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Measuring the Economic Importance of the Meetings Industry Developing a Tourism Satellite Account Extension

Copyright © 2006 World Tourism Organization Calle Capitán Haya, 42 28020 Madrid, Spain

Measuring the Economic Importance of the Meetings Industry – Developing a Tourism Satellite Account Extension ISBN-13: 978-92-844-1195-5 ISBN-10: 92-844-1195-5

Published and printed by the World Tourism Organization, Madrid, Spain First printing 2006 All rights reserved

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Table of Contents

Achnowledgements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

v

Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Aims of the Study . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . What is a Tourism Satellite Account? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Method . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Key Finding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Trends in the Meetings Industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Key Measures of the Meetings Industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Recommendations on Meetings Industry Data Collection . . . . . . . . . . . . . . . Recommendations on Meetings Industry Definitions . . . . . . . . . . . . . . . . . . . . Current Problems in Measurement of the Meetings Industry . . . . . . . . . . . . . . Limitations in Use of Existing TSA for Estimating the Economic Contribution of the Meetings Industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Adapting the TSA to Measure the Meetings Industry . . . . . . . . . . . . . . . . . . . Statistical Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Proposed Broad Methodological Steps . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Further Issues to be Considered . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

vii vii viii ix ix ix x xi xii xii xiii xiv xv xvii xvii xvii

Main Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1

1

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.1 Aims of the Study . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.2 Background to the Study . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.3 Scope . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.4 Structure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.5 Method . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3 3 3 4 4 4

2

Global Overview of the Industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.1 Trends in the Global Meetings Industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.1.1 Trends in Meetings and Conferences. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.1.2 Trends in Exhibitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.1.3 Trends in Incentives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2 Current Data Collection Practices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2.1 Data Collection by Global Agencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2.2 Data Collection by National Tourism Organisations . . . . . . . . . . . . . . . . . . . . . 2.2.3 Convention Bureaux and City Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

5 5 5 9 11 11 12 13 13

© 2006 World Tourism Organization - ISBN 978-92-844-1195-5

iv

Measuring the Economic Importance of the Meetings Industry

2.2.4 Summary of Previous Studies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2.5 Gaps in Meeting Industry Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Definitional Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3.1 Nomenclature for the Industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3.2 Definition of Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

14 17 18 18 19

Using the TSA to Evaluate the Economic Contribution of the Meetings Industry . . . 3.1 The Economic Contribution of the Meetings Industry has Two Components. . . . . . . . 3.2 Use of an Existing TSA to Provide an Indicative Estimate of the Economic Contribution of the Meetings Industry . . . . . . . . . . . . . . . . . . . . . . . 3.3 Limitations of the Use of the TSA in Measuring Meetings’ Activity . . . . . . . . . . . . . . . 3.4 The new International Standard Industrial Classification 823, ‘Convention and Trade Show Organisers’ . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.5 Implications of ISIC 823 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.6 Presentation of Results: A Meetings ‘Satellite Account’ . . . . . . . . . . . . . . . . . . . . . . . 3.7 Conclusions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

21 25

2.3

3

4

5

25 26 27 28 29 30

Framework for an Evaluation of the Meetings Industry . . . . . . . . . . . . . . . . . . . . . . . . 4.1 Measurement Problems . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.2 Data to be Collected . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.3 Collection of Expenditure Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.4 Lessons from Previous Research in the Meetings Industry . . . . . . . . . . . . . . . . . . . . . 4.5 Surveying Participants in Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.6 Expenditure on Travel to Meetings in Other Countries . . . . . . . . . . . . . . . . . . . . . . . . . 4.7 The Use of Survey Data to Measure the Economic Contribution of the Meetings Industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.8 Quarterly Measures of Meetings Industry Performance . . . . . . . . . . . . . . . . . . . . . . . .

33 33 34 35 35 36 37 38 39

Proposed Broad Methodological Steps and Further Issues to be Considered . . . . . 5.1 Proposed Broad Methodological Steps . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.2 Further Issues to be Considered . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

43 43 45

Appendices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A: Summary of Supply of the Meetings Industry Facilities by Country . . . . . . . . . . . . . . . B: Congress and Convention Centres in the Americas Region . . . . . . . . . . . . . . . . . . . . C: Case Study . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . D: Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E: Example of Venue Identification from the National Business Events Study (NBES) . . . F: ICCA Categories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . G: Examples of Questionnaires to Collect Relevant Data . . . . . . . . . . . . . . . . . . . . . . . .

47 47 59 61 63 67 69 71

Bibliography. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

79

List of Abbreviations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

81

Acknowledgements

The publication of this study on Meetings Tourism is the result of a fruitful collaborative effort carried out by the World Tourism Organization (UNWTO) and Affiliate Members Reed Travel Exhibitions, the International Congress & Convention Association (ICCA) and Meeting Professional International (MPI). Given the common interest in gaining better knowledge of the tourism industry and of all the elements that contribute to the development of tourism in general, the UNWTO Department of Statistics and Economic Measurement of Tourism and the Business Council of the Affiliate Members addressed the concerns raised by these Members regarding how to measure the meetings industry’s linkage to tourism and the extent to which the conceptual framework of the Tourism Satellite Account is capable of elucidating this linkage from a macroeconomic perspective consistent with the measurement and analysis framework of the National Accounts of countries in which this industry is a prominent activity. Thus the groundwork was laid for an intensive effort carried out with great professionalism by the team of experts - Margaret Deery, Leo Jago, Larry Dwyer, Ray Spurr and Liz Fredline - of the Sustainable Tourism Cooperative Research Centre (STCRC) of Australia, which was able to rely on the support of the collaborating entities at all times. In fact, the “National Business Events Study: An Evaluation of the Australian Business Events Industry”, conducted by the STCRC and published in 2005 served as an important reference source for this new study. From that perspective, the study constitutes the starting point of a longer-term task that, with the efforts of the parties involved, will contribute to broadening and strengthening the public’s recognition of this industry, which has taken off so spectacularly over the past several years and has consolidated itself as a tourism segment of the first order. We also wish to underline the importance of the coordination efforts carried out by Jens Jensen, initially from his post within the Business Council, and in the latter stages, as an expert on the subject, which made it possible to achieve the necessary coherence of the study within the framework of the objectives of the programme of the Business Council of the UNWTO Affiliate Members. Lastly, we would like to acknowledge the editing work carried out by UNWTO consultant Stan Fleetwood (Australia), who drew on his comprehensive knowledge of the Tourism Satellite Account for the final revision of this study. Madrid, November 2006 Victoria Marcos Executive Director Affiliate Members Antonio Massieu Chief, Statistics and Economic Measurement of Tourism


Executive Summary

The Meetings Industry has emerged over recent decades as an important contributor to national economies. It is perceived as a significant and growing component of tourism and other industries and yet little reliable and consistent data exist to support this perception. With the lack of consistent concepts and definitions, as well as data, it is impossible to measure the industry accurately. Therefore the industry is unable to credibly demonstrate its value. In an attempt to rectify this gap, the World Tourism Organisation (UNWTO), and Affiliate Members, Reed Travel Exhibitions and International Congress & Convention Association (ICCA) – in cooperation with Meeting Professional International (MPI) commissioned the Sustainable Tourism Cooperative Research Centre (STCRC) from Australia “to encourage the UNWTO to focus more on the Meetings Industry and in partnership to undertake a study that would lead to proposals for the adaptation of the Tourism Satellite Account (TSA) to reflect the real importance of the Meetings Industry and its contribution to tourism” (Meetings Industry Terms of Reference, p 1). Tourism, in fact, was confronted with this same problem of being unable to demonstrate its value and hence the TSA was developed. This study is a first important contribution on how the TSA could be used as an analytical tool to measure the tourism connection of the Meetings Industry. In order to obtain comparable figures, however, additional efforts by the Meetings Industry will be required to: 1.

define the appropriate concepts and definitions to be measured,

2.

identify a list of appropriate commodities (services) for inclusion, and

3.

promote and cooperate in the collection of data, both from the demand and supply sides.

Aims of the Study The aim of this study is to analyse whether and how the TSA conceptual framework can be adapted to the measurement of the Meetings Industry. This approach can provide an analytical framework that allows the measurement in macroeconomic terms of different sub-sectors of Tourism in the overall framework of tourism’s economic contribution in the economy. Specific aims of the study are to provide an understanding of the global Meetings Industry with particular attention to the measurement of the economic importance of the industry. The three key components of the report are: a)

to present an overview of the current measurement of the global Meetings Industry and the inherent gaps in this, including the issue of definitions for meetings;

b)

to provide a summary of the demand and supply data that should be collected to evaluate the Meetings Industry using the Tourism Satellite Account (TSA) conceptual and measurement framework;

c)

to examine the use of these data in developing a model for evaluating the economic contribution of the Meetings Industry in macroeconomic terms.


viii


What is a Tourism Satellite Account? The Tourism Satellite Account (TSA) is a measurement framework, based on the concepts, definitions and classifications of the System of National Accounts (SNA) developed to provide a credible measure of the economic contribution of the tourism sector. The National Accounts measure the economic contribution of industries that are specified in a country’s official classification of industries. These classifications are usually based on the International Standard Industrial Classification (ISIC) code (although some countries have their own classification systems). Industries are usually defined as groups of businesses producing a similar product. As tourism is a demand side activity (dependent on the status of the consumer rather than on the type of supplier), and hence is not identified in ISIC or in countries’ National Accounts. The TSA extracts all tourism-related economic activity which is included in the National Accounts but not identified as tourism. Tourism activity is “hidden” in the relevant industry activities, e.g. the Accommodation, Transport, and Travel Agency industries. This activity will be identified and brought together in a separate but related account, i.e. an account that is a satellite of the core national accounts. An important aspect of this approach is that the TSA is an official part of the national accounts, using similar concepts, definitions, valuations and classification systems. This means that for the first time, it is possible to have available an official, objective and credible measure of the tourism sector, comparable with other industries. Basically, the TSA identifies tourism characteristic industries, i.e. those which would disappear or be substantially reduced if tourism did not exist. The TSA identifies the total output, costs, value added (GVA) and employment of those industries, (the production account) similar to what is provided for all industries in the core SNA. Surveys of visitors identify product purchases which can be related to the production of characteristic (and other) industries. A tourism-ratio for each industry is calculated corresponding to the share of each tourism characteristic industry’s output that is attributable to purchases by visitors. These tourism ratios are applied to the production accounts for tourism characteristic industries to calculate the value of these variables that are attributable to tourism demand. The results are often split to show the contribution of Domestic and International tourism and of Leisure and Business (including Government) tourism. The TSA measures only those transactions undertaken directly between the visitor and the provider of the goods and services. That is, only measures of the “direct” economic contribution of the tourism sector are included. However, there are other contributions resulting from tourism demand (such as indirect and induced effects). These “up-stream” effects result from the demand by businesses directly supplying the visitors, for inputs produced by other businesses. For example, a hotel needs to buy food, electricity, possibly cleaning services, etc. Industries producing these products also benefit from tourism demand. This indirect contribution from tourism can legitimately be claimed by the tourism sector as part of its overall contribution to the economy. Indirect effects can be calculated by the use of modelling techniques. It is important when quoting the contribution of an industry, or a sector such as tourism, to an economy, to be clear whether the contribution includes only the direct effects or also includes indirect and induced effects. This point is also relevant in discussing the measurement of the contribution of the Meetings Industry. If such a measure is based on the TSA, then the result will show only the direct contribution, and further analysis is needed to calculate the other types of effects.

Executive Summary

ix

Method The consultants collated the data necessary to inform the findings of the study by means of a comprehensive literature search followed by extensive communications with industry experts. The comprehensive literature search investigated industry reports, national statistical data including TSA, and academic articles focussing on conferences, meetings, exhibitions and incentives. In particular, the search concentrated on the type of statistics collected, how these were collected, and the use made of the information. Extensive discussions with industry experts and widespread consultation with organisations such as the UNWTO and ICCA then complemented the literature search. Industry experts still require a list of identified products provided by the Meetings Industry, so that methods can be developed to classify and measure them in terms of revenues received. A provisional list has been drawn up by industry, represented by the International Association of Professional Congress Organizers (IAPCO)1, from which a list could possibly be drawn for measurement purposes, including items such as: •

assistance with congress bids

•

finance consultancy

•

secretariat and office facilities

•

abstract handling

•

delegate transfers and on-site transportation

•

accommodation bookings

and many more.

