Every year for the past 12 years, I have published my annual TrendsWatch report at ibtm world, the leading global event for the business events industry, held in Barcelona. It’s a detailed review of the past year’s trends in this industry and an analysis of the outlook for the year ahead.
Without a shadow of a doubt, I can say that compiling the latest TrendsWatch report was the most demanding task ever, for this researcher. The widespread uncertainty in the geopolitical situation and in global markets, unleashed by last year’s Brexit vote and the election of the new American president, meant that predicting what lies down the road for the international business events industry was challenging, to say the least.
But 2016 was not all doom and gloom for our industry, by any means. In terms of demand for corporate meetings, performance within the key market segments of automotive, pharmaceutical, and construction were generally favourable last year, reflecting growth in these three sectors.
Association conferences continued to represent a more stable and consistent segment of the meetings market, with growth in the number of new associations – in particular international associations – continuing, year-on-year. European cities dominated in terms of the destinations chosen for the conferences of international associations. Last year’s figures show that 15 of the 20 top-ranked conference cities were in Europe, the same number as the previous year. And 13 of the 20 top-ranked countries were European, one more than the previous year.
Even the incentive travel market has seen a continuing rally in demand, and in the all-important US market, budgets for incentive travel are expanding and incentive programmes are growing, building on the turnaround in the market seen in 2015. The three main uses to which incentive planners put their increased budgets are: 1. Adding more WOW elements; 2. Choosing a more deluxe property; 3. Increasing the food and beverage budget.
But several formidable challenges lie ahead. Security in European cities has become a major concern of meeting planners. The terror incidents over the last year in Paris, Brussels, Istanbul, Munich and Nice have pushed security to the top of meeting planners’ agendas.
Brexit is also seen as a key risk factor for the year ahead. Uncertainties abound as the UK formulates its withdrawal strategy and its future relationship with the EU and this is already feeding through to changes in demand in the business events sector. It is widely expected, for example, that due to the current weakness of the pound against many other currencies, UK companies will be more inclined to hold their meetings in the UK, rather than abroad.
At the same time, currency weakness is making the UK a more attractive option for meeting planners based in other countries. For example, during the two calendar months following Brexit, the London & Partners convention bureau fielded 66 percent more inquiries from US conference organisers than the same time last year. Overall, among all international source markets, there was a 41 percent rise in inquiries from business event planners from June through to September. However, there are growing indications that UK inflation is set to rise, and a direct result of that will be that the higher costs of all the inputs that are required for meetings, from transport to food and beverage, will inevitably lead to price rises for those holding such events.
Today’s most formidable challenge for the meetings and events sector is to learn how to adapt to this uncertainty and how to operate effectively within the fast-moving changes in the market environment. As a destination practically untouched by terrorist violence and with an image of openness towards Europe and beyond, Scotland now has a valuable opportunity to build on its success as a location for conferences and incentive trips. But political recognition of, and support for, our industry is now more vital than ever, in the ongoing task of bringing these high-value, high-spending, all-year-round business tourists to this country.
Rob Davidson is Managing Director of MICEknowledge.com and a leading events industry researcher and academic
The TrendsWatch report is free to download at: http://www.ibtmworld. com/trends
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