Peter Heath, founder, Venue Performance, advises venues to be selective and creative as trading cools.
“The market is softening. This is not a bad thing; there’s still going to be growth, but it will be a lot slower than it was in 2023, which is something to be mindful of. And that growth is going to be tempered with costs and inflation, which are likely to outpace any gains.
“With profit margins squeezed, being selective about what type of events you take and the rate you take them at is going to be the name of the game for the end of this year and for 2024. If you look at pricing, there was a 25% increase from 2022 to 2023, but there is no forecast increase from 2023 to 2024, which would imply that the operators have now passed costs on, but don’t want to push costs up any further, certainly not for forward bookings.
“Although it will be tough, there is still going to be growth, we won’t be going backwards. Even with the looming nastiness of world events, oil prices, recessions and elections, we will still see growth.
“Yes, uncertainty will be a watchword, with many organisations wondering whether they should hold events, or book later than normal, but 2024 will still be a variation on good. It won’t be as crazy as 2023 and it won’t be at the same level as 2019, but with 2019 now four years ago, it is time to stop looking back at it as a benchmark.
“Looking past 2024, I think 2025 and 2026 are going to be strong, although, as we are finding now, customers will be demanding in what they want. They will want attractive venues at a good price which can deliver on experience.
“When businesses do events these days, they don't just want a humdrum event. Ironically, the working from home trend has probably helped events, because companies want to get their workforce together more than they would have done if they were just all in the office. And they prefer off-site meetings to meeting in the office.
“When they have made that decision to hold a gathering, they want to give their staff an experience, they don't want to just shove them in a room and talk at them for three hours. They want to get them involved, they want to take them to new places, they want to show them historic buildings or buildings with meaning; properties with story and history and resonance with their brand and all of those wonderful things and THEN talk to them for three hours.
“This all means that companies are being more creative - and are likely to spend more money when they do. So as competition grows for the high-spending customer who can improve your margins, venues must be more creative too.”