Key Findings

Trends in the Meetings Industry The Meetings Industry has difficulty in obtaining consistent and credible trend data due to the plethora of definitions for the various components of the industry. The industry needs to define consistent definitions and concepts that can be widely used by its members. When examining the International Meetings Industry, however, some trends do emerge. The Industry appears to have gone through a period of decline beginning in 2000, but showed improvement in 2005. This fits with the notion that the Meetings Industry is cyclical with five-year cycles. Other ‘trends’ that appear in the data are: •

while there has been a decrease in the number of events over the 2000-2004 period, there appears to have been an increase in the number of participants at these events;

•

the duration of all events including exhibitions, conventions and incentive travel have become shorter;

•

the number of exhibitors at exhibitions is increasing;

•

the number of new competitors in the Meetings Industry, such as those in China and Dubai, is increasing; and

•

the incentive travel area remains the most lucrative but the most volatile component of the Meetings Industry.

1

Extract from Appendix A, How to Choose the right PCO, copyright, IAPCO, 4th edition, March 2005

x


Key Measures of the Meetings Industry There are two types of measures relating to the economic contribution of activities relating to meetings for which information is required: •

Supply side measures of the industry include such variables as income (represented by fees, and commissions) costs, value added and employment. Businesses may be identified by using the recently developed class of ISIC (International Standard Industrial Classification) 823, for example. In addition to those businesses which provide meetings services as their primary activity, it is important to include other relevant businesses that provide such services as a secondary activity, e.g. government agencies producing these services, hotels, etc.. These variables are the building blocks to measure the contribution of this industry to GDP.

•

Demand side measures include such variables as expenditure by participants at meetings on specific identified services supplied by the meetings industry or other industries. Non-monetary variables to be related to the expenditure data include: numbers of participants, lengths of meetings, number of nights in hotels, or other accommodation, distance travelled to get to the meeting, and number in the travelling party.

A complete picture of the industry requires measurement of both dimensions. A demand side only approach does not identify the contribution of industry to the economy (e.g. Production account), while a supply side approach does not identify expenditure by participants on products purchased from other industries (e.g. the accommodation industry, transport industry, etc.) while participating in the meeting. So far this report has not mentioned the possibility of adding a regional dimension to the analysis. In some countries this aspect is very important, as the type of meetings may be quite different between regions of a country. The contribution of the industry to regional GDP and employment may vary. Data are collected through four main types of agencies: •

Global agencies that collect meetings industry data are the specific industry groups such as ICCA, MPI, SITE, UIA and Reed Exhibitions e.g. FutureWatch (MPI); Five Year Trends Report (EIBTM)

•

National Statistics Offices, e.g. Business surveys for hotels, businesses renting out meeting facilities and other relevant industries

•

Other government agencies, such as US Business Traveller to Canada Study Summary 2002 (Canadian Tourism Commission)

•

Convention Bureau and Regional or City Reports such as those by the Finland Convention Bureau and the Sri Lankan Convention Bureau.

Other surveys are conducted – either specifically designed or by adding questions to existing surveys – of members of industry associations (such as IAPCO), to obtain their views, or to explore possibilities of the types of data that could be collected. A number of countries and regions have undertaken economic studies on the Meetings Industry. Some of these are mis-named as ‘economic impact’ studies, although it is likely that they are either economic contribution studies or expenditure estimates. This study examined twelve detailed studies of the Meetings Industry over the last three years. A summary of the studies and the categories used is provided in Table 1.

Executive Summary

xi

Table 1 Summary of meetings industry studies and categories used Origin of meetings industry study

Demand side categories used in the study

Supply side categories used in the study

Australia, Britain, Canada, Finland, France, Hungary, Israel, Netherlands, Norway, Spain, Sri Lanka, United States

• Registration fee;

• Sales figures of PCOs, DMCs and event organisers;

• Types of services purchased by firms or individuals, e.g. local ground transport, overnight accommodation at the conference; • overnight accommodation before and after the conference;

• organiser expenditure and income commissions; • types of services provided by organisers.

• pre/post conference tours; • additional expenditure by accompanying persons; • restaurants and cafes; • airfares; • shopping.

Recommendations on Meetings Industry Data Collection 1.

Data Collection Agency Data should be collected by government agencies as part of the national statistics’ data collection process. This will give the statistics a greater degree of credibility as they will be seen as official and objective measures, using the same concepts and definitions as other industry data. In order to cooperate with these agencies, national Meeting Industry associations should identify what kinds of data they will require for their industry. These should include a list of services provided. They should also include other industries that may provide services as a secondary product (found in other parts of the industry classification). If this approach is not possible, then the data should be collected by convention bureaux (or equivalent).

2.

Type of data to be collected The data variables to be collected need to be further discussed and defined by all interested parties. Those who will be asked to provide the data for both supply and demand will also be further consulted. • Demand side: -

Total number of participants (local (i.e. non visitors), domestic visitors, international visitors),

-

Delegate expenditure: fees, (total expenditure and average daily expenditure and breakdown by products),

-

Characteristics of participants (e.g. origin, demographics, size of the travel party, activities),

-

Characteristics of the trip (organization, duration, extensions).

• Supply side: -

The number of meetings, investment in facilities, Gross Value Added, employment, number of businesses involved in the meetings industry.

xii


Recommendations on Meetings Industry Definitions A major problem with the previously-mentioned studies is that they frequently use different definitions and include different components of the industry. In examining the many definitions adopted by various organisations, the following definitions are recommended for adoption by the Meetings Industry. Table 2 Recommended meetings industry definitions and rationale for definitions Issue

Recommendation

Rationale

Nomenclature for the industry

Meetings industry

This name represents the supply side. It has support from key industry participants.

Meeting aims

To motivate participants, to conduct business, share ideas, to learn, socialise and hold discussions.

These aims, or similar aims, were the most common in the industry and academic literature .

Meeting size

Minimum number of ten (10) participants

Many meetings organisations use this number.

Meeting venue

Venues where there is payment for the use of the venue for meetings

Where there is payment for the use of a contracted venue, there will be an economic contribution to the economy.

Meeting duration

A half-day (four hours) or more

Although a minimum duration may not be needed, the limit of four hours will provide a practical and sensible in-scope boundary for data collection.

As noted in Table 2, some definitions, such as the size of a meeting, are not really necessary for the task of evaluating the economic contribution of the Meetings Industry. The minimum essential criteria are the meeting aims and the meeting venue. A recent proposal from the UNWTO for a new International Standard Industrial Classification (ISIC) code 8230 “Convention and trade show organisers” represents an important new step toward agreement on the scope of the ‘Meetings Industry’. •

This class includes the organisation, promotion and/or management of events, such as business and trade shows, conventions, conferences and meetings, whether or not including the management and provision of the staff to operate the facilities in which these events take place.

As a result of the inclusion of activity 8230 in ISIC, there is now the capacity to identify all establishments who undertake trade show organization activities (as their primary activity). We now have the possibility to have a picture of all establishments that produce convention and trade show organization, with more comprehensive coverage than has been possible previously. These activities were all included before in macro economic measurement, but could not easily be separately identified.

Current Problems in Measurement of the Meetings Industry The economic contribution of the Meetings Industry internationally appears to be significant but there are several major problems with its measurement and, hence, comparability. These measurement problems, affecting both supply side and demand side measures, arise because of the following: •

The standard industrial classifications (e.g. ISIC) do not currently identify a separate ‘Meetings’ industry.

Executive Summary

xiii

•

The data collected show enormous diversity and inconsistency.

•

The statistics are based on different measures of both supply side and demand side data.

•

The data are created for different purposes using different methodologies and thus cannot be compared.

•

The quality of the data collection is often not up to strict statistical standards and thus results are of questionable reliability.

Some work can be done in the future by the meetings industry to ensure greater consistency to definitions and methods.

Limitations in Use of Existing TSA for Estimating the Economic Contribution of the Meetings Industry In the TSA, products are those which are purchased by or for visitors. Products – which comprise goods and services – are what are purchased by consumers. Activities (industries) produce products. The TSA splits products into two categories, specific tourism products, (comprising tourism characteristic and tourism connected products) and non-specific products (all those which are considered of no major direct tourism interest). Broadly, “Tourism characteristic products” are those products which represent an important part of tourism consumption, or for which a significant proportion of the sales are to visitors. Productive units include tourism-specific activities/industries (comprising tourism characteristic and tourism connected activities/industries) and non-specific activities/industries (which includes all other productive activities). “Tourism characteristic activities” are those industries that would either cease to exist in their present form or would be significantly affected if tourism were to cease. Table 3 provides these characteristic industries and characteristic products (UNWTO). Table 3 List of tourism characteristic industries and products2 Industries:

Products:

1. Hotels and similar

1. Accommodation Services

2. Second home ownership (imputed)

2. Food and Beverage Serving Industries

3. Restaurants and similar

3. Passenger Transport Services

4. Railway passenger transport services

4. Travel Agency, tour operator and tourist guide services

5. Road passenger transport services

5. Cultural Services

6. Water passenger transport services

6. Recreation and Other Equipment Services

7. Air passenger transport services

7. Miscellaneous tourism services (e.g. insurance, travel card services

8. Transport supporting services 9. Transport equipment rental 10. Travel agencies and similar 11. Cultural Services 12. Sporting and other recreational services

2

Tourism Satellite Account (TSA): Recommended Methodological Framework,UNWTO/UNSD/OECD/Eurostat

xiv


In applying these lists to the Meetings Industry, however, there are limitations to the use of these lists, including: •

The lack of clear definition of the Meetings Industry

•

The lists of tourism characteristic industries and products do not reflect meetings’ activity (i.e. meetings’ characteristic industries and products)

The underlying issue is that meetings activity cannot be explicitly identified as a sub-set of tourism activity. Because of this the TSA cannot be used, in its existing form, to provide a complete measure of the Meetings Industry. Modifications are required to the presentation and to the data collection currently used in production of the TSA (see page 16). This is clearly technically possible, but it would involve extra expense, particularly for data collection, than would be required if the current TSA results could be used to provide a measure of Meetings Industry activity. One way to partially address this would be to add the Meetings Industry to the TSA as a tourism characteristic industry. This would work if it can be determined approximately what share of the Meetings Industry output goes to visitors, rather than local residents. The criterion could be set at something like 25-30% of the output going to visitors. If this criterion is not met, the Meeting Industry could be separately identified in the TSA as a ‘special’ case.

Adapting the TSA to Measure the Meetings Industry The recommended new ISIC code ‘8230 – Convention and trade show organisers’ represents an important development regarding adaptation of the TSA to measure the Meetings Industry. Countries’ classifications of industries and products to be used for measuring meetings’ activity can in future be taken from the international standards, ISIC and CPC (Central Product Classification). Two products will be identified at present in the CPC: Services of convention organisers, and services of trade show organisers. The new ISIC categories are: •

823 Convention and trade show organisers See class 8230

•

8230 Convention and trade show organisers This class includes the organisation, promotion and/or management of events, such as business and trade shows, conventions, conferences and meetings, whether or not including the management and provision of the staff to operate the facilities in which these events take place.

The TSA approach enables the supply side (industry) contribution to be measured through the activity of the Meetings Industry and all other relevant ISIC industries (e.g. Accommodation industry), and also enables the full contribution of meetings’ participants to be measured through their total consumption of goods and services associated with their participation in meetings. The separate identification of the Meetings Industry means that, once implemented, statistical agencies will be able to survey this industry in the same way as other industries in the economy are surveyed. Several issues need to be highlighted: 1.

The new ISIC category excludes some supplier types that one may wish to count as part of the Meetings Industry. -

Types of businesses that possibly may not be represented in the 8230 ISIC code include Incentive Houses, as well as a range of other organisations.

-

The great majority of meetings take place without using the services of businesses whose primary activity is organising meetings, conferences, conventions and trade shows. Thus, use

Executive Summary

xv

of the code to define the Meetings Industry from the supply side will capture only a small percentage of the production of meetings’ goods and services. The identification of industries for which meetings’ organization is a secondary activity can be measured as well. 2.

