At last week’s FICP (Financial and Insurance Association of Meeting Professionals) annual meeting, Mike Dominguez, president and CEO of the International Luxury Hotel Association (ALHI), analyzed the latest economic trends affecting meeting planners.
1. The growth of internal and external meetings
Training, learning and development meetings and team meetings will grow faster this year than leading sales and customer relations meetings in 2022 and 2023, according to Deloitte’s 2024 Business Travel Report.
“There’s more pressure on planners because we tend to spend less money on ourselves than we do on clients,” Dominquez said.
“When it comes to clients, leadership says, ‘Spend whatever you want,’ but when it comes to our team meetings, it’s more like, ‘It’s not that we don’t care about our teams, it’s that we need to manage ours. expenditure.'”
2. Business travel budget increases
The Deloitte survey asked respondents how their business travel budgets in 2024 compared with 2023 – only 6% said it was lower. Only 6% said it would be lower in 2025.
“That means the other people who answered the question overall want more business travel, which is a very healthy sign,” Dominguez said.
3. Meeting costs per attendee rising
The latest CWT-GBTA Global Business Travel Forecast finds that meeting costs per event attendee will increase by 4.5% in 2024, to $162 per person.
“It’s a very good metric that you can say to your stakeholders, ‘This is what the industry is doing,’ especially if you’re in an environment where you’re competing with others for the same customers,” he said.
4. Usability is a top concern
“The three questions we always ask hotels are still the same: price, dates and space. That hasn’t changed at all in 35 years. “They are still the number one driver. “
With a lack of full-service hotels being built, he now sees space as the primary issue, replacing price. “Planners say, ‘I can’t find anywhere to have meetings.’ Now that’s what’s driving up costs across the board.
5. Price is non-negotiable
Restaurant labor costs are growing faster than revenue, leaving planners with little room to negotiate prices.
“The number one cost for any restaurant is labor,” he said. “That’s why our revenue is at an all-time high, but our operating margin is declining year by year.
“I often hear planners say, ‘I can’t believe hotels won’t increase their room rates by $5’ — but $5 matters these days because margins are so thin. So instead of asking the hotel for specifics, talk to them Talk about what you want to achieve and ask them to help you get there.
6. Compression won’t ease until 2027
Dominquez said renovations at major convention centers in Dallas and Austin will only make the squeeze worse. “In an already compressed environment, we will compress further. “I won’t see the light at the end of the tunnel until 2026 or 2027. “
7. Texas is becoming the next financial center
Research from the U.S. Department of Labor shows that Texas now has more financial and insurance workers than New York. In June, TXSE Group announced plans to launch the Texas Stock Exchange in Dallas in 2025, with support from BlackRock and Citadel Securities.
“Planners in the financial services industry need to consider where attendees are coming from,” says Mike Dominguez. “There’s been huge population changes across the United States, and there’s been huge population growth in the Southeast.”
8. Food prices continue to rise
Food prices remain 18% higher than in 2019, according to McKinsey Global Economic Intelligence. Egg prices have increased by 70%. Many other products, from olive oil to coffee, are affected by growing conditions around the world.
“So when your boss asks you why you need a bigger budget, you need at least 18% more budget than you had in 2019,” Dominguez said.
