The SITE Index 2018 reports positivity and growth for the sector
The global MICE industry has been confronted with many challenges this year. From political uncertainty to natural disasters, from terrorist attacks to economic instability, much has happened in 2017 to impact business events.
The Society for Incentive Travel Excellence (SITE) Foundation recently released the SITE Index 2018. An annual analysis and forecast for the incentive travel industry, it explores the complex environment in which MICE professionals currently work and shows that, despite world events, optimism in the incentive travel sector is still high.
The comprehensive survey of 574 respondents from 74 countries, including 201 buyers, covers behaviours of both buyers and sellers of incentive travel services, revealing some positive indicators, as well as a look at future trends for the industry.
Nearly half of incentive travel buyers report an increase in their overall budget and the average spend per person has significantly increased from US$3,000 to US$4,000. This increase may be attributed to a greater number of responses from corporate buyers in the financial and professional services, science and technology, and pharmaceutical and healthcare industries, all of which are strong users of incentive travel.
TECHNOLOGY IS AN INCREASINGLY IMPORTANT PART OF THE DEPLOYMENT OF PROGRAMMES
Over half of buyers report that they are planning to increase the number of people eligible for incentive travel programmes, continuing the trend over the past two years. Buyers of incentive programmes universally believe them to be strong motivators of performance, with increased company sales and profitability remaining the most important business objective, followed by improved employee engagement.
More buyers say incentive travel programmes have been “very effective” (72
percent versus 51 percent in 2016). There is also a slight increase in the measurement of
incentive programmes, driven by one-third of corporate buyers reporting they “almost
always, or always” track return on investment or return on objectives.
Although budgets have increased, buyers are still continually looking for ways to reduce costs, with some selecting less expensive destinations and reducing amenities.
This may indicate a trend towards more elite programmes, with fewer qualifiers given even more extraordinary rewards in exchange for their exceptional performance. At the same time, sellers of incentive travel services are attempting to add value through greater creativity and innovative event design.
Air transportation still comprises nearly a quarter of budget, although technology is an increasingly important part of the deployment of programmes whether for communications, budgeting or operations . Programme apps and data tracking tools are now far more commonplace in the delivery of incentives.
The survey also found that there is more optimism about global and national
economies among buyers and sellers. Although safety remains a top concern, it has decreased since 2016 and both buyers and sellers report that it’s not a deterrent to a strong incentive market.
Despite terrorist incidents in Europe, buyers planning programmes to Western Europe increased four percentage points over 2016. Among Middle Eastern and African buyers, the most used destinations outside their region are Western Europe, Eastern Europe and Southeast Asia.
Buyers and sellers were asked to rank seven criteria for selecting one destination over another for an incentive travel programmes. Destination appeal was the top reason, whereas access from a participant’s city or origin – a key criterion when selecting a destination for a meeting or conference came in fifth place.
The survey also found that the top three sources of influence when choosing a destination for incentives are recommendations from trade associations, from incentive houses and travel partners, or word of mouth within the organisation.
Both buyers and sellers also report that sustainability is having the most positive impact on incentive travel. This correlates to the finding that a majority of programmes now include at least one CSR activity.
Buyers and sellers of incentive travel will benefit greatly from reviewing the SITE Index report, applying the findings and implementing strategies, to ensure that their business will continue to grow and the global incentive travel industry will remain strong for years to come.