Macau is staying active in the business events scene, and continues to induct new event spaces, develop fresh attractions, as well as expand her stable of hotel rooms through property expansions.
One major project in the works is the Galaxy International Convention Center. The venue features a 10,000m2 pillar-less exhibition hall, a 4,000m2 conference hall, and a 16,000-seat Galaxy Arena for concerts and sporting events.
Directly connected to the convention centre will be the Andaz Macau, set to open soon with over 700 rooms and suites. Also in the pipeline is the 483-suite Raffles at Galaxy Macau.
All three builds are part of the Galaxy Macau expansion plans. Although construction has been completed, their openings will largely depend on how the pandemic situation plays out.
Nearby in Cotai, Studio City’s phase two expansion is also happening.
Once complete, approximately 900 hotel rooms will be added – one of which is a W hotel – alongside a state-of-the-art business events venue, and attractions such as the Super Fun Zone – a four-storey family-friendly entertainment facility – and an indoor water park.
More hotel rooms will join Macau’s portfolio via the Treasure Island Resort World Hotel. Facing Nam Van Lake, the property will boast 600 hotel rooms and a five-storey shopping and entertainment complex.
According to a Macao Government Tourism Office (MGTO) spokesperson: “These new developments will provide Macau with the necessary infrastructure to work towards the goal of deepening “tourism +” cross-sector integration, including “tourism + MICE”, “tourism + sports”.
“This will take the city’s tourism industry to the next level, fostering related sectors and diversifying the destination’s offerings, to attract different profiles of visitors for longer stays and more spending.”
Earlier in April, MGTO also unveiled a promotional campaign – titled Experience Macao, Unlimited – which will sport different themes each month. The most recent theme in June was gourmet food, reflecting the Creative City of Gastronomy recognition by UNESCO.
A spokesperson from the Macao Trade and Investment Promotion Institute (IPIM) shared that the organisation will help planners to “enrich local itineraries” that revolve around various themes.
For now, as Macau patiently waits for borders to open, the various hotels continue to reinvent and revamp their offerings to stay competitive.
For instance, Grand Hyatt Macau has been revamping its F&B menus that utilise seasonal or organic ingredients due to the increased emphasis on wellness.
A hotel spokesperson added that the Grand Hyatt Macau also provides “hybrid meeting solutions” with the latest event technology for meetings as small as 10, up to large conventions of over 1,000 people.
The Londoner Macao, which opened in 2021, is also waiting to unveil its 6,000-seater multipurpose arena for big conferences and concerts, as well as a 1,700-seat Londoner Theatre.
For now, to capture the hybrid events market, Sands China has unveiled the Smart Stage at The Londoner Macao, an Extended Reality (XR) studio.
Smart Stage offers professional broadcast quality live-streaming capability and hologram functionality. Unlike the classic ‘green screen’ environment, XR allows presenters to interact with real-time visual markers to deliver a more authentic experience.
Within the 1,400m2 venue, the backdrop, floor, and stage lighting can all be customised, designed and operated to suit an organiser’s requirements, shared general manager sales and marketing at t the Sheraton Grand Macao, Cotai Central and The St. Regis Maca, Daniella Tonetto.
On the activities front, “many of the integrated resorts have begun diversifying and revamping their products to further differentiate themselves,” general manager for Hong Kong & Macau at global agency MCI, Olinto Oliveira told TTGmice.
For example, Lisboeta Macau lures younger travellers with its H853 Fun Factory, a one-stop retail-tainment space that includes exhilarating attractions such as the 388m-long ZIPCITY Macau, first-ever indoor skydiving centre GoAirborne, and various art exhibitions.
In mid-2021, Studio City opened a waterpark which Oliveira opined will make a “big splash” with groups in the summer months. The resort is also home to Legend Heroes Park – the city’s first tech-based VR theme park.
Oliveira confidently stated: “Overall when the time comes for major events and conferences to return to the city, visitors will certainly be pleasantly surprised to find that the city has been hard at work ensuring that the destination continues to be a premier location for unforgettable experiences.”
Global travel prices are predicted to continue to increase in the remaining months of 2022 and throughout 2023, according to the 2023 Global Business Travel Forecast, published by CWT and the Global Business Travel Association (GBTA).
Rising fuel prices, labour shortages, and inflationary pressures in raw material costs are the primary drivers of the expected price growth, according to the report, which uses anonymised data generated by CWT and GBTA, with publicly available industry information, and econometric and statistical modelling developed by the Avrio Institute.
Macroeconomic influences
The world economy shrank 3.4% in 2020 in one of the worst declines since World War II. Service sectors, including travel and hospitality, were hit especially hard, but the global economy recovered briskly, rising off the lows of 2020 and increasing 5.8% in 2021.