Different and unique bundles of services related to meetings can be packaged. This characteristic can complicate the measurement issues. Normally, consumption of accommodation, transport, food, etc. by meetings’ participants would be an activity of the relevant industries providing these services to the participants, and not of the Meetings Industry. However, a complication arises when, for example, the meeting organiser includes in the meeting/conference registration fee, the cost of accommodation, entertainment, and possibly some transport – services which will be provided directly to the meeting participant by the business rather than the meeting organiser. The same issues arise when an exhibition organiser pays for various goods and services from exhibitor fees which are provided directly to participants. The question is: should the Gross Value Added in providing these services be attributed to the meetings’ organiser, treating the package as a single product (known as the “gross” approach), or should the Gross Value Added be attributed to the direct providers of each of the packages’ components, i.e. to the Accommodation industry, the Transport industry, the Tourist Attractions industry, etc. (known as the “net” approach). In compiling the TSA, the UNWTO recommends that the “net” approach is taken. Consistency with UNWTO guidelines would suggest that this approach should be taken in measuring the Meetings Industry. The potential ‘downside’ of this is that the apparent economic contribution of the Meetings Industry will be lower compared to what the gross approach would indicate. The overall total Gross Value Added will not be affected as the GVA associated with the supply of these products will be attributed to the supplying industry (rather than to the Meetings Industry). It is important that the approach taken be consistent with existing official standards to ensure that the method is accepted as providing an objective and credible measure of the industry.

3.

The listing of the new ISIC code for the Meetings Industry does not, in itself, ensure that central statistical agencies will implement the new code, or that they will automatically collect this information as they would for other industries. In most cases industry information is collected at a higher level than the 3 (or 4)-digit level. The agencies would have to be persuaded to collect data on this industry at this lower level. This would involve more costs for the agency in data collection and might be resisted for this reason.

4.

The presentation of statistical results needs close consideration. Adoption of the new ISIC 8230 code will be a useful step towards higher credibility if implemented by central statistical agencies because it will provide central statistical agency imprimatur to the measurement of the Meetings Industry.

Statistical Issues A number of statistical issues need to be addressed, including: •

Creation of a list of services provided by meeting organisers. Some such lists exist already, which could be utilized.

•

Central statistical agencies should be encouraged to collect the data in their annual business surveys. This will involve additional costs and the need for ‘political’ will/support. The appropriate business surveys, which would cover where primary and secondary products are produced for the meetings industry, need to be identified.

•

Meeting Industry associations could complement this information with business intention surveys (also called business opinion or expectation surveys, condition or climate surveys) which collect qualitative type information from business managers on a monthly and/or quarterly basis.

xvi


•

The new ISIC code 8230 does not necessarily resolve all of the supply side data issues. Industry should identify what is missing.

•

Many meetings do not make use of a professional meetings’ organiser. ISIC code 8230 may not include: -

Incentive Houses,

-

Exhibition organisers (perhaps),

-

Exhibition contractors,

-

Speaker bureaux,

-

Corporate entertainment,

-

Catering companies,

-

Hotels which host meetings but would not regard themselves as meetings specialists.

A further issue relates to how the results of any measurement of the Meetings Industry would be presented. In practice options are limited to the following typology: 1.

incorporated in the TSA, with the “Meetings Industry” identified as another tourism industry;

2.

incorporated in the TSA framework as a complementary set of tables specifically identifying meetings’ activity; or

3.

as a separate satellite account.

Therefore there are three options: The first option implies that the Meeting Industry is a tourism characteristic activity such as Accommodation, Passenger Transportation, Travel Agencies, etc. There is no clear evidence that this is the case at least on a national level The Meetings Industry is not a clear subset of the Tourism sector – indeed the new ISIC 8230 code will cover activity by conference organisers on behalf of resident conference and meeting participants as well as those for visitor participants (whether domestic or international visitors). Some organisers which fall under the code may do very little of their business with ‘visitors’ as defined under the TSA The second option (to consider the development of a separate industry extension relevant for the Meetings Industry) seems the proper way to proceed. Such an extension could involve, for example, the usual supply and demand information for the industry plus other information and characteristics not normally found in the TSA. The TSA could be a supporting instrument and framework, but more information about the industry could be incorporated. Although such specific industry extensions cannot be referenced, analogies of this approach appear, for example, in the Balance of Payments as memoranda items, where information is provided outside the specific BOP guidelines, but which is still of interest to users. In one specific case, (in Canada), a memorandum item has been used to provide a provincial breakdown for travel. This is not actually a component of the BOP. It elaborates the usual BOP compilation, but provides additional useful information. (Such an analysis could be assembled for any industry in the SNA, where some descriptive characteristics are available and important, but lie outside the specific SNA requirements). In this context, the Meetings Industry could use the synergy of the TSA framework, but add supplementary information of particular interest as a memorandum item. The industry itself could elaborate such characteristics as they wish. The tables to be produced as supplements to the main TSA tables could be set up along the lines of the TSA-RMF (consumption by products and categories of visitors, and production accounts for the industry). Below are examples of such tables, using the Tourism Satellite Account: Recommended Methodological Framework (TSA-RMF) as an example and some hypothetical detail. The Meetings Industry would make a valuable contribution to the discussion by reviewing these proposals before identifying the optimal alternative for their specific situation. Finally, the third option while perhaps ideal from the industry viewpoint, is most unlikely to be accepted by statistical agencies, at least until they have some sense of the importance of the industry.

Executive Summary

xvii

Summary

Proposed Broad Methodological Steps This proposed method relates to measuring the economic contribution at the national level. It is based on, and an extension of the Tourism Satellite Account. As previously indicated, a regional perspective may be important, as diversity of Meetings Industry activity among regions in a country may exist. Some regions may have a Meetings Industry that is sufficiently important to be considered part of a tourism industry, while others may not. Steps required are: 1.

Decide scope of industry and meetings participants

2.

Identify data requirements on the supply side and demand side

3.

Develop data collection methods

4.

Surveying organisation should, where possible, be the National Statistical Office

5.

Incorporation of the data into the Tourism Satellite Account (TSA)

6.

The results should at a minimum, show (1) the demand side value of consumption resulting from meetings’ activity, and (2) how much meetings’ activity contributes to a country’s Gross Value Added (and/or GDP).

See sub-chapter 5.1 for more details of proposed method.

Further Issues to be Considered Throughout this report, we have noted many issues that need further consideration, mainly by the Meetings Industry in conjunction with the relevant technical experts. The following is an outline of the main issues that need to be considered by the Steering Committee to progress this exercise: 1.

Discuss with technical experts and any other relevant international agencies, how an international standard method can be adopted, by building on the findings of this report.

2.

Agree on the scope of the industry.

3.

How will national industry associations be “brought on board” to actively support the measurement of the industry in their country?

4.

How will national industry associations be encouraged to educate their members and other industry participants to actively support the implementation of the measurement?

5.

How will industry participants be persuaded to fully co-operate with and contribute to the implementation of the adopted measurement of their industry?

Further information on these issues is provided in sub-chapter 5.2.

Main Report

Chapter 1 Introduction

1.1 Aims of the Study This report outlines some steps that could be taken to overview the characteristics of the Meetings Industry, using the analytical model of the Tourism Satellite Account (TSA) that would show the importance of this industry and identify how it could be defined and measured. The benefits of using the TSA are that it establishes an analytical framework that would provide credible results for the Meetings Industry. This would be of value in the context of the industry’s wish to draw the attention of governments to the economic importance of the sector. More specifically, the report aims to provide an understanding of the global Meetings Industry, with particular attention to the measurement of its economic importance. The three key objectives of the report are to: a.

present an overview of the current measurement of the global Meetings Industry and the gaps inherent in this, including the issue of definitions for meetings;

b.

provide a summary of the demand and supply side data that should be collected to evaluate the Meetings Industry using a TSA; and

c.

use these data in developing a model for evaluating the economic contribution of the Meetings Industry.

1.2 Background to the Study Competition for the tourist dollar is becoming more intense and countries around the world are seeking to gain a competitive edge through niche tourism activity. Meetings and business events are one such niche tourism activity that contributes significantly to Gross Domestic and Regional Product as well as to the branding and awareness of tourist destinations. While the benefits of meetings and business events are becoming recognised by the industry, the size and importance of this sector is not reflected systematically in official statistics. National Statistical Offices generally do not produce data on the activities of business event segments such as meetings, conferences, exhibitions and incentives in the structural and economic statistics. In response to this lack of systematic data collection and the growth of business event activity, the World Tourism Organisation (UNWTO) Affiliate Members Reed Travel Exhibitions and the International Congress & Convention Association (ICCA) – in cooperation with Meeting Professionals International (MPI) encouraged the UNWTO to undertake a study that would lead to proposals for the modification of the TSA to reflect the real importance of the Meetings Industry and its contribution to tourism. The UNWTO thus commissioned the Australian based Sustainable Tourism Co-operative Research Centre (STCRC) to undertake this study.


4


1.3 Scope The UNWTO, MPI and ICCA have developed a definition for the International Standard Industrial Classification (ISIC) revision process, recently undertaken. (The ISIC is the official international statistical classification system for identifying industries. Many countries base their own industrial classification system on this international standard). Based on this definition, we have defined a Meetings sector (sometimes referred to as the Meetings, Incentives, Conferences and Exhibitions – or ‘MICE’ Sector) to include: activities based on the organisation, promotion, sales and delivery of meetings and events; products and services that include corporate, association and government meetings, corporate incentives, seminars, congresses, conferences, conventions events, exhibitions and fairs. Although this definition provides substantial detail in terms of defining the various components of the Meetings Industry, further refinement of this definition will ultimately be required. Issues that will need to be considered include: •

whether this definition applies only to purpose built conference facilities,

•

the minimum number of participants and duration for a meeting, and

•

the criteria to distinguish international meetings.

These issues and others will be considered in a later section.

1.4 Structure There are five chapters making up the remainder of this report. The method chapter appears next, followed by a chapter relating to each part of the project as identified in the project brief, and a final chapter on further actions needed. 2.0 Method 3.0 Global Overview of the Industry 4.0 The Role and Use of the TSA in an evaluation 5.0 Framework for an Evaluation of the Meetings Industry 6.0 Roadmap for Further Action for Shareholders

1.5 Method The consultants used two methods to collate the data necessary to inform the findings. First, a comprehensive literature search investigated industry reports, national statistical data including TSA, and academic articles focussing on conferences, meetings, exhibitions and incentives. In particular, the search concentrated on the type of statistics collected, how these were collected and the use made of the information. The second phase of the project entailed extensive interviews and discussions with industry experts and widespread consultation with organisations such as the UNWTO and ICCA. These interviews provided invaluable material and industry insights that confirmed and expanded the information obtained from the reports and other literature.

Chapter 2 Global Overview of the Industry

In undertaking the search for information, reports were obtained from a number of sources within the Meetings Industry such as ICCA, MPI and the Convention Industry Council (CIC), as well as from tourism bodies such as the UNWTO. Although some of this information comes from tourism, there is the recognition that meetings are broader than tourism in that some participants are local residents and not tourists. In addition, a search was conducted of the academic literature, which added to the findings. The key aim of this part of the report is to document trends within the industry and the current data collection practices. This leads to identification of gaps in the statistics on the Meetings Industry that inhibit a consistent and reliable evaluation of its economic importance.

2.1 Trends in the Global Meetings Industry The Meetings Industry has three main components that will be examined here: •

meetings and conferences,

•

exhibitions, and

•

incentives.

Of these three key segments, the meetings and conference component has been examined more often, while the exhibitions and incentives components have been relatively under-researched. That said, there are many inconsistencies in the ways meetings and conferences are measured and reported, and the trends presented here illustrate these inconsistencies.

2.1.1 Trends in Meetings and Conferences Weber and Ladkin (2004), in their study on trends affecting the convention industry in the 21st century, argue that the growth of the knowledge economy has enhanced the growth of the conventions industry. The continual need for information and updating of knowledge provides a strong platform for conventions as a key medium for the dissemination of such knowledge. A number of countries and convention associations have recognised the importance of meetings and conventions in this growth of the knowledge economy and have attempted to evaluate the size and scope of the industry. These studies have been undertaken at varying levels of complexity. Unfortunately, however, these evaluations have been undertaken in isolation and so comparing the results and making global estimations is difficult. To illustrate the difficulties, Table 1 provides a summary of some of the most recent evaluations of the industry.


