by Bruce Harris and
Brad Weaber

• What is happening to the room supply/demand equation?
• Will hotels continue to "roll over" in negotiations as they did during the past four years?
• How will emerging technologies affect the number and size of meetings?
• What new opportunities will these technologies create for associations?

It's no secret that the hospitality industry is completing an economic metamorphosis. After a decade of losses, many hotels are once again profitable. As a result, the mid-'90s will be a rude wake-up call for associations and their meeting managers. And the magnitude of the change will be far greater than anyone anticipated.

Meeting managers must be careful not to get wrapped up in the negotiation euphoria of recent years. During the recession, planners who had business found a hotel community almost desperate to get it on the books. The word "no" was virtually forbidden from negotiations. Space and rooms always seemed available. Concessions were granted easily.

Well, you can kiss those days good-bye! You're going to hear a lot more "no's" in the future. The pendulum has been swinging back toward the seller. And with no expectation of another round of new construction, it's likely to stay that way.

Major meeting hotels report increases in overall occupancy and group business, in particular. The corporate group market is showing signs of life. With the moratorium on hotel building (except in Las Vegas, of course), peak season demand in some destinations will exceed supply. You don't need advanced math to understand that this will mean higher rates. Negotiating for concessions, especially "non-standard" ones, will become increasingly difficult.

All this comes at a time when associations are wondering how much they can count on meetings as a revenue source in the future. While the answer to that question may be industry-specific, economic downturns force the members of every association to take a hard look at how they spend their money. This was mirrored in the early '90s, not only by a drop in attendance and exhibitor participation, but also by declines in membership.

Thankfully, the future is brighter than one might expect. The trade show medium is well-established; annual meetings are not going to go away. While it will take a couple of years, exhibitors will start to build back larger booth commitments and the number of people they bring to shows.

Associations will remain the primary source of information for industries associations and professional groups. But more of that information will be shared by email. While Internet, Prodigy and America On-Line are growing geometrically, more specialized services like Space Works will become the "communication boardrooms" of associations.

How will this affect your annual meeting? Imagine if members could enjoy a video preview of convention speakers on their own personal computer. Imagine if they could then register and pay... on-line! How will this technology change the way you market meetings? And how much additional revenue will you be able to generate by charging a fee for other information, products and services made available through a network? The answer is that non-dues revenue will definitely increase and will be limited only by each association's lack of creativity or foresight.

The marvels of technology notwithstanding, nothing will replace the human interaction created when people get together at an annual meeting. The electricity, excitement and sense of power created by face-to-face networking cannot be reproduced by a computer. But technology is changing the way we communicate. Association executives must focus on how to meet the information and communication needs of members. Only then can they strategize where meetings and the needed meetings revenue fit into the equation.

First published in: Convene Magazine, September 1994