Thu, Feb. 17 at 12pm ET / 9am PT
Sponsored by FCM
Tues, Feb. 22 at 12pm ET / 9am PT
Sponsored by: Advito
Tues., Mar. 1 at 12pm ET / 9am PT
Sponsored By: TripActions
Virtual Event Series – March/April 2022
2022 Dates TBA
Virtual Event – March 16, 2022
Filter in or out as many as 200 cities, as well as hotel and car rental class and meals of the day and watch as the per-diem calculator automatically adjusts per diems to your program. Drill down into cost breakdowns and export the results.
BTN’s 2016 respondent mix managed fewer meetings dollars on average than the respondents in 2015. With a higher concentration of smaller meetings programs, BTN saw fewer signs of mature meetings programs in this year’s meetings management survey. That said, a higher concentration of smaller meetings programs suggests that strategic meetings management practices are filtering deeper into the midmarket.
Despite consolidation in the hotel industry, corporates have opportunities to compete in key markets, not to mention corporates’ flexibility to choose in what market it hosts a meeting. But they’ll need data and a purchasing strategy.
High demand and a shortage of meeting space mean hotels are charging for ballroom and conference room use, which once upon a time came free of charge if the planner booked a large enough room block. Food and beverage prices are up, and so is audiovisual. Negotiating these types of costs in advance along with the room rate is a smart move.
Centralized meetings operations‚ i.e., the planning function, is nothing new. Many corporations have a meetings department, but it’s the percentage of meetings whose logistics funnel through a centralized department or, at minimum, whose meetings data is exposed to a centralized department that shapes the visibility achieved through SMM. Case in point: Just over a quarter of respondents have centralized data while not event one-third have truly centralized meetings purchasing.
Though mobile meetings apps have not permeated the majority of meetings, 73 percent of respondents have adopted apps for some meetings. That’s more than those who reported using attendee registration technology.
There’s no sense initiating SMM if policy and engagement aren’t in place to drive effective compliance. While 83 percent of respondents had preferred suppliers in place for meetings, for example, they drove less than half of their meetings through those partners.
Respondents used attendee registration technology and online air booking as much as the year before. Process and budget management technology usage, however, dropped slightly. Just 36 percent used online RFPs in 2015, compared to 40 percent the year before. Electronic payment dropped 7 percentage points. Automation of internal approvals was cut in half, though high-demand and a seller’s market also could have affected usage.
Business Travel News conducted an online survey of travel and meetings professionals from June 2016 to July 2016. Invitations to participate were distributed to subscribers of BTN Group publications and newsletters, as well as to select subscribers of Meetings & Conventions, a fellow Northstar Travel Group publication. The research was sponsored in part by Delta Air Lines. A total of 243 respondents qualified by indicating they have decision-making responsibility for at least one critical meetings management function. Not all respondents answered all questions. Unless otherwise noted, data displayed in this report has been rounded to the nearest whole number.
The Global Business Travel Association rolled out its strategic meetings management model 12 years ago. As the organization readies a third version for debut in the upcoming days to reflect new maturity in the practice, many companies surveyed in BTN’s 2016 Strategic Meetings Management study are stuck in first or second gear.
Those who start and end strategic meetings management under the governance of travel management may view the meetings policies and processes around venue sourcing and contract signing authority as the end game of the initiative. There’s a lot to be said for implementing those facets of SMM. The risks tend to be lower and the returns are tangible in terms of savings and efficiencies. Pros are quick to recognize that value.
“The venue sourcing piece is like the second cousin of travel management,” said vice president of Carlson Wagonlit Meetings & Events Tony Wagner. “It allows [the SMM leader] to show value and exhibit some data control. Those aspects of SMM are in clear alignment with procurement, and [they allow] corporate executives to see good financial control internally. That’s a win.”
The BTN survey showed many companies leaning heavily on the venue sourcing and contracting aspects of SMM but not yet digging deeper to realize additional benefits. It was a sticking point that continued from last year, when the BTN survey showed a spike in procurement’s involvement in meetings, as well as a significant move among respondents to lock down contract signing authority to gain visibility into meetings activity but also to mitigate financial and legal risks. That trend line is holding fairly steady.
