Meetings No 22
Intro
Constructive Journalism
Atti Soenarso: Journalism that offers a fuller picture of our world.
Cover Story
Anna Rosling Rönnlund, Gapminder
“We’re right, you’re wrong. It’s as simple as that.”
Intermission
You have to have Stories to tell
The simple poetry of My Life as a Dog.
Long Tail Insights
The Power and Legacy of Conferences
Stories of serendipity, innovation and driving social change.
Smart Decision
Sustainable Meetings Vital Part of the New Strategy of Gothenburg
Gothenburg has a clear plan.
Radar
African Convention Bureaux Will Lead the Way
Agenda 2063 is a call to action.
Radar
IBTM World Announces Tech Watch Award shortlist
A shortlist of nine finalists has been announced.
Economic Impact
Incheon – Forward-thinking Metropolis
A South Korean city with a demand for business events.
Intermission
You Are Not Safe
Predicting the birth of the Internet with 20/20 hindsight.
Global Index
Gaining Edge Launches Global Competitive Index
Bigger isn’t always more competitive.
Radar
IACC confirms 63 new member venues in Denmark
The new venues are part of Danske Konference Centre.
Sharma
Isn’t It Time? The 13 Questions for Visionaries
Robin Sharma hopes to help you win.
Thought Leadership
A Futurist on the Future of Payments
Anders Sorman-Nilsson: It has to be frictionless.
Radar
Tips for Measuring ROI
Two ROI experts share their insights.
Forecast
CWT Meetings and Events Forecast 2019
Data-driven insight and expert analysis to maximise your results.
Kellerman
Our Knowledge Bank Is Growing
Roger Kellerman: New knowledge flows to us.
classifieds
news
business intelligence
One theme set to dominate 2019,
according to IMEX Group: how to leverage assets
business intelligence
The Meetings Show’s advisory board
predicts the biggest trends for 2019.
Business Intelligence
ICC Sydney Bolsters Legacy Program,
Unveiling Dedicated Creative Industries Stream.
futuristic
IACC partners with industry greats
and World Obesity Federation to bring delegate dietary requirements guide for meeting planners.
business Intelligence
Scottish Event Campus (SEC)
submits planning application to create global facility for world class events.
Hi tech
IBTM Trends Watch report
highlights importance of tech to events industry.
business Intelligence
BestCities
unveil ground-breaking ‘Universal Accessibility in Meetings’ research.
Fast growth
IACC
confirms 63 new member venues in Denmark
Growth from Asia
Asia Pac exhibitors
extend footprint at IBTM World 2018.
IBTM World 2018
When the party’s over… top tips for measuring ROI
top tips for measuring ROI.
Links
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CWT Meetings and Events Forecast 2019
Data-driven insight and expert analysis to maximise your results

‌“We have been examining the global and regional outlook for the year ahead, and the industry trends that will shape 2019 and beyond. Our goal is to offer insight and ideas that will drive even greater success for your meetings & events (M&E),” says Cindy Fisher, Senior Vice President and Global Head, CWT Meetings & Events.

“The trends show more events of every size. Whether your meeting is for 20 or 2,000, this report aims to be your guide for getting maximum return on investment, attendee engagement and value creation. There’s a palpable buzz around the technology that feeds into enhancing delegate experience, data capture and simpler logistics. Online booking tools for venues and group transport are set to boom in 2019, while almost half of you are taking advantage of CWT Meetings & Events’ expertise in strategic meetings management (SMM). All the pieces of the puzzle combine to create events that will bring a real return on your strategic business objectives. I wish you every success with your meetings and events program in 2019.

The growth in demand for meetings and events There has never been a more exciting time for meetings and events. The increase in sophisticated venues across the globe and innovation in tech is making boundless creativity a reality. And smarter ways of using data to fine-tune the value around meetings programs are in full effect.

The digital revolution and use of social media as a key channel for sharing messaging are reinforcing the value of engagement, discussion, conversation, and networking – all areas where meetings and events triumphs.

Face-to-face is valuable – and with the latest ’CMO Survey 2018’ from Dentsu Aegis Network finding that six in ten marketers expect budgets to rise in 2019, and Cvent’s Global Planner Sourcing Report 2018 showing numbers and size of events expanding year-over-year, it’s evident that demand is set to grow in 2019.

Meanwhile, a pipeline of hotel and venue openings outside major cities is bringing additional choice at a reduced cost – sometimes up to 40 per cent less – for meeting planners who can be flexible on location.

