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Eventful News: What Does Economic Uncertainty Mean for Sourcing?

This week, the big focus is on hotels. With a possible economic decline looming, some hotels are already beginning to feel the impact — and that impact also has an effect on sourcing. Three of this week’s five stories focus on that impact, potential shifts for planners working with venues, and some of the factors other than economic uncertainty that have shifted the way planners interact with these partners.

Stay up to date with this week’s five biggest stories.

1. Could Piling on Brands Become a Problem for Hotels? (New York Times)

TLDR

Driven by a younger target demographic and the need to diversify to meet modern expectations around personalization, new hotel chains have been popping up rapidly over the past decade. In fact, the hotel analytics firm STR reports that there are about 180 chains with more than five properties in the United States. However, as the market begins to show signs of fatigue amidst concerns over the near future of the global economy, this bullish pursuit of new brands may spell problems.

The hotel industry historically has been very cyclical…It’s not a matter of if, it’s a matter of when the downturn will happen.” -Flo Lugli, Principal of Navesink Advisory Group

What does it mean for planners?

If hotels do in fact have to fight for a shrinking share of both group and transient business, it could bode well in terms of group rates. Planners may be able to use the economic climate as leverage in negotiations, with hotels unwilling or unable to turn away group business.

What’s next?

Does economic turmoil mean that we’ll see brands disappear off the map? Most likely no. Since most hotels are built, financed, and managed as franchises, most of the burden is felt at the individual property level. Of these franchises, those that serve a very narrow niche are likely at the most risk. Meanwhile, those that cast a wide net are better equipped to ride out the stormy waters of a sinking economy. However, if franchise owners choose to band together and take legal action against brands, there is always the prospect of brand disintegration.

Further Reading: Negotiating Hotel Contracts: 20 Tips for Win-Win Events

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2. Is the Group Bookings Slowdown Already Here? (Skift)


TLDR

Many industry experts, including Cvent, have forecast a decline in group bookings heading into 2020. However, initial bookings data from the first half of 2019 shows that the decline may be here early. Industry giants Hilton, Hyatt, and IHG all experience a slowdown in group bookings, in part due to the economic impact of trade tensions with China — tensions which have thrown the global economy as a whole into a state of disarray.

“More people are putting their caution flags up. Talking to other CEOs, talking to friends — anybody you talk to — will tell you that what’s going on in the political world, which is connected to the trade world, is definitely having some impact.” Hilton CEO Christopher Nassetta in an earnings call in July

What does it mean for planners?

When group bookings are down for hotels, it means less meetings and events are in the pipeline. For planners, especially corporate planners and agencies who depend on external clients for business, this could spell some trouble. However, for planners sourcing venues, there may be more room to negotiate favorable rates with venues as they continue to feel the downturn.

What’s next? 

With the global economic outlook being one of uncertainty and many economic experts predicting a possible recession, corporations are already working to reel in budgets and cut costs. Even with a steadfast commitment from brands to event marketing in recent years, planners need to prepare for the inevitable backlash of an unfavorable economic climate.

Further Reading: Cvent Group Business Outlook | Q2 2019

3. 5 Unusual Techniques to Build Trust (Inc.)

TLDR

Chances are, you’ve experienced some level of conflict as a planner — whether it be in working with clients, team members, or superiors. You’re not alone: A recent study by CPP Global reports that 85% of employees at all levels have experienced conflict in the workplace. For planners, trust is especially important, both in building the bonds that help teams gel as well as establishing credibility with clients. In this article, consultant Tanya Prive lays out five techniques that can help resolve conflict and build trust.

Imagine an unwalked path. The more you walk down the same path, the more forged the path becomes. Eventually that path becomes a proper trail that leads to a specific place. Your thoughts are building roadmaps in your brain, which forms your perception of reality and guides what you think you can do and, ultimately, can’t do.” -Tanya Prive, Partner at Legacy Transformational Consulting 

What does it mean for planners?

  1. Watch what you say – When you speak, the words you use actually build neural pathways in your brain. So if you’re using positive and empowering language, you’ll build the same types of neural connections.
  2. Speak slowly, confidently, briefly, and calmly – Confidence in your voice is a large determinate of how much people trust you. Plus, the average human brain can only hold onto information blocks of 30-40 seconds.
  3. Don’t forget to smile – Research shows that the most trustworthy body language consists of gentle eyes and a gentle smile.
  4. Keep it real – Listen and be authentic as opposed to exaggerating positivity. Being overly positive is actually perceived as a negative. 
  5. Realize everyone is a mirror – Humans have mirror neurons which means they perceive and mirror the emotions of others. So when someone is being angry, staying calm can actually help calm them down too. 

