Maritz Travel To Maintain Experient As Distinct Meetings Entity

Calling his company's acquisition of Experient "a growth initiative, not an efficiency play," Maritz Travel CEO David Peckinpaugh on Wednesday told BTN that Maritz would operate Experient as a distinct entity and that there were "no immediate plans" to integrate any of the two companies' systems or offerings.

Peckinpaugh said Maritz, which on April 3 announced the acquisition of Experient from private equity firm and majority owner Riverside Co., will approach the meetings market with two brands, with "significant growth plans" for each. Maritz Travel will manage events for the company's traditional base of corporate clients while Experient will maintain its branding and target association, trade show and government clients. Maritz also will continue to participate in its Maxvantage alliance with American Express, which provides strategic meetings management services to corporate clients and is unaffected by the Experient deal, he said. Former Experient corporate clients "will be served by the Maritz Travel brand," according to a Maritz spokesman. "Operations for full-service events will reside with Maritz Travel, and select services will reside with Experient."

The deal brings together two of the largest meetings-management third parties in the industry. St. Louis-based Maritz Travel and Twinsburg, Ohio-based Experient in 2011 combined to represent more than $2 billion in spending and book more than 11,500 meetings and manage, according to Maritz. Experient's 540 employees will join Maritz Travel's 823 with no job attrition, except for former Experient CEO Jeff Price, whose last day at the firm was Wednesday, Peckinpaugh said. Maritz Travel now has a network of 12 locations in the United States as well as additional sales offices.

In maintaining distinct brands, client bases, organizational structures and sales and support staffs, Maritz will make no immediate moves to change the companies' rosters of preferred suppliers or technologies offered, Peckinpaugh said.

"There are opportunities to find best-in-class solutions, and we have that on our optimization timeline in the mid- to long term," Peckinpaugh said. "But we have to do a lot of assessment. We have to make sure there is no customer impact or interruptions. On the systems side, we will operate as we are right now. Over time I'm pretty sure that will evolve, but we don't have any immediate or significant plans to address that other than in the assessment phase."

Peckinpaugh did note, however, that opportunities existed in leveraging the volume of the two companies, "and we're going to do that aggressively."

Joining Forces For A Bigger Footprint 

The deal also serves as a byproduct of a corporate restructuring process started last fall by Maritz Travel parent Maritz Inc. that, among other aspects, led to the exploration of meetings management opportunities outside of Maritz Travel's client roster, which was nearly 100 percent corporate.

"In the fall, we went into a very robust strategic planning process that was completed in December," said Peckinpaugh, who joined Maritz Travel as CEO in June 2011 from meetings management third-party HelmsBriscoe, where he served as vice president of business development. "During that process we identified the areas where we wanted to take the company, and one of the key areas was adjacent markets where we saw great opportunity: association, trade show and government," he added. "Part of [the planning process] was whether we would do it organically or inorganically, and we had plans built to explore the wisdom of both. Out of the blue came this opportunity from the seller."

Experient, known until 2006 as Conferon, for decades has served as a large industry third party. Purchased by Riverside in 1999 from founder Bruce Harris, the company in the following few years grew through acquisitions, including the 2003 purchase of tradeshow and attendee management firm ExpoExchange. Since then, the firm has integrated the acquisitions and realigned its operations into two lines of business—event management, along with registration and housing—said Rick Binford, president of Experient's event management unit.

"We've been through a lot of retooling and refocusing over the past four or five years with the shifts that have gone on in the marketplace," Binford said. "We've been performing very, very strongly over the past 24 months, and it was the right time to bring our company to market. We wanted to find a buyer that offered opportunities for growth, and Maritz was a great match."

"We've done a lot of analysis [of Maritz Travel's competitive set]," Peckinpaugh said. "We see ourselves as a very unique entity. There is no one else who can offer that breadth of analysis and expertise."

Peckinpaugh himself is a former Experient executive, serving eight years and ascending to the position of chief marketing officer before leaving in 2006 to head the San Diego Convention & Visitors Bureau. "I certainly kept track of what [Experient] was doing and the direction they were going," he said.

Withstanding Meeting Valleys 

The deal, the financial terms of which were undisclosed, also allows Maritz Travel enough diversity in clientele to better withstand valleys in corporate meetings demand, Peckinpaugh said.

"One of the reasons we did this deal is for that diversity," Peckinpaugh said. "When you're 100 percent deployed against the corporate marketplace, it's a volatile world. The association sector is much more consistent, and government is pretty consistent. We'll be able to weather and withstand any economic challenges moving forward."

Peckinpaugh, though, added that corporate meetings demand has "come back in a strong way," claiming "double-digit growth for the past few years," pointing specifically to strength in the technology, telecommunications and automotive sectors.

Maritz's roster also includes several pharmaceutical clients, and Peckinpaugh noted opportunities related to the upcoming to track expenses related to Physician Payments Sunshine Act, the provisions of the U.S. Affordable Care Act that will require such corporations to track marketing expenses to physicians and report such expenses to a publicly accessible national database. "The need for compliance and control really plays into our strength," he said.