DALLAS - The multi-billion-dollar global meeting industry is anticipating a healthy year-over-year performance as planners and suppliers equally forecast an average 4 percent growth in spending and revenue, according to FutureWatch 2004, a comparative annual outlook from Meeting Professionals International (MPI) and American Express.

Other results pointing to a welcome upturn include a likely 11 percent increase in outbound international meetings from North America; a 3 percent-plus growth in industry employment; and expansion of training budgets by at least 5 percent. Yet lingering budget constraints and market share pressures are mirrored in an identical 7 percent divergence between 2004 vs. 2003 projected spending and revenue. FutureWatch 2004 also reveals industry-first data on the pace of strategic sourcing for meeting procurement and discloses key shifts in buyer/seller business relationships.

"Meeting professionals are increasingly optimistic about the industry's health in 2004," said Colin Rorrie, Jr., PhD, CAE, president and CEO of MPI. "But we are not out of the woods. Budget and manpower declines of past years, plus new technologies and an evolving purchasing model, have changed how the business of meetings is conducted. Better communication and training are critical as market recovery creates different kinds of pressure and commoditization concerns continue to surface."

This side-by-side view on the global business of meetings is a one-of-a-kind report on quantitative and—for the first time, qualitative—responses from 2,075 North American and European meeting professionals. Fifty-four percent (1,116) were planners from corporate, independent, consultant, association, and vertical segments, and 46 percent (959) were from supplier organizations such as hotel chains, conference centers, airlines, and convention and visitors bureaus.

High expectations in 2004

In 2004, meeting planners project an average 3 percent increase in spending as opposed to a 1.1 percent decline in 2003. Their more confident supplier counterparts project a 10 percent meeting revenue increase as opposed to a 6 percent increase in 2003 continuing the 7 percent gap in expectations of last year.

"We believe there is more room for optimism however as an interesting phenomenon occurred when asking planners to estimate percentage change in budgets and then requesting they write in an actual 2004 budget amount," said Rorrie. "Although conservative in projecting how much budgets would increase percentage-wise, actual amounts written in by U.S. and European planners equate to a 25 percent boost respectively over 2003, with Canadians at 12 percent."

A robust sign for travel, U.S. planners predict 22 percent of all meetings will be international, up 11 percent from 2003, primarily to Europe and Canada (7 and 5 percent respectively). Canadian planners project an increase to 23 percent over 11 percent, mostly to the United States (11 percent) and Central America (4 percent). The majority of meetings (83 percent) will stay in Europe in 2004 as in 2003 however European planners expect to raise travel to the United States by 50 percent, up 9 percent in 2004 vs. 6 percent in 2003.

More positive indicators for recovery include planners projecting employment growth at 3 percent and a 5 percent training budget increase while suppliers project growth in employment by 4 percent and training budgets by 9 percent.

Industry-first measurement of pace of meetings management; other trends impact business

Meeting professionals face emerging challenges and opportunities as new business practices, broader use of technology, commoditization concerns and miscommunication weigh on an enterprise founded on face-to-face relationships. To benchmark changes, FutureWatch 2004 delivers an industry-first look at how quickly the industry is moving to a purchasing model similar to that of business travel.

About 80 percent of planner respondents have considered standards for areas such as contract language, travel management, registration tools, and reconciliation with more than half already employing some form of organization-wide meeting purchasing policies. Concurrently, 45 percent of suppliers indicate they conform to planner organization policies more than 50 percent of the time, but are required to be a preferred vendor less often, with just 14 percent saying they must have preferred status more than 50 percent of the time.

Increased Internet use continues into 2004, as planners indicate they expect to use it 20 percent more to research venues on top of an increase of 23 percent in 2003, with actual meeting bookings via the Web projected to increase 6 percent over last year's 5 percent increase. Correspondingly, 83 percent of suppliers expect to enhance their Web sites.

"Planners and suppliers agree in larger numbers that the industry is employing more standardization, less personal contact and more automation leading to more commoditization concerns in 2004. Write-in responses also indicate that planners will persist in asks for quick proposal turnarounds and value-added offerings, while suppliers expect higher demand will re-establish an upper hand on rates and issues such as attrition and cancellation clauses," said Rorrie.

