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Too many event registrants are booking outside hotel blocks — an issue discussed during three PCMA roundtable conversations over the past year.
When only two out of five of your registrants book their housing within the designated room block, you know you’re trying to work with a flawed industry model. And this stat is not isolated to a particular event, it’s an industry-wide average that has steadily declined from higher levels in the past, and now shows signs of dropping from 40 percent to only 30 percent booking in the block.
This low room-block pickup negatively impacts revenues for all parties involved.
Historically, a guaranteed room block has enabled event organizers to have greater negotiating power for meeting space and other concessions, but the risk of attrition has made this model no longer viable for many. There remains, however, plenty of compelling reasons why organizers and hotels need to have a handle on housing.
Since the pandemic, the problem of fewer registrants booking within in the contracted room block has become more acute. Among them: rate sensitivity — in May 2024, the average daily rate for a hotel room in the U.S. was $158, the second-highest ever; and the trend of attendees waiting until the last minute to register for the event and then book their housing is a lingering aftereffect of the pandemic.
The question of how to address this broken events industry model brought together the same group of representatives from hotel brands and housing services providers, including onPeak, for three PCMA Housing Experience Roundtables, held in May, June, and August this year.
Here are highlights from those conversations:
Contributing Factors to Low Room-Block Utilization
Late booking decisions — Participants identified attendees’ late booking decisions — often past the cut-off date for room blocks — as a key challenge contributing to only 40 percent booking in the block. The group agreed that this behavior seems to have been exacerbated by the uncertainties surrounding the pandemic, with people delaying the decision to attend until the last minute. One participant cited a recent citywide event in which half of the participants registered within three weeks of the conference. This last-minute uptick in registration makes it challenging for planners and hotels to accurately forecast and for hotels to manage inventory.
Efforts to encourage early bookings through discounts, points, or other incentives, according to the group, have had limited success — and sometimes backfired by leading to more cancellations.
Rate sensitivity — Higher room rates were cited as a factor contributing to later bookings and reduced block utilization, especially for exhibitors booking multiple rooms. In addition, the availability of lower rates outside contracted room blooks — particularly in cities with high hotel inventory and especially during periods of lower compression — makes it difficult to incentivize attendees to book within the block.
Corporate travel policies — The true addressable opportunity could be smaller than it may seem, it was suggested, as a significant portion of attendees are bound by corporate travel policies that require them to book through specific channels or to negotiate rates.
A poor user experience — Registrants’ experience in booking housing is often described as cumbersome and lacking in transparency. Registrants are frustrated by the inability to see their reservations in loyalty program apps (see below), they are confused by confirmation numbers, and experience difficulties when booking on shoulder or peak nights, leading many to forgo the process altogether, finding it more convenient to book on their own.
Loyalty program integration — Attendees are influenced in their booking decisions by their loyalty to hotel brands and their desire to earn and redeem points in loyalty programs they belong to. This leads them to book directly with hotels, even if the rates are slightly higher than the contracted room-block rates because they can’t seamlessly integrate loyalty programs into the housing process. And when registrants do go through the process of booking in the block through housing companies using their loyalty program info, there is often a delay in points being reflected in their accounts.
Booking a hotel is often the first interaction participants have with an event, setting the tone for their overall experience. As an industry, we need to continue to evaluate and react to the challenges of today’s landscape and work to improve the hotel booking process to boost participant satisfaction and increase room block utilization.”
Housing Ecosystem Issues
Beyond the challenges it presents for attendees and exhibitors, the current room-block booking environment is problematic for organizers, housing providers, and hotels.
Inefficient and Manual Processes — There is a lack of standardized connectivity between housing platforms and hotel systems, leading to inefficiencies and limiting the ability to offer later cutoff dates. The current housing ecosystem is made up of multiple intermediaries and manual processes that create inefficiencies and friction. Such tasks as comparing, cross-checking, and auditing rooming lists are time-consuming and prone to errors, leading to delays in commission payments and discrepancies.
While technological integration could streamline these processes, aligning diverse hotel systems and policies seems like an insurmountable challenge. There was discussion on the need for a recommended policy around criteria for booked rooms identified in the post-event audit being credited to the room block.
Data Security and Risk — The manual nature of data transfer and involvement of multiple parties in the housing ecosystem raise concerns about data security and the potential risk of data breaches or non-compliance with Payment Card Industry (PCI) Data Security Standard — a set of requirements that ensure businesses that process, store, or transmit credit card information maintain a secure environment.
Other Organizational Priorities and Policies — While staying in the block is important to event organizers, their overall attendance and exhibitor numbers often are higher priorities. As a result, organizers are reluctant to implement strict housing policies or roadblocks that could discourage attendance, even if it means sacrificing room-block fulfillment. “Stay to play” policies have limited appeal. Some events, like HIMSS, successfully require exhibitors to book within the room block in order to participate, but this approach is not feasible for most events. Planners express concerns about losing exhibitors and alienating attendees.
Multiple cutoff dates — Having multiple room list due dates was identified as an inefficient and potentially unnecessary practice given improved visibility into pickup rates.
Better data — Hotel representatives expressed a desire for more granular historical data on room-block performance, broken down by brand and location rather than overall event totals.
Is Tech the Answer?
There was consensus among participants that technological advancements could hold the solution to many of the challenges with room-block utilization. Suggestions included developing a comprehensive platform that streamlines processes, enhances transparency, and provides registrants with the same seamless user experience they have when making purchases and reservations online as consumers.
There are a few impediments to tech solutions, however, voiced by roundtable participants. First, there would need to be greater trust between hotels and housing providers to enable later cutoff dates and more flexible inventory management. A point was also made about regulatory and competitive restraints — concerns about antitrust regulations and maintaining competitive advantages limit some forms of industry-wide collaboration. In addition, different housing providers and hotel brands have varying levels of technological capabilities and resources to invest in new solutions.
The group briefly touched on how AI developments might be key to — or negatively impact — data security in the future. Time will tell. But with the rapid adoption and acceleration of AI, we may not have to wait long.
Michelle Russell is editor in chief of Convene.
How the Roundtables Work
The PCMA Housing Experience Roundtables explored the participant process of booking housing for business events. The group of 10 participants, who represented hotel brands and housing companies, was tasked with identifying pain points and inefficiencies in the housing booking process; brainstorming and proposing strategies to enhance the overall participant experience; and collaborating on the development of guidelines or frameworks to address industry needs. Meredith Rollins, PCMA chief community officer and PCMA Foundation executive director, served as staff liaison for the roundtables.
On the Web
In 2019, Hilton Worldwide, NYC & Company (now New York City Tourism + Conventions), and the PCMA Foundation partnered on a room block study. See what has — and hasn’t — changed since then. Read Making Sense of Room-Block Decisions.