The key to success in our current industry seems to hinge on one word: flexibility. We see the U.S. financial market sitting on a seesaw with the global economy, creating ups and downs that require balance and tenacity. With one tip, the meeting professional can teeter, but a strong hold on creative solutions will level the fear.
“We should be asking ourselves, ‘What can I do that will make me an invaluable business weapon for my clients?'” says Bruce MacMillan, president and CEO of Meeting Professionals International (MPI). “If your answer is the same today as it was three months ago, that’s a problem because the entire business paradigm has shifted.”
This change is evident in the World Tourism Organization’s (UNWTO) Barometer report, which reveals that international tourist arrivals fell to less than 2 percent in June and 1 percent in the peak travel months of July and August. The UNWTO reports “energy prices, inflation and the credit crunch started to have a real impact on travel and tourism. The economic downturn, combined with the current uncertainties, extreme market volatility and a decline in both consumer and business confidence are expected to continue taking their toll on demand for tourism – at least in the short-to-medium term.”
According to Katie Callahan-Giobbi, executive vice president of MPI and chief business architect for the MPI Foundation, 60 percent of their members surveyed anticipated a decrease in meeting spend. However, 37 percent expected to see a modest spending increase of 3 to 5 percent.
“While some segments and organizations are pulling back, some see this as a time of opportunity,” Callahan-Giobbi says.
During the 2001 recession, independent meeting planners were able to use their entrepreneurial skills to carve out a nice piece of the event planning pie. Companies found the prospect of outsourcing meetings attractive because independent contractors required no benefits or overhead investment. As companies tighten belts again, many corporate planners are worrying about job stability.
“This was the trend that emerged post-9/11, but I’m always cautious about comparisons to [the] 9/11 recession,” MacMillan says. “[However], I think independent planners have an opportunity to be much more innovative and flexible in creating new value-added services and approaches without the confines of existing organizational structure.”
MPI’s November 2008 Business Barometer shows that corporate business activity has suffered more than association business activity. MacMillan says the “AIG Effect” is partially to blame because it has forced “corporations to make an analysis of the impact of turmoil on their own businesses.”
“I think the specter of federal regulation in one way, shape or form on certain industries or organizations is on the radar screen,” MacMillan adds. “President-elect Obama has been very clear on his willingness to explore it for financial services.”
How then is the corporate planner — with an organization that may be struggling under a volatile stock market, bankruptcy rumors and employee layoffs — able to survive in this current climate?
Proving the value of each meeting or event is the best way to keep it from being cancelled.
“If you can show an immediate return on investment (ROI) by attending a meeting, a forward-looking CFO or CEO, whoever’s making the decisions, may listen to you,” says Warren Marr, advisory – hospitality and leisure, PricewaterhouseCoopers. “If it’s maintaining our networks and connectivity, that makes a lot of sense right now.” Face to face meetings continue to be the most effective way for a company — especially one that has several branches — to educate, train, motivate and communicate with its workforce.
Callahan-Giobbi says that live events are gaining a reputation as being a valuable marketing technique, as well. According to the MPI Foundation/George P. Johnson EventView study of Fortune 1000 chief marketing officers, experiential events give the highest ROI of any corporate marketing program. “We need to remember and demonstrate that meetings and events are part of a business strategy,” Callahan-Giobbi says.
As long as companies continue to scrutinize business plans and examine cost-containment or cost-reduction strategies, Marr suggests planners consider choosing flexibility over price when negotiating contracts. “If you’re negotiating with hotel A and they’re $10 higher on the room rate, but they’re going to give you more flexibility in making your room block commitments, that’s something in the uncertainty of this economy that you might want to look at,” he says.
In this ambiguous economy, looking at the whole picture and processing information quickly can provide an edge. MacMillan suggests taking more of a right-brained approach to meetings and events.
“Exploring a new value paradigm has to be a conscious choice,” MacMillan says. “If any planners or suppliers are doing the same-old, same-old, they suffer the same risk of being outsourced or replaced by a computer.”
Monica Compton, CMP, is an event specialist with Pinnacle Productions Inc. She has 16 years of experience as a global meeting planner, managing a variety of corporate programs both domestically and internationally.