What’s next?

Trying to embody all of these techniques at once can actually backfire. After all, you can only focus on so much! Instead work towards mastering one technique at a time. Soon enough, you’ll be so good at that technique you don’t have to give it the additional brain power. That frees your mind up to focus on the next. Eventually, you’ll have all five down pat. 

Further Reading: 45 Event Planning Questions for Clients

19 Trends Shacking Up Events in 2019

4. Beyond Hotel Meeting Space: The Changing Marketplace (Business Travel News)

TLDR

In the days of old, the meeting venue marketplace was simple and somewhat homogenous: Traditional hotel venues saturated the market and corporate planners booked accordingly. However, in the past decade especially, a slew of new venues have begun to encroach on hotel business — from the Convenes of the world to non-traditional venues that were once not even considered. 

In this interview, Business Travel News interviews well-known meetings consultant, Betsy Bondurant, and Estee Lauder Executive Director of Global Travel Design, Jami Stapelmann, about why the face of the industry has changed. The consensus? It’s a mixed bag driven in part by generational change, more meeting variety, and an increase in nonprofessional planners who may prefer the simplified sourcing of alternative venues. 

Some companies are recognizing that ad hoc and smaller meetings are a significant part of their meeting spend, and they are trying to put in mechanisms to capture that data without having to bring that volume under centralized control. So I don’t know if recognizing that type of meeting is what is growing the business at these alternative venues, but it’s not hurting them.” -Betsy Bondurant, Founder of Bondurant Consulting

What does it mean for planners?

With more diversity in the types of venues available for meetings, has come the opportunity for planners to take a more selective approach. Smaller, one-off meetings have more opportunities to right-size their meeting spaces, avoid jumping through additional sourcing hoops, and receive attention they may not have at hotels looking to land bigger business. Plus, some of these smaller, more purpose-driven venues are able to offer technology suites that are more advanced than those of traditional hotels. 

What’s next?

At the end of the day, hotels are still gobbling up the lion’s share of group business. However, the prospect of losing out on business to more nimble, modern competitors puts new pressure on hotels to innovate and advance their offerings. Ultimately, planners will win out as hotels continue to ramp up investments in the elements where they may see potential lag compared to more tech-forward competitors. 

5. Why 6 Hours of Sleep May Be as Bad as None at All (Fast Company)

TLDR

We all know that sleep is one of the most important factors when it comes to our health. Still, the realities of being an event planner often mean that we just don’t get the full eight hours we need. Well, according to a new study by the scientific journal Sleep, getting only six hours of sleep over a period of ten days or more can be just as detrimental to cognition as going two full days without any sleep. 

Figuring out how to get enough sleep, consistently, is a tough nut to crack. The same advice experts have batted around for decades is probably a good place to start: Have a consistent bedtime; don’t look at electronic screens at least 30 minutes before bed; limit alcohol intake (alcohol makes many people sleepy, but it can also decrease the quality and duration of sleep); and get enough exercise.” -Jill Duffy, Fast Company

What does it mean for planners?

It’s not always easy getting enough sleep, but it’s important to realize the impact it has on our brains. Perhaps the most alarming piece of the study was that the group who was limited to only six hours of sleep a night didn’t rate their sleep as being bad. That means for planners who are getting less than adequate sleep leading up to a big event, they could be taking a toll on their functionality without actually even registering the impact. 

What’s next?

The moral of the story? Whatever you can do to increase your time asleep, do it! For some, that could mean eliminating that hour of chill time in front of the TV at the end of the night. For others, it could mean finding corners to cut in morning routines to allow for a little bit of extra time to sleep in. No matter what, it’s by no means easy, but it will pay off in big dividends when you’re bringing your best self to planning. 


Further Reading: 7 Stress-Busting Tips to Prevent Event Management Burnout

Published August 29, 2019

Come back to our blog next Thursday for another roundup of the most important event news of the week! And, find last week’s event planning news about micro hotels here.

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