“Demand for meetings far outstrips supply of venues and hotels as the number of meetings and budgets increase in North America, in response to the strength of the economy. It causes challenges and were seeing more hotels declining to respond to request for proposals (RFPs), which is encouraging clients to increase their lead times to get the properties they want for their events.”

Tony Wagner, Vice President, Americas, CWT Meetings & Events

“Return on investment (ROI) is still not fully embedded in the industry. While the practice is continually spoken about, ROI has not yet taken hold in a significant way, so our challenge is to get event planners and CMOs thinking about their programs and individual events at least six months in advance.”

Ian Cummings, Vice President, EMEA, CWT Meetings & Events

On the demand side, the tech and retail industries are investing heavily in the power of live experiences. These industries will be the ones to watch for innovation around destinations, venues, facilities, social media engagement, gamification and augmented reality.

Savings are certainly possible – but the key message is to plan ahead. Our research shows that the optimum time for booking meetings and events activity for small groups is 30+ days, while for large groups the sweet spot is 75+ days. Outside of these booking times, potential savings dip by 5–10 per cent.

Consolidation of a meeting program can help with pricing. Our data shows strategic meetings management (SMM) can save 22 per cent less time on sourcing and an average 19 per cent additional negotiated savings on room nights.

The possibility of finding savings amid high demand is there for the taking – it’s just a matter of planning ahead for a year of events that will motivate, drive knowledge, and ultimately lead to business success.

5 fast facts concerning 2019

  • Optimum time for booking small meetings: + 30 days
  • Forecast global average increase in hotel rates: 3.7 per cent
  • Forecast global average increase in air prices: 2.6 per cent
  • Forecast growth M&E demands: 5–10 per cent
  • Fastest growth in meetings of the size: 101–500

North America

Economic growth fuels the industry. North America’s buoyant economy is driving meetings growth. Tech companies, in particular, are adapting to demand for more customised, experiential events by holding smaller meetings of 20–50 people in multiple cities on a six-monthly loop.

Increasing regulation on transparency in the pharma sector is impacting on budgets, but the cyclical nature of the global industry means that some companies – with new product launches – are investing in their meetings and events programs, while those with products coming off patent are looking to make savings of up to 30 per cent.

Overall, the North America meetings market will continue to be driven by robust economic growth in the United States, with projections from the Carlson Wagonlit Travel (CWT) / Global Business Travel Association (GBTA) 2019 Global Travel Forecast suggesting growth of 2.8 per cent in GDP in 2019.

Strong economic growth in the US was fueled by President Trump’s tax cuts in late 2017, but there are fears that potential trade wars with China, the European Union and even neighbouring Canada and Mexico could severely hamper economic growth.

Hotel rates on the rise Average hotel prices are likely to rise by 2.8 per cent in North America in 2019, which will push up costs for meetings buyers. Average daily rates (ADRs) have been on the rise for the past five years.

Demand is already exceeding supply for hotel venues – particularly for larger meetings and conferences. The buoyant US market is expected to see a 14 per cent increase in group sizes in 2019 as organisations use their meetings and events program to spur further growth.

The US pipeline for new hotels is strong with an estimated 5,300 properties currently planned, adding more than 630,000 rooms across the country (source: Lodging Econometrics).

But despite the high overall numbers, there are very few “big box” properties with 500-plus rooms and extensive conference facilities being built. This is not expected to change given the business models of the major hotel firms concentrate on expanding their “select service”, mid-scale and budget brands, which typically have limited meetings and events facilities.

“Demand continues to outpace supply of meetings-eligible hotels. The demand for meetings, which includes accommodation, is going to be significantly challenged by a lack of inventory. Continuing industry consolidation means fewer options for buyers and that will push prices up.”

Nathan Brooks, Senior Director and Global Lead, Supplier Management, CWT Meetings & Events

Top 10 cities in North America 2019 (2018)

  1. Las Vegas (San Francisco)
  2. New York (New York)
  3. Orlando (Dallas)
  4. Boston (Orlando)
  5. San Antonio (Philadelphia)
  6. Dallas (Phoenix)
  7. Seattle (Atlanta)
  8. San Francisco (Chicago)
  9. Chicago (Seattle)
  10. Vancouver (Las Vegas)

Average Group size 2019: 88

Lead times set to increase With a tight market for meetings in 2019, lead times will increase in the US, as clients have to act earlier to secure their desired venues and dates.

Lead times for events of 100-plus attendees, which require a ballroom and breakout spaces, are now being booked between four to six months in advance, while events for 400–500 delegates are being planned six to nine months ahead. Booking more than one year in advance is becoming the norm for major conferences and conventions.

