No change: 18%
Prices are rising in the
meetings industry. In an online survey conducted in
August, M&C asked planners how they’re coping with
higher-than-expected costs. Of the 165 respondents, 45 percent said
their meeting budgets increased from 2005 to 2006, while 36 percent
said they remained the same and 19 percent saw a decrease.
But budgets do not always mesh with reality.
Almost three quarters (74 percent) said their actual meeting costs
increased from 2005 to 2006, while only 18 percent said they
remained the same and 8 percent said they decreased.
To cover rising expenses, more than
half (58 percent) asked for a budget increase in the past six
months. Of those, 48 percent were successful in convincing their
higher-ups they needed more money, while 32 percent did not get the
extra dollars and 20 percent were awaiting a decision.
When asked how they are compensating for higher
costs, 41 percent of the sample said they have contracted with less
expensive hotels, 29 percent have planned more regional meetings,
22 percent are meeting in more hub cities and 16 percent have
renegotiated group airfares.
To cut costs, 49 percent of respondents
have solicited more sponsorships, 26 percent have reduced F&B
spending, 42 percent are planning fewer off-site events, 41 percent
reduced the number of on-site staff, and 40 percent have reduced or
eliminated attendee gifts.
Looking to 2007, more than half of the
sample (56 percent) expect their meeting budgets to increase, 29
percent expect their budgets to remain the same and 15 percent
anticipate a decrease.