Destinations

The Global Meetings Industry Regains Its Footing

@gregoates

Aug 08, 2014 9:30 am

Skift Take

By bringing together the largest ever cross section of tourism industry players, the Meetings Mean Business Coalition shows how the economic impact of business meetings dwarfs other industries, and why it needs to be supported by government at all levels.

— Greg Oates

Free Report: The Changing Business of Extended-Stay Hotels

DMAI

Attendees at the Destination Marketing Association International event in July 2014. DMAI


According to the latest Convention Industry Council data published in January, the U.S. meetings industry contributed over $115 billion to the GDP in 2012, while directly and indirectly supporting jobs for more than 1.7 million Americans.

In comparison, the automotive industry provides about 600,000 direct/indirect jobs domestically.

This past winter, multiple sectors in the travel industry came together in a show of solidarity to re-establish the Meetings Mean Business Coalition (MMBC), which was first formed loosely in 2009 on a smaller scale. [We profiled the relaunch in our March 2014 trend report: The Future of Meetings in Hospitality].

The purpose of the MMBC is to prove, promote and protect the meeting industry’s position as an economic driver and job creator in the U.S and globally.

The Dark Years

During the height of the recession in 2009, the U.S. government spent billions of dollars bailing out the automotive and financial industries, while at the same questioning the validity of group business travel as a significant economic driver.

Federal and state governments also heavily curtailed their own travel for meetings and conferences to cut costs, partially impacted by perception issues spurred by poorly reported stories such as Muffingate. (The continental breakfast cost $16, not the muffins).

That strategy sent a strong signal to corporate America, who followed suit by drastically slashing company meeting and travel budgets nationwide. Consequently, the U.S. tourism industry took a full frontal hit, as illustrated in our recent Las Vegas meetings story.

To suggest that the meetings industry felt it got burned and burned hard is an understatement.

When those corporate cutbacks nationwide gained steam during the late months of 2008, following the Lehman Brothers bankruptcy in September, and the more damaging and ill-reported AIG incentive travel scandal in October, the U.S. meetings industry had no data to back up the economic impact of face-to-face meetings and events.

Eventually the “AIG Effect,” as it’s referred to in the industry, resulted in over $2 billion in cancelled group business contracts.

“In September of that year [2008], we fell of the cliff and it was devastating,” says Larry Luteran, co-chair of the MMBC, and VP of group sales/industry relations at Hilton Worldwide. “It really took us by surprise, and even though crises had hit our industry in the past, we never had anything like this. Our relevance was legitimately threatened and we had to fight back. It took about five months to get our collective act together, and we rallied around Meetings Mean Business.”

We recently participated in the Incentive, Business Travel & Meetings Americas (AIBTM) trade show in June, the Destination Marketing Association International (DMAI) conference last month, and the annual Meeting Professionals International (MPI) conference this week to follow up on our trend report and the progress of the MMBC.

MeetingsMeanBusiness.com

The central hub for all of the data supporting the economic value of destination meetings is now housed at the seven-month-old Meetings Mean Business website and app.

There is also a “Toolkit” section for meeting planners to help them verify the value of meetings to their procurement departments and C-suite executives. And there’s a continuously updated selection of media stories about meeting industry trends, which can now be shared via the new @MeetingsMeanBiz Twitter account.

“We don’t only have to be proactive, we have to be past that and be a step forward, and that’s what the Meetings Mean Business Coalition is all about,” said Nan Marchand Beauvois, senior director, national council relations for the U.S. Travel Association, and liaison for MMBC, who spoke during DMAI. “It is truly a coalition of one voice talking about the importance of face-to-face meetings, and this time around—the difference between now and 2009—is the fact that we have the vast majority our major association partners at the same table advocating for the same thing.”

Some of the most compelling content at the MMBC portal includes the business trend and data reports compiled by organizations such as PCMA, DMAI, MPI, Maritz and the U.S. Travel Association. At AIBTM, Luteran mentioned The Travel Effect paper commissioned by the U.S. Travel Association, stating that one dollar invested in meetings and events earns an average return of $9.50.

