The road has been rocky for financial and insurance events in recent years, with meetings and incentives canceled or scaled back, and luxury properties and long-haul destinations avoided. But by 2011, when M&C last profiled this sector, the industry was on the brink of recovery, and today, with no new major economic or public fallouts, it continues to stabilize and even prosper. Some changes, such as booking top-tier properties, reflect a return to tradition. Others, like concerns over negative publicity and more scrutiny of spending, have become the new norm.
For a real-time check on the trends shaping financial and insurance meetings, M&C sought insights from top industry pros and secured preliminary research from the Chicago-based Financial & Insurance Conference Planners' Economic Impact Survey, the first comprehensive study of the industry to be conducted since 2006, due to be released later this summer.
Luxury is back Today's financial and insurance event landscape is a far cry from the no-frills, strictly business environment that prevailed in the aftermath of the federal government's Troubled Asset Relief Program and the recession, causing groups to shy away from luxury chains and resorts. "There were policies put in place and certain brands were called out; that has softened," says Tom Wilson, division vice president, sales, at Fenton, Mo.-based Maritz Travel.
Dave Akin, director of marketing at the 210-room Four Seasons Resort Scottsdale (Ariz.) at Troon North, sees the sea change reflected in his property's business. "Definitely, more insurance and financial firms can meet at luxury properties now. Some clients had put out mandates and moratoriums against using us; those have mainly been lifted," he says.
Among other luxury chains, Ritz-Carlton Hotel Co. and Mandarin Oriental Hotel Group report a strong resurgence in 2012 and beyond in group business from this sector.
Another reason luxury is back on the map: Financial and insurance companies want to retain their top performers and provide them with rewards commensurate with their efforts and expectations. "They are not short-sighted; they want quality associated with their brands and want to give their best performers a top experience," says Steve O'Malley, senior vice president at St. Louis-based Maxvantage/Maritz.
Mary Bussone, senior vice president of the ITA Group in West Des Moines, Iowa, agrees. "These companies are requiring greater effort [of their employees and channel partners] today to achieve their goals, whether it's in sales or service. The higher goals require a higher-perceived reward experience, typically at a luxury hotel."
A typical financial/insurance meeting:
Budgets have shifted According to the FICP
survey, which gathered information from 91 senior meeting executives at
North American financial and insurance firms, the average annual budget
for events this year is $3 million. While the majority of those polled
said their budgets were flat, nearly a quarter reported healthier
budgets this year over 2011, and looking ahead, most expect a moderate
uptick for 2013.
Mary Bussone reports that her clients' budgets
have increased slightly over last year. She attributes the modest boost
to two factors: the shift from a buyer's to a seller's market when it
comes to hotels and airlines, driving up those costs, as well as
companies adding more business-related activities to incentive programs,
requiring speakers, educational materials and, often, high-tech systems
like virtual polling.
Dave Akin says that most of his financial
and insurance clients' budgets are flat, but their spend allocations
are different now than they were in the pre-TARP and pre-AIG-effect
days. "They're spending less on décor," he notes, "and putting that
money in areas with more substance, such as speakers and production."
also has noticed a growing trend: More firms are looking to their
strategic partners -- e.g., credit card and other
financial/insurance-related companies -- to offset their meetings'
costs. "They allow [such partners] to sponsor meals and sessions,
similar to the way associations operate," he says.
financial and insurance clients being more conscious of value," adds
Kristi Cavanaugh, director of sales and marketing at the 179-room St.
Regis Aspen Resort in Colorado. "Instead of holding events during peak
months, they are buying shoulder months." Cavanaugh also notes that
"dinners are not as opulent. Now, they'll serve a good wine, but not the
Content is key Today,
it's rare to find a meeting or incentive program -- regardless of the
industry sector -- that does not have some educational component.
Companies increasingly are using events to discuss important changes in
the marketplace or introduce new products or practices.
example, education has a role in all the events organized for
Maxvantage's financial and insurance clients. "It's not just management
that wants it; there is an appetite and desire from attendees to bring
home something they can use in their daily jobs," says Steve O'Malley.
In this regard, according to Maritz Travel's Wilson, one financial
client is holding a series of regional meetings at major universities
around the country with the participation of top economic professors.
increased emphasis on education has led the 649-room Fairmont
Scottsdale Princess to build a second conference center, set to open in
October, to accommodate financial/insurance clients -- its number-one
"Many of those clients outgrew us because we
didn't have enough conference space," notes Michele Zwirek, director of
sales for the Fairmont property. The new $20 million facility will add
approximately 52,331 square feet of meeting space to the hotel, for a
total of 150,000 square feet. Plans call for numerous flexible breakout
rooms, a need that was pinpointed by the planners with whom the sales
team consulted when designing the space.
More are eyeing overseas destinations
Preliminary results from the FICP survey show that respondents are
holding fewer international events than they did in 2006, but industry
insiders are beginning to see an uptick in interest in overseas
"Some companies see the value of currency exchange
rates and, in light of the tight hotel supply in the U.S., are finding
more availability in international destinations," says Tom Wilson.
they are looking outside the U.S., it is to the Caribbean," notes Tracy
Norum, strategic division manager, incentive services, at Meetings
& Incentives in Caledonia, Wis., of her insurance clients. In fact,
the Caribbean is the most popular international destination for all
types of U.S. firms to hold incentives, according to research compiled
for M&C's "2012 Global Planner" supplement.
suppliers also are experiencing an uptick in business from U.S. groups.
Ken Lyons, sales manager at the Ritz-Carlton, Powerscourt, in Ireland,
notes that while the market has been slow for the past few years, in
2012 about 25 percent of the property's group business will come from
U.S. insurance/financial firms.
For her part, Cindy Hoddeson,
director, meeting and incentive sales, at the Monaco Government Tourist
Office, has seen a resurgence in incentive business from North American
firms. "This year is strong, and we already have two confirmed insurance
groups for 2013 and one for 700-plus participants booked for 2014."
Events are lengthening
The average financial/insurance event runs for 3.5 nights, according
FICP's survey findings. Sources say new bookings are going even longer.
O'Malley reports that the average duration of his clients' typical
meetings and events has increased by fully 10 percent, from 4.2 days to
4.4. "Some firms have expanded their incentive programs by a day. It
increases the value of the event to the winners, but the costs aren't
significantly increased," he notes.
Michele Zwirek at the
Fairmont Scottsdale Princess notes that "we are seeing a slow but steady
increase to three days" for meetings that had been shortened from four
to two days in recent years.
Use of technology is surprisingly sluggish"One
of FICP's goals," according to executive director Steve Bova, "is to
focus more on technology." In fact, the association featured its first
technology showcase for members last November at its annual conference
held at the Grand Hyatt San Antonio. Accordingly, FICP's survey asked
several tech-related questions. And the results were eye-opening: Just
15 percent of respondents used social media for their events, and only
15 percent organized hybrid meetings/events.
Steve O'Malley is
not surprised by the latter point. "As much as we thought virtual events
would be highly embraced, it hasn't been the tidal wave we thought it
would be three years ago, because clients say they still see the value
in face-to-face events," he says.
Low profiles still prevail Signs
emblazoned with company monikers and logos have gone by the wayside --
or gone undercover. "More and more these days, meetings and incentives
are posted under a generic name rather than the company's name," says
Dave Akin of the Four Seasons Resort Scottsdale at Troon North. For
example, he notes, "today an event might be called the Golden Circle or
2012 Executive Council, rather than the X-Company Executive Council."
Travel's financial and insurance clients also go incognito and avoid
possible negative attention, according to Tom Wilson. "It's a best
practice that is here to stay," he states.