United States -Market Update – Q3
LEISURE TRAVEL
America West
· Entertainment Travel
o Universal Music Group
§ Now participating in the PHR Corporate Rate Chain Agreement
§ This year’s RFP asked for hotels to offer a two year deal
§ Social responsibility has become extremely important within corporate entertainment accounts in general. Updated safety and security measures are important to have established in order to win RFP.
· Southern California
o Top Domestic Leisure Destinations
§ New York City
§ Las Vegas
§ Boston
§ Washington D.C.
§ Scottsdale
§ Dallas
§ Anchorage
§ South California (Los Angeles, Ojai, Laguna Beach, La Jolla)
o Top International Leisure Destinations
§ Italy – Amalfi, Ravello, Venice, Lake Como, Milan, Florence, Rome
§ Netherlands – Amsterdam
§ United Kingdom – London
§ Ireland – Dublin
§ Spain – Madrid, Barcelona
§ Japan – Tokyo
§ France – Paris, St. Tropez
Contacts for this market are Maya Latinovic and Michelle Minassian based in Southern California.
America Central
· The Baby Boomer generation has decisive and confident travellers who are not tied to a budget. Boomers travel on average 27 days per year and are heavily focused on visiting family, so they know where they want to go and how to get there, which makes them seem more predictable than other generations. They are less likely to be tied to a budget than other generations, and when not visiting family, they fill their itinerary with museums, historical sites, arts and culture and recommendations from locals.
· Family Traveller Magazine to launch in the United States in January 2018. This magazine will appeal to a new generation of travellers who are interested in introducing their kids to the world.
Contact for this market is MaryAnn Rodriguez based in Chicago, Illinois
America Southeast
· In general leisure travel remained flat over the previous period. Main outbound destinations include Europe, especially Italy and Greece. South America, specifically Peru is also popular. Domestic travel is also up, top destinations include Las Vegas, California and Florida.
· Top Leisure Destinations
o Signature Top Destinations – Las Vegas, Ojai, Amsterdam
o Virtuoso Top Destinations – Sedona, Tremezzo, Amsterdam, Ravello, Mykonos.
o FHR Top Destinations – Las Vegas, Beverly Hills, Tremezzo
o Travel Leaders Top Destinations – New York, Madrid, Memphis
Contact for this market is Danielle Haar based in Miami, Florida
CORPORATE/BUSINESS TRAVEL
America West
· Top corporate international city destinations in Q3 from the Western United States: Mexico City, Dublin, Bengaluru and Tokyo.
· Top corporate domestic destinations in Q3 from the Western United States: San Francisco, Cedar Rapids, Santa Monica, Louisville, Reno, Madison, New York, Boston and Washington D.C.
· Qualcomm
o San Diego based company, Qualcomm, is in the process of approvals for a potential merger with NXP Semiconductors, one of the largest semiconductor companies in the European Union.
o If the deal is accepted by the European Commission, the travel manager anticipates significant growth within the travel program.
o This would create gains in key destinations that saw a decline in 2016 due to the massive layoffs the company underwent.
Contacts for this market are Emily Reynolds based in Northern California and Michelle Minassian based in Southern California
America Central
· Emerson
o The network power division of Emerson rebranded early this year as Vertiv. If a property received the Emerson RFP for 2017 but did not receive it for 2018, they should receive the Vertiv RFP if their business was coming from the Emerson network power division.
· AT&T/Time Warner
o The AT&T-Time Warner merger is expected to take place by year end.
· Abbott/Alere
o The Abbott acquisition of Alere is et to close on Oct 3, 2017. The transaction establishes Abbott as the global leader in point of care testing – the fastest growing segment of the $50 billion in vitro diagnostics market, and further strengthens the company’s diagnostics presence. The addition of this business aligns with Abbott’s long standing strategy of shaping the company for growth and complements the leadership positions it has built across its other businesses, which include medical devices, nutritionals and established pharmaceuticals. This merger will increase Abbott’s booking potential. Please see the Alere website for current locations globally.
· Aon
o Unsolicited bids will be accepted for 2018 only if US hotels have tracked 75 room nights annualized and non-US hotels have tracked 50 room nights annualized (not in one month). If a property fits this criteria and is located in close proximity to an Aon locations, please complete and submit the Corporate Survey by October 15th.