Planners and suppliers: A growing communications gap

Another FutureWatch 2004 differentiator asked planners and suppliers to describe their working relationships, which led to analysis of more than 2,000 write-in responses. When planners were asked how suppliers could work better with them, they requested more efficient communication; quick response to requests and inquiries; better understanding of lead time and flexibility restraints; more transparent, understandable and detailed proposals; teamwork; continuation of competitive pricing; taking time to learn about their needs and work flow; and a softer approach to sales and marketing.

When suppliers were asked how planners could work better with them, they requested better and more complete communication; more lead time and flexibility; honesty regarding budgets and expectations; detailed information regarding meeting needs; teamwork; taking time to learn about their offerings and resources; and allowance for creativity.

"Clearly now is the time for meeting planners and suppliers to take the time to train and assess how to make the most of the economic recovery by learning about each other, evaluating creative ways to protect room blocks, manage attrition and cancellation, improve communication and streamline the proposal process," said Rorrie.

Other Findings of Note

  • Third parties continue to thrive with 2004 vs. 2003 estimated budget increases for independent planners to $6.5 million over $4.8 million; consultants to $6.9 million from $3 million; and multimanagement companies stable at $2.5 million from $2.6 million.
  • Average corporate meeting budgets regained significant ground moving to $5.3 million in 2004 from $4 million in 2003. Also signaling a boost are association and society planners with year-over-year average budgets at $3.1 million up over $1.4 million.
  • Proposal activity is expected to increase as planners expect to consider 4 percent more facilities or locations for each meeting in 2004 vs. 2003 and suppliers expect 11 percent more inquiries and/or proposal activity.
  • Wireless leads the list of additional technology investments being made by suppliers to enhance product appeal and customer service, with 66 percent of suppliers giving it a nod. New guestroom technologies (65 percent), new A/V equipment (62 percent), on-line booking/planning systems (59 percent) and customer relationship management systems (59 percent) also rank high on the list of supplier improvements.
  • Based on qualitative analysis, planners and suppliers agree that their great professional challenge in 2004 is the improving economy followed distantly by global terrorism.

Association Insights, an independent market research firm, conducted the FutureWatch 2004 survey, which can be downloaded in its entirety from www.mpiweb.org. Approximately 16,370 of MPI's approximate 18,000 members were invited to participate via email with overall participation representing nearly 14 percent of MPI's planner members and 12 percent of its supplier members.

Rorrie added, "The forward-focused insights of FutureWatch 2004 come at a pivotal time in MPI's history as it leads the transformation of the meeting industry with Pathways to Excellence, its strategic plan to drive fundamental change and take meetings to the next level of professionalism, recognition and inclusion in the business world."

About American Express - American Express is a leader in corporate expense management services; its Corporate Cards, Corporate Meeting Cards and Corporate Purchasing Solutions are used by more than 70% of the Fortune 500 and tens of thousands of mid-size companies. American Express Meetings & Incentives assists clients with a wide range of meeting planning and event management services. American Express also operates one of the world's largest travel agencies with more than $17.2 billion in worldwide travel sales in 2001. American Express Company, a diversified worldwide travel, financial and network services company founded in 1850 – is a leader in charge and credit cards, Travelers Cheques, travel, financial planning, investment products, insurance and international banking.

About Meeting Professionals International - Established in 1972, Dallas-based Meeting Professionals International (MPI) is the largest association for the meeting profession with 18,000 members in 64 chapters and affiliates. As the global authority and resource for the $102.3 billion meeting and event industry, MPI empowers meeting professionals to increase their strategic value with education, business growth opportunities and a clearly defined career development pathway. MPI is implementing Pathways to Excellence, its strategic plan designed to elevate the role of meetings in business via three core strategies: creating professional development pathways to evolve member careers to positions of strategic understanding and influence; educating executives about the value of meetings; and intensifying business opportunities for suppliers.

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