What’s missing in BTN‘s numbers is a clearer reflection of a more mature trajectory: the deeper dive that the most effective programs are taking—thinking beyond savings to react intelligently to the market—to support corporate duty of care and to align programs with revenue generation. Overall, to step outside of a strictly sourcing mind-set.
One reason for that gap may be buried in the survey demographics. This year, BTN saw a larger percentage of smaller and midsize volume meeting buyers responding to our strategic meetings management survey. That, in itself, however, reflects a trend in the market. As midsize buyers enter the space, we may be seeing the next wave of meetings management adoption.
These buyers will start in the same way their peers did: with sourcing, contract governance and select technology adoption. That said, maturity may come faster for this new wave than it did for the first- and second-movers in the space. A level of program maturity that once took six or eight years to achieve from concerted SMM efforts, may now take just two to four years, given more complete technology stacks, available integrations and an evolution toward better business alignment in the meetings management space overall.
In this report, BTN will explore that shift across four vectors:
1) The convergence of travel and meetings management
2) Meetings globalization and duty of care
3) Strategic meetings management and marketing
4) Small and midsize programs adopt SMM
All of this, however, is informed by market dynamics.
BTN’s 2016 Strategic Meetings Management study showed an increase in meetings spend for full-year 2015 over 2014, with 42 percent of survey respondents reporting higher meetings spend for that year and a 14 percent average increase among that set. Just 14 percent of respondents overall noted decreased meetings spend for 2015—but with a larger drop, at 17 percent. Weighting both sides for the trend, the needle swung toward higher spend volumes for 2015
Respondents projected roughly the same effect for 2016. Thirty-six percent reported a trajectory toward increased spend over 2015, with an average increase of 13 percent. Only 10 percent said their company’s meeting spend would drop in 2016, pegging the average decline at 15 percent.
Rising meetings costs in 2016 have not been entirely a matter of hotel rates, according to the BTN study. Nearly two-thirds of survey respondents said their group hotel rates were “about the same” as in 2015. Those rates were nearing peak last year with high demand and comparatively low inventory in some major markets. One-fifth of survey respondents reported higher group rates in 2016, while 17 percent managed to reduce their room rates this year.
If pressure on hotel rates saw even a small reprieve in 2016, it’s likely to be short lived.
Hotel Consolidation Motivates Spend Management
The hotel merger and acquisition environment is looming large for meetings and travel management. Marriott and Starwood announced their planned merger last November and finalized the proposal in late March after a last-minute challenge by Chinese investment consortium Anbang. If consummated as planned—Chinese regulatory approval has delayed its expected closing this summer—the Marriott-Starwood deal will create the largest hotel company in the world with a total of 30 brands.
A Carlson Wagonlit Travel report released in June showed that in 14 of the 20 cities worldwide where CWT transient travel clients spent the most, the combined portfolios of Marriott and Starwood would represent 30 percent or more of corporate room nights. In Minneapolis, the worst-case scenario in the study, that number would rise to 50 percent after the merger.
That type of market dominance has motivated corporates to look closely at how to improve their volume positions. Plus, it’s not just Marriott-Starwood. Smaller deals like Accor’s acquisition of FRHI hotels, which closed in July, will continue, while the Mar-Star deal has put pressure on larger brands like Hilton, Hyatt and IHG to go big to compete.
At the end of the day, though, there could be some interesting opportunities for meetings buyers despite pressures from consolidation, according to Wagner. “The hotel market is still pretty fragmented,” he said. “Companies may have opportunities to do deals with hotel management companies and ownership groups in key markets, and there is often flexibility in where you deploy the meeting and the market that you choose.”
They’ll need data and a purchasing strategy to convert those opportunities. Among BTN’s survey respondents, under one-third had brought the purchasing function under central management; just a quarter were pulling the data together.