Economic growth is moderating as the recovery lengthens, although another recession is a growing concern. The current base case scenario for 2022 is for 3% growth, followed by 2.8% growth in 2023. Cautionary notes also highlighted in the 2023 Global Business Travel Forecast, highlight the three main forces exerting pressure on the economy and the business travel industry. These include Russia’s invasion of Ukraine coupled with other geopolitical uncertainties, inflationary pressures that are pushing costs higher, and the risk of further Covid outbreaks that could restrict business travel.
Conversely, with businesses ranking sustainability among their top priorities and reflecting the accelerated importance of combating climate change, the report highlights greater visibility at the point of sale for greener travel options, as well as carbon foot-printing, and environmental impact assessment is an opportunity for the travel industry to actively assist in responsible choice-making.
Meetings and events
Prices have increased in all regions across most categories of spend, fuelled by pent-up demand, a desire to build company culture and an uncertain economic outlook. The cost-per-attendee for meetings and events in 2022 is expected to be around 25% higher than in 2019, and it’s forecast to rise a further 7% in 2023.
Alongside pent-up demand, corporate events are now competing with many other types of events that were cancelled in 2020. And, with many companies having given up office space during the pandemic in favor of remote working, they are now booking meeting spaces when staff gather in person, further fuelling demand.
Shorter lead times for events, varying from one to three months versus six to 12 months, are also contributing to this perfect storm, perhaps underscored by corporate concerns that the situation they face today could change very rapidly. This is particularly noticeable within Asia Pacific, which has been slower than other regions to re-open post-pandemic, with ongoing restrictions in China prompting clients to make sure their events can go ahead, and as quickly as possible.
Air
Business travel airfares fell over 12% in 2020 from 2019 followed by an additional 26% decline in 2021. Economy ticket prices fell over 24% from 2019 to 2021, while premium tickets fell 33%. Prices are expected to rise 48.5% in 2022, but even with this steep price increase, prices are expected to remain below pre-pandemic levels until 2023. Following an increase of 48.5% in 2022, prices are expected to rise 8.4% in 2023.
Rising demand and continued price rises on jet fuel, which have seen prices more than double in some markets to over $160/barrel according to S&P Global, are putting upward pressure on ticket prices.
Premium class tickets comprised over 7% of all tickets purchased in 2019. The share of premium class tickets fell to 6.5% in 2020 and to 4.5% in 2021 but have started to rise in 2022. Through the first half of the year, premium tickets made up 6.2% of all tickets purchased. A rising share of premium class tickets will result in higher average fares as average ticket price comprises economy and premium.
International and cross-border bookings are recovering across most regions which will result in a higher share of international ticket bookings and a corresponding higher average ticket price despite uncertainties caused by the war in Ukraine. Following two years of minimal to no expenditure, business travellers are likely to be willing to spend more on tickets, especially as availability reduces due to labour shortages. This upward trend is largely due to widespread vaccine rollouts and border re-openings.
Hotel
Hotel prices fell 13.3% in 2020 from 2019 and a further 9.5% in 2021, however the report expects them to rise 18.5% in 2022 followed by an 8.2% lift in 2023. Hotel prices have already eclipsed 2019 levels in some areas such as Europe, the Middle East & Africa and North America and are expected do so globally by 2023.
Hotel rates have risen sharply in parts of the world including a 22% rise in North America – and a forecast 31.8% across Europe, the Middle East & Africa – driven by an accelerated recovery coupled with continued capacity constraints.
Hotel rate increases were initially driven by strong leisure travel in 2021 but group travel for corporate meetings and events is improving and transient business travel is similarly gaining healthy pace, putting further pressure on average daily hotel rates.
Ground transportation
Global car rental prices fell 2.5% in 2020 from 2019, before rising 5.1% in 2021. Prices are expected to increase 7.3% in 2022, hitting new highs, and rise a further 6.8% in 2023.
The vehicle industry remains capacity constrained and rental agencies which reduced fleet sizes in the wake of the pandemic, have not yet fully recovered – due in part to component shortages and supply chain disruptions that have reduced global auto production.
Rental agencies have reverted to buying used vehicles to increase fleet sizes and are keeping their vehicles longer. Some agencies are also buying vehicles from auto-makers outside of their historically supported brands.
Skyrocketing prices, vehicle shortages and the need for visibility into carbon emissions from door-to-door are driving corporate travel managers to factor ground transport into full trip planning from the beginning. This is especially true when factoring in the inclusion of electric vehicles, and while widespread adoption may still be a few years away, personal preference should not be underrated.