North America: Key destinations A surge in the opening of new hotels across New York City has helped moderate rates and make the city a more attractive meetings destination. New York has added 45,000 rooms over the past ten years taking the total up to 118,000 rooms. This upward trend is expected to continue with another 18,000 rooms due to be introduced by 2020. Also, the US $1.5 billion expansion of the Javits Center in Manhattan, will add 1.2 million square feet of new exhibition and meeting space from 2021.

One major city seeing a hotel capacity squeeze is San Francisco, which will keep prices high – particularly as the city is already the number one meetings destination in the US.

The impact of commission cuts Marriott’s move to cut group sales commission from 10 to 7 per cent for bookings in the US and Canada was swiftly followed by similar commission cuts by rivals Hilton and IHG at North American properties.

This reduction in commission means organisations now face the prospect of higher costs for their meetings and events programs.

Rachel Lunderborg, Global Director, Solutions & Analytics, CWT Meetings & Events, explains what clients can do to mitigate the impact of these commission cuts. “Commissions are a way for us to keep costs down for the program. The commission cuts will force the buyer to become more strategic to make up for these increased costs by looking at control management strategies,” she says. “This includes putting in place preferred agreements with suppliers and focusing on other terms and conditions. It’s really about negotiating hard over the business terms to make up the difference from the reduction in commission. Organisations have to refocus their volume and spend to those suppliers who have not cut commission. That’s where you can make a difference.”

Asia Pacific

The forefront of growth for 2019 Asia Pacific is expected to continue growth in 2019, with the average meeting size up 3 per cent and China seeing consistent expansion year-on-year. This is set to continue in 2019.

Countries such as Vietnam, Myanmar and the Philippines are seeing a meetings and events buzz as multinational companies establish their presence, with more inbound and outbound travel from these markets predicted for the coming year.

The International Monetary Fund (IMF) is forecasting GDP to rise by 5.6 per cent next year. And the major economies of China (+6.4 % in 2019) and India (+7.3) will stay in the lead.

Travel is growing hugely in China across all sectors – it is already the world’s largest business travel market, while Chinese tourists spent a total of US$258 billion on international tourism in 2017 (source: UNWTO).

This sustained surge in demand for air travel and accommodation will continue to push up prices in the region. We are predicting airfares will rise by 3.2 per cent in 2019 with hotel rates set to go up by 5.1 per cent.

With such strong growth throughout the region, there is an increased willingness by organisations to spend on meetings and events.

A critical factor With hotels playing host to around 90 per cent of meetings and events in Asia Pacific, the sector’s development will be crucial. More than 4,200 hotels are being developed in Asia Pacific, which will add more than 900,000 rooms. This ranks behind North America in terms of new hotel projects and number one in total new rooms.

China A region in its own right. China has its own market dynamics and regulations. Tier one cities such as Shanghai and Beijing have a strong regional and global presence, allowing them to compete for international conferences with other major Asia Pacific destinations such as Singapore, Hong Kong, Japan, and Sydney.

Prices in cities like Shanghai are now on a par – or even higher – than other major cities outside China, despite the scale of hotel growth in the destination.

Meanwhile, second and third-tier Chinese cities, such as Chengdu and Chongqing, are more popular for domestic meetings and events as well as international exhibitions and trade shows.

Sanya on the vacation island of Hainan in southern China is growing as a destination for annual meetings, particularly in winter when it is seen as a warm weather alternative to Shanghai and other more northerly cities.

China accounts for more than half of Asia Pacific’s new hotels (59 %), which will add more than 500,000 rooms to the country’s portfolio. Shanghai will see the biggest rise in hotels with 125 projects set to introduce 25,750 rooms. Expect this to strengthen the city’s position as the number one meetings destination in the region.

“Fast growing markets in the region, such as Myanmar, need to work on developing and training more meetings and events professionals to support the increasing demand flowing into the market.”

Sam Lay, Senior Director, Asia Pacific, CWT Meetings & Events

Mature vs. developing markets The more mature destinations in the region – Singapore, Hong Kong, Tokyo and Seoul – are leading the way when it comes to hosting conferences that focus more on thought leadership and the exchange of ideas rather than real commercial activities.

In developing markets such as Vietnam, Philippines, and Cambodia, exhibitions and trade-shows take centre stage in promoting trade activities in the markets.

Domestic events are a huge part of the market in more isolated parts of the region, including Australia and New Zealand. Sydney and Melbourne still attract regional and global conferences, despite long travel times.

