Budgets + Revenue

Got Shrinking Room Blocks?

Although the percentage of room pick-up has remained steady over the last decade, the numbers have dwindled while attendance has grown. Is it time to think differently?

First a look at the numbers, taken from a decade’s worth of  data gathered in Convene‘s Meetings Market Survey: The average room pickup in 2007 was 6,009 —  in 2016 it was 3,449. Over the years, the percentage of rooms picked up by organizations has remained steady in the mid-80 percent range. Meanwhile, the average number of attendees in 2007 was 4,400, while in 2016 it was 5,201. 

In other words, there are more attendees now but fewer rooms picked up compared to 10 years ago.  It’s clear that attendee-booking behavior has changed and event organizers are hedging their bets by lowering the size of the block. 

But that can lead to problems, according to industry experts. “The industry still continues to focus on the room block and the room-block pick-up as the primary measure to value the event, even in light of general agreement that many attendees book outside the room block,” DMAI’s Christine “Shimo” Shimasaki, CDME, CMP, wrote in The Event Room Demand Study, produced by Tourism Economics in July 2015.

The fact that DMOs and hotels continue to use the historical room-block pick-up as one of the most important factors in valuing an event has consequences, Shimaski noted in the report: “If an event has a high percentage of attendees booking outside the room block, then that event may be undervalued, the meeting planner may find difficulty securing first-option space several years in advance, and hotels may not be prepared for the actual impact of the event.”

Funded by five industry associations, the study was undertaken to quantify the degree to which attendees and exhibitors book hotel rooms outside of the organizer’s contracted room block. 

Among its key findings:

  • On average, one out of every three rooms is booked outside the room block.
  • The larger the event, the higher the share of rooms booked outside the block (but only up to a point).
  • The larger the facility, the higher the share of rooms booked outside the block. 
  • Convention-center events had more rooms booked outside the block vs. events contained in single hotels.
  • Trade shows had more rooms booked outside the block vs. meetings.
  • Shorter events had a higher share of rooms booked outside the block.

Proper evaluation of an event needs to include rooms being booked outside of the contracted room block, the study concluded, putting DMOs in a unique position to reinforce this point to event organizers, hoteliers, convention facilities, and local politicians. Read the full study on room blocks from DMAI.

Michelle Russell

Michelle Russell is editor in chief of Convene.