· 2018 RFP Trends
o An increasing number of companies are asking for the following inclusive requests in their RFPs
§ 2-year agreement
§ Hotels who offer same rate/amenities as previous year are automatically accepted
§ 6pm day of arrival cancellation
§ Complimentary transportation to and from local office
§ Complimentary breakfast
§ Food & Beverage discounts
§ Complimentary parking
· PHR Dynamic Corporate Chain Discount Program
o This commissionable chain discount program will be available to all iPrefer participating properties to complete and submit in Lanyon. We expect to invite many companies who require commissionable rates from hotels. Hotels must offer 10% commission and a minimum of 12% off BAR. Please note, if your property is currently participating in the PHR Corporate Rate Chain Discount Program, this is a different program.
TOP 10 DOMESTIC CITIES BOOKED OUT OF MIDWEST US TRAVEL AGENCIES / TOP 10 INTERNTIONAL CITIES BOOKED OUT OF MIDWESTUS TRAVEL AGENCIES
New York, New York / London, England, United Kingdom
Boston, Massachusetts / San Pedro Garza Garcia, Nuevo Leon, Mexico
Reno, Nevada / Singapore, Singapore
Cincinnati, OH / Hong Kong, China
Milwaukee, Wisconsin / Monterrey, Mexico
St. Paul, Minnesota / Paris, France
Des Moines, Iowa / Saltillo, Mexico
Santa Monica, California / Silao, Guanajuato, Mexico
Omaha, Nebraska / Amsterdam, Netherlands
New Orleans, Louisiana / Bogota, Colombia
Contact for this market is Laura Mori based in Chicago, Illinois
Southeast
· Main Booking Corporations from Region:
o Deloitte (Jacksonville FL) Top Cities: New York, Boston, Milwaukee, Atlanta
o Siemens (Orlando FL) Top Cities: Tarrytown, Boston, Singapore, Boston, Lima
o Chemours (Jacksonville FL) Top Cities: Wilmington and Tokyo
o Astellas (Birmingham AL) Top City: Tokyo, Santa Monica, Seoul
o WPP (Jacksonville FL) Top Cities: New York, Washington, Boston, Santa Monica
o Sanofi Aventis (Memphis TN) Top Cities: Paris, Boston, Tokyo, Anchorage
o Nissan (Memphis TN) Top Cities: Yokohama, Aguascalientes, Irvine
o FedEx (Memphis TN) Top Cities: Reno, Irvine, Memphis
o SAP (Memphis TN) Top Cities: New York, Bogota, Bengaluru, Tokyo
o HCA Healthcare (Memphis TN) Top Cities: Riverside, Richmond
· In general, bookings from the region decreased by 5%, room nights decreased by 12%, and ADR increased by 6.5% from the previous quarter. Bookings, room nights and ADR remained practically flat for the same period the previous year.
Contact for this market is Danielle Haar based in Miami, Florida
Northeast
· U.S Business Travel
o Total U.S. business travel spending was $424 billion in 2016, and is expected to remain as high or higher in 2017. For the second straight year, China topped the charts, surpassing the United States as the largest business travel market in the world.
o Business travel spending is projected to grow 6.1% in 2018, followed by about 7% growth in both 2019 and 2020 – the highest spending gains since 2011. However, the forecast remains on shaky ground as the Global Economic Policy Uncertainty Index as hit a 20-year high. Some sources of uncertainty could ultimately have a positive impact on business travel as lower corporate tax rates are pushed forward and business regulations are rolled back as infrastructure investments increases around the globe. Other factors will have a decidedly more negative impact on business travel including trade policy renegotiation, terrorism, travel and immigration bans, sanctions, electronics bans and geopolitical tensions.
o Business travel represented 3% of U.S. GDP in 2016. Trip volumes grew 1.2% in 2016 while spending dripped slightly on a per trip basis, falling 1.1%. Transient business purposes accounted for 48% of business trips, while group travel totaled 28% and 25% were a combination of business and leisure.
· Banking Travel
o Although quite a few major banks are recording better-than-expected results/profits in Q3 2017, banks are still being cautious with spending (travel) due to uncertainties in the market, financially and politically. Cost-cutting remains the number one goal for banks travel managers, who are requesting for flat rates or very minimal (less than 3%) increase for 2018.
· Consulting Firms Travel
o Firms are adhering to a minimum 200 room night threshold for RFP solicitations. Member firms within the big 4 are collaborating and creating more unified global programs.
Contacts for this market are Wen Yong and Jamie Brown based in New York City, New York