<B> More Mtgs. On The Agenda</B>
By Chris Davis
While the growth of the meetings industry has continued steadily over the past several years, adding its weight to the airlines' sky-high load factors and the scarcity of hotel rooms in major cities, respondents to a recent Meetings Monitor survey indicate the growth may be slowing just a bit.
The good news is that more than half (51 percent) of the 213 corporate planners surveyed expect to spend more on meetings in 1999 than they did in 1998, and of them more than half predicted expenditures would rise by at least 10 percent. Only 26 percent expect corporate meetings expenditures to drop. The remainder said meetings expenditures would stay about the same.
Those are solid numbers that point to another year of growth. But still, the rate of growth is lower than meeting buyers predicted last year, when 56 percent of planners expected their companies to spend more on meetings in 1998, and only 11 percent expected meetings budgets to drop (<I>Meetings Today,</I> Dec. 8, 1997).
While that's not a tremendous swing in the numbers, it may well be significant, particularly as some industry analysts are predicting a slight softening of the airline market in 1999 (<I>BTN,</I> Jan. 11) and others have pointed to signs that the hotel seller's market may be losing its vise grip (<I>BTN,</I> Sept. 14, 1998).
Whether budgets are up or down, though, many planners expect to be facing an increased workload in 1999. Almost 45 percent indicated they will plan more meetings, versus 17 percent who expect to plan fewer--primarily due to the opportunities the resilient domestic economy is providing their corporations. Almost half of those who said their meetings expenditures will increase cited increasing domestic business as the prime factor, as did an additional 36 percent who cited an improved economy and better business conditions.
Planners are expecting to stage more training meetings, as companies expand their workforces, increase their global presence or merge with other corporations.
The latter reason applies to Ken Pickle, manager of incentives and conferences in the corporate travel and incentives division of Seattle-based insurance firm Safeco Corp. Pickle said his company's acquisition of American States Financial Corp. in June 1997 continues to necessitate an increase in the number of training meetings he stages. The acquisition will increase the company's workforce from about 8,000 employees to about 11,500.
"We're still in the closing transition of that process, which is requiring a few more meetings than we would have held had we not purchased them," Pickle said. "We sell our products through independent agents. As we bring the independent agents that only represented American States on to the Safeco line, we have to train them to use the Safeco products, and we have to train our own agents to use the American States product."
Merging the two corporate cultures requires meetings as well, Pickle said. "We're getting the American States employee to know what Safeco is about, and vice versa."
Some businesses also are taking advantage of the healthy economic climate to broaden the range of services they offer customers. Boston-based Keane Inc., an information technology consultancy, will hold more meetings for that reason, said corporate travel manager Marianne Goodman. "They're mainly employee training meetings, because Keane is moving into other areas," she said, estimating the company will hold about 300 meetings in 1999, up from 215 last year. "We've been very big in the Y2K compliance area, but we're moving into other areas: application outsourcing, help-desk outsourcing, e-commerce. So now we're bringing our people back in for more training."
Other organizations are expanding as well. "We have new activities this year, including a compulsory maintenance of certification program," said Anna Lee Chabot, head of the meetings and assemblies section of the Ottawa-based Royal College of Physicians and Surgeons of Canada and a past president of Meeting Professionals International. "To get these programs under way, new meetings of members will need to take place and there will be added travel by our members to do the committee work."
Business expansion often leads to opening new sites, and was cited by about 43 percent of those surveyed as the reason for a meetings-expenditure increase.
On the flip side, the most common reason for decreases in meetings budgets--cited by almost 27 percent--was a lack of improvement in business conditions and the economy. Indeed, the fact that the economy was mentioned as a reason for both cutting and adding meetings is indicative of the uncertainty many businesses feel about the future of the global economy.
The second highest rationale given for a meetings decrease, by more than 23 percent, was an increase in the use of videoconferencing, though an equal number of respondents said videoconferencing was the main reason their meetings expenditure would stay about the same. While 4 percent said their companies would hold more meetings because of videoconferencing, the technology's profile has increased over the past year as more corporations consider videoconferencing as an alternative to travel (<I>BTN,</I> Aug. 3, 1998).
Planners also expect the number of sales meetings and board and top executive meetings to increase this year, with 38 and 28 percent, respectively, making that prediction.
While incentive trips are the least likely to be increased, 19 percent of respondents had plans to reward top achievers in this way more frequently in 1999. But almost the same number of planners expect their companies to cut the number of incentive trips.
"It's still a necessary part of the communication process, and we have to do it," said Soni Strang, events marketing manager at Solaris Software of Palo Alto, Calif., a subsidiary of Sun Microsystems. "The communication and the team building is important for everybody."
The most common expected target for a cut is larger conferences and conventions, with 24 percent of planners expecting fewer of those in 1999. Training meetings appear to be the least likely to feel the hatchet, with only 11 percent expecting them to decrease.