Travel & Meetings Merge
“People are getting nervous because of the Marriott-Starwood merger,” said Jill Huffman, Cardinal Health senior manager of global travel management and meetings management. Though Huffman began to merge Cardinal’s travel and meetings programs prior to the megamerger announcement last fall, she gets frequent calls from industry peers to ask how she did it. “At first they want to talk about travel management, but almost every time they end up talking to me about meetings,” she said.
Monica Dickenson, head of meetings and events for global biotech company Shire, implemented a strategic meetings management program over the course of 12 months at her former organization Baxalta, which combined with Shire in June. Shire is looking to Dickenson to clone that SMM program for the newly integrated enterprise. Dickenson takes a unique approach to her preferred supplier partners, certifying them through an intensive training program in all things Shire. She spoke with BTN about why she developed the program.
BTN: What suppliers are targeted for certification?
Dickenson: Currently, it’s designed for third-party meeting organizers. As a combined organization, we had a lot of third-party suppliers managing our meetings, but for the centralized [meetings services] group, we only had three preferred third-party meetings management companies. We wanted to make sure that the market share was coming through the central program for meeting planning services because we know these three suppliers are 100 percent dedicated to this type of service. Not to mention we can guarantee lower pricing. Still, I wanted to figure out how to elevate our suppliers over those other “preferred” suppliers. So I [proposed] certifying our third parties and writing it into the meetings policy to support our efforts in controlling the market share and resources in this category.
BTN: What does certification entail?
Dickenson: We have 30 standard operating procedures, two meetings and compliance technology tools, service level agreements with key performance indicators and, in addition to the meetings policy, we have several interdependent policies like transient travel and expense that intersect with our meetings policy. Our third parties are trained on the same policies, technologies, processes as our internal meetings team. Whether the [meeting owner] works with someone internally or a third party, they get the same level of service. Via the policy, our central meetings department controls whether the meeting owner will work with an internal person or a third-party provider, but a lot of the time, they can’t tell the difference.
BTN: Why would anyone work with a non-certified partner?
Dickenson: Because we are pharma, meetings include a significant amount of content. There are companies out there that specialize in content and they say to our meeting organizers, “Hey, we’ll bundle our services and do the content and the meeting planning services and you can work with one person.” From a customer perspective, that sounds great. In some cases it could be great, and the meetings department is open to looking at this as a solution, but it has to be right for the business. We also wanted to work with meeting owners to educate them on the services already available to them. We can offer them the same service model, so the meeting owner still has one contact while being more cost effective.
BTN: Would you consider taking this certification program beyond third-party meeting organizers, say, to hotel partners?
Dickenson: Absolutely. I’ve worked very closely with many of the national sales organizations that we have today, not just with Shire, but throughout my career. I do appreciate the value of those partnerships. We want our hotel partners to understand our business and who owns the relationship. I want to make sure the hotels, down to the property level, have enough awareness that if a meeting organizer comes to them independently, before they issue a contract, it is OK to alert us. This is beneficial to both Shire and the hotels.
According to American Express Meetings & Events senior vice president and general manager Issa Jouaneh, “The M&A environment on the supply side is driving companies to [improve] visibility into overall spend to inform their supplier negotiations. We are certainly seeing more interest in leveraging transient and meetings spend.”
CWT Meetings & Events’ Wagner said he sees the same. “How to leverage [total] meetings and transient volume is the biggest consulting practice growth that we have.”
Gaining that joint visibility relies on execution of the basics: implementing strategic meetings management and travel management consistently. Jouaneh said that even those in the implementation process can reap some rewards, though. “We’ve seen suppliers open to a partnership approach with companies that have a clear understanding and the ability influence business to preferreds.”
Wagner cautioned, however, that it doesn’t happen overnight. “You aren’t going to launch the SMM in June, have the RFP go out in October and get results in 2017. You need more data.”
Monica Dickenson, head of meetings and events for global biotech company Shire, started with internal partnerships and new policies when she implemented her SMM program last year at Baxalta, a program that will be cloned under Shire since the combination of the two companies was completed this June.