6


Table 1 Some recent meetings industry evaluations Meetings industry evaluation report

Source and frequency of report

Snapshots from the evaluation

State of the Industry 2005

Successful Meetings

“For the last few years, the Meetings Industry as a whole seemed like a seriously ill patient.” (p. 1) 2005 looks promising: The majority of planners expect meeting size and frequency to increase (p. 2)

Future Watch 2004

Meeting Professionals International 2004 (MPI)

Bi annual

Annual

International Meetings Statistics for the Year 2004

Union of International Associations (UIA)

The Realities of Convention Centres as Economic Development Strategy 2005

Brookings Institute

Annual

Annual

“In a positive indicator for international business travel, USA planners expect an 11% growth in international meetings in 2004, twice that of 2003. Overall predicted international meetings by European planners are about the same in 2004 as in 2003. The difference is the significant increase in projected travel to the United States with European planners indicating a 50% rise in travel to USA destinations, up to 9% vs. 6% of all meetings last year. “While two year projections suggest a levelling out, the number of meetings already scheduled for 2005 is –22% lower than the same time last year; this suggests a downturn for 2005” (p. 2) “The overall convention marketplace is declining in a manner that suggests that a recovery or turnaround is unlikely to yield much increased business for any given community, contrary to repeated industry projections.” (p. 1)

The majority of these reports indicate an upturn in the Meetings Industry for 2005 after some years of decline. The exception to this is the report by The Union of International Associations (UIA). (The Brookings Institute evaluation also predicts a decline, but this was written from the perspective of the investment climate in relation to convention centres.) The UIA report highlights the definitional problems that exist in the industry. The UIA criteria for an international meeting are: •

a minimum of 300 participants,

•

lasting a minimum of three days, and

•

with representatives from at least five different countries.

A definition such as this only allows data to be collected from a select group of meetings and does not provide a more general overview of the industry. In many ways, such a definition disadvantages the Meetings Industry, since it narrows the scope of industry activity. One report, however, conducted annually by the ICCA, International Association and Corporate Meetings Market: Statistics Report, does attempt to bring some consistency into the reporting of the Meetings Industry, and the definition of international meetings1 used by ICCA has been adopted by the UNWTO when collecting Meetings Industry data for its Tourism Market Trends. This defines international meetings as having a minimum of 50 participants, be held regularly and rotate among at least three different countries. The data collected in the ICCA annual reports have been collated and summarised here to provide some trend data for the industry.

1

International meetings are defined by ICCA as having a minimum of 50 participants, be held regularly and rotate among at least 3 different countries.

Global Overview of the Industry

7

2.1.1.1 Trends in the international Meetings Industry

2.1.1.1.1 Demand The research by ICCA on the trends in the international Meetings Industry provides consistent longitudinal data on this component of the industry. The data are important in that they use a consistent definition and are collected from the six global UNWTO tourism regions. In using these data, it is possible to examine the trends over time and location as well as aligning the Meetings Industry within the tourism industry. This enables comparisons of, for example, meetings visitors to leisure visitors. The number of international meetings held globally over the 2000-2004 period is presented in Figure 1. Figure 1 The number of international meetings by region (ICCA statistics adapted from UNWTO) 2000-2004

2.500 2.000 Europe

1.500

Asia North America Latin America

1.000

Australia/Pacific Africa

500 0 2000

2001

2002

2003

2004

Source: ICCA statistics adapted from UNWTO, 2005, Basic Introductory Report: The Meeting Conventions Market in the Americas’, International Seminar on MICE Tourism and Business Tourism, World Tourism Organisation, Chile, 25-26 May 2005.

As illustrated in Figure 1, there appears to have been a decrease in the number of international meetings over the last five-year period. The decrease in the number of international meetings is particularly marked in Europe, although each region shows a drop in numbers. It is argued, however, that the Meetings Industry is cyclical in nature (Weber and Ladkin, 2004; UNWTO, 2005) and in arguing this, the UNWTO report suggests that the year 2000 is the peak of a five year cycle. The report further argues that the ICCA 2005 results show a significant improvement in numbers and it states that “2005 […] looks as if it will be an excellent year – the best since the previous world peak figure in 2000” (p. 3). In providing reasons for the variation in the industry, the report suggests that there was a general decline in the world economy; the impact of events such as September 11, SARS and the Iraq war curtailed travel; and, there were budgetary restrictions within some important industries, such as pharmaceuticals. Although there appears to have been a decrease in the number of events during the 2000 to 2004 period, the numbers of attendees appear to have increased. Figure 2 illustrates the trend in the number of attendees to international meetings.

8


Figure 2 Average numbers of participants in meetings by region (ICCA statistics adapted from UNWTO) 2000-2004

1.600 1.400 1.200 Latin America

1.000

North America

800

Australia

600

Africa Asia

400

Europe

200 0 2000

2001

2002

2003

2004

Source: ICCA statistics adapted from UNWTO, 2005, Basic Introductory Report: The Meeting Conventions Market in the Americas’, International Seminar on MICE Tourism and Business Tourism, World Tourism Organisation, Chile, 25-26 May 2005.

The numbers of attendees to international meetings in North America rose substantially in 2004, following the continuous decline from 2000. Industry sources suggest that visa difficulties for those entering the USA, for example, may have contributed to this fall in numbers, with these restrictions being eased in 2004. By 2004, the number of participants in international meetings had increased in all but the Latin America region. It is also interesting to note that the growth in the size of meetings was in the smaller meetings category (50-249 participants), which grew by 37% (ICCA, 2004). Another important variable for examining trends in the industry is the duration of the meeting. The trend has been for shorter meetings and in 2004, the average duration for international meetings was 4.2 days, the lowest average for the past 10 years (ICCA, 2004). These statistics are confirmed in other studies such as the Australian study by Deery et al (2005), the research on Israel conference tourism (Sultan, Ditzan and Darsa, 2002) and the Korean Meetings Industry study by Kim et al (2003).

2.1.1.1.2 Supply The growth of the international Meetings Industry can be illustrated through a discussion of the supply side of the industry. With regard to the supply of convention facilities and convention capacity, the following discussion is structured according to the five regions identified by the UNWTO. The data are taken from the Tourism Market Trends, 2005 Edition (UNWTO). Appendix A of this report provides a summary for each country within these regions.

Africa The report on the supply of convention facilities is divided into North and South Africa. In North Africa, countries such as Morocco and Algeria have substantial facilities for the Meetings Industry. Many of the countries have conference facilities that could host between 400 and 3,000 conference delegates and most have high quality accommodation nearby the convention centre. In the South Africa region, there would appear to be stronger development of the industry – Botswana, Kenya and Mozambique have all acquired new conference centres. In some areas, however, such as Eritrea, there are constraints on the growth of the industry due to the frequency, capacity and cost of flights into the country. Little information is provided on the impact of political unrest in these areas on the Meetings Industry.


9

Americas Some regions, such as the Americas, have collected data on the main congress and convention centres in the key areas of the region. These data are presented in Appendix B and although it provides a snapshot of the size and location of key centres, it unfortunately does not provide a full picture of the supply side in this region. The UNWTO report, The Meeting Conventions Market in the Americas (2005b, p. 45), suggests that “while the more mature parts of the region have seen little growth in supply, there has been a considerable amount of activity in the Caribbean, Central America and South America.”

Asia and the Pacific One of the main Asian convention destinations is Hong Kong, with its Hong Kong Convention & Exhibition Centre of 64,000 m2. In addition, Macao, China and India have increased their capacity for holding large conventions, with major destinations being Beijing, Shanghai, New Delhi, Agra, Bangalore, Chennai and Mumbai. In Oceania, some of the Pacific Islands such as New Caledonia and Fiji are expanding their convention facilities while Australia and New Zealand both provide a comprehensive range of convention properties.

Europe Europe is traditionally one of the key locations for the Meetings Industry. Many European countries have state-of-the-art facilities and the easy access to these countries make them favoured Meetings Industry destinations. It is a highly competitive environment. France, for example, currently has 120 convention centres, making it the top European country in terms of facilities. Those countries that provide value-added conference facilities, such as the Netherlands and Spain, have excellent infrastructure with a wide range of product. In addition, countries which are new to the meetings/conference industry, such as Estonia and Andorra, are developing their Meetings Industry facilities and offering different types of facilities.

Middle East According to the UNWTO (2005b), Dubai offers the most comprehensive Meetings Industry supply in the Middle East. Other countries in this region, however, such as Saudi Arabia, Bahrain and Syria, also have excellent facilities that compete strongly with other destinations.

2.1.2 Trends in Exhibitions

2.1.2.1 Demand A global overview of the exhibition industry is even more difficult to provide. While there is general agreement on the definition of exhibitions2, and the Convention Industry Council’s (CIC) definition presents an example of this, there is little global information on the trends in this sector. The industry tends to assess its performance on the size of the space used for exhibitions, but there is no consistency in the boundaries of these measures.

2

Convention Industry Council definition of exhibition: 1) An event at which products and services are displayed. The primary activity of attendees is visiting exhibits on the show floor. These events focus primarily on business-to-business (B2B) relationships. 2) Display of products or promotional material for the purposes of public relations, sales and/or marketing.

10


A study undertaken on the South African Exhibition sector (Heath et al, 2005) and that undertaken in Australia (Deery et al, 2005) show some trends that could be extrapolated to the global situation. In South Africa, for example, the average number of exhibitions per exhibition organiser increased from 1.97 in 2001 to 2.2 exhibitions per organiser in 2004. The majority of exhibitions (77%) take place annually, which is consistent with the Australian situation (73% in 2003). Paralleling trends in the international Meetings Industry, the actual number of show days declined from 4.86 days in 2002 to 4 days in 2004. This 4-day average was also in line with international trends in the exhibition sector with a 3.7 days average duration in the United States in 2004 and 3 days duration in Australia in 2003 (Heath et al, 2005). In an attempt to obtain consistent data from the USA and Canadian exhibition sectors, the Centre for Exhibition Industry Research (CEIR) has developed an Exhibition Industry Index which measures a range of indicators of the industry’s development. This provides data for the North American scene but does not provide any global overview.

2.1.2.2 Supply The information provided on the supply side of the exhibition sector is somewhat limited and inconsistent in the way it is reported. In Africa, for example, the UNWTO reports that while places such as Tunisia, Zimbabwe and Ghana have dedicated facilities for exhibitions and fairs, other countries within the region appear to use convention centres and other spaces such as cultural and sporting centres for the purposes of exhibiting. Within the Americas region, there appears to have been considerable growth in the exhibition sector with countries such as Mexico, Cuba, Curacao, Brazil, Chile, Barbados and Bermuda all expanding their facilities. The more mature markets, such as North America, do not appear to have grown the exhibition component substantially. The Asia and Pacific region possesses significant exhibition facilities with countries such as Hong Kong, China and India being among the largest providers of exhibition space. Although there was a decrease in the number of exhibitions in Hong Kong due to the SARS outbreak, the sector appears to have recovered and a new exhibition centre has been completed. Europe has traditionally held some of the largest and most comprehensive exhibitions in the world. In particular, Germany has six very large exhibition locations while countries such as the United Kingdom, Luxembourg and Monaco have increased their exhibitions’ capacity. Finally, it is the Middle East that has increased its profile within the exhibition arena. In particular, the high-tech, purpose-built Dubai Airport Exhibition Centre and the Bahrain International Exhibition Centre have increased the Middle East exhibition capacity. In summary, the exhibition sector appears to be following similar trends to the international Meetings Industry, with predicted growth in exhibition events, but a decrease in the duration of the exhibitions. One of the greatest challenges for the exhibition industry is the increase in competition globally with the emergence of countries such as China, where there are 57 new convention and exhibition centres currently under construction, Dubai, which is planning a dedicated city for exhibitions spread over 74 acres, and India, which has five new convention and exhibition centres planned (Tourism Australia, 2005). For the smaller exhibition countries, such as South Africa and Australia, there is an opportunity for strategic regional alliances to combat such competition.


11

2.1.3 Trends in Incentives Of the three key components of the Meetings Industry, the incentives sector is the least researched. Corporations implement incentive programs to drive sales, increase profits, improve service, enhance morale, retain staff or provide high-profile recognition. The level of secrecy surrounding this component largely explains the lack of research and, as stated in the Sri Lankan Convention Bureau Report 2004 (p.3), “The Incentive Travel figures had been left out once again in view of the reluctance of producing such data with the perception that information provided will be detrimental to their business and/or inability to separate incentive travel figures by hotels from general tourism data“. Incentive Travel is regarded, within the Meetings Industry, as the highest yielding sector of the industry. The world wide incentive market is a ‘multi-billion dollar global industry’. (The Society of Incentive & Travel Executives (SITE)), 2004. While it is difficult to provide world-wide trends, there are common elements in the changes occurring in the industry around the world. For example, the shortening of the duration of incentive programs from seven days to an average of four days is recorded in the USA (SITE, 2005) and 5.1 days in Australia (Deery et al, 2005). In a comprehensive study undertaken by the Malta Tourism Authority on the incentive sector in 2000-2001, incentive program duration had already decreased to four days during this period. The incentive travel sector is probably the most vulnerable to volatility in world events. According to the Incentive Federation’s Incentive Study 2003, of the respondents who did not use incentives in the past 2 years, a concern about cost was the main reason for their companies not using incentives. Other concerns included difficulties in making the program fair, uncertainty of program outcomes, uncertainty about the kind of incentives to offer, not knowing enough about incentive programs or how to measure results, administration, legal/liabilities and management resistance. The Australian study (Deery et al, 2005) found that a number of those organizations involved in the incentive travel industry had lost business for a variety of reasons. These included that companies were choosing cheaper options, the impact of world events such as SARS, September 11, and the Bali bombing, additional competition, the non availability of flights, the destination’s inability to meet needs of participants, the distance barrier and visa problems. In summary, the incentive travel area is a lucrative, yet volatile, component of the Meetings Industry. While this component is an extremely competitive one as new destinations replace older, less attractive and potentially less safe destinations, new markets such as China and India are emerging. The challenge for those involved in the incentive travel component is to attract these new markets – which tend to be presently lower yield markets- into longer stay programs.

