During a recent meeting with a colleague in charge of travel management for a large global non-profit based in Washington DC, our conversation was interrupted by a stream of ongoing text dings, phone calls and distractions. The challenge for my friend was trying to move a number of employees around the Pacific Rim to a meeting in Fiji just as a cyclone was brewing in the region. We ambled through massive glassed-in office spaces filled with cubicles for some 500 employees on that floor. The sound? Silence. In a far corner, a lone manager peeked over the edge of a sea of partitions. This was not a forced lockdown three years ago in the midst of the pandemic. This was office life in the middle of a normal business day in May 2023.
In-person events and budgets have been on the rise this year, according to the latest Global Meetings and Events Forecast by American Express Meetings and Events. And the projections are for meetings spend this year to post an average rise of 3.1 percent globally, with the cost per attendee attending tradeshows, conferences and meetings to increase up to 3 percent as well. The report, published last October, was based on a survey of 580 meetings buyers and suppliers, and noted that some 87 percent of meetings were expected to have an in-person component in 2023.Stormy, with a Deluge of Hope
Predictions aside, the meetings climate is still stormy, according to pundits within the industry, but the forecast is clearing and the markets are expected to adjust.
“So, right now, within the travel industry in general, you've got a lot of pent-up demand that is chasing capacity. And at the same time, you've got capacity chasing resources,” says Ron DiLeo, founder and CEO of the IN THE BLACK Group, consultants in all aspects of travel management and business performance. “And the resources just aren't there. People retired or they left the business. There's a solid 20 percent gap between what the demand is calling for in terms of capacity and what capacity can actually be delivered.”
If there are trends afoot, they are erratic and unpredictable. What was de rigueur for meetings over the last three years is a fast-fading memory, according to Alisa de Gaspe Beaubien, COO of meetings and events planning platform Groupize. “Experts across the industry are saying that meetings are replacing the in-person office environment. Virtual meetings are over, and hybrid is lagging way behind in-person meetings. Meetings is the leading category for return to travel, almost every hotel chain attributes their recovery to meetings, events and groups. The CEO of Amex attributed small internal meetings to be a major source of profitability for 2023. Private equity firms are seeing corporate real estate budgets moving to travel and meetings.”
New trends are emerging with in-person meetings, de Gaspe Beaubien points out, including holding them in corporate office spaces versus hotel meeting rooms, hosting them regionally versus nationally, and combining venues for internal meetings with customer meetings. “Groupize has always been focused on multi-traveler events and we are seeing that companies are willing to invest in larger gatherings of employees and customers vs. road warrior type trips. The primary challenge buyers are experiencing is with supply – rates and availability. It’s a seller’s market,” she says.
For Groupize, as other meetings management concerns, the top challenges are:
• Staffing Issues – This is across the board from internal roles to third parties to venues, restaurants, airlines and car rentals, de Gaspe Beaubien says. This impacts the traveler experience, and more communication needs to happen to set proper expectations that travel does not feel like it did pre-COVID.
• Compression and Demand – Major cities lost lots of supply during the pandemic that has not come back online, and with more companies having more meetings, rates are high and availability is low. Pre-pandemic negotiation tactics and concessions have diminished, de Gaspe Beaubien says, “It’s a take it or leave it mentality. If a buyer doesn’t want the space, someone else will.”
• Air Costs and Availability – Ticket prices are up and lift is down, another major component impacting the total budget. “And, it’s no longer acceptable to avoid duty of care discussions for meetings and events. Companies need the visibility to ensure attendee health and safety,” she adds.
The Optimism Factor
When it comes to trends down in the weeds of meetings travel, Cvent also sees these 2023 days as interesting times. The company has been tracking the optimism factor for business travel and meetings recovery, now at 94 percent. Hybrid and remote workers are often encouraged to travel more for in-person meetings, trainings and company events to encourage relationships building and maintain a strong corporate culture.
“We are seeing that travel managers are changing their approach to sourcing to match new realities and priorities, however,” says Cvent’s senior marketing director Julie Haddix. “In fact, Cvent’s recent survey of travel managers in North America found that an overwhelming majority (97 percent) also source for meetings and events. And of that portion, over half (55 percent) stated they also plan conferences, seminars or conventions.”
