By most accounts the meetings industry is in good shape. Could it be better? Sure. Could it be worse? Absolutely. Each sector of the industry experiences things in slightly different ways, but our insider experts agree that 2019 has been a good year — and 2020 could be even better.

THE MEASURE OF SUCCESS

Success can be measured in multiple ways. One interesting takeaway from the 2019 Incentive Travel Industry Index, a joint project of SITE, the Incentive Research Foundation and Financial & Insurance Conference Professionals (FICP), is that ‘soft-power objectives’ such as engagement, relationship building, authenticity, reputation and the importance of human touch are significantly more important than financial stability and value.

Some of our experts pointed to inclusion as one such measure. Fred Dixon, president and CEO of NYC & Company, offered a destination perspective, noting that delegates with disabilities are being better served, and inclusion of the LGBTQ community in the meeting and event space has increased.

Hotelier Ulrich Samietz, general manager of Grand Hyatt Baha Mar, lists creative differentiation, embracing change and building bridges as success. “From my point of view, this has always been the most captivating element of the travel industry — bringing people and cultures of the world together to celebrate stepping outside of everyday routines.”

But ‘hard’ variables matter, too, including financial success. Richard Harper, an executive vice president at HelmsBriscoe, paints a positive picture in that regard. “The overall meetings economy continues to be robust, which is fueling significant economic output and job growth in the sector.”

Tech is at the forefront of success as well. Annette Gregg, CMM, MBA, senior vice president, Experience, at MPI, thinks more innovative event tech has been a plus for the industry.

“From my point of view, this has always been the most captivating element of the travel industry — bringing people and cultures of the world together to celebrate stepping outside of everyday routines.”
Ulrich Samietz

Hotelier Axel Gasser, vice president and general manager at SLS Baha Mar, sees success in, “utilizing technology, particularly apps, to provide additional convenience to guests who spend a lot of time on their mobile phones. This includes the ability to check-in using an app and controlling the television from your phone instead of using the hotel remote.” He also thinks increased use of social media is a success. “For us, that means fully embracing social media and placing an emphasis on providing relevant content on the official hotel platforms as well as encouraging guests to post.” Given that the hotel’s target audience is millennials (1980-1994), it’s not surprising that tech and social media are successes. “This works well for SLS Baha Mar as this is a core demo for us.”

But some, including Samietz, caution against heavy reliance on tech. “With each passing year, we become more dependent on technology and screen time to accomplish daily tasks. While embracing tools that make our guests’ and colleagues’ lives better is essential to success, the travel industry remains at its core a business of providing real-life connections.”

In the DMC realm, Jennifer Patino, DMCP, CEO of Hosts Global, thinks the industry and destinations themselves benefit when new destinations come to the forefront. “Emerging destinations,” she says, “are receiving good business opportunities.

They’re good for incentive award winners, too. Catherine Chaulet, president and CEO of Global DMC Partners, counts “the discovery of new or lesser-known destinations for incentive trips” among the year’s successes. She also puts “great advances in environmental considerations at meetings” in the plus column.

Tahira Endean, CMP, DES, CED, head of Events at SITE, agrees, noting that sustainability also continued to be at the forefront in meetings in 2019 and will be for 2020.

Dixon has a unique perspective on that aspect of meetings. “Another major success of the industry is its ongoing effort to make meetings, incentives, conventions and events green. In September, we were proud to again collaborate with The Climate Group — the international nonprofit focused on accelerating climate action — in coordination with the United Nations and the city of New York — to welcome Climate Week NYC.”

Brian Stevens, CEO of ConferenceDirect, describes the industry overall as “flat,” but says it’s a positive that Marriott International managed to so quickly integrate Starwood Hotels into its systems. Additionally, he says, “It’s likely that the collaboration of Hilton, Marriott, IHG and Accor investing in Group360, a meeting space booking engine, will be positive for both buyers and suppliers.”

Mike Waterman, chief sales officer for Visit Orlando, points out that regardless of the year’s successes, it’s important to look to the future. “We’ve had a strong year and 2020 is looking positive as well, but we’re always looking ahead to make sure Orlando remains the country’s top meetings destination. Our convention center is expanding significantly, our airport is adding an entirely new terminal that will increase airlift, and we’re in the middle of the biggest two-year period for hotel expansion in Orlando’s history.”

On another front, Chaulet and Patino say navigating through all of the data privacy and General Data Protection Regulation (GDPR) requirements and achieving compliance is yet another check in the 2019 success box.

Mike Fiber, CEO at PRA, offers this: “The industry’s single-greatest success has been the realization from the broader business community as to the importance of business events and their role in driving performance on an individual and personal basis.”

RISING TO THE CHALLENGES

What, then, have been the biggest disruptors in 2019? Not surprisingly, many are out of the control of planners and stakeholders. “Social unrest and bankruptcies in the tourism and airline industries, as well as climate changes impacting travel patterns were the greatest disruptors this year,” Chaulet says.

Patino points to global economic uncertainty. “The biggest disruptor/game changer this year is continued economic uncertainty with the trade situation impacting the economic outlook. While I believe demand remains strong for meetings, economics and geopolitical issues are impacting the global meetings industry more regionally for a variety of reasons.”