Policy directs all meeting organizers to initiate business through Dickenson’s centralized meetings group. Should meeting organizers bypass the centralized group, Dickenson has established check points with legal, finance, procurement and travel management to identify that business and pass it back to the central group.
She has partnered closely with travel management not only to identify purchase orders for noncompliant meetings but also to tap into transient hotel deals where possible. “We break down the transient program to identify preferred properties that are appropriate for meetings,” she said. “If we need to bring on a new supplier, we also work closely with the travel group on combined RFPs.”
Still, Dickenson would like to work more effectively with travel management by creating a “freestanding” group hotel program and coming together with travel management for joint business reviews with suppliers to truly leverage the volume of each other’s programs. “That’s one of the next items on my road map,” she said. She also wants to integrate registration and booking technologies to increase control of the booking and data pathways. “I see a lot of potential there,” she said.
Huffman took a different approach when she implemented SMM at Cardinal Health. With transient data in hand, she’s transformed Cardinals’ negotiating position by breaking down the silos between the two programs.
“Especially when we go out to the Marriotts and Hiltons of the world, the total combined volume has been very effective for the RFP process,” she said. And not just for savings. With visibility into travelers’ needs on both a transient and meetings basis, Huffman has negotiating some innovative inclusions to avoid unexpected charges.
“We’ve found that many of our transient travelers actually have a need for conference space,” said Huffman. “So when we source for transient, we look for a level where our travelers can get up to two hours of free conference space.”
Meetings Globalization: Maturing into Duty of Care
Huffman’s approach to SMM was informed by another factor that has influenced recent SMM implementations: globalization.
“We see this in a few verticals right now,” said Wagner, who added that many companies need to move quickly with this process. “Pharmaceutical and healthcare because of the need to regulate, new technology companies because they want to get that big marketing bang fast and also in the energy sector because it’s [a depressed market] right now and they see an opportunity to optimize.”
The push for globalization at Cardinal Health was initially a regulatory play. “Cardinal had acquired Cordis, which held a lot of congresses in Europe, and we needed to ensure that we had the right governance in place,” Huffman said. She had gone to the United States-based meetings team, which decided to step back from globalization in Phase 1. So Huffman started the implementation independently with Europe and Asia-Pacific. With those regions up and running, the United States-based team has seen the positive effects and has raised a hand to be included in the global program.
Beyond regulatory compliance, a huge part of that positive effect has been on duty of care.
“With a globalized program that includes both transient travel and meetings, there are no silos in spend or duty of care,” said Huffman. “I can bring in the [data] feed from transient travel, but I also have the ability to work with our third-party [meetings company] that we use for Europe and the Americas and bring that data into our security system. In Asia we have multiple third-party providers that I pull into our system,” said Huffman.
“This gives us a lot of visibility around group air or if we have a program where we need to bring in security detail proactively. We have access to all of that.”
Attaining duty-of-care visibility has become a priority for many multinational companies, according to Wagner. Controlling the data plays a big role, here, making a meetings management strategy critical to success.
As an industry, though, Wagner said meetings and events need to think even bigger. “Managing safety and security used to be [knowing] who was on airplanes. It’s not airplanes anymore. It’s not even safety and security in hotels,” he said. “We are seeing great demand for duty of care in terms of travelers but also for those attending locally. If there are smaller meetings couched within a bigger event, do we know who’s there? We need to get our arms around that.”
Duty of care comes at a cost. An SMM program predicated on savings as the primary success metric may struggle to come terms with that. “There is no ROI for companies doing a 25-person meeting to care about safety and security,” said Wagner. “I think there will be some shaking out of that. Companies have to decide to prioritize.”
SMM Meets Marketing
Taking a step back from meetings and looking at how companies measure results, they don’t start with operational savings. They start with topline revenue. So is there a better metric than savings for measuring meetings management efforts, one that supports that topline strategy?
American Express Meetings & Events’ Jouaneh said the whole picture is starting to change. “Our clients are looking at SMM as a tool kit to support strategic business objectives,” he said. “[They are looking for] innovation in working with internal stakeholders to create flexibility in solutions and service configurations. They want to balance traditional tenets of savings, visibility and control with delivering on the attendee experience.”
