The thriving corporate events landscape should come as no surprise. There is a robust global demand for meetings and events, and 2025 is expected to be no different.
As hybrid and remote work models remain the norm, companies prioritize in-person gatherings to reconnect teams, boost morale, and drive results. This presents a tremendous opportunity for hotels to capture a larger share of the corporate events market, particularly sales kick-offs (SKOs) happening in early 2025.
Looking ahead, there are a few key questions to consider. What will travel budgets look like? How will companies adjust their expectations? How will companies balance their objectives with the need for more in-person collaboration?
Let’s dive into industry projections.
The Economic Landscape: 2025 Corporate Travel Trends
As we move away from pandemic-spiked uncertainty, many companies are increasing their event budgets for 2025. They want to foster employee engagement, improve company culture, and strengthen client relationships.
Employees are also enthusiastic about events. A Freeman survey found that 82% of event attendees prefer meeting in person, and 75% view them as the most trustworthy source of information.
Additionally, 60% of companies have found that in-person get-togethers are the most effective for generating revenue, as opposed to hybrid and virtual events. This perspective allows companies to consider meeting costs as an investment in their overall success.
What to Expect From Corporate Budgets
During our 2024 Meeting Planner Survey, 47% of planners reported being most dissatisfied by costs. As economic conditions normalize, corporate event planners will allocate their budgets to in-person events.
Forecasts expect global business travel prices to rise moderately in 2025. Airfares, hotel rates, and car rental prices are all projected to increase slightly. Corporations will look to reenergize their price strategies, focus on the holistic picture, shift KPIs, and continuously optimize their meeting plans.
Still, planners will seek to balance cost-effectiveness with quality. Your hotel can compete by exploring creative ways to maximize their budgets while delivering exceptional experiences.
New and evolving trends in corporate budgets include:
Demonstrated ROI: Companies are already becoming more strategic in their event spending, demanding a clear return on investment (ROI). Many events must align with specific business objectives and deliver measurable results.
Increased Allocations: As the economy recovers and businesses adapt to new ways of working, there is a general trend towards increased allocations for corporate events. This is especially true for companies that value in-person interactions and team-building.
Divergent Pricing: Global economic growth will result in varied regional costs, allowing for strategic planning to offset some costs. Hotels should ensure their pricing strategies are still aligned with top accounts. However, strong ADR and relief from occupancy demands mean hotels still hold the pricing power.
2025 Meeting Cost Projections
According to CWT’s Global Business Travel Forecast, rates are expected to increase in cost-per-attendee and ADR. Take a look:
Cost Per Attendee:
- 2023: $155 per day, a 3.1% decrease from 2022.
- 2024: Projected to increase to $162 per day, a 4.5% rise.
- 2025: Expected to rise to $169 per day, an additional 4.3% increase.
Global Average Daily Room Rate (ADR):
- 2025: $165, a 1.9% increase from 2024.
- 2024: $162, a 2.5% increase from 2023.
- 2023: $158, a 3.9% increase from 2022.
Referencing these projections can help gauge the profitability of potential clients.
Notable Cost-Saving Strategies
Corporate planners will take additional steps to mitigate 2025’s price increases. Prepare to navigate shifting approaches:
Integrated Approach: Businesses now integrate meetings and transient business travel to leverage better negotiating power. Hotel sales teams are responding with comprehensive solutions–packaging business travel and meetings. This holistic approach simplifies the booking process and provides added value, making it an attractive option for companies looking to maximize their travel budgets.
Secondary Cities: In our 2024 Meeting Planner Survey, 53% of respondents said they considered moving events to secondary cities to maintain chain scale and reduce costs. If your property is in a secondary market, there is a strong opportunity to shift share from the Top 25 markets. On the other hand, hotels in primary cities should reconnect with past clients and offer pricing solutions as needed.
Zero-Based Budgeting: This approach involves breaking down trips or meetings from scratch and justifying each expense category by category. It ensures high visibility and accountability for travel expenses. Ensure your sellers can demonstrate the ROI of each additional budget item for a seamless conversion.
Investment Perspective: Corporations are leaning to brand M&E spending as an investment rather than just an expense. When we refer back to zero-based budgeting, knowing this perspective will give your hotel an advantage. Ensure your sellers have case studies or metrics available to demonstrate the value of your venue.
