Annette Gregg
CEO, SITE & SITE Foundation
The incentive travel sector made a dramatic recovery following the pandemic, with some regions – although not Asia – getting back to 2019 levels by the end of 2022.
In many regions, 2023 produced record revenues for agencies, DMC, hotels and venues; but supply chain challenges rained on the parade. These supply chain issues are expected to last well into 2024 and are among the headwinds the industry faces in the Incentive Travel Index (ITI), SITE and the Incentive Research Foundation’s annual global survey of the industry.
Other headwinds for 2024 are rising costs, inflation and short-term planning that cause uncertainty.
In terms of destination selection, the 2023 ITI reveals a robust preference among buyers for “destinations not used before”; good news for second- and third-tier destinations that can now expect to enter the consideration set.
Urban destinations, eschewed during the pandemic, continue to rank low for incentive travel buyers, while demand for resorts, particularly all-inclusive resorts, is at an all-time high.
While transcontinental travel has resumed, it is decisively risk-averse and cautious and is consolidated around tried-and-tested destinations. And despite the prominence of “new” destinations in the consideration set, these are nearby, local, national or regional locations, as opposed to longhaul.
In terms of programme design, buyers are increasingly relying on elements such as group meals and teambuilding to reinforce company culture and foster relationships between participants and the C-suite.
Sustainability is also increasing in importance as a key programme inclusion, but more among European than North American planners.
As we enter 2024, corporate buyers are that incentive travel is acquiring a more strategic role and purpose within their organisations. It is increasingly more than a mere company trip in fulfilment of a sales campaign, and more an annual opportunity to focus on company culture and values.
Technology will continue to insinuate itself into the daily routine of incentive travel professionals in 2024 and beyond, although the 2023 index shows little appetite among incentive travel professionals for artificial intelligence (AI), with only seven per cent expecting platforms like ChatGPT to disrupt marketing and communications.
The spend per head on incentive travel will increase over the next three years, with 58 per cent of ITI respondents predicting levels above, or significantly above, 2022 by 2025, versus nine per cent who forecast that spending will be below or significantly below 2022 levels.
Still on budget, 64 per cent of ITI respondents are predicting an increase, or a large increase, in airfares by 2025. Production levels for incentive events and gala dinners may also fall, with six per cent of respondents forecasting a large decrease versus four per cent who see an increase.
Geoff Dickinson
President 2023-2024, UFI
Until the end of 2019, the Asian exhibition industry enjoyed more than 20 years of uninterrupted growth. In early 2020, Covid-19 unleashed a global health crisis and an unprecedented challenge to our industry.
According to the latest research from UFI, net space sold at trade fairs in Asia fell from 24.5 million square metres in 2019 to just 3.3 million square metres in 2022.
In 2022, while most of the exhibition industry in Europe and the US was back to the business of organising events, China was shut down for the entire year as it stuck with its Covid-zero policies. The rest of the region made a cautious restart in 2022, but many of those markets still had some Covid restrictions in place for at least part of the year.
As a result, net space sold in most Asian markets was down between 60 and 70 per cent compared to 2019. The markets with the most restrictive approach to managing Covid-19 – China, Hong Kong, Macau and Taiwan – recorded a drop of between 80 and 100 per cent.
Thankfully, all of the key exhibition markets have recorded a remarkable recovery in 2023. UFI’s latest barometer shows that India will exceed its pre-pandemic revenues again in 2023.
Looking at venue space sold, China, Japan, India, South Korea and Hong Kong are expected to match or surpass net space sold this year when compared to 2019. Together, these markets make up more than four-fifths of the regional market size.
With the new UFI barometer data coming out in a few weeks (at press time), I am expecting more positive news, and more growth being forecast for 2024.
But there remain many critical issues: a shortage of qualified staff, the need to make events more sustainable, higher travel and hotel costs, as well as the impact of war and geopolitical tensions. UFI’s five trends to watch describe these in more detail, and these issues will remain top of mind throughout the year.
Despite these substantial challenges, it is encouraging to see Asia’s exhibition industry return so rapidly to a position of strength and growth, but the next test of our industry will be to address these challenges head-on.
Peter Koh
Chair, APAC Advisory Board, GBTA
Business travel is anticipated to return to pre-pandemic spending levels in 2024, a finding outlined in GBTA’s 2023 Business Travel Index.