2.2 Current Data Collection Practices Data are collected on the Meetings Industry in a myriad of ways, and this section summarises the techniques used in existing studies. However, there is value in considering the components of the Meetings Industry to provide a context for the discussion. A simple model of the meetings industry is presented in Figure 3.

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Figure 3 The Meetings Industry

Supply

Demand

Delegates

Pay registration fee to organisers

Organiser Exhibitors

Pay other suppliers for various goods and services

Host Organisation

Venue

Other Goods and Services e.g. transport, accommodation, restaurants, retail

The Meetings Industry can be regarded as having two broad dimensions: the demand side and the supply side. For the purposes of this study, the demand side is defined as the delegates (the consumers) – or participants, as they will be referred to in this report – and the supply side is defined as comprising the organiser, the venue and the host organisation. While the activities of suppliers of other goods and services, e.g. accommodation, transport, etc., that delegates use in conjunction with their attendance at the meeting will be measured in assessing the economic contribution of meetings’ participants, these suppliers are not components of the Meetings Industry. The overlapping hashed lines above indicate that in some cases the host organisation acts as the organiser, and in some cases, the venue will act as the organiser. This has implications for data collection. Demand side research collects data about the delegates in terms of their total numbers, their origin and expenditure on registration and other goods and services. Supply side research collects data about the meetings, the organisers, the numbers of participants, and the costs and revenues associated with hosting/organising the meeting. A complete picture of the industry requires data from both the demand and supply sides. A demand only approach does not identify the full economic contribution of the industry, while the supply side approach does not identify additional expenditure by participants incurred in the host region.

2.2.1 Data Collection by Global Agencies The UNWTO, in its Tourism Market Trends 2004 survey, collates data by asking each country whether statistics are collected on international meetings in their country. No definition of the Meetings Industry is provided as none existed at the time of the data collection. If the answer is ‘yes’, there is a small description of the importance and size of the industry and another on the evolution of the Meetings Industry. Typically, these are demand estimates, with countries providing an estimate of the size of their international meetings tourism as a percentage of total inbound tourism. The difficulties with this method are:


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a)

there is no consistent definition used for the meetings industry and so the estimates of the size of meetings activity vary widely from country to country, and

b)

these figures do not include the domestic meetings market which can be a sizeable market.

Other global agencies that collect meetings industry data are the specific industry groups such as ICCA, MPI, SITE, UIA and Reed Exhibitions. These organisations issue regular reports including: •

FutureWatch (MPI)

•

The State of the Industry (Successful Meetings)

•

International Association Meetings Market: Statistics Report (ICCA)

•

Five Year Trends Report (EIBTM)

•

Economic Impact Study (CIC)

•

International Meetings Statistics (UIA)

•

The SITE Foundation Industry Reports (SITE)

While these organisations collect regular and consistent data, it tends to be in a specific context, for example, purely international meetings (ICCA, UIA, MPI) or the incentive industry (SITE). By and large, these reports are not intended to provide an economic evaluation of the meetings component on which they are reporting. Only a few reports contain definitions and little information is provided on the methods used. While these reports provide a ‘snapshot’ for industry practitioners, it is difficult to discern what assumptions underpin the measurements and analysis, therefore making them of little use in tracking consistent data for use in an overall evaluation of the industry. While the reports are useful, they also highlight the need for a more consistent data collection process.

2.2.2 Data Collection by National Tourism Organisations A number of national studies have been undertaken on the Meetings Industry or components of the industry. These appear to be able to collect more accurate data on both the demand and supply sides, and they generally provide greater information on the methods used. These reports, by and large, provide sufficient detail to enable planning by the tourism authorities. Some of the reports collected for this study include: •

Estudio Del Mercado De Reuniones en España 2003 (Instituto de Turismo de España)

•

USA Business Traveller to Canada Study Summary 2002 (Canadian Tourism Commission)

•

British Conference Venues Survey 2003 (British Tourist Authority)

•

Characteristics of Conference Tourism in Israel (Israel Ministry of Tourism)

•

National Business Events Study 2005 (Australian Sustainable Tourism Co-operative Research Centre)

•

The Conference and Incentive Travel Market in Malta for the Years 2000-2001 (Malta Tourism Authority)

2.2.3 Convention Bureaux and City Reports As the level of data collection moves from the global to the region or city, there tends to be greater levels of detail in the reports with regard to data collected and the level of analysis. Again, these studies generally consider both the demand and supply aspects. Reports such as those by the Finland Convention Bureau and the Sri Lankan Convention Bureau illustrate that the bureaux have access to the industry and have the links to obtain the data.

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2.2.4 Summary of Previous Studies In order to provide some understanding of the ways in which data are collected and used, a number of more detailed studies investigating the value of the Meetings Industry are summarised here. The studies provided to the research team that are included in this summary are: •

Estudios de Productos Turisticos: Spanish National Tourism Board

•

The MICE Industry: Sri Lankan Convention Bureau

•

The World of Meeting Statistics: Finland Convention Bureau

•

Netherlands Board of Tourism & Conventions

•

The Economic Impact of Business Conventions in Toronto in 2002: Ontario Ministry of Tourism and Recreation

•

Estimating the Direct Expenditure Benefits of Conferences to a Local Area: British Tourist Authority

•

Survey of economic benefits: France Congres

•

Characteristics of Conference Tourism in Israel: Israel Ministry of Tourism

•

National Business Events Study: An Evaluation of the Australian Business Events Sector: Australian Sustainable Tourism Co-operative Research Centre

Further details with regard to these studies are provided in Table 2. Table 2 Examples of national and regional economic studies of the Meetings Industry Country

Method

Collection agency

Categories

Australia

• Online survey;

Tourism Australia and STCRC

• Registration fee;

• self-complete mailout questionnaires

• Local ground transport overnight accommodation at the conference; • overnight accommodation before and after the conference; • pre/post conference tours; • additional expenditure by accompanying persons; • restaurants and cafes airfares within Australia; • shopping. ECONOMIC CONTRIBUTION: YES

Britain

• Face-to-face interviews with delegates • post-event questionnaires • conference organiser questionnaires

British Tourist Authority

• Registration fee; • overnight accommodation at the conference; • overnight accommodation before and after the conference; • travel to the United Kingdom; • travel in the United Kingdom to the conference; • local travel at the destination; • food and drink; • evening events and entertainment; • shopping and gifts; day trips and/or pre/post conference tours; • additional expenditure by accompanying persons. ECONOMIC CONTRIBUTION: YES


Country

Method

Collection agency

Categories

Canada (Toronto)

• Data collected through survey method

Ontario Ministry of Tourism and Recreation

• Travel services; • public transport; • private transport (rental and operation); • local transportation; accommodation; • food and beverage (at stores and at restaurants); • recreation and entertainment; • retail (clothing and other). ECONOMIC IMPACT: YES

Canada (USA Business Traveller to Canada)

• Survey of USA business travellers to Canada

Canadian Tourism Commission

• Trip planning and information seeking; • length of stay; • demographics; • association and corporate sectors; • recent trip information; • additional nights stayed; • ratings of Canada as a business venue. ECONOMIC IMPACT: NO

Finland

France

• Information gathered from venues on a monthly basis (internet questionnaire)

Finland Convention Bureau

• Number of meetings and participants; • average size, duration, location and seasons; • meeting sales figures of venues; • sales figures of PCOs, DMCs and event organisers;

• Event organisers

• organiser expenditure;

• Weighted to national statistics’ collections

• delegate expenditure and travelling costs.

• Data collected at convention centres

ECONOMIC IMPACT: YES

France Congress

• Economic evaluation includes direct and indirect benefits; • induced benefits; • jobs; • days of attendance by participants; • overnight stays. ECONOMIC IMPACT: YES

Hungary

• Survey of congress organisers, venues and organisations

Hungarian National Tourist Office

• Numbers of international meetings; • international exhibition; • average number of nationalities; • average length of conferences; • numbers of conferences organised by PCOs; • location of conferences; • types of venues; • subject matter; • seasonality; • nationality of meeting planners; • expected and factual number of participants. ECONOMIC IMPACT: NO

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Country

Method

Collection agency

Categories

Israel

• Data reported by conference organisers to the Ministry of Tourism

Israel Ministry of Tourism

• Characteristics of the tourists (age, family group size, nationality); • length of stay; • places visited; purpose of visit;

• survey of inbound tourists

• expenditure on various items (not provided); • opinions about tourist services in Israel; • characteristics of international meetings by month, place and subject. ECONOMIC IMPACT: NO

Netherlands


Netherlands Board of Tourism & Conventions

• Total number of conventions; • average duration of convention; • average number of participants; • total number of participant days. ECONOMIC IMPACT: NO

Norway

• Data collected on a monthly basis from hotels

Central Bureau of Statistics

• Number of bednights and roomnights; • nationality; • purpose of visit. ECONOMIC IMPACT: NO

Spain

• Survey of cities categorised by population

Spanish National Tourism Board

Supply: • Number of meetings and participants; • daily expenditure of participants; • duration of stay. Demand: • registration costs; • daily accommodation expenditure; • daily expenditure; • % of delegates that attended with partner; • average number of companions; • duration of the convention; • total number of nights stayed in the city; • nights additional to the convention. ECONOMIC IMPACT: YES

Sri Lanka

• Data collected from Sri Lanka meetings/conference Convention Bureau organisers through interviews and questionnaires

• Number of national and international conferences and meetings; • number of exhibitions; • air travel; • pre and post tours; • shopping; • equipment and material; • food and beverage; • revenue. ECONOMIC IMPACT: NO


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Country

Method

Collection agency

Categories

United States of America


Convention Industry Council

• Largest share of the convention and exhibition dollar (35%) spent in hotels and other facilities. The rest is widely distributed throughout local economies. After air transportation (24%), the biggest categories of attendee, exhibitor, and sponsor spending were: restaurant and outside catering food and beverage outlets (14%) and business services (12%). ECONOMIC IMPACT: YES

As an example, the results of the economic study conducted in Spain are presented in Appendix C. It is important, however, to clarify the terminology used as there is frequent confusion regarding the correct use of the term ‘economic impact’.

2.2.4.1 Economic ‘Contribution’, not ‘Impact’ Sometimes, commentators and reports incorrectly refer to the ‘economic impact’ of the Meetings Industry. Some studies even refer to expenditure associated with meetings as its ‘economic impact’. It is argued here that the use of the concept of ‘impacts’ should be reserved for the changes to the economy that may result from a shock (positive or negative) to the Meetings Industry. Thus, while it is meaningful, for example, to explore the ‘impacts’ of some event on the international Meetings Industry, it is not meaningful to ask about the economic ‘impact’ of the Meetings Industry on the economy of a destination. Rather, what is meant is the economic contribution of the industry to the wider economy. This contribution is usually measured in term of the contribution to Gross Domestic Product (GDP), Gross Value Added (GVA) and employment. In this context, the TSA is an important information base for the estimation of the economic effects of changes in tourism demand, but is not in itself a technique for impact estimation. Impacts refer to changes, resulting from specific events or activities, in the economic contribution and should not be confused with the contribution itself. Contribution measures the size and overall significance of the industry within an economy. Economic impact implies the change in the total economy as a result of such a contribution and needs to allow for extensive interactive effects which will have occurred across the economy. It is possible to undertake an economic impact study of the effects of changes in final demand, but this requires the use of specific economic modelling techniques such as Computable General Equilibrium Modelling.

2.2.5 Gaps in Meeting Industry Data One of the main problems with the above mentioned studies is that they frequently use different definitions and cover different components of the industry. Coupled with this definitional problem is the way in which data are collected. There are a number of issues related to this. First, the type of agency responsible for the data collection appears to influence greatly the level of rigour and consistency in the data collected. The agency could be, as in the case of Australia, a government agency. In many instances, however, the data are collected by smaller entities such as convention bureaux. Other issues relate to the frequency of data collection and the difficulty in using data from a variety of sources, both private and public, in order to ‘fill the gaps’.

