SAN FRANCISCO — The hotel business of small meetings and groups is vastly underappreciated, particularly in the United States and Europe, according to Accor executives speaking at the company’s Global Meeting Exchange conference.
The return to pre-pandemic performance in this segment has not been quick, but trade and event planners now need to be proactive to secure the space they need in certain markets.
“It’s not equal everywhere, but we’re confident we’ve seen an increase in business travel,” said Markus Keller, Accor’s director of sales and distribution and also a member of the board of directors. ‘Hospitality Sales & Marketing Association International Europe.
Meenaz Diamond, the French hotel company’s senior vice president of global sales, said hotels need to exceed expectations to capture this emerging business.
“Participants don’t always have to go to a meeting anymore, and they can be difficult. The value proposition has to be right, and there has to be a leisure component as well” in the itinerary of any event, she said.
Diamond added that she sees a trickle of longer meetings and events in Europe, which she says is encouraging.
Emlyn Brown, global vice president of wellbeing at Accor, said health and experience drive meetings, events and business travel. He added that the industry must remember that travel is full of wonder.
“People have their eyes open. Travel must become special again. Hotels that understand this will do well,” he said.
Accor’s recent structural split of its portfolio helps clarify that message in its North American market, where it currently has around 120 hotels.
Its “power brands”, including Swissôtel and Novotel, are led by CEOs who lead traditional geographic markets such as the Americas, Europe and North Africa and the Middle East, Asia and the Pacific. Its luxury and lifestyle brands are now split into separate groups such as Fairmont; Raffles/Orient Express; Ennismore and Sofitel/MGallery/soft brand emblems.
Greater China, due to its current shutdown, stands on its own as a single market.
The move aims to better explain Accor’s offerings to investors and group, event and incentive buyers, said Patrick Mendes, Accor Group Chief Commercial Officer. He added that 61% of the company’s portfolio is now outside Europe, compared to 26% in 2013; and 33% of its luxury portfolio is now outside Europe, compared to 11% in 2013.
He said Accor was now the second largest hotel company in North America in the luxury market.
Mendes said this “deep transformation” will be officially implemented in October.
Heather McCrory, CEO of Accor for North and Central America, said she remains cautious about the rise in business travel.
“Everything in 2020 and 2021 has been moved to 2022,” she said, adding that it was encouraging to see some event activities in 2022 having to be booked further afield in order to get the dates the organizer wanted.
Mendes said caution is warranted as the recovery is driven by the average daily rate.
Jan Freitag, national director of hotel market analysis at CoStar, said the US hotel industry is now selling exactly the same number of rooms as in 2019. Demand from US groups has also returned to normal in the segment. luxury, he said.
“ADR will continue to increase and booking windows will continue to lengthen,” Freitag added.
Digital nomads and bleisure travelers are now competing for Thursday night bookings, which have typically been dominated by groups.
Jeff Doane, chief commercial officer of Accor, said group and events business in North America rebounded to 67% of 2019 levels. He said the figure is better than that in real terms, or adjusted depending on inflation.
“This improvement has really happened in the last 75% of this year,” he said, adding that it includes new business as well as postponed business.
Editor’s Note: Accor paid for all travel expenses in San Francisco, including airfare, amenities, and hotel accommodations. Complete editorial control was at the discretion of the Hotel News Now editorial team; Accor had no influence on the coverage provided.
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