That’s good and fine, but the success and importance of the meetings industry is rarely reported in mainstream business media, as illustrated in the 1992 PBS documentary by Charles Osgood called “The Invisible Industry.” Since the MMBC relaunch in January, the Coalition’s story has played well in the travel trade media, but now the organization wants to get the message outside of the travel industry’s inner circle.

“The next phase is really to try to get general consumer and business trades excited and interested in meetings and why they’re important,” said Beauvois at DMAI. “So we need to hear your stories. We need to know, what was a success story for you when you went to an MPI, when you came to a DMAI? What happened on the trade show floor? What happened when you met with someone that you hadn’t seen in years? What kind of positive business outcome [did you achieve]? We need to personalize this industry for elected officials, and it’s those stories that help give us the leverage we need to make sure this resonates up on the Hill.”

Richard Harper, executive VP at HelmsBriscoe, a global third-party meeting planning company, also spoke during the DMAI panel.

“In January 2009, we said shame on us as an industry, shame on us for not being prepared, considering the scope and value of the business that we bring to the economy,” he said. “The problem was, none of us knew what that was. Well we do now, and it’s all sitting there right on the app.”

Roger Dow, president/CEO of the U.S. Travel Association, summed up the big picture at AIBTM by discussing a recent meeting with President Obama and key members of the tourism industry.

“When I sat with the President a couple weeks ago, I said, ‘Mr. President, do you understand this is adult education? This is how Americans are going to grow…. This is the way that we’re going to grow our competitiveness, not by going back to college for a course, but by going to that meeting to learn best practices.’”

Meeting Professionals International

At MPI’s World Education Congress (WEC) in Minneapolis this week, CEO Paul Van Deventer said MPI launched the Meetings Move Us Forward grassroots campaign to support Meetings Mean Business, which includes this six-minute documentary. The media stories, videos, ad campaigns and how-to white papers provide talking points for anyone aligned in some way with the meetings industry to help promote the business impact of face-to-face business events.

“Looking at this industry that employs millions of people,” said Deventer, “if we can just get everyone talking the same three or four key messages, that will build a grassroots momentum around the world that starts to get the attention of politicians and investors everywhere about why this industry is so strong.”

At WEC, we pointed out that one of the best quarterly economic indicators to determine the impact of the meetings industry on tourism development is by looking at hotel group bookings, which make up 29% of room demand domestically. In Q4 2013, that equated to $8.26 billion in the U.S., which is expected to remain on a positive growth path.

According to the 2014 Meetings Forecast by American Express Meetings & Events:

“Meeting experts have noticed that the major hotel brands are becoming more focused on their meeting sales. Many now have dedicated meeting specialists to promote their properties specifically from a meeting perspective. Some are also branding their meeting services, such that there is a standard set of services available across their properties.”

Deventer put that into perspective at WEC.

“Our community is vibrant, it’s strong, it’s growing and it has over 8,000 planners in it,” he said during his keynote. “Combined, they manage $23 billion a year in meeting investment, and importantly, $20 billion is here in North America.”

One of the biggest challenges, however, that MPI and the rest of the industry is facing coming from corporate America is the idea that technology can somehow replace the need for face-to-face meetings. It’s been a constant refrain since the introduction of the fax machine and teleconferencing.

Back at AIBTM, the first audience question following the MMBC presentation was submitted by Brian Silverman, U.S. sales rep for the popular event tech company Sli.do. He asked the panel if the boom in event tech and “hybrid meetings” was cutting into the necessity for destination meetings.

“We just engaged Leeds University to do a study on the future of meetings, and it was interesting because we had the same concerns,” said Deventer. “And what came out was that social media, the electronic interaction, is actually driving more face-to-face meetings. The fact that Millennials get online and use their devices creates new reasons to get together, and creates new groups. So that’s actually driving the progression of meetings, and the advancement of meetings. But it has also changed the way that meetings have to be put forth…. So technology when you’re in the live event now has to be used to provide a different experience.”

Greg Oates covers hotel/tourism development and travel brand media. email/twitter

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