Business Travel Growth in the SME Sector
Although business travel is slow to recover, there is some very encouraging news for those of us that handle meetings as part of our business travel portfolio. Both Amex and Northstar surveys indicate that meetings in the SME sector are part of that encouraging trend:
Amex M&E's 2023 Global Meeting and Events Forecast is based on a survey fielded in May and June of 580 global meetings and events professionals across five continents and 23 countries. The report highlighted several trends as the volume of in-person corporate meetings climbs back from their pandemic depths.
Small and internal meetings are dominating the recovery. The number of internal, small and simple meetings in several regions have surpassed 2019 levels by as much as 25 percent among some Amex M&E clients and will “continue to be the fastest growing category in 2023 across all regions,” according to the report, which pegged North America with the sharpest growth trajectory, followed by Latin America, Europe and Asia-Pacific. This trend is partially driven by the fact that nearly half of survey respondents' organizations now operate with a dispersed workforce and require such events to build corporate culture.
North America can expect the highest rate increases going into 2023, according to the report. Amex M&E forecast 2023 meeting spend in this region to increase by 3.8 percent year over year and pegged projected average group hotel rates to increase 7.4 percent and group airfares to increase 7.8 percent. Survey respondents expected increased volume for every type of in-person meeting in 2023 compared with 2022, with the largest increase expected to be in small and simple meetings, at 4.7 percent. Virtual and hybrid events are projected to decrease. Even facing steep pricing increases and competition for venues and space, North American meeting professionals are optimistic, with 65 percent rating their career outlook at an eight or higher on an ascending scale of one to 10; 72 percent rated meetings industry health at eight or higher.
Strong meetings demand is creating a market for automation and strong supplier relationships to work together to navigate challenges and greater control over the booking process, according to the report. Currently, longer-than-expected request-for-proposal response times are plaguing meetings organizers as they jockey for prime meetings space, often with one-off event requests. These challenges are sending meeting organizers around policy guardrails just to make a meeting happen.
Amex M&E suggested that strong meetings management that automates policy and approvals and minimizes administrative headaches will be key to capturing data and advancing meetings strategies, and that includes the small meetings segment. Specialized small meetings tools emerged prior to the pandemic but are gaining more traction now given the new environment, according to the report. While such tools sometimes diverted the meetings-management process away from specialists and toward meeting owners, strong policy guidance built in these tools can optimize guidance and data collection among ad hoc event organizers, allowing meeting program managers more visibility into the total meetings portfolio, according to the report.
Northstar Meetings Group and Cvent reported a strong demand for new events and a busy Q4 amid rising costs in the latest Meetings Industry PULSE Survey.
According to the survey, “demand for new events remains strong” with “68 percent of planners booking or actively sourcing,” which aligns with August activity. The industry can expect a very busy Q4 as the data showed “62 percent of planners will produce their next event before the end of the year.”
The survey also noted most respondents were optimistic in terms of the meetings industry with only 16 percent stating they were “less optimistic than they were in August.” More than 60 percent of respondents were “more optimistic” regarding how their outlook on meeting and events changed in the last six weeks.
The highest report of optimism this year was among planners surveyed in March 2022 (more than 70 percent claimed they were “more optimistic”) contrasting against a wave of January cancellations due to Omicron—a period during which sentiment was particularly negative.
While meetings volumes and optimism continue an upward trajectory, so do expenses. The survey highlighted the impact of rising costs as 86 percent of survey respondents said they were feeling the material impact on their events. At the same time, they are trying to gain a return on experience, but “cost containment is just as important,” the survey noted.
Meeting volume may be high for organizers right now, but attendance is as much. According to the survey data, 2022 attendance was down overall—still below pre-pandemic levels—and “will likely be down next year.” More than 60 percent of respondents report Covid-19 is “not a factor” in their planning. This group is up 10 percent since August, marking a growing distance from pandemic concerns.
Mark Altman
Forte Business Travel Solutions
516-624-0500 x5072
maltman@travelsavers.com
Sources: American Express Global Business Travel – 2023 Global Meetings and Events Forecast and the Northstar Meetings Group – Northstar/Cvent Meetings Industry PULSE Survey