Mobile meetings apps have become a huge part of that drive to engage with the attendee—and establish touchpoints that go beyond the live event, said Jouaneh. “There is a clear shift to mobile applications to empower attendee engagement, pre-, during- and post-event, and there is more desire for insights into how live meetings are driving business outcomes.”
BTN’s Strategic Meetings Management Survey reflected that shift—to an extent. Similar to the results of last year’s survey, respondents deployed online registration at higher rates than any other traditional meetings technology tool. Sixty-three percent said they used them as part of their core technology stack. Asked whether they had ever used a mobile meetings app, however, 73 percent said, “yes,” but only for a fraction of their programs. They are eager to test the waters.
That result brings up a new question about meetings management and technology adoption. Will mobile apps become the new gateway technology for delivering meetings data? And what does that mean for meetings management?
According to Wagner, it portends a larger shift toward marketing and overall revenue generation as the focal point of meetings management.
“When you look at SMM and marketing, there wasn’t a lot of data to pull out [until now],” he said. “The attendee registration piece—[meeting organizers] just look at it as a way to automate the task of planning the meeting.” As mobile technologies have gotten better and smarter, the data they generate has become more valuable.
Jill Huffman, senior manager of global travel and meetings for Cardinal Health, needed to figure out how to manage meetings without a mandated policy. Enter payment. Limiting access to the purse strings proved an elegant solution. Here’s what she did.
BTN: How did you get your hands on meetings payment?
Huffman: Fairly early in the process, I took over the governance of the meetings card. I worked with finance to put limits on the payment vehicles so that any meetings payment request would have to come back through my process.
BTN: What kind of limits?
Huffman: There were three types of payment: travel cards, procurement cards and meetings cards. I restricted the merchant codes on these cards so that travel cards could only pay for air, hotel and car expenses up to $10,000 and could only pay those categories. Procurement cards were the opposite: air, hotel and car are restricted categories that cannot be charged on a P-card. Meetings cards, however, are configured specifically for meetings and they have to come through my process to get one.
BTN: That gives you a lot of visibility and data.
Huffman: I look at global meetings spend on a weekly basis. We know what meetings are planned; we can shift business when meetings are canceled, and we are able to capture the commissions, which helps pay for the meetings.
“The data set you can get with the mobile app—you can see how long attendees stayed in the session, you can track how they were using the app features during the session to engage with the content or not to engage,” Wagner continued. “Before now, we didn’t have access to this data, and it definitely wasn’t making it back to the [customer relationship management systems], the Marketos and Eloquas of the world. Now that we have the tools and the data, SMM is going to evolve. It’s always been a good value proposition, with good savings and efficiencies. That’s all good stuff. But companies have meetings to grow the topline.”
Small & Midsize Adopt SMM
As mature programs push the SMM practice forward, smaller and midsize programs are reaping the benefits of lowered barriers to entry. The BTN survey showed a larger percentage of small and midsize programs working toward SMM than ever before.
For the smallest programs, perhaps those with fewer than 50 meetings annually that largely surround a headquarters city, certain practices of SMM should apply. Companies clearly benefit from a risk and liability perspective once they limit contract signing authority. Online registration, another widely used facet of SMM among survey respondents with smaller programs, can offer a task management benefit for any program. It becomes questionable, however, whether tracking data for volume sourcing purposes is worth the effort, according to Wagner. In the midmarket, though, it starts to make sense.
“In the midmarket, SMM is trickling down,” he said. “They start purely in the venue sourcing space, and for many of [these companies] sourcing equates to SMM. It can be a no-cost model through a commission-based provider.”
Whether the corporate meetings strategy will extend beyond sourcing is a toss-up in the midmarket, but Wagner thinks they should take a long, hard look at the opportunities. “If they learn the market and expose that to their teams, they’ll realize much more quickly than their SMM predecessors that their work can drive revenue. Once they see this, they’ll approach SMM much differently than they might have four years ago.”