Japan: A sporting hotspot Japan will be a hot destination in the next couple of years as it hosts the Rugby World Cup tournament in 2019 followed by the 2020 Olympics in Tokyo. The country’s government wants to increase visitor numbers to 40 million in 2020, a 40 per cent rise on 2017’s arrivals, with plans for 60 million by 2020.

Top 10 cities in Asia Pacific 2019 (2018)

  1. Shanghai (Shanghai)
  2. Singapore (Singapore)
  3. Beijing (Schenzhen)
  4. Bangkok (Beijing)
  5. Sydney (Sydney)
  6. Tokyo (Bangkok)
  7. Hong Kong (Taipei)
  8. Melbourne (Tokyo)
  9. Mumbai (Guangzhou)
  10. Chengdu (Hong Kong)

Average group size 2019: 81

“Border control in the UK is a concern post-Brexit if tighter measures lead to longer queues at airports. Paris, France, will win over the UK if its tricky for attendees to come into the country, especially from Asia.”

Ian Cummings, Vice President, EMEA, CWT Meetings & Events

Europe, Middle East and Africa

An industry expands The industry remains positive, with mature European markets demanding enhanced engagement and innovation – making events an ideal showcase for the power of face-to-face in a digitally-focused world.

In the Eurozone, inflation hit 2.1 per cent in July, according to the European Commission’s statistics bureau, Eurostat, above the European Central Bank’s target of keeping price rises below 2 per cent, while in the UK the Bank of England has raised interest rates for only the second time in a decade.

While safety and security are always a priority when planning any meetings and events activity, it seems the terrorist attacks in the UK, France, Spain, and Germany in 2016 and 2017 have not significantly dampened demand in London, Paris, Barcelona and Berlin.

However, secondary cities like Birmingham, Manchester, and Liverpool continue to see growth. Non-traditional event venues such as sporting arenas are tapping into the income possibilities from meetings and events, offering greater choice for planners.

As Greece has made progress towards political stability, we have seen a re-emergence of demand for Athens for meetings and many of the Islands for incentives. Islands such as Mykonos have become hot incentive destinations and are now being positioned as an excellent alternative to Ibiza, south of France and other popular Mediterranean destinations. Mykonos has rapidly emerged as one of the coolest destinations in Europe.

Despite ongoing Brexit negotiations casting uncertainty over how the deal will play out for airlines, visas and border control, the popularity of London as a destination has not abated. The city was propelled to the number one spot in Europe, Middle East and Africa (EMEA) this year.

Russia’s hosting of the FIFA World Cup 2018 is likely to have impacted on the appeal of Moscow as a meetings and events destination, while Paris, Barcelona, Berlin, and Madrid remain perennially popular.

Hotel rates on the rise Like with airfares, hotel prices in Western Europe are forecast to see the highest increase of any region globally, rising 5.6 per cent next year.

A supplier’s market means there’s little room for negotiation on rates, as occupancy hit highs of 82 per cent in London and Amsterdam despite additional supply, while terms and conditions are becoming the golden ticket for any added value.

In Eastern Europe, there’s a projected decrease of 1.9 per cent on hotel rates. In the Middle East and Africa is expected to go down 1.5 per cent.

European airfares – East vs. West Airfares in Western Europe are predicted to be the fastest-growing worldwide, with a projected increase of 4.8 per cent in 2019.

However, it’s a different picture in Eastern Europe, where rates are projected to decrease by 2.3 per cent, while in the Middle East and Africa there’s a similar downward trend of 2 per cent. Surging oil prices – which rose to $78.77 a barrel in June, up from $46 the same time last year – have now stabilised at around $70, but the availability of low-cost carriers is expected to moderate the aviation market.

Growth in the Middle East The CWT/GBTA 2019 Global Travel Forecast projects regional growth to increase to 3.8 per cent in 2019, and hold firm through 2020. The increase in growth is expected to be driven by a favourable global economic environment, stability in the oil market at slightly higher prices, and post-conflict reconstruction.

Top 10 cities in Europe, Middle East & Africa 2019 (2018)

  1. London (London)
  2. Moscow (Paris)
  3. Barcelona (Istanbul)
  4. Berlin (Amsterdam)
  5. Hamburg (Barcelona)
  6. Vienna (Moscow)
  7. Stockholm (Dubai)
  8. Cologne (Berlin)
  9. Paris (Madrid)
  10. Frankfurt (Cologne)

Average group size in 2019: 48

Selected extracts from the annual CWT Meetings and Events Forecast. You can find the report in full at www.cwt-meetings-events.com/2019metrends.