High-End Financial Meetings Demand Stays Strong

High-end executive board meetings and incentive trips in the financial services industry appear to be on the rise despite the shift to a seller's market. Hoteliers said financial companies still are looking for luxury, though increased scrutiny has pushed more business to independent and non-resort properties.

Though hotels have raised rates and the market has shifted in favor of vendors, financial services companies are holding as many or more meetings than they did in 2005, said Tim Bruins, senior account executive at St. Louis-based meetings management firm Maritz Travel.

"I'm not seeing insurance companies and brokerage houses cut back on their travel. They're still doing the same kind of incentive trips. They're still doing sales meetings," Bruins said. "Healthy financial services companies are growing because of all the wealth transfer and baby boomers retiring and needing to do something with their money."

Incentive trips in particular include more attendees or are held more frequently, he said.

High-end meetings from financial services companies are a steady source of business, said Joe Carino, president of hotel representation firm The Carino Collection, based in New York. More than half of the number of corporate meeting buyers that contact the company are from financial companies, he said, and overall volume and revenue has increased 20 percent from last year's levels. The collection acts as a marketing and sales organization for more than 75 independent luxury hotels in 16 countries. Seventy-five percent of member hotels are city-center, business-focused properties, he added.

"The high end of the market never seems to feel a recession," Carino said. "They do cut back a little bit. Instead of a five-day meeting it's a four-day meeting. We've seen some of that."

During the past year, high-end financial meetings have been moving back to international destinations and cutbacks have been lifted, he said.

"They're going back to Europe and Asia," Carino said. "We're seeing a shift in that they're now willing to take that risk."

Bruins said overseas group travel generated by the financial sector is on the rise.

"We've got trips going to Asia, Africa, Europe, South America—participants want to travel," he said.

Since many attendees who qualify for incentive reward trips from their financial companies are successful enough to afford travel on their own, Bruins said there is pressure to make overseas trips memorable and unique.

Even though budgets for high-end meetings at financial services companies have rebounded, spending has not yet passed levels reached before Sept. 11, 2001, he said.

"Everyone is much more cost-conscious not to go over and above, but they are definitely back to what they were spending," Carino said.

Independent hotels have an edge in serving image-conscious financial services companies, he said. Shareholders may balk at the use of well-known luxury brands or resorts and could see it as a sign of corporate excess or mismanagement.

Financial companies have not significantly changed how they negotiate for high-end meetings, he said, as cost is usually not the primary concern.

"When it comes to these high-end financial services meetings, they do what they need to do. There's very little that they hold back on," hotelier Carino said.

Increased scrutiny from shareholders and regulators has affected some financial services meetings served by Maritz, Bruins said. Some types of events must be held within 30 miles of company headquarters.

"Some companies are foregoing those meetings, as much on perception as anything," Bruins said, adding that some West Coast clients had chosen not to have certain events, even though there were appropriate locations within the 30-mile requirement, because of perceptions that attendees would be headed to beaches."In the past, they might do an afternoon of golf or activities, but now it's more meeting-intensive," he said.

In particular, some clients are strictly avoiding Las Vegas or other destinations that have casinos, Bruins said.

Corporate meeting business from financial services industries is increasing at the JW Marriott Denver at Cherry Creek, said director of sales and marketing Jenni Gaherty. Financial industry meetings make up about 25 percent of overall business at the hotel because of the close proximity of 26 financial institutions, she said. Small, executive board meetings make up the majority of bookings.

"Every month, even from this year compared to last year, our numbers our increasing and we find our customers' decisions are not based on price. Their decisions are based on the quality of the hotel. When financial companies are conducting business they need to be at the top of their game," Gaherty said.

The hotel also has benefited from financial companies that are looking for luxury services but are hesitant to book meetings at a luxury brand or resort property, Gaherty said.

"We have been able to capture the business because we are luxury. However, we're city luxury," Gaherty said. "We're not a resort destination. It's probably worked in our favor."

Gaherty said high-end financial meetings often include add-on programs for attendees' spouses, so more buyers are asking for spa services and shopping.

"We'll find that they'll do a two- or three-day program and do an afternoon where they do some teambuilding or spousal program," she said.

Security and confidentially continue to be issues of concern among financial meeting buyers, she said.

"One trend we're seeing is some financial companies will request a non-compete clause," she said. "It doesn't happen every single time, but sometimes companies will give you a list of their competitors."