This year’s Meetings + Incentive Travel’s Meetings Market Report finds the industry enjoying a period of relative stability. The majority of respondents (85 per cent) reported that their companies or clients did not cut back on the number of days of any multi-day events in 2015, and 87 per cent said there had been no cutbacks in 2016. Data on spend showed little year-over-year change, with the exception of food and beverage costs, which 45 per cent of respondents said had increased. Overall estimated spend in 2016 was expected to be 10.5 per cent higher than in 2016, rising from $733,000 to $810,000. And on average, respondents said they planned 8.8 meetings a year, and booked 564 room nights. Looking at the data, it’s fair to conclude that it’s been a good 16 months for event pros.
However, there are ripples under the industry’s calm surface. When asked about challenges, the number one response was “costs.” In addition to f&b, planners were worried about rising prices for venues, hotel rooms, audiovisual, travel and more. They also said that the impact of these rising costs is compounded by flat budgets and the down dollar. If estimated average spend was rising 10.5 per cent, why all the concern?
Clearly, the data wasn’t telling the whole story. To help us put the pieces of the puzzle together, we assembled a panel of planners and held a session at IncentiveWorks 2016. The panelists were:
- Bettyanne Sherrer, CMP, CMM, president of ProPlan Conferences & Events, current president of CanSPEP and M+IT’s 2013 Hall of Fame Industry Planner inductee;
- Marie-France Watson, event planner and business officer at Concordia University and the 2016 president of Meeting Professional International’s (MPI) Montreal and Quebec chapter;
- Julie Calvert, CMP, CMM, manager of events and regional programs for The Canadian Payroll Association and M+IT’s 2014 Hall of Fame Industry Planner inductee;
- Kate Cheney, CMP, CMM, owner of two Calgary-based event companies—ConventionAll Management and Meeting Solutions, and the 2010 president of MPI Greater Calgary; and
- Kalinda Cripwell, event manager at Invesco Canada and one of the industry’s new generation of planners.
Here’s what they had to say.
WHAT’S THE STATE OF THE INDUSTRY?
To start the session, we asked the panelists how they would rate the state of the industry on a scale of one to 10, with one being a planner’s worst nightmare and 10 being a planner’s paradise. Their answers came in at an average of seven. Sherrer and Calvert gave today’s meetings market a mark of eight, citing its strength and the acknowledged importance of face-to-face business events.
Cheney was less optimistic. She gave the national meetings industry a seven and Alberta’s meetings industry a four. “We’re facing some great struggles in Alberta,” she said, noting that suppliers and planners who worked for corporations and some of the oil and gas associations were “really feeling the pain.” There are fewer events, budgets have been cut and people are losing their jobs because marketing and events are the first places corporations look to cut when the economy falters, she explained. “We faced it in 2008, but I don’t think we learned enough. People didn’t diversify.”
Watson and Cripwell were also less optimistic. Watson, who has to contend with funding from government, gave the industry a score of 7.5. Cripwell gave it a seven, “maybe a six,” saying that she found the financial sector was still recovering from the downturn of 2008/2009, and like Cheney, felt marketing and events teams are particularly vulnerable to economic ups and downs.
CHAMPAGNE TASTES, BEER BUDGETS
Despite the anticipated 10.5 per cent rise in overall spend reported in the survey, many planners continue to deal with flat budgets. As a result, keeping costs down is a major challenge, particularly with elevated client and attendee expectations. The key to controlling spend, the panelists agreed, is working with suppliers. “We’re all on the same team when it comes to event design and delivery,” said Sherrer. “We need to collaborate to maintain that event experience, but also be very cognizant of spend because the bottom line affects our delegates, our corporations and our clients. Everybody has to give a little bit.”
Calvert pointed out that external economic factors “are huge” and negotiating in a boom economy is very different from negotiating in a bust economy. As an example, she cited the challenges that Calgary’s going through right now. “Who would envision that oil and gas would walk off a cliff?” she asked. She used the cost of a hotel room in the city as an example. The contract, which would have been negotiated two years ago when demand was at its peak, would look different if it were being negotiated today, she said. “I think as planners we face a unique stressor when it comes to managing the bottom line for our employers. Unless they’re in the weeds with a planner, I don’t think senior management or people on the periphery of the planning segment are actually aware of the difficulties and the length of time involved in reaching a mutually agreeable negotiation. It takes time. It takes patience. You just have to maintain integrity and be your authentic self all the way through the process and you will eventually get there,” she added.
