Financial Cos. Adding Asian Events

As an increasing number of multinational financial services corporations conduct business and set up operations in Asia/Pacific, corporate meeting buyers in the financial industry are taking more groups to the region. Regional governments also are taking note of the revenues that corporate meetings and incentives bring to their countries, and unveiling new initiatives to attract financial groups.

However, taking a group of executives or top earners to Asia, or setting up a strategic meetings management policy for an Asian division, comes with its own unique challenges. Destinations must be evaluated on the basis of ease of business, not just proximity to overseas operations, buyers said.

American International Group Inc., based in New York, spends more on meetings and incentives in the Asia/Pacific region than it does in the U.S. market, said Kelli Livers, director of global meeting services, in large part because the multinational was founded in Shanghai in 1919.

AIG introduced a new meetings policy this year and has plans to roll out a global policy this quarter, she said. The global policy requires overseas business units to register events with Livers' department, which also handles all vendor contracts.

"Seems like most of our Asia-based companies do fewer meetings, but they're larger—a lot of their incentives are 2,000 or 3,000 attendees," Livers said, adding that the structure of the incentive events tends to be different as well. Group activities are preferred over breakout activities, she said, and fewer attendees bring their spouses.

"Twenty percent to 30 percent bring spouses, given the opportunity, in the U.S., whereas the split would be more like 90 percent to 10 percent there," she said.

The global policy would largely mirror the domestic meetings policy, Livers said, except for preferred supplier lists.

"In Asia/Pacific, they tend to outsource all their larger events to third parties," Livers said. "That's what I've found in my initial research. Even smaller events, they tend to outsource."

AIG held a large forum last year in Singapore, at the local Singapore Expo center. The decision to use Singapore was made by regional business units, but was likely based on the ease of doing business in Singapore, rather than proximity to business operations, Livers said. Many regional events tend to be incentives, though, which are destination-based, she said.

Many multinational firms have scheduled events at the expo center this year, said Tan Hwee Ling, assistant manager of marketing for Singex Venues, the management company responsible for the center. American International Assurance Co., IBM Singapore and Amway all have held large events at the center.

Singapore, a rising financial hub of Southeast Asia, in early August announced a set of initiatives to increase meetings, incentive travel, conventions and exhibitions in the city-state. That industry, often called by its MICE acronym overseas, and corporate travel together accounted for 30 percent of tourism revenues in 2004 and the government aims to increase that proportion to 35 percent by 2015, said Aloysius Arlando, assistant chief executive of business travel and MICE groups for the Singapore Tourism Board.

The city-state in September hosted the 2006 annual meetings of the boards of governors of the International Monetary Fund and the World Bank Group. Singapore is also ranked as the fourth-largest foreign exchange trading center in the world after London, New York and Tokyo.

Corporate meetings make up about 60 percent of the MICE market to the island, Arlando said, and the Singapore Tourism Board has taken a "strategic cluster approach" in targeting more business. The approach seeks to maximize the country's existing economic drivers—such as biomedical sciences, banking and finance and information and communication technology—and target those sectors for increased meetings growth. The financial industry is an enormous driver for the economy and the goal of the corporate meetings campaign is to promote the city as a global "exchange capital," Arlando said.

The cluster approach, targeting specific industries for more meetings business, was used because of the industry trend toward measuring return on investment for events. Singapore also uses a return-on-investment approach in its own development, and such industries as the financial services sector have the greatest growth potential. The city can't rely on its location alone to attract business events, as buyers also demand a place that is easy to achieve corporate objectives. "We're moving beyond venue position to value extraction," he said.

The campaign is funded with an approximately $107 million investment over the next three years specially to attract corporate events. Incentives available for corporate meeting buyers include discounts for multimeeting contracts and value-adds for large or high-level groups. Executive board meetings have the option of complimentary VIP clearances at the airport, special-interest "study visits" around the island and dialogue sessions available with prominent local business leaders and government agencies.

"We need to tap into our strategic location, cosmopolitan and vibrant tourism offerings and extensive global connectivity to deliver value and enriching experiences to all business visitors. Corporate end-users and decision makers who choose Singapore as the venue for their business events will also stand to gain from a dynamic and pro-business environment which leverages a strong economic base comprising key industries that are pivotal to the success of MICE business," he said.

Many financial companies bringing incentive groups to Singapore are using a "hybrid" approach of adding on a day of business meetings to the typical three-day visit, Arlando said.

Incentive groups with at least 400 visitor nights can receive complimentary destination management company services or customized support from the Singapore Tourism Board.

Singapore lifted a ban on casinos last year and there are now plans for two massive "integrated resorts," one of which will be developed by Las Vegas Sands Corp. at a cost of more than $4 billion and would offer 200,000 square meters of convention and exhibition space. The Sands was chosen in part due to its strong focus on meetings and exhibitions, according to the Singapore Tourism Board.