Bouncing back

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The mood may be fragile but confidence is building and advance bookings are up… Stand Out looks at EIBTM’s Global Industry Trends and Market Share research.

Corporate bookings are expected to grow in 2011, incentive business will improve and event bookings are up on 2010 – these are just some of the findings to have been released by Reed Travel Exhibitions at EIBTM.

The EIBTM 2010 Global Industry Trends and Market Share report says that industry is displaying cautious optimism and the signs indicate sustained growth in corporate meetings.

According to the study buyers have become adept in driving down costs with tough negotiations, and events are now more serious in content as industry continues to avoid frills and lavishness.

Rob Davidson, the report’s author and senior lecturer in business travel and tourism at the University of Westminster, comments: “Whilst for 2010 most economists were divided on whether the global recovery would grow, stall or even reverse, now at the end of the year there is talk about favourable prospects for global recovery albeit it slow and uneven. However, the vast majority of indicators for the meetings and events industry point to improved business conditions ahead in 2011.

“Business barometers in 2010 have indicated that the industry continues its recovery apace indicating that current business conditions are better than a year ago. There is definitely a clear majority who feel optimistic about the future.”

For most of 2010, economists continued to be divided on whether the global recovery would grow, stall, or even be reversed in the year ahead. However, by the end of the year, more and more of them were daring to talk about favourable prospects for global recovery, albeit it slow and uneven.

However, the vast majority of indicators for the meetings and events industry point to improved business conditions ahead in 2011.

MPI Business Barometers in 2010 indicated that the industry was continuing its recovery at a steady pace. The majority of August 2010 Business Barometer respondents (62 per cent) indicated that current business conditions were better than a year ago. At the same time, there was a clear majority feeling optimistic about the future, with 70 percent of August 2010 Business Barometer respondents projecting better upcoming business conditions than a year ago.

Corporate budgets for meetings and events are widely expected to grow in 2011. For example, in the British Meetings and Events Industry Survey corporate respondents reported an average 5.6 per cent increase in their budgets for 2011 – although association budgets were predicted to fall by an average of one per cent.

The outlook for the incentive travel market also looks favourable, according to the most recent Pulse Survey from the Incentive Research Foundation, which reveals that survey respondents (incentive providers, corporate incentive travel buyers, incentive suppliers, and others) predict that the incentive business will improve in both 2011 and 2012. Overall, 68 percent of Pulse Survey respondents predict that business will be better for the incentive industry in 2011, and 77 per cent say it will be better in 2012.

Heralding positive news for suppliers, the Advito 2011 Industry Forecast 2011 predicts that although the supply of corporate meetings facilities and services outweighed demand in 2010, that will begin to turn around in 2011, reversing the trend for lower rates and short-notice reservations. According to Advito 2011 will see sustained growth in demand for corporate meetings, which will push up rates for the first time since 2008, but shaky economic confidence means that increases will generally be small, with the possible exception of markets characterised by high-demand levels, such as New York and London, where steep rate rises may occur. If occupancy rates continue to rise in 2011, then supplier confidence will strengthen considerably and, with little new supply expected, pricing will turn sharply upwards in 2012. Advito’s advice to its clients included the recommendation to buck the trend towards shorted lead times by booking their corporate meetings earlier in order to avoid either zero or only expensive availability in 2011.