If it seems the world moves faster and faster these days, it’s only because it does. This is not some off-handed, semi-serious declaration offered as an excuse because the To-Do List has become tome-ish. It’s fact. And the pace of change is currently outpacing the human ability to adapt.
For those of us in the meetings and events industry, it’s critical to understand the tangible impact of current realities like change, speed-of-change, adaptation, discernment and, ultimately, success.
I attended an industry event early last month that featured a fascinating luncheon presentation. Michael Dominguez, Chief Sales Officer for MGM Resorts International, delivered a fast-paced, one-hour whirlwind (appropriate!) of insights that had many in the room snapping smartphone photos of his PowerPoint presentation.
I’D LIKE TO SHARE SOME OF THE HIGHLIGHTS, STARTING WITH “THE BIG PICTURE” THEN FOCUSING IT DOWN TO THE HOTEL INDUSTRY:
Change is running faster than our ability to 100% keep up – Sometime in the last several years, the trend lines of Human Adaptability and Technology crossed and, for the first time in humankind, people are, to some degree, tripping and falling like hamsters on a spinning wheel, unable to stay on top of everything. That’s because “everything” now consists of many more “things” than it used to. The key is to identify those platforms and tools we must keep pace with and not sweat the others. To try and do it all perfectly – email, text, instant messenger, cell, social media, etc., etc., etc. – will ultimately exhaust you.
– If you’re fond of being the best door-to-door salesman or VHS repair dude, don’t change. But if you’re looking to survive and thrive in this nutty-fast world, you simply must learn to do things differently. What worked yesterday is wasted time today. If you don’t believe this, when was the last time you saw advertising for Polaroid, Blockbuster, Sears, Radio Shack, Woolworth, Kodak, K-Mart, myspace or napster? As Charles Darwin — that evolutionary revolutionary – opined more than a century ago: “It is not the strongest of the species that survives, nor the most intelligent … it is the one that is most adaptable to change.”
Coping at the speed-of-life – There is good news amongst the chaos and frenzy: Authenticity is still in style and is as important as ever. Be true to your clients, customers and consumers and you will be rewarded. Meet them on their terms instead of doing what you’ve always done.
At one point during his presentation, Dominguez asked the audience what American company has led the way in recent years when it comes to evolving and remaining relevant to its base. He got the expected responses: “Apple … Amazon … Google”, etc.
Nope, “Domino’s Pizza,” he told the group. Suffice to say virtually everyone’s jaws dropped.
In stark contrast to the Polaroids and K-Marts of the world, Domino’s, Netflix and, yes, Apple, Google and mighty, mighty Amazon have succeeded in evolving and growing but it was the pizza company whose CEO came out publicly and admitted, “Our pizza sucks and we need to make it better” that led all others.
And it has paid dividends. Consider, if you’d invested $1,000 in Domino’s stock just eight years ago (when the “We suck” declaration was made) you’d be sitting on a $21,238 pile of cash today. That wouldn’t be true had their CEO not been bold enough to be authentic.
As Alvin Toffler, author of Future Shock and a rather insightful dude with a crystal ball, once said: “The illiterate of the 21st century will not be those who cannot read or write, but those who cannot learn, unlearn and relearn.” Clearly, Domino’s accomplished that.
So how does all this relate to the meetings and events industry and the hotels we research, site visit, contract with, execute meetings in, and call home for a large percentage of the year?
Boom times for rooms! – Every single significant metric used to measure hotel success – occupancy, average daily room rate, revpar (short for “Revenue Per Available Room” and calculated as Revpar = Revenue ÷ Available Rooms), occupied rooms, and room revenues – were up, up, up in the U.S. in 2016 with the trend continuing at a record pace in 2017 and, up until recently, this year, too. For the first time since 2010 – a run of 102 consecutive “plus” months – the U.S. hotel industry saw a slight 0.3% dip in revpar in September, according to STR which monitors the lodging industry. (The record of 111 consecutive months of revpar growth was established 1992-2001.) Hurricane Irma helped smash the demand record in September 2017 which made this month’s year-to-year comparison a toughie to surpass. But Dominguez said all indicators are the positive growth will continue for at least two years.
That panic button …? Yeah, no need to push it yet. The industry is alive and well with no end to bookings in sight.
Demand is outpacing supply – Every year since 2011, there’s been a call for more rooms than there are rooms available for groups. Some industry analysts believe this balance in favor of sellers has helped the industry skip a downturn which typically occurs every 8-10 years. Expect group rates to continue to be less than a bargain moving forward. And the booking cycle will include even greater lead times.
Less is apparently more these days – Put your Real Simple magazine aside for a moment and consider this: The biggest area of growth in new hotel construction is in the “Limited-Service” category which means hotels with fewer ballrooms than we traditionally have seen, or those ballrooms and other conference spaces are shrinking. Thus, if you find an attractive group rate, you might have to be creative and locate a nearby space large enough for your group’s business and social settings. (This adds ground transportation, budgetary and agenda timing challenges.) This “limited-service” movement is particularly true in the upscale and upper-midscale categories which makes sense since they’re already outpacing the industry in terms of room demand. And while there are six new hotels opening in the U.S. this year with 50,000+ square feet of meeting space, that trend is expected to turn downward in 2019.
Fewer Meetings = Larger Groups – Interestingly, during the period 2013-2015, we saw a trend begin towards fewer meetings but larger groups of attendees. There was actually a decline in group size in the >300 and 300-900 categories while meetings of 1,000 people rose.
People are suddenly more than mere units – Demographics have always been, and always will be, important but numbers-based data needs to slide over and make room for non-black & white considerations called “psychographics” which is hoity-toity-speak for what tickles peoples’ fancy. It’s no longer simply a matter of age, gender breakdown, race, geographical location, and employment status, it’s also the “grey areas” like personality, value systems, attitudes, interests and behavioral patterns. That’s why we’re seeing “lifestyle brands” popping up in the hotel industry – Stay Well, Kimpton, West Elm and Shinola to name a few. Finally, the industry has awakened to the fact that behavioral science is just as important as mathematics and percentages when it comes to targeting markets and managing your business. It seems behavioral science has actually become more important than math when assessing what the consumer needs and desires.
In Conclusion …
Just as Domino’s did, we must all step back and honestly assess how we approach what we do and how we do it. Today’s meetings and events (or Meeting and Event Planner, for that matter) are not the same as yesterday’s. Modern times and industry dynamics everywhere are shifting and being reshaped. We must keep pace or we’ll become irrelevant because, “The times, they are a’ changin’ …” (Sing it, Bob Dylan!)
TAKEAWAY MESSAGE
Today’s meetings and events (or Meeting and Event Planner, for that matter) are not the same as yesterday’s. Modern times and industry dynamics everywhere are shifting and being reshaped. We must keep pace or we’ll become irrelevant.
Cheers,