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Recommendation on the Data Collection Agency for the Meetings Industry It is recommended that data relating to the Meetings Industry are collected by government agencies as part of a national statistics collection. This will ensure that the data relate to the country as a whole and that consistent and rigorous methods are used. National statistics’ agencies are generally viewed with a level of credibility and authority, and may have the legal power to compel the provision of data. Where such legal power does not exist, it is suggested that convention bureaux (or appropriate industry associations) be employed to encourage responses by promoting the benefits of a more informed industry.

2.3 Definitional Issues The plethora of definitions – and in many cases, lack of definitions – is widely acknowledged within the Meetings Industry. The debates focus on a number of components of the definition. These are: •

The nomenclature of the industry

•

Definitions of meetings: -

The aims of a meeting

-

Meeting venues

-

Meeting size

-

Meeting duration

2.3.1 Nomenclature for the Industry The definitional issues relate to a number of areas including the naming of the industry as a whole. The industry has most commonly been named the Meetings, Incentives, Conventions and Exhibitions (MICE) Industry. This nomenclature has the disadvantage of presenting the industry as a collection of discrete parts rather than in any holistic manner. The UNWTO has used the term ‘Meetings Industry’ and ‘International Meetings Industry’ in what appears to be an interchangeable fashion and these terms encompass the organisation, promotion, sales and delivery of events for corporate, association and government meetings, corporate incentives, seminars, congresses, conferences, conventions, events, technical visits, exhibitions and fairs. The UNWTO has proposed that a new International Standard Industrial Classification (ISIC) category be developed to represent the activities of the Meetings Industry. (This is discussed in more depth in Section 4.5). The new ISIC category represents an attempt to identify an industry representing the Meetings Industry, through the addition of a new class, viz. 8230 ‘Convention and trade show organisers’. This industry includes: the organisation, promotion and/or management of events, such as business and trade shows, conventions, conferences and meetings, whether or not including the management and provision of the staff to operate the facilities in which these events take place. Within the brief for this study there is a proposed title and definition for the industry. This definition, proposed by the UNWTO, ICCA, Reed Exhibitions and MPI, calls the industry ‘The Meetings and Events Industry’. In consultation with key industry participants, however, the title of the ‘Meetings Industry’ appears to have greater acceptability. In general, the term ‘event’ is perceived to be too broad to be used in this context. The definition that is proposed by UNWTO, ICCA, Reed Exhibitions and MPI is more encompassing than the new ISIC definition, detailing the clients (association, government and corporate) and including the incentives area. It would be useful for the industry to further promote the adoption of this definition.


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Recommendation for the Industry Name Given that key industry stakeholders have suggested the name of the industry to be the ‘Meetings Industry’, the consultants recommend this term be adopted since the key component of any business event is a meeting of people. This title is inclusive of the meeting components such as conventions, congresses, conferences, symposia, seminars, company general meetings and events such as public or trade shows, exhibitions, and incentive events that include a meeting booked through a convention or trade show organiser.

2.3.2 Definition of Meetings There are a number of components of meetings that need to be considered in order to facilitate the collection of data that can be used for accurate measurement of the industry. These are addressed under the headings of: a)

aims of a meeting,

b)

meeting venue,

c)

meeting size, and

d)

meeting duration.

2.3.2.1 The Aims of a Meeting There are a number of aims of a meeting that are articulated in the literature, both academic research and industry reports alike. The common elements of these definitions are that attendance at an event must be for a common purpose with a number of other participants with whom to share ideas, socialise and discuss. Frequency can be on an ad hoc basis or according to a set pattern. The key terms used in the definitions are ‘to meet’, ‘to confer’, and ‘to share information’. A summary of definitions can be found in Appendix D and, based on the review of the literature, the consultants recommend the following definition be adopted. Recommendation for a Definition of a Meeting Based on its Aims The ICCA definition encompasses most of the key elements of all the definitions. It is therefore recommended that the definition of the aim of a meeting be: A meeting is a general term indicating the coming together of a number of people in one place, to confer or carry out a particular activity. The key purposes of meetings are to motivate participants and to conduct business. Frequency can be on an ad hoc basis or according to a set pattern, as for instance annual general meetings, committee meetings, etc. Within the literature, definitions are also offered for other categories within the Meetings Industry such as conferences, congresses and conventions. All these definitions differ subtly from each other and a summary of them has also been provided in Appendix D as part of the overview of definitions. For the purposes of this exercise – i.e. to provide a working definition for meetings that will assist in the evaluation of the Meetings Industry – the subtle differences between these various meeting types are not considered important.

2.3.2.2 Meeting Venue Some definitions include the need for the meeting to be held in specific types of venues. For example, Weber and Chon (2002) state that “a meeting should be held at a purpose built facility”. The Business Events Council of Australia states that business events must be ‘held in a specific venue or venues’. The

20


British Tourist Authority uses the definition of a conference as an ‘out of office meeting of at least six hours’. The issue for debate then is what constitutes a specific venue? The National Business Events Study (Deery et al, 2005) provided a list of the types of venues that were not included in the data collection. These exclusions covered a range of venues where business events were not seen to be a core part of their overall business (see Appendix E). These included venues such as scout halls, motels and restaurants. The definition of a meeting, therefore, would also need to include a criterion on the type of venue used, but this may vary from country to country. Recommendation for the Inclusion of the Type of Venue for Meetings in the Definition It is recommended that data be collected on meeting activity from contracted venues where there is payment (or in-kind payment) for the use of the venue for meetings (and related events such as exhibitions and incentive activities). For the purposes of data collection, meetings not held in commercial venues should not be considered as a meeting. This is because of the difficulty in obtaining data from these non-commercial venues. This treatment is also justified by the fact that the holding of such meetings is not a business activity of the venue.

2.3.2.3 Meeting Size The issue of the minimum size of a meeting to fit within the criterion has been well debated by the industry. Different organisations such as ICCA and UIA, have set different minimum numbers for a meeting to be included in data collections. From the numerous reports and research into the Meetings Industry, it is clear that the number of required participants at a meeting is the most contested criterion. Table 3 presents a variety of definitions. Table 3 Size, duration/frequency and the number of countries involved in meetings Type

Number of participants

Meeting

> 10

Finland Convention Bureau

> 10

Korea NTO

> 15

-

Up to 250

On average 1 day

> 300

> 3 days

> 50

Number of countries involved

Other

> 6 hours < 2 days

> 15

International Meeting

Duration/ frequency

> 4 hours

Source

Hughes 1988 -

Held in commercial venue space

Meetings Industry Association of Australia (MIAA) German Convention Bureau

> 5 countries

> 40% foreign attendees

Union of International Associations (UIA)

> 4 countries


MIAA

> 3 countries


Instituto de Turismo de España


Type

Number of participants

Duration/ frequency

Number of countries involved

Other

> 3 countries

Source

International Association Meeting

> 50

International Board Meeting

> 10

Corporate Meeting

Gathering of employees or representatives of a commercial organisation. Usually, attendance is required and travel, room and most meal expenses are paid for by the organisation.

CIC

Government Meeting

An event at which attendees are civil servants, elected officials or service providers to governmental entities.

CIC

regular basis (annually, biennially)

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ICCA

Association must be in the UIA Yearbook

UIA

While different definitions may be justifiable in themselves in different contexts, it is essential that a common definition be developed to promote consistency internationally and to facilitate the comparison of economic measures. However, it is quite arbitrary what the minimum number of participants should be, and this issue will always be contentious. The consultants suggest that data collection complexities would be reduced if no minimum size was imposed, as survey respondents would not be required to filter out meetings which do not conform to the criterion. It is also unlikely that meetings with very few participants would be held in commercial venues, so the inclusion of this criterion in the definition essentially overcomes the need to agree on a minimum size for a meeting. However, the industry has traditionally defined meetings using a minimum size and may be reluctant to give up this practice. If this is the case then the smallest minimum should be adopted, that is, ten participants. Recommendation for the Minimum Size of a Meeting In order to obtain a comprehensive collection of data on all meetings, it is recommended to collect data on meetings with ten participants or more.

2.3.2.4 Meeting Duration As illustrated in Table 3, there is a range of suggestions for the minimum duration of a meeting, from four hours to three days. Again, the consultants would recommend no minimum duration, based on the argument that this reduces complexity in the data collection process, and that in practice it is unlikely that a meeting of very short duration would be held in a commercial venue. However, if a minimum duration is seen as essential this should be as inclusive as possible – i.e. a half day or four hours.

2.3.2.5 International Meetings With respect to the venue, size and duration of international meetings, there is no valid reason why these should be defined differently than for meetings per se. The only difference between a meeting and an international meeting is that the latter attracts a substantial proportion of international delegates. Therefore, the number of countries and proportion of international delegates need to be considered. In terms of the minimum number of participating countries required to meet the criteria of an International Meeting, the consultants suggest that there be participants from at least one country other than the host country.

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With regard to the percentage of international participants that are required to meet the definition, many of the definitions include percentages in the range of 40%-45%. This proportion may be appropriate in regions where countries are close geographically and cross border travel is commonplace, such as Europe. However, for meetings held outside Europe this proportion seems excessive as many meeting with a far smaller proportion of international delegates would nonetheless be regarded as international. The consultants recommend, therefore, that international delegates should comprise a minimum of 20% of the total meeting numbers. However, there may also be cases, particularly in large meetings, where this 20% criterion would fail to identify meetings which attract large numbers of international delegates but where their numbers represent less than 20% of total participants. For example, a medical meeting of 2,000 participants held in North America may have 200 international participants, but would fail to meet the criterion currently offered. Consideration should be given to perhaps using a criterion based on an absolute number in situations such as this. Recommendation for the Minimum Criteria of an International Meeting An international meeting is defined as a meeting having a minimum of ten participants, of at least halfday duration, with participants representing at least one country other than the host country and with a minimum of 20% of all participants being of international origin. In the case of large meetings, an absolute number of international delegates should be considered.

Chapter 3 Using the TSA to Evaluate the Economic Contribution of the Meetings Industry

This chapter looks at the role that TSAs can play in the evaluation of the economic contribution of the Meetings Industry, and the issues that need to be considered in this process. A major aim of this report is to discuss how these issues may be addressed. Employing the TSA to estimate the economic contribution of the Meetings Industry involves measuring the total contribution to the economy from people participating in meetings, together with the consequent contribution made by the industry itself. The structure of the TSA is designed to show the relationship between the demand for products generated by tourism, and their total supply. The process for tourism involves identifying products consumed by tourists (or, the correct UNWTO term, ‘visitors’), such as accommodation services and meals, and linking these products to the industries that produce them. The UNWTO defines tourism as: “the activities of persons travelling to and staying in places outside their usual environment, for not more than one consecutive year for leisure, business and other purposes not related to the exercise of an activity remunerated from within the place visited.” Information on the role tourism plays in national economies throughout the world is deficient, and credible data concerning the scale and significance of tourism are needed. To address this, the UNWTO, in conjunction with the Commission of the European Communities-Eurostat, Organisation for Economic Co-operation and Development (OECD) and United Nations Statistical Division), has produced the Tourism Satellite Account: Recommended Methodological Framework. For purposes of the TSA, the UNWTO has identified a list of tourism characteristic activities/industries as follows: 1. Hotels and similar 2. Second home ownership (imputed) 3. Restaurants and similar 4. Railway passenger transport services 5. Road passenger transport services 6. Water passenger transport services 7. Air passenger transport services 8. Transport supporting services 9. Transport equipment rental 10. Travel agencies and similar 11. Cultural Services 12. Sporting and other recreational services These are industries which produce tourism characteristic products, defined below.


