Corp. Mtgs. Slowly Making A Comeback

The corporate meetings industry is certainly in the midst of a general slowdown, as shown by recent Meetings Monitor polling data, but there are also some quantitative signs of a mild rebound, despite continuing travel security concerns.

According to an exclusive Meetings Today survey of 137 corporate meetings buyers, 44 percent of buyers expect their companies' meetings expenditures to drop this year compared with last year, buttressing claims of cutbacks. However, 29 percent said their meetings expenses would rise against last year's totals and 37 percent indicated that their companies would spend more this year than in historically meetings-rife 2000.

Those numbers suggest that a solid number of corporations already have completed their cutbacks and currently are at the expected lowest watermark of meetings spending.

That is the case at Dayton, Ohio-based NCR Corp., which began cutting meetings expenditures in earnest in July, said events manager Julie Steible. With spending closely watched, the company in 2001 cut spend to the point where further cutbacks this year only will be slight. "There's not going to be a dramatic difference in 2002, though we'll be down a little bit," Steible said. "We have to really keep an eye on ensuring value and scrutinize. We're in the technology realm, and if our big customers don't buy technology, we buckle down."

Steible said that no one particular type of meeting was targeted or spared from cutbacks, including incentive trips. "Anything is fair game," she said.

Of those companies that are increasing some meetings expenditures, 30 percent will dedicate more resources to large meetings and conventions. This likely is due to the fact that many companies, particularly technology companies, have decreed that most offsite meetings cannot take place unless they include direct contact with clients, a hallmark of large corporate conferences.

Meetings of less than 100 attendees and training meetings are expected to see additional resources this year, according to 23 percent and 20 percent of respondents respectively, but only 9 percent said their companies would spend more on sales meetings.

Not surprisingly, the battered domestic economy and weakened corporate business conditions were cited by the largest group, 46 percent of respondents, as the drivers of changed expense projections; 23 percent also blamed decreasing domestic business and 10 percent said slipping international business was a contributing factor.

However, 34 percent of respondents also said safety and security concerns were prime factors in declining meetings expenditures, suggesting that the specter of Sept. 11 will continue to profoundly and directly impact corporate meetings projections and spending.

This poll was conducted in November and December, concluding roughly three months after the industry-crippling attacks.

Others pointed to corporate projections of sunnier economic days in 2002, with 23 percent of respondents pointing to increased domestic business as the key driver in projected meetings expenditure savings, 16 percent indicating the change will be caused by an improving economy and 8 percent citing better international business.

A significant chunk of respondents, 29 percent, said that despite the industry upheaval, their spending would not be dissimilar to what it was in 2001, and 15 percent said their 2002 expenditures should be pretty close to what they were in 2000.

"It should be pretty static," said Leslie Veenhuis, meetings and events manager for Ventura, Calif.-based Kinko's Inc. "We've actually been pretty constant for the past four or five years, not decreasing expenditures but not increasing either, even for cost of living. But our meetings are becoming more business- and education-focused, with some of the celebratory elements left behind. There's less focus on themes and rewards, and that money then is directed at training, education and business sessions. It's a decision based on the economy and business strategy."

Meanwhile, videoconferencing has never sported a higher profile in Corporate America than it does now, as a direct result of the terrorist attacks, and that shows up in the Monitor results, but perhaps not to the extent one would expect: 17 percent of respondents attributed their planned spending changes to additional use of the technology. That number is far below the percentage of senior corporate executives who indicated, in a Business Travel News survey conducted shortly after the attacks, that 59 percent would provide videoconferencing as an alternative to travel this year (BTN, Nov. 26, 2001).