In the same report, GBTA found that the global business travel industry rebounded in 2022 at a more accelerated rate than expected, and is now expected to surpass the 2019 spending level of US$1.4 trillion in 2024.
The three main reasons for this conclusion were varied, with respondents citing pent-up demand, especially for groups and meetings after the Covid-19 pandemic, more favourable global economic conditions in 2022 and 2023, and recession risks that have yet to happen.
The industry also reports general optimism in terms of outlook. GBTA’s most recent Business Travel Outlook Poll (October 2023) found that 67 per cent of travel buyers surveyed expect their travel budgets to increase or remain about the same in 2024.
Moreover, only one in 10 buyers report they are currently implementing a plan to limit business travel because of economic concerns. So, despite rising costs and economic uncertainty, companies see value in face-to-face business interactions and are eager to get back on the road.
However, risks and threats for the year ahead include geo-political circumstances, persistent inflation in certain areas, much tighter global financial conditions, and deterioration in the manufacturing sector.
Another topic we see gaining even more traction in 2024 is emerging technology. It is increasingly clear that technology – from tools such as AI to the implementation of new industry technologies related to New Distribution Capability – is going to play a larger role in the future of business travel.
How large of a role remains to be seen. While nearly half of the respondents in the October poll feel new industry technologies will pose the most significant technological challenges in the year ahead, only about a third of all stakeholders are excited about AI, and another third feel it is too early to predict its full impact. Lastly, GBTA expects sustainability and conversations around people and the planet will gain momentum in the coming year to produce real industry action. For example, the GBTA Foundation is starting with the collective procurement process to produce the industry’s first Sustainable Procurement Criteria, beginning with education through an academy course centred on business travel management sustainability and tools. The industry has a long way to go before a business trip will be entirely net zero, but it is eager to progress with planning, collaboration and collective innovation.
Moving forward, we will see continued interest in blended ‘bleisure’ travel. Almost half of Asia Pacific-based business travellers – 45 per cent – extended a work trip for leisure time last year. This is higher than the share of travellers who took a blended trip in any other region.
Business travellers also continue to view travel as key to achieving their goals, where 70 per cent say they are now travelling the same or more than they did in 2019, with 81 per cent reporting business travel is worthwhile to achieve business objectives.
Senthil Gopinath
CEO, ICCA
Asia Pacific is ready and geared for business. For our members and our associations, we believe the practical solutions to make things happen, and the cultural richness of Asia-Pacific – so mesmerising, so unique, so varied – are placing venues, cities, and communities near the very top of a global wishlist.
It is ICCA’s role to share the good news stories and advocate why our industry has a home in this region. We of course champion sustainability, legacy, DEI, and innovation… and we believe this will all influence where business goes.
ICCA is proud of our history, but we are more excited by the future, especially as we face it stronger than ever. Asia-Pacific has genuine capacity for growth and everyone at ICCA will do all that we can to enable it through engagement, action, and collaboration.
The recent 62nd ICCA Congress in Bangkok is a testament to the wonderful relationship we have with the Asia-Pacific region. The numbers were excellent: over 1,120 attendees from over 80 countries and territories, over 80 associations, over 100 speakers, and 360 minutes of member-led co-creation content. It was the most successful ICCA Congress in the region and the third-largest ICCA Congress of all.
Asia-Pacific is blessed with countless great venues, amazing staff, dedicated support teams, a desire to promote our industry at the highest social and political level and great work being undertaken.
Initiatives are afoot, such as the Bangkok Pledge on Gastronomy Sustainability by ICCA, as well as a ICCASkills educational programme making landfall in Beijing and Christchurch. BE Sarawak will also be supporting the Association Impact Masterclass this coming April.
One last memory from the ICCA Congress in Bangkok is a group of very happy Thai university students, thrilled to be guests at the congress.
We hope they, and many other students and young professionals, will get to enjoy plenty of opportunities to be involved in our business meetings, gatherings, and events in 2024.
By bringing them into our community and showing them what is possible, we do not just dream of the future… we start building it.
As the former vice president of sales & marketing, Greater China at Marriott International, he brings a wealth of knowledge and insights to the intricacies of market dynamics and consumer preferences.
She has a background working across private and public sectors, from Hilton and Mars to the White House in the US, as well as experience in embedding sustainability into business models across the private and public sectors.