According to Cheney managing client and attendee expectations is also key to controlling costs. It always goes back to establishing the meetings’ goals and objectives; asking your client what they want attendees to get out of the event, what kind of experience they’re looking for, she said. Transparency is also essential. Suppliers should be upfront with planners about all fees. This allows planners to be candid with clients. “Service charges are big kickers when you’re looking at your food and beverage budget,” explained Cheney. “You have to explain to your client that what they’ve selected is great, but there’s an 18 to 20 per cent charge on top of that.”
The discussion inspired the panelists to share some nuts and bolts solutions to controlling costs. Cripwell said that Invesco has started to focus on “intimate, smaller conferences,” which they hold in Canada rather than running large conferences in international destinations. “It’s saving us money and it looks good on the client side because they’re getting one-on-one interaction with speakers. It’s more intimate and they feel it’s just for them,” she explained.
On the f&b side, she said they no longer serve food on breaks. “Take a break, check your phone, grab a coffee, that’s it,” she explained, adding that people are more mindful of food waste today. She also works hard to negotiate service fees. “The craziest fee I ever saw was a tip jar removal fee. I was already paying a 22 per cent service charge on top of my costs and I had to pay each bartender $75 to take the tip jar off their bar. That’s the sort of thing that’s often not in contracts, but you can negotiate with your customer service manager (CSM) to reduce or remove it.”
Watson said going local is one of the ways she’s dealt with flat budgets and increased food costs. “The days of caviar and champagne meetings are over,” she explained. Now, she looks more at vegetarian options and incorporating what’s in season into meeting menus. In addition, she selects whole fruits over sliced fruits, saving on labour costs.
Piggybacking on other events in the same venue has worked well for Sherrer. She explained that four to six months out, when planners are dealing with their CSM, they can save money by asking what events are being held in the venue at the same time. She recommended finding out what the other group is serving for dinner, and serving the same meal to your group. “Your delegates don’t know… [and] it’s going to save a lot of time [and labour] in the kitchen,” she said. The same thing can be done with audiovisual. “Who’s in front of me [in the meeting space]? What’s the production company? What’s their rigging? Can I save? I’m going to adjust my floor plan to save $20,000 in rigging. What can you do with that in your budget? Being flexible on the fly in the two to six months-out window, and asking questions of your venue partner so you can leverage the other group’s spend, can make a really big difference,” she said.
DO MEETINGS MATTER?
The survey revealed that the majority of respondents felt that government and corporate Canada understand the value of professionally-planned meetings and events, but the profession is undervalued by the general public. This lack of knowledge about, and validation of, meeting planning appeared frequently on the list of answers to the question of challenges the industry is currently facing.
While she agreed with the 64 per cent of respondents who said corporate Canada/government value planners and meetings, Sherrer, with the agreement of the other panelists, challenged the statement. “I think corporate and government are two different things—apples and oranges,” she said. “When it comes to understanding the value of our industry, government lives in economic impact. That’s the data they want. Corporate wants to talk ROI [return on investment]. Those are two very different conversations.”
Calvert and Sherrer both pointed out the headway that the industry has made thanks to National Meetings Industry Day (now Global Meetings Industry Day), the Canadian economic impact studies (CEIS) and the ongoing work of the Business Events Industry Coalition of Canada (BEICC). “Eight point five billion dollars in taxes, that’s from our industry. That’s huge,” said Calvert. “We generated $27 billion—1.5 per cent of Canada’s GDP… We’re creating 200,000 full-time jobs. Out of every $85,000 spent at an event, the equivalent of one full-time job is created… I think there’s definitely a conscious recognition, certainly at the government level, that meetings do create value and we are a serious revenue generator alongside the taxpayer.”
But this recognition hasn’t trickled down to the public, said Cheney. “People don’t understand the value of what we can bring to their city, to the economy. We’re not getting enough press in the everyday [consumer] media about those economic impacts and what we can do.” And public perception is important, she said, explaining that government in Calgary is convinced that the city needs a new or expanded conference centre, but the taxpayers aren’t onboard.
Cripwell said that she was on the fence when it came to agreeing with the statement about corporate Canada valuing planners and meetings. “On a good day, I’ll agree with it. On some days, I don’t agree with it at all.” She pointed out that it’s still a struggle for planners to get a seat at the executive table, and to be looped in from the start of a discussion about an event or meeting.
Planners are victims of their own success, added Watson. “If you don’t see us, it means everything has gone well. But I don’t think we do enough to educate the public… We do lots of ads [before the event] … but we don’t do a press release after. We have to do a better job educating others about it.”
Sherrer said she’s had the privilege of serving on several NMID committees, and one of the first goals is “to stop talking to ourselves.” The day’s mandate is to push the message that meetings matter to the government and consumer media. “That’s really the ultimate goal,” she said. “I know that we’re trying.”