Gregg emphasizes two issues: “Although the U.S. economy is growing, trade sanctions and isolationism have caused some fears in foreign travel to the U.S. and the strong U.S. economy makes it a more expensive destination for inbound travel. Additionally, the reduction in hotel commission payouts are affecting a huge sector of our industry — independent business owners. With hotel chains consolidating and wielding more power, many predict that hotels may stop paying commissions altogether.”

In Fiber’s view, “Consolidation in virtually every sector of the industry is under way, overdue and executed with varying degrees of success. We’re still in relatively early stages into a fully consolidated industry, so there’s time and room to deliver stronger execution over time.”

Then there’s climate change. “From natural disasters to man-made messes, we’re seeing this every day, globally,” Endean says. “From kindergarten classes to the highest level of government, this is on the agenda and we’re going to see this continue to affect the travel and event industry in both perception and day-to-day actions.”

Taking action is increasingly critical. “Meeting planners and leisure travelers are more aware of their environmental impact than ever before,” Samietz says. “Groups want to make a positive impact on destinations they experience in a meaningful way and leave it in better condition than when they arrived.”

In Dixon’s view, “The biggest disruption is a movement toward ‘community as a classroom.’ While there will always be a place for traditional, large-scale event spaces, we increasingly see planners getting attendees outside of ballrooms and into communities.”

While Waterman admits technology can be a disruptor, he says there’s another way to view it. “We’re constantly connected to our devices, but that’s where experiential meetings come into play. Instead of fighting against technology, planners can view it as a way to create more engagement, whether it be through unique venues, one-of-a-kind experiences or even a corporate social responsibility event.”

WILL THE DISRUPTORS CHANGE?

Most agree that they’ll be largely the same with added challenges to negotiate come 2020. “Do we have other disruptors?” Endean asks. “Of course, from #MeToo to Brexit, strikes in world capitals and the rise of artificial intelligence across industries. All of these will continue to play out. The issues will always evolve, but ultimately, we have one planet and it requires our attention.”

One unknown is how the political scene will play out domestically. “We’ll see the same challenges, but planning is a calculated risk because of the U.S. elections,” Gregg notes. “More mergers and growth among multinational companies will require global travel and convergence via meetings; however, businesses may not commit until they see how the political environment stabilizes.”

Regardless of the challenges, Samietz says the fundamentals of providing value to clients and guests will remain the same. “However,” he adds, “developing creative new ways to delight our guests’ senses will remain a priority, which will bring innovative differences as well.”

BUDGET ANALYTICS

One question is whether meeting budgets increased in 2019. They have. But the degree to which they’ve risen is up for debate. Gregg, for example, labels it as “slight growth.”

Patino says there have been modest increases. “But we’re seeing more incentive program qualifiers, which decreases the per-person budget. And we’re seeing more ‘all-inclusive’ solutions being booked for incentives as a strategy to contain spend. I think we’ll continue with a slight growth cycle for the next 12-18 months. Our forecasts are stronger going into 2020 than they were for 2019.”

At PRA, budgets are definitely larger, Fiber notes. “And the year ahead looks very robust in our business, more so than at any time in our history at PRA,” he says. “Our clients are looking for increasingly experiential events, which is a positive for PRA given our solution set.”

Dixon agrees the 2019 economy has been strong. “Domestically, the strong economy has generated additional revenue, which allows for more flexibility as in-house and third-party planners for Fortune 500 entities select ambitious destinations and exercise creativity in venue and hotel selection while implementing immersive and experiential programming.”

One trend crystallizing related to budgets, Chaulet says, is “programs that spend more per participant but reduce the number of attendees for a higher, yet more focused spend.” She also says she’s seeing “some increases in budgets due to higher costs of service,” adding that 2020 budgets look similar to 2019.

Citing data from the 2019 Incentive Travel Industry Index, Endean says, “Yes, overall budgets seem to be slightly on the rise, keeping up with slightly rising costs. And this trend appears to be continuing into 2022.”

Samietz also points to the Index. “Having had the pleasure of attending this year’s Incentive Research Foundation annual meeting in Miami, the data suggests that a majority of organizations are budgeting higher. Grand Hyatt Baha Mar has seen that trend as well in 2019, with larger groups, higher attendance and more RFP opportunities among incentives programs than the year prior.”

Glasser echoes that. “Given that SLS Baha Mar is an international destination and most of our groups are incentive, the budgets are pretty strong.”

BOOKING FLUCTUATIONS

Everyone seems to agree that booking windows continue to shrink, which Endean calls the new norm.

That said, the uptick in last-minute bookings may be a positive according to Chaulet. “Currently we’re experiencing a slight slowdown for meetings; however, this may be offset with more last-minute bookings in 2020.”

Samietz also sees both sides of the bookings coin. “We’ve seen great demand for advance bookings as well as higher-than-expected demand for events planned inside of 90 days.”

Then there’s the question of how these shorter windows impact the way groups and planners work. “Groups that typically come to SLS are a bit nimbler, can make decisions quickly and turn programs around within a few weeks or months,” Glasser says. “The typical booking is coming within 24 months, but there are a number of groups that book more last minute — within a few months of meeting.”

