Three-quarters of respondents to the Meeting Professionals International Spring 2018 Meetings Outlook study said they thought business conditions were looking pretty good this year, with one major exception: 46.2 percent said the recent cuts to third-party commissions by several hotel chains are likely to affect their businesses. Marriott led the commission-cut charge, reducing the percentage it paid out to third parties from 10 percent to 7 percent. Hilton Worldwide followed suit, announcing in April that commissions will drop to 7 percent in the fall.
The report found that it wasn’t just third parties who expected the commission cuts to hurt their bottom line, either. This echoes a recent MeetingsNet survey, where about one in three third parties said they shared the hotel commission with their corporate and association clients, and 44 percent of organizations said they received a share from their third-party partners.
Commission cuts notwithstanding, the majority of MPI respondents said they anticipated 3.9 percent growth in their overall business bottom line over the next year, which is the highest anticipated growth rate since spring 2015. Both live and virtual meeting attendance is also expected to grow, by 2.3 and 2.7 percent respectively. This is a more robust growth rate than respondents predicted in last quarter’s Meetings Outlook survey.
This may explain why the number-one trend was growth in virtual and hybrid streaming, which respondents pegged at 33.3 percent. Also on-trend for 23.3 percent of respondents is providing more experiential activities, including more interactive and hands-on activities, and introducing more “outside the box” experiences, according to a report on the findings. Adding more apps and more local flair inside the venue also are on the upswing.
Budgets are reportedly fairly stable; however, the projected budget increase of just 1.8 percent likely won’t account for rapidly rising costs. The biggest budget bite goes to food and beverage, which on average consumes 34.4 percent of respondents’ dollars, followed by technology, housing, transportation, speakers, entertainment, and safety and security.
Download the full report at the MPI website.