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An ‘industry’ is normally regarded as ‘a group of establishments engaged in the same kind of productive activities’. The definition of the characteristic industries can vary across countries. (Note: The USA, Canada, Australia and New Zealand use the concept of ‘industry’ and Europe uses the concept of ‘activity’.) In the TSA, products are what are purchased by or for visitors. Activities (or industries) produce products. These products are classified as tourism characteristic, tourism connected and tourism specific (related). Tourism characteristic products are those products, which, in most countries, it is considered, would cease to exist in meaningful quantity or those for which the level of consumption would be significantly reduced in the absence of visitors, and for which statistical information seems possible to obtain. Tourism connected products are a residual category including those that have been identified as tourism specific in a given country, but for which this attribute has not been acknowledged on a world wide basis. Tourism specific products are the sum of the two previous categories. In some countries these products are called ‘tourism related’. Another category is products which are consumed by visitors but which are not important enough to fall into the above categories. In the TSA, these are aggregated into a single category “Other”. In order to measure demand (products consumed) information is required on purchases by or for visitors. (Fixed capital formation and government collective consumption are not currently included for estimating value added, GDP or employment in the TSA although there is provision for them to be included in separate tables in the TSA). Tourism consumption comprises, as well as consumption by leisure visitors, consumption by business visitors relating to a business trip. Such visitors may be conducting business on behalf of themselves or a private or public sector employer. In the System of National Accounts (SNA), such consumption is treated as intermediate consumption, but in the TSA, to fully reflect the full value of tourism demand, it is treated as tourism final consumption. It is important to understand, however, that while the TSA is recognised internationally as an important information base for the calculation of tourism’s contribution to the economy, the Meetings Industry is not simply a subset of the tourism industry. The TSA defines a ‘visitor’ as ‘any person travelling to a place other than that of his/her usual environment for less than twelve months and whose main purpose of trip is other than the exercise of an activity remunerated within the place visited’. A proportion of these ‘visitors’ will be ‘international’ while others (perhaps the majority) will be ‘domestic visitors’. Thus, while some participants at meetings will meet the TSA’s criteria for a ‘visitor’, the majority of meeting participants may well be ‘local residents’ who reside within the city or immediate confines in which the meeting is being held and who do not meet the TSA’s ‘visitor’ criteria of travelling outside their usual environment. While these participants are not visitors and thus their economic activities associated with meetings are not included within the TSA, to omit the economic contribution of these participants would be to significantly under-state the economic contribution of the Meetings Industry to the economy. Because some of these meeting participants are not visitors, and their activity is not included in the TSA, this means that the TSA cannot be used directly to measure the activity of all meeting participants. As a result, revisions or additions to the TSA have to be made to measure the activity of all meeting participants. However, the consultants believe that the TSA can still be usefully used to estimate the economic contribution of the Meetings Industry. This requires a number of significant challenges to be overcome. The discussion below will proceed in two main parts. The first part outlines how destinations may employ existing TSAs to estimate the economic contribution of meetings, with a discussion of the

Using the TSA to Evaluate the Economic Contribution of the Meeting Industry

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challenges this presents. The second part will explore the implications of the development of the new International Standard Industrial Classification of All Economic Activities (ISIC) category, 823 Convention and Trade Show Organisers.

3.1 The Economic Contribution of the Meetings Industry has Two Components There are two important aspects of the economic contribution of activities relating to meetings which need to be addressed. Supply side measures relate to the size of the specific industry being considered – in this case those firms or agencies that fall within the specific definition of the ‘Meetings Industry’ which is adopted, for example, under ISIC 823. We might regard these as comprising the core professional meetings’ organising firms. These measures will include such variables as number of meetings held, employment, number of businesses involved in the Meetings Industry, contribution to GDP, etc. They will measure the activity of the defined ‘Meetings Industry’, including that resulting from both visitor and non-visitor demand. They will not include activity in other industry sectors, such as accommodation, transport or catering, which results from demand generated by meeting/events participants. They will also not include the activity of organising/hosting meetings where this activity is a secondary activity of a business, e.g. a large hotel, which will be included in the ‘Accommodation’ industry. Demand side measures include such variables as expenditure by participants attending meetings, number of meetings’ participants, the origin of the participants, their demographic profiles and so on. They would also include demand from meeting/events participants for goods and services provided by industries outside the Meetings Industry, e.g. for food, accommodation, entertainment, transport etc. Some of this demand will come from traditionally defined ‘visitors’ and already be accounted for under their various categories in the TSA. Other demand will come from local (non-visitor) participants in meetings which are not included in the TSA measures. The supply side and demand side measures are quite different, and it should be clear in the mind of the user what exactly is being measured. Each measure serves a different purpose. Estimating the total economic contribution of meetings-related activity will involve both identifying the size of the Meetings Industry itself (the supply side), and also the total consumption of participants resulting from their participation in meetings/events (the demand side).

3.2 Use of an Existing TSA to Provide an Indicative Estimate of the Economic Contribution of the Meetings Industry Under the System of National Accounts (SNA), industry size and economic significance are normally measured from the supply side only. In recent years, Tourism Satellite Accounts have been developed to estimate the economic contribution of the tourism sector to the economy. The TSA is a relatively new concept in national accounting terms – it matches demand side activity of the relevant consumers (i.e. visitors) with the supply side activity of the industries meeting this demand. A TSA extracts from the National Accounts the contribution which tourism makes to each industry of the economy, allowing measurement of the contribution of tourism to GVA and employment, and permitting comparison with other industries which are listed in the core National Accounts. The TSA measures tourism consumption, and relates that to the total output of the tourism connected industries. This enables identifying and measuring the supply side activities of the ‘tourism industry’. By aggregating the activity of each industry resulting from tourism demand, total ‘tourism industry’ activity can be examined and compared to traditional industries in the national accounts.

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The TSA thus identifies tourism activities within the national accounting framework so that a comprehensive set of economic data on tourism can be compiled. Approximately 80 nations have now developed or are developing a TSA for their economy. Measurement of the economic activity of industries in the SNA comprises only the direct activity of each industry. That is, the indirect or upstream activity, which flows from the activity of any industry, is not incorporated in the size of that industry’s contribution to the economy. This same principle applies to the TSA. So, for example, the TSA does not include the activity of suppliers to the accommodation industry (food suppliers, cleaning services, electricity supply, etc.). It only includes the activity of those businesses that directly supply goods or services to the consumer (the visitors). Because of this, any use of the TSA to measure the economic activity of the Meetings Industry will not include the upstream activity resulting from the activities of this industry (e.g. providers of equipment for meetings, events, venue cleaning services, etc.). If this indirect contribution is required – to combine with the measure of the direct activity of the industry to arrive at the full economic contribution of meetings’ activity – then further analysis is required. The UNWTO has identified the potential benefits from development of a TSA as being to: “Increase and improve knowledge of tourism’s importance relative to overall economic activity in a given country; provide an instrument for designing more efficient policies relating to tourism and its employment aspects; and create awareness among the various players directly and indirectly involved with tourism of the economic importance of this activity; and by extension its role in all the industries involved in the production of goods and services demanded by visitors” [www.unwto.org/statistics/tsa-project]. The TSA provides a framework that can be employed to produce similar benefits for the Meetings Industry by giving greater rigour and credibility to its measurement and improving awareness of the importance of the industry. However, a number of difficulties arise in seeking to do this. These will be considered below.

3.3 Limitations of the Use of the TSA in Measuring Meetings’ Activity As it currently stands the TSA cannot provide a reasonable measure, or estimate, of the size of meetings activity. This is primarily because meetings activity is not a sub-set of tourism activity, as discussed earlier. These two activities overlap, but neither is fully encompassed by the other. The great majority of tourism activity is non-meetings activity, while a significant part – in some countries a majority – of meetings activity is activity of locals who are not visitors to the area, and thus whose activity is not included in the TSA. Even if all meetings activity were encompassed in tourism (and the TSA), the TSA as it currently is compiled would not be able to measure meetings activity. This is because extra data, which are not currently required for the TSA would be needed to measure meetings activity. The basis for the TSA is a supply-use table which splits the economy into ‘tourism activity’ and ‘all other economic activity’. Meetings activity is not identified. The TSA calculates tourism ratios for products and industries, i.e. what proportion of products and industries’ activities come from tourism consumption. As consumption by meetings’ participants is completely different in level and composition from that of ‘visitors’, the TSA tourism ratios cannot be used to measure meetings activity. While the tourism ratios could be calculated for ‘Business visitors’, it is not known how these would differ from the ratios which would apply to meetings participants. These would certainly differ, particularly as the consumption level and composition of non-visitor (i.e. local) meeting participants would be significantly different from that of ‘Business visitors’. To use the TSA to measure meetings activity, it would be necessary to collect extra data than are now required for the TSA.


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On the supply side it would be necessary to collect economic data on those industries which are identified as ‘meetings-characteristic industries’. The addition of a new category to the ISIC, which is discussed elsewhere in this report, will go a long way to addressing this. However, the existence of relevant ISIC categories is not sufficient – it merely provides the statistical industry framework which facilitates the required data collection. National Statistical Offices would still need to be persuaded to collect the required data from these industries. The collection of the extra supply side data would provide a basis for an estimate of the economic activity of the Meetings Industry. However, the framework for supply side data collection, e.g. ISIC or a national derivative, is constructed so that each business is allocated to the industry category which reflects its primary activity. Many businesses also have secondary activities. For example, a large hotel would be categorised to the ‘Accommodation’ industry, and all of its activity, including organising and hosting meetings/conferences would be measured as part of that industry and not to the ‘Meetings Industry’. On the demand side, it would be necessary to expand the list of ‘purposes of visit’ in the data collection and analysis to identify ‘Meeting participant’. Currently for many countries such visitors are included in ‘Business visitors’ and not identified separately. The separate identification of ‘Meeting participants’ does not involve any technical problems. The main issue would be the extra cost of collecting and analysing this data. This extra data collection would still not encompass the total value of consumption of meetings participants. This is because it would still not include consumption by local (i.e. non-visitor) participants. A separate exercise would be needed to measure this consumption.

3.4 The new International Standard Industrial Classification 823, ‘Convention and Trade Show Organisers.’ If the TSA is to be used to estimate the economic contribution of meetings participants as a subset of visitors, what is required is a clear definition of ‘meetings tourism’ and a ‘meetings visitor’. Some guidance on this is provided by UNWTO, ICCA, IMP in their proposal for the ISIC revision process, resulting in the development of new ISIC code 8230. That is, ISIC is currently undergoing revision which will add the identification of a separate category, as follows: •

823 Convention and trade show organisers See class 8230

•

8230 Convention and trade show organisers This class includes the organisation, promotion and/or management of events, such as business and trade shows, conventions, conferences and meetings, whether or not including the management and provision of the staff to operate the facilities in which these events take place.

This means that there will be one ISIC activity group (ISIC 823/8230 Convention and Trade Show Organisers) in which all businesses, whose primary activity is as described, are included. Whilst some businesses have a variety of activities, they will be allocated to the one category that reflects their primary activity. The ISIC 8230 can serve to define the scope of the Meetings Industry, providing a consistency of definition lacking in the industry to date, thus enhancing the credibility of measures of its economic significance. Whether or not the Meetings Industry is categorised as a tourism connected industry will depend to some extent on the share of its revenues that are attributable to tourism. Although no precise share

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threshold is specified, it should not be below 25% in most cases. The tourism aspects of the Meetings Industry are its direct transactions with meetings participants who are visitors. Given the scale of local resident (non-visitors’) expenditure on meetings and events activities, it seems very likely that the Meetings ‘industry’ will fall below the 25% threshold. In that event it may be important to seek to have the Meetings Industry regarded as a special case in order to have it explicitly identified in the TSA tables. The TSA approach enables the ‘industry’ contribution to be measured by measuring the activity of all the relevant ISIC industries, and also enables the full contribution of meeting participants to be measured through their total consumption of goods and services. The separate identification of this industry means that, once implemented, statistical agencies will be able to survey the industry in the same way as other, more traditional, industries are surveyed.

3.5 Implications of ISIC 823 While many of the implications of use of ISIC 823/8230 have been identified above it is appropriate to acknowledge them explicitly at this point: 1.

The code itself could exclude some supplier types that one may wish to count as part of the Meetings Industry. Businesses that may not be represented in ISIC 8230 include Incentive Houses, or in-house corporate planners as well as a range of other organisations. For example, many hotels may host meetings but as their primary activity providing accommodation, they would be included in the ISIC Accommodation code. Additionally, a large number of Associations worldwide host meetings/conferences for members but do not have as their primary activity the types of activities falling under ISIC 8230. Thus, while the new ISIC code will be suitable for the classification of firms primarily engaged in organising meetings, conferences, conventions and trade shows, this industry category will understate the total activity of organising meetings. The great majority of meetings do not use the services of organisations where meetings are their primary activity. For example, as noted above, smaller hotels which do not have a designated convention or conference centre will in many cases still provide meetings organisation and hosting services .Where such meetings are organised by a professional meetings organiser which does qualify under the ISIC 8230 definition this activity will be included, but otherwise it will appear as part of the Accommodation Industry in ISIC. The use of the concept of activity, however, can bring together production of similar products in the different industries where this production occurs. In Deery et al (2005), it was found that Professional Conference and Convention organisers were employed for only about 10 per cent of the meetings held annually in Australia. These companies are important and specific players in the Meetings Industry as this is their core business, but they do not represent the full scope of the industry from a spending or revenue standpoint: a large number of meetings – including very large ones – are organised by in-house professionals within associations and corporations. This implies that use of the code to define the Meetings Industry from the supply side may capture only a small percentage of inputs and outputs of the production of meetings goods and services.