Current Trends in Corporate Events
Gone are the days of cookie-cutter corporate events. Today’s companies seek experiences that cater to a hybrid workforce and address key trends:
- Hybrid and Virtual Events: These are becoming more common but have significant costs for digital technology and multi-platform content.
- ESG and DEI: Environmental, Social, and Governance (ESG) factors and Diversity, Equity, and Inclusion (DEI) are increasingly important, influencing venue and supplier choices.
- Experiential Events: There is a shift towards more purposeful and experiential events, which require more investment in time, effort, and money.
Looking Back at Corporate Events in Early 2024
As we approach the new year, corporate events will be in full swing. Let’s examine why your sales team should focus on early 2025 events now.
In Q1 2024, the Hospitality Group & Business Performance Index reported that corporate industries accounted for nearly 66% of meetings and events in the Top 25 markets.
SMERF businesses held 16.5% of the market, followed by Associations at 12.7%. Government events and Weddings hovered under 3%. We saw similar trends in Q1 2023, proving the dominance of corporate events.
Additionally, Group was the top-performing revenue segment in Q1 2024. It achieved 102.3% overall health index by maintaining room nights (99.1% of last year) and increasing ADR by 3.2%.
Ready to start prospecting for early 2025 need periods? Here are some key strategies to consider:
How to Capture Your Share of Corporate Business in 2025
Now is the time to fill openings you might have for January and February as corporations across the U.S. are re-energizing their kick-off events. Get started with simple strategy enhancements:
1. Proactively Prospect
It’s commonplace to check in with clients on your S&C system, but hotel sales teams must actively solicit new accounts for measurable revenue growth. Account-based selling tools can help you hone in on the most qualified prospects.
For example, a corporate sales manager using Knowland can input need dates and property details to view accounts with high booking potential. They can gain insight into their booking behaviors and company contacts to build relationships with the planners.
2. Leverage Event Intelligence and Local Market Insights
Hotels use data analytics to examine previous event booking trends and pinpoint companies with comparable requirements. By doing so, your sales team can tailor their strategies to the targeted audience.
Market data trends reveal the corporate environment near your hotel. Team members should also track opportunities in competitive markets with a market intelligence tool. Direct your focus towards companies that favor hosting regular monthly meetings. This targeted approach has the potential to yield a consistent and reliable stream of revenue for your business.
3. Know the Events to Pursue
When targeting corporate events scheduled for Q1, hotels identify these events through key terms. Look at the account’s event history in a specific time frame to know what they could be booking again in 2025.
Types of events held in Q1
- Company kick-offs: Some companies use annual kick-offs to combine setting goals and objectives with employee-focused activities to foster connections and reinforce cultural values.
- Company Retreats: These off-site events can be used for team-building activities, breakout sessions, strategic planning, or simply to relax and recharge.
- Industry Conferences: These events bring together professionals and keynote speakers in a specific industry to network, learn about new trends, and share best practices.
- Awards Ceremonies: Companies may hold awards ceremonies to recognize top performers, outstanding achievements, or contributions to the company’s success.
- New Product Launches: Companies may use Q1 to launch new products or services, often with events that include demonstrations, product training sessions, and networking opportunities.
Why Hotels Are Perfectly Positioned to Win
By understanding the evolving corporate events landscape and playing to your strengths, hotels can capture a significant share of the 2025 market. Embrace the trend of hybrid experiences, prioritize employee well-being, and work with companies to create impactful events that drive success.
Here are some ideas to align your property with planner priorities:
- Sustainability Initiatives: Implement eco-friendly practices, such as reducing waste, using sustainable materials, and supporting local businesses.
- Hybrid-Friendly Venues: Offer flexible spaces accommodating in-person and virtual attendees, ensuring everyone feels included.
- Offer Flexible Cancellation Policies: Understand companies’ challenges and offer flexible cancellation policies.
- Technology Integration: Ensure your venue has the latest technology to support hybrid events, including high-quality audio and video conferencing equipment.
- Experiential Expertise: Help companies create unique experiences beyond traditional meetings, fostering team bonding and engagement.
At Knowland, we specialize in helping hotels identify and connect with accounts that ensure a steady stream of business. Our advanced data analytics and market insights empower hotel general managers and sales directors to target the right opportunities, optimize their strategies, and ultimately enhance revenue. Embrace the future of business travel with Knowland, and let us help you transform your 2025 strategy into a thriving source of consistent business. Contact us today to learn more.