How to Optimize Your Hotel Sales Strategy for More Group Business

100+ months of continuous RevPAR growth has the hotel industry riding an unprecedented high. Meanwhile, group demand continues to grow as we round into the year ahead and, to cap it all off, the supply pipeline is expected to slow. So what does it all mean for hotels looking to grow group business?

The short version: Group demand is there.

The long version: It’s actually a more complex picture when you dive into the details.

For properties and chains looking to develop a cohesive hotel sales strategy for groups and meetings, the long version is key to capitalizing on group demand, booking more meeting space, and bringing in more revenue from each booking. In this post, we’ll dive into the nuances of the segment, laying out important areas of focus for hotels hoping to grow group sales.

Step 1: Understand the larger hotel industry trends driving group performance.

Meetings are getting bigger — 22.7% bigger, according to the AMEX Global Meetings Forecast. Since 2009, attendee growth has resulted in every four meeting attendees being joined by a fifth. Meetings themselves, however, have seen somewhat stagnant growth (only 5.4%) over the same period. Meanwhile, 4% of all meetings requiring over 500 room nights contribute 39% of of the entirety of hotel industry group revenue.

The point? The lead pool isn’t growing and the big fish are few. For larger chains especially, it means a more competitive climate that complicates group sales. Today, landing meetings requires a more innovative approach to hotel sales and marketing. Taking those meetings and turning them into repeat business, however, is all about building mutually beneficial relationships with planners.

A great sales strategy incorporates both.

High commissions and group acquisition costs are taking a toll on chains.

Today, when technology, room block processing, intermediary fees, and other similar expenses are factored in, large hotels are shelling out 15-25% of guest-paid revenue to acquire new business. By 2022, this number could be 20-30%.

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