Another interesting trend Haddix is seeing in these post-pandemic days is an increase in “bleisure” travel, as employees add on leisure travel days to their business trips to capitalize on their time away. This growing travel trend is now affecting how travel buyers are sourcing hotels and venues, with many looking to choose destinations that have a robust array of attractions to offer attendees.
“All this to say, the recessionary environment we’re in is certainly impacting organizational decisions when it comes to corporate travel,” Haddix says. “We’re seeing more levels of approvals required as companies look to maximize every dollar spent, while capitalizing on the powerful impact in-person meetings have on driving business.”
And keeping those costs in order is a challenge, especially in in-demand leisure markets, adds Sue Gill, global managing director, MICE, for Internova Travel Group. “Accessibility due to reduced services on air, and the availability at many venues where leisure has become a focus and room rates have increased is now a problem. We’re seeing venues becoming unavailable or at higher rates and fewer room nights offered for MICE.”On the Boiler Plate
In the face of all this, there are methods to adopt, keys to containment and policy points that should be considered as the market strives to correct itself and stabilize into a workable system. Advice is rarely in short supply for travel and meetings managers, but it comes down to these keys:
• Constant communication
• Clear policies
• Strong research
• Centralizing technology
To start, when planning a meeting or conference, it is essential to consider the audience in attendance, according to Keith McKenna, regional vice president, TripEvents Client Experience at Internet Travel Solutions (ITS). “Make sure to do your homework to gain some knowledge of possible conflicts,” McKenna advises. “Will your tentative dates fall within a peak time for the industry of your attendees? Will there be a competing meeting or conference around the same time? Knowing more about how your audience travels will help gauge the availability of who will attend. Additionally, communicating information and event dates early can positively impact your attendance. Done well, you can create a buzz about the event, driving excitement for your attendees.”
Communication, whether with attendees, stakeholders, or suppliers, can possibly be the most challenging area of this business. However, now this area is the most easily supported with an integrated technical platform that can eliminate much of the stress as conditions change.
“Communications are critical to running a successful, stress-free event, from planning to post-event evaluation,” adds Brian Tanis, VP of product and marketing at ITS. For instance, ITS, a provider of travel technology for the corporate, convention, and event and meeting sectors, offers tools to assist event managers by managing e-mail invitations for events that have not leveraged third-party registration. “If attendees fail to register, TripEvents can tackle resending invitations to prompt registration and travel booking activity. Post-booking, TripEvents sends event-branded purchase confirmation e-mails to the attendee and allows them to either resend or forward itinerary information to anyone they choose.”
In today’s travel environment, airline service disruptions are all too common, Tanis adds. “With TripEvents, any unplanned airline schedule change will be assessed and travel adjustments will not be more than 30 minutes from the original itinerary. Individuals will then be notified and able to select alternatives with the best fit.”Hidden Costs
Most of the challenges facing managers putting meetings together are a matter of knowing the policies for that meeting, the desired costs and the real expected costs, the audience, the terms of the venue and the right technology to make it all workable, says DiLeo, who adds jokingly – and not so jokingly – that meetings costs are like construction; you have to automatically add 30 percent to the projected price.
But when it comes to the deep dives managers make as they assess the things that can go wrong amid the things that seem to be going right, duty of care, compliance, regulatory concerns, sustainability requirements can all be handled through knowing the audience, the meetings stakeholders, the policy for the meeting and audience, and having the technical dexterity to keep the channels of communication active.
However, there is a dirty little secret that many planners may not know, adds DiLeo. “And that is only about 10 percent of the travel and entertainment spend for a meeting actually gets managed. Often these staff expenses show up as travel expenses, not meetings and conferences, on a company’s ledger, and is therefore managed differently. It's the other 30 percent and it is just out there in the great unwashed world. That's the part of life that companies can't get their arms around. It's just really hard. But once everyone steps back up (as staffing issues fade), that world will become a lot more recognizable – two years from now if the pundits are correct.”