour, according to the Bureau of Labor Statistics. To keep costs in check in 2024, hoteliers will continue to invest in technology to optimize processes, workflows, employee productivity, and inventory.
Flexibility and Responsiveness Matter
Adaptability and responsiveness have become increasingly impactful on hotel sales teams because short-term booking windows have become the new norm; the group market segment is NOT returning to long lead times.
According to recent surveys, the primary considerations for venue selection in 2024 are how well the venue’s offerings align with the changing objectives of programs (49%), the venue’s flexibility to accommodate adjustments (47%), and the speed with which venues can reply to communications (46%). Furthermore, past experiences with a hotel or destination sway only 34% of planners, hinting at a growing openness to exploring new venues that align with their current needs. The choice influenced by the popularity of a destination or hotel stands at 33%, underscoring a shift towards venues that can fulfill specific event requirements over those with a strong reputation.
With shorter booking windows, guests may have less time to research and compare options. By offering personalized recommendations, prompt responses to inquiries, and seamless check-in experiences, hotels can differentiate themselves and build loyalty among guests who value convenience and efficiency.
Sustainability & Wellness at the Forefront
Sustainable travel is more than a trend; it’s a movement. There is a noticeable shift in the preferences and expectations of event planners and attendees. Today, sustainability and wellness have become key factors in choosing event venues. In 2024, sustainability will be a top priority for 90% of event planners, with eco-friendly practices and venues being preferred. Additionally, 85% of attendees expect hotels to have wellness offerings, such as fitness facilities and healthy food options. Hoteliers must adapt to these changing preferences to attract and retain group bookings and event business.
As trends evolve, adaptability remains the cornerstone for maximizing group sales revenue in 2024 and beyond. With a significant demand for meetings and events and the support of automation technologies, hotels are presented with an unparalleled opportunity for growth. Adopting an advanced, easy-to-use, cloud-based sales and catering platform like STS Cloud enables hotels to scale efficiently, ensuring an experience that resonates with today’s clients and paves the way for tomorrow’s success.