Destinations may experience these fluctuations differently, depending on a variety of factors. “Speaking for New York City, the meetings and conventions sector remains strong, consistently drawing in excess of 6 million delegates to the five boroughs each year,” Dixon says. “As such, this remains a stable and integral segment of our overall visitor demographic, which shows no signs of slowing down. In fact, new business is already being booked for the highly anticipated Javits Center expansion, set to open in 2021. Naturally, booking windows vary dependent on convention size and season. If a citywide or large self-contained conference requires ample accommodations and high-capacity venues, they book further out to select from a wider variety of options. However, the booking window continues to shorten for smaller events.”

INCENTIVES ON THE RISE

“The 2019 Travel Industry Index shows incentives on the rise,” Endean says. “This makes sense given the current economics we’re seeing globally and a recognition that when it comes to an informed talent pool seeking experiences as the No. 1 luxury, incentives remain a top recognition, recruitment and retention tool.”

Samietz, Glasser and Patino all agree incentive programs are increasing overall. However, there are shifts in the programs themselves. “As travelers become savvier and more millennials qualify for incentives,” Gregg says, “there’s a demand for more unique destinations and experiential experiences.”

The focus, Chaulet notes, “is on more impactful individual experiences, which are offset by smaller attendee numbers. Higher attention is given to the qualification process for the incentive trip.”

Fiber sees the same. “Incentive programs are rising, with more emphasis on experiences delivered and meaningful promises around sustainability and social responsibility being kept by the organizers.”

In New York, Dixon is getting client feedback that more programs will remain stateside as opposed to going abroad. “Furthermore, corporations are increasingly rewarding top performers with urban escapes, often choosing major global hubs with a relevant knowledge economy. In New York City’s five boroughs,” he says, “multiple industries are experiencing thriving economies. This gives incentive winners access to world-renowned industry experts in their fields and unparalleled opportunities to make meaningful connections.”

DEMOGRAPHICS

There’s no question that meeting demographics have changed as more millennials and now Gen Xers (1965-1979) and Gen Zers (1995-2015) enter into the equation and baby boomers (1944-1964) remain in the workforce. This year has been one of multiple generations attending programs and events with varying expectations.

“Multiple generations attending many of our events will continue,” Endean says, “particularly as we see four-generation workplaces with incentives for both sales and service opening more doors to program inclusion. It’s no longer a simple demographic understanding we need; rather, understanding the shifting values and alignments we need within our programs is key.”

Younger attendees drive many of these shifts. “They’re looking for brands they can believe in, authenticity and making a positive world change,” Gregg says. “The brand experiences at conferences need to reflect these ethics — walking the talk. The younger participant is also looking for learning environments that are more participatory, diverse, sustainable and high-tech/connected.”

Patino thinks demographics haven’t changed as much as the level of engagement. “As we see a greater number of young attendees, their interests and values are driving wellness programming and we’re seeing greater interest in sustainability initiatives. The audience we serve today requires greater creativity, understanding of the meeting objectives and measurement on the return on investment. Business as usual will result in compression; we’ve got to see through our clients’ and their stakeholders’ eyes, delivering on their unique goals or challenges to provide a ‘value add’ partnership with our clients.”

Dixon sees conference attendees today as younger, more diverse, increasingly tech savvy, focused on sustainability and interested in local culture. “Experiential events will only grow in frequency and prominence to match their expectations. It will be interesting to see how the industry adapts to accommodate this rapidly growing desire for innovative location and venue selection year-over-year.”

But Fiber has a different view. “Personally, I don’t reference demographics as much as mindset,” he says. “Everyone, regardless of age, gender and other demographic definitions has higher expectations around experience design and responsible delivery of business events.”

THE BOTTOM LINE

In the end, the state of the industry as 2019 comes to a close is mostly very positive.

Stevens does see one dark cloud, but also the silver lining. “We’ll have a hotel recession in the next three quarters,” he predicts, “but it will last a shorter amount of time than the last downturn.”

And in spite of persistent worries that face-to-face meetings will disappear, many experts, including Harper, believe they’ll remain a priority. “More and more organizations are seeing the tangible benefits of face-to-face meetings, which is a key driver for our industry,” he says.

Waterman agrees. “Nothing can replace the value of face-to-face meetings. No matter how technology evolves, there’s an inherent value in face-to-face meetings that cannot be replicated with virtual events. Whether it’s an educational event, an incentive meeting or closing a deal, in-person conferences will continue to have a significant impact on business.”

That’s Patino’s view as well. “Face-to-face meetings and incentives remain a key component of global business growth as well as employee engagement. And while we’re aware of economic/market uncertainties, we’re confident that the meetings industry will continue to successfully weather the challenges for industry growth into 2020.”

Looking back at 2019 and ahead to 2020 yields the same result: The meetings industry is on solid ground. But that doesn’t mean it’s time to sit back.

“We’re part of one of the largest, most influential and most far-reaching industries in the world,” Harper says. “It’s important that we all work together to ensure the industry and its impact continue to grow.” C&IT