Industry Trends

So What’s Next?

For many respondents to this year’s State of the Industry survey, the theme for what’s next is optimism —cautious optimism, maybe, but optimism nonetheless.

The vast majority of vendors who responded to the State of the Industry survey believe their companies’ revenues will increase in 2008. While 84 percent believe that they would increase, either slightly (56 percent) or significantly (28 percent), only 4 percent believe that their revenues will decrease.

Planners had a similarly rosy view, if a little less so; 67 percent believe the meetings and hospitality industry in Minnesota will increase in 2008, while
28 percent expect buesiness to stay about the same.

According to the Travel Industry Association (TIA), the cost of travel has gone up. Data for September 2007 (the most recent data available at press time) reveals that the Travel Price Index was up by 5.1 percent compared to September 2006. The index measures the cost of travel away from home in the United States. Also, gas prices were up 0.4 percent over August, and 8.6 percent compared to September 2006. Lodging prices had risen by 7.1 percent.

Inside those numbers lay the overall message that most of the things that people use to travel or meet—gas, hotels, other travel-related expenses, food, beverages—have gone up. While the meetings industry is still humming along, everyone’s spending a little more than last year to do it.

Other movements in the industry include trends that have been moving out of the political world and into the business world. Hotels have already been dipping their toes into the concepts of sustainability and green living for a few years now, with such programs that ask guests to help them use less water and electricity. The meetings industry has been following suit.

“Being green was big in the ‘90s, then it flagged, but now it’s getting big again,” says Devie Hagen, director of sales for Madden’s at Gull Lake in Brainerd. “We’ve been a green property for a long time, and we have a committee to revisit or make sure we’re above green standards.” Thinking green may end up being more than a simple trend.

“I’m definitely seeing a trend toward more green meetings, especially in the last year or so,” says Barbara Goin, director of sales for the Mystic Lake Casino and Hotel in Prior Lake. “So we’re using reusable water bottles and using other green practices.”

The trend toward green is still in its infancy. While vendors are beginning to offer green alternatives (following in the footsteps of high-profile efforts in other industries, such as construction and manufacturing), the market doesn’t always know to demand it. “I’m already using organic materials and recyclable containers and buying locally in my business,” says Alice-Lynne Olson, owner of The Late Bloomer Floral Design Studio in St. Louis Park. “But not as many people are interested in green meetings as I would expect. It’s like the awareness is there, but people need to be educated in asking the right questions.”

Another movement has also been gaining traction for some time: the cycle from paid staff to outside contractors for event planning. The larger companies have been experimenting more with this kind of outsourcing in the past few years. Plenty of contractors out there are doing the work that in-house staff used to do. But the movement doesn’t always sit well with the vendors in the industry.

“I’ve been amazed lately at how many independent contractors are doing the work of planning meeting logistics at bigger companies, like Allianz or Medtronic,” says Hagen. “I think they end up spending more money that way, not saving it. When it comes to working together to solve problems, I’ll do that readily with a planner with whom I can have a long-term relationship, but contractors are short-term by definition, and it’s harder to do that.”

Companies seem aware that only so many meetings functions should be altogether outsourced. According to Meeting Professionals International’s FutureWatch 2007 report, meeting planner respondents to the associated survey said that only 15 percent of their meetings would be outsourced in 2007. Not only that, but only 5 percent of meetings would be totally outsourced; the remaining 10 percent would only be partially outsourced, mostly for logistical services and support, not strategic planning.