In tough economic times, offhand comments by politicians and media pundits can have a profound impact on important segments of our economy. The meetings industry is one such segment that has experienced the sting of recent generalizations regarding meeting excesses. Read on to understand why you should care and whether there is turnaround on the way!
The U.S. trade show and event planning industry is a highly fragmented service industry comprised of meeting planners and suppliers who organize, design, promote, manage business and consumer trade shows, conferences, and meetings. The meetings industry has a direct impact on the airlines and the hotels, restaurants, sightseeing tours and economies in the cities that host meetings.
Unfortunately, in addition to facing a persistent recession, negative political and media comments have impacted the industry. One event planning company reported losing 90% of their scheduled events for 2009 after President Obama commented on Las Vegas meeting excesses. In response, associations have merged, meetings moved from resorts to less “lavish” properties, and meetings were consolidated or scheduled for fewer days.
According to the CEIR Index published by the Center for Exhibition Industry Research, the exhibition industry suffered big declines in the first quarter of 2009, dropping 11.6 percent compared to the first quarter of 2008. In the first quarter, revenues were hardest hit, dropping 19.7 percent for the quarter, net square footage of exhibit space used fell 14.8 percent, and the number of exhibiting companies was down 10.4 percent.
With companies limiting convention attendance and tightening travel budgets, hotel revenue has declined 18.7 percent, occupancy dropped 10.9 percent and the average daily rate fell 8.7 percent for the first half of 2009 vs. the same period in 2008, according to data released by Smith Travel Research (STR). Senior STR VP Bobby Bowers said, "The first half of 2009 was, without question, one of the most challenging the U.S. lodging industry has experienced." STR is currently forecasting a total industry revenue decline of about 17 percent for full-year 2009."
With pushback from the meetings industry and local governments, the political rhetoric has softened. U.S. Senator Harry Reid (D-Nevada) sent a letter to cabinet secretaries and the head of every federal agency requesting they reject or reverse any travel policy that discriminates against specific U.S. cities, including Las Vegas and Reno. According to a survey by the Society of Government Meeting Planners, 84 percent of members polled said there should not be a federal government policy against meeting in "desirable" locations. (http://mcmag.com/article_ektid27546.aspx#2) Final TARP rules have been published requiring companies receiving Troubled Asset Relief Program funds to develop a company-wide policy for meetings but leave it up to a company’s board of directors to decide what’s frivolous and what’s not.
The Convention Industry Council, Meeting Planners International and the National Speakers Association (www.whymeetingsmatter.org) have all been working to get the message out that meetings are good for business and jobs. The US Travel Association has developed a website (www.Meetingsmeanbusiness.com) with factual information, an engaging video and other resources to help make the case. ASAE (American Society of Association Executives) has argued that business meetings and incentive trips have been falsely branded as “junkets” that waste valuable capital or public funds. On the contrary, a recent study released in September by the U.S. Travel Association found that for every dollar invested in business travel, businesses experience an average of $12.50 in increased revenue and $3.80 in new profits. Such meetings not only provide benefits to the meeting sponsor and attendees, but to the economically vulnerable meetings destinations.
For members of associations and those working for corporations, meetings mean more than business. Author and management visionary Peter Drucker once observed, “The fastest growth industry in the U.S. will soon be continuing education of adults because things are changing so fast in every field and occupation.” The age of lifelong employment and secure professions is over, and there is a compelling need for targeted, competency-based training that will help leaders and professionals in all areas move from obsolescence to relevance. Companies and associations committed to providing valuable training at their meetings give their people the best “insurance” policy—updated and relevant skills positioned to invent the future.
According to National Speakers Association President Phil Van Hooser, “Not only do meetings help drive a vibrant and productive economy, but, with the right programs and speakers, meetings matter in developing leaders and a workforce ready to help invent a profitable future.” In support of meetings, Van Hooser has challenged speakers around the world to use the platform to reinforce the message that Meetings Matter and to provide the content to help attendees make change work.
More optimistic projections are surfacing. According to a poll conducted by Special Events magazine, event planners are getting more optimistic about business for the rest of the year: Some 41 percent of special event professionals polled this summer by Special Events predict that the economy will start to recover this year, up from 7 percent of respondents in March. (http://specialevents.com/economy/more-event-planners-expect-economy-recover-2009-0513/)
That recovery can not come soon enough for those working in the meetings and hospitality industry and the millions of attendees they serve. As Global Speakers Federation President Lindsay Adams reminds us, “Meetings and Conferences Matter because they help sustain an educated and connected global workforce. …Where there are meetings, knowledge is gained, revenue is generated and millions of jobs are maintained.”
No matter what the short-term numbers indicate, meetings do matter. Meetings mean business. Meeting together, we can invent a profitable economic future and create the jobs that will help turn this economy around. It’s time politicians and media experts focus on the importance of meetings rather than discount their value. Meetings are part of the answer in turning our economy around.