During a popular education session at the PCMA Convening Leaders, Christine “Shimo” Shimasaki, representing Destination Marketing Association International (DMAI) led a panel of industry experts, suppliers and meeting planners to discuss: Are Room Blocks Here to Stay, Or Will They Become A Thing of the Past?
The discussion was fueled by a recent study, the Event Room Demand Study, where Tourism Economics analyzed 174 events and over 880,000 zip codes of attendees and exhibitors and found, on average one out of every three rooms are being booked outside the contracted room block. For citywides, the average is closer to 45% of rooms being booked outside the contracted room block. Mandated travel policies, attendee preferences, Airbnb, pirates and poachers are just a few factors affecting room blocks and in-turn this increases the risk of attrition penalties.
Therefore, the question naturally comes up, with so many attendees and exhibitors booking rooms outside the contracted room block, will room blocks continue to exist?
About the Discussion: The panel was broken out into two groups: Those taking the position that “Room Blocks are Here to Stay” and the other, the position of “Room Blocks Will Become a Thing of the Past.” Representing the “Room Blocks are Here to Stay” team was Robin Preston with National School Boards Association and Rachel Benedick with Visit Denver. The “Room Blocks Will Become a Thing of The Past” team comprised of Lisa Astorga with International Society on Thrombosis and Haemostasis and Gregg Talley with Talley Management Group, Inc. Each team then gave their best argument for their position.
Argument: Room Blocks are Here to Stay
Right now, cities and hotels use a lot of different metrics to evaluate meeting business. For example, they are looking at total number of peak nights, overall pattern, attendance figures, and contracted room block.
If room blocks were to go away, then it becomes very difficult for a destination and hotel to determine the overall economic impact of the meeting. Additionally, without a contracted room block, there is a potential for a whole host of problems arising from other consumers of hotel rooms, namely:
- Business travelers
- Leisure travelers
- Other events in the destination
- Additional meetings in the destination
- Other destination specific demand factors
Why room blocks are important to the meeting planner: Meeting planners are responsible for an innumerable number of things to create a successful meeting; however they are mostly responsible for creating a memorable meeting experience for the attendee. By providing a contracted hotel room block, planners know they are providing the attendee experience they were promised. The hotels will have been vetted, prices negotiated, etc. Additionally, there is support available if they have any issues.
Likewise, there are strategies meeting planners utilize to offset some of their costs, namely rebates and reduced and/or free convention center space. If you don’t have contracted hotel rooms, planners won’t have help offsetting their costs.
Argument: Room Blocks Will Become a Thing of the Past
The study clearly shows that attendees no longer rely on the meeting planner to find the right hotel for them; they want to find it on their own. With the increase in popularity of online hotel searches, Airbnb, personal travel preferences, booking.coms, room pirates and mandated travel policies, the trend is only going to continue.
Why room blocks will become a thing of the past. What all of this adds up to is that the attendee is not going to change their behavior. Attendees are loyal to themselves, the programs they belong to, or are mandated to be loyal. They unfortunately are not loyal to the destination or the organization.
Additionally, those that plan international programs are probably familiar with the European model. In the European model, meeting planners are paying for the meeting space. There aren’t any concessions or hotel rebates and when attendees book, there are strict cancellation policies. Generally, they want you to pay the total night stay upfront, with a cancellation up to three months out.
Why the European Model hasn’t been adopted in the US thus far- By contrast, in the US, convention centers are typically municipally owned. They are considered to be loss leaders and utilize discounted rental to grow the meeting business. These facilities and destinations recognize the greater economic impact that occurs outside the building. This is why room blocks are such an important aspect when hotels and destinations value an event.
What these two arguments point out is that meeting planners need to take control of their room block. And that as an industry, these are all things we can try and do better so that the true impact of a meeting in a destination can be accurately measured.
What Can Planners Do? Consider Taking More Control of Their Own Room Block.
As aggravating as it may be to effectively manage the attendee experience and the organization risk related to the room block, there are several practices planners should be thinking about, including:
- Do your attendees understand why it’s important to book inside the room block?
- How are you educating those attendees who traditionally book outside your contracted room block?
- How are you accommodating the last minute bookers?
- How are you managing pirates and poachers?
- How do you make sure you stay ahead of the problems your attendee will face in securing a hotel room?
How the convention and visitors bureau (CVB) helps meeting planners. Each time the same meeting is held in a different destination, it no longer is the same meeting. The CVB sales and service professionals are the planners’ best point of contact for understanding the destination and how to best leverage the city’s assets. To get in touch with a CVB destination expert at more than 150 of the top meeting destinations, visit www.empowerMINT.com.
To continue this room block conversation, please consider joining us on May webinar, “5 Ways to To Avoid A Half Empty Room Block”. Please click on the image below to learn more and save your seat today!