2.

Depending on the requirements of the client, different and unique bundles of services related to meetings can be packaged. This characteristic can complicate the measurement issues, as they should all be aggregated to reflect the industry output. Normally, consumption of accommodation, transport, food, etc. by meetings’ participants would be treated as an activity of the relevant industries providing these services to the attendees, and not of the Meetings Industry. However, a complication arises when, for example, the meeting organiser includes in the


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meeting/conference registration fee, the cost of accommodation, conference speaker, corporate entertainment, and possibly some transport – services which will be provided directly to the meeting participant by the business rather than the meeting organiser. The same issue arises when an exhibition organiser pays for various goods and services from exhibitor fees. Both are analogous to the situation where a travel agent sells a package tour – comprising a number of products (e.g. accommodation, transport, sight-seeing, etc.) which will be provided directly to the visitor by the service provider rather than by the travel agent. The question is: should the Gross Value Added in providing these services be attributed to the meetings organiser, treating the package as a single product (known as the ‘gross’ approach), or should the Gross Value Added be attributed to the direct providers of each of the packages’ components, i.e. to the Accommodation industry, the Transport industry, the Tourist Attractions industry, etc. (known as the ‘net’ approach). In compiling the TSA, the UNWTO recommends that the ‘net’ approach is taken. Consistency with UNWTO guidelines would suggest that this approach should be taken in measuring the Meetings Industry, using the TSA as a basis. The potential ‘downside’ of this is that the apparent economic contribution of the Meetings Industry will be lower than what the gross approach would indicate. However, it is important that the approach taken be consistent with existing official standards to ensure that the methodology is accepted as providing an objective and credible measure of the industry. 3.

One might also note that the listing of the new ISIC code does not, in itself, imply that central statistical agencies will implement new ISIC 3 (and 4) digit code for Meetings or that they will automatically collect this information as they would for other industries. In most cases industry information is collected at a higher (ISIC 2- or even 1-digit) level than the 3- or 4-digit level. The agencies would have to be persuaded to collect data on this industry at this lower level. This would involve more costs for the agency in data collection and might be resisted for this reason. A related issue is that, while ISIC may incorporate this new code, each individual country will have to decide whether it will create a corresponding code in its national industrial classification system. Even if so, changing such classification systems can take a considerable amount of time and it could be years before such a new code is actually included.

4.

The presentation of statistical results needs close consideration. Adoption of the new ISIC 8230 code will be a useful step towards such credibility if implemented by central statistical agencies because it will provide central statistical agency imprimatur to an important element of the Meetings Industry data. Where the measure of the Meetings Industry is based on TSA data, its credibility will be improved by the fact that the TSA is a part of the official National Accounts and thus enjoys the credibility and status of a National Accounts measure.

3.6 Presentation of Results: A Meetings ‘Satellite Account’ A further issue relates to how the results of any measurement of the tourism connection of the Meetings Industry would be presented. It can be argued that the credibility of the Meetings Industry estimates will ultimately depend on whether they can be incorporated into the mainstream of the TSA (or the SNA itself). From this point of view some form of link to the TSA may be the best route to credibility for the Meetings Industry as it would attach the industry to an existing and credible national accounting structure which already incorporates the form of demand side analysis which is recommended here for the Meetings Industry. To establish a completely new identity for meetings activity, independent of that of tourism activity would be a difficult and lengthy process. It is not apparent that the Meetings Industry of itself has the political clout or influence to succeed without a major champion such as the tourism community.

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In practice options are limited to the following typology: 1.

incorporated in the TSA, with the “Meetings Industry” identified as another tourism industry;

2.

incorporated in the TSA framework as a complementary set of tables specifically identifying meetings’ activity; or

3.

as a separate satellite account.

Therefore there are three options. The first option implies that the Meeting Industry is a tourism characteristic activity such as Accommodation, Passenger Transportation, Travel Agencies, etc. There is no clear evidence that this is the case at least on a national levelThe Meetings Industry is not a clear subset of the Tourism sector – indeed the new ISIC 8230 code will cover activity by conference organisers on behalf of resident conference and meeting participants as well as those for visitor participants (whether domestic or international visitors). Some organisers which fall under the code may do very little of their business with ‘visitors’ as defined under the TSA. The second option (to consider the development of a separate industry extension relevant for the Meetings Industry) seems the proper way to proceed. Such an extension could involve, for example, the usual supply and demand information for the industry plus other information and characteristics not normally found in the TSA. The TSA could be a supporting instrument and framework, but more information about the Meetings Industry could be incorporated. Although such specific industry extensions cannot be referenced, analogies of this approach appear, for example, in the Balance of Payments as memoranda items, where information is provided outside the specific BOP guidelines, but which is still of interest to users. For example, in Australia, memorandum items in the BoP identify Tourism Exports and Tourism Imports. In another case, Canada, a memorandum item has been used to provide a provincial breakdown for travel. These are not actually components of the BOP. They elaborate the usual BOP compilation, and provide additional useful information. (Such analyses could be assembled for any industry in the SNA, where some descriptive characteristics are available and important, but lie outside the specific SNA requirements.) In this context, the Meetings Industry could use the basis of the TSA framework, and add supplementary information of particular interest as a memorandum item. The industry itself could identify such characteristics as they wish. The tables to be produced as supplements to the main TSA tables could be set up along the lines of the TSA-RMF (consumption by products and categories of visitors, and production accounts for the industry). The Meetings Industry would make a valuable contribution to the discussion by reviewing these proposals before identifying the optimal tables for their specific needs. Finally, the third option, while perhaps ideal from the industry viewpoint, is most unlikely to be accepted by statistical agencies, at least until they have some sense of the importance of the industry. The industry may be able to help, by providing judgments to the statistical agencies, as to the number of meetings held in specific countries, and the share of these meetings that are organised by the meetings industry.

3.7 Conclusions A credible international system, and eventual incorporation into the mainstream of the TSA, requires that we move towards some consistent definitions of meetings. The TSA framework allows for special insight into tourism related industries. The term “TSA extension” should be understood as a complementary set of data on a specific issue of special interest for tourism related economic analysis (such as the tourism connection of the Meetings Industry), which may also include some conceptual clarification issues on the TSA official text. The closest comparison could be Balance of Payment memorandum items.


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TSAs provide a mechanism for countries to estimate the economic contribution of the various components of the tourism sector. The aim of this study has been to undertake some preliminary work towards the development of a standard methodology for measuring the economic value of the Meetings Industry based on Tourism Satellite Accounting. This initiative should adapt the conceptual framework of the TSA and raise worldwide awareness of the need for TSA compilers to identify and measure adequately the Meetings Industry. Incorporating meetings explicitly within the TSA would enhance credibility of any measurements of economic contribution of this industry. While it is possible to present a framework to assist in estimating the value of the Meetings Industry globally, the issue of lack of consistency in the method and frequency of data collection will remain a barrier to progress. The ongoing refinement of the global data collection process will require considerable attention by the UNWTO and the current study will provide criteria and recommendations for the statistics that are collected and the assumptions underlying these statistics.

Chapter 4 Framework for an Evaluation of the Meetings Industry

The following chapter outlines a potential strategy for collecting the data necessary to inform the estimation of economic contribution described in Section 4.1. The methods are based loosely on those used in the National Business Events Study (Deery et al, 2005) taking into account lessons learned during that study.

4.1 Measurement Problems There are several major problems with measurement of the Meetings Industry to date. These measurement problems, affecting both supply side and demand side measures, arise because: •

The standard industrial classifications (e.g. ISIC) do not (currently) identify a separate Meetings Industry.

•

The data collected by existing surveys shows enormous diversity and inconsistency.

•

The data are created for different purposes and are frequently not comparable.

•

The data are often not up to acceptable statistical standards.

Ideally, there should be agreement on the basic data to be collected for the purpose of estimating the economic contribution of the Meetings Industry. Statistical agencies in different countries should also adopt the same method of collecting the basic data for the Meetings Industry and the same approach to estimating its economic contribution. This would enhance the credibility of the estimates made and facilitate comparison of Meetings Industry performance between destinations and with other industries. The size and value of the economic contribution made by ‘meetings’ depends on the definition of the Meetings Industry both in aggregate and in terms of its constituent parts (meetings, incentives, conventions and exhibitions). The definitions formulated in Chapter 3 can help to define a meetings’ participant. As indicated earlier, there is presently much confusion in the industry as to the appropriate definitions of ‘meetings’. We have seen that the definitions proposed differ in respect of required numbers of participants, mix of nationalities, duration and so on. Use of the TSA to estimate the economic contribution of the Meetings Industry requires that participants at meetings be clearly defined. Different definitions will result in different numbers and expenditure counts for meetings participants. Clearly, the set of tourism related activities/industries (characteristic plus connected) does not equate to what might be regarded as the set of ‘meetings related’ activities/industries. What is required is that the TSA, or a Meetings Industry sub-set of the TSA, identifies specific industries which reasonably represent the activity of this sector. This requires that the industrial classification used identifies the relevant industries. At the moment, the current version of the ISIC – on which many countries base their official national industrial classifications – does not identify a category specific to ‘meetings organisers’. Such businesses would currently be included in a broad category encompassing a range of businesses providing a variety of services. This category is far too broad to use for the purpose of measuring the activity of the Meetings Industry.


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Without the adoption of consistent definitions, the results will not be comparable over time or between countries or jurisdictions. This would prevent measurement of the global size and importance of the industry.

4.2 Data to be Collected As referred to in earlier chapters, a full picture of the Meetings Industry requires knowledge about both the demand and supply components of the industry. On the demand side, two types of data are required. The first type of information is an estimate of the total number of participants grouped into locals (from within the region) domestic visitors (from outside the region but within the country) and international visitors (from outside the country). Reliable expenditure data are extremely important in the exercise of a Meetings Industry economic contribution evaluation. The different categories of expenditure data required and the broad methods to be used are presented in Table 4. Table 4 Expenditure data: Types of meeting participants and broad methods International Visitor Expenditure

Domestic Visitor Expenditure

Locals’ –non-visitors Expenditure

1. Survey of international visitors on 1. Household surveys of domestic 1. Surveys of meeting participants. arrival or departure from country visitors after end of their visit - ‘Attending meeting’ needs to be a category of purpose of trip.

– ‘Attending meeting’ needs to be a category of purpose of trip. 2. Surveys of meeting participants.

2. Surveys of meeting participants.

The second type of data is the details of their expenditure on registration and other goods and services associated with their participation in the meeting, and, if they are visitors, expenditure on all goods and services consumed in the destination country/region. In countries where there are surveys of inbound and domestic visitors that are rigorous and comprehensive enough to provide accurate estimates of the number of meeting participants and their expenditure, then these data sources would provide some of the required information. However, some primary data would still be required to ascertain the number of local participants and their expenditure. On the supply side, data is required on the number of meetings and participants. This will inform an estimate of the total number of delegates grouped into the three aforementioned categories of locals, domestic visitors and international visitors. The population of interest depends on the definition of the Meetings Industry. If the definition implied by the new ISIC code is adopted then the data collection needs to be focused on businesses identified by the code. However, as discussed in Chapter 4, other industries where meeting organisation/hosting, e.g. the Accommodation industry, is undertaken as a secondary activity will also need to be surveyed. It should be noted that this scope excludes meeting activity where the meetings are held in-house (i.e. organised and hosted in the premises of a business which does not organise meetings as a commercial activity). Including these meetings in the scope would require very difficult, if not impossible, data collection from the supply side as every business in the country would be in-scope.

Framework for an Evaluation of the Meetings Industry

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4.3 Collection of Expenditure Data A potential strategy for collecting the expenditure data of meetings’ participants is outlined below. A series of four draft questionnaires containing the data to be collected has been developed to collect data from venues, organisers, delegates and exhibitors. These are presented in Appendix G. Step 1: Development of a sampling frame of commercial meeting venues stratified by appropriate variables such as size, region, and annual volume of business. Step 2: Collection of data from a representative sample of these businesses identifying total number of meetings hosted, total number of delegates and region of origin of participants. Respondents could be asked to provide a sampling frame of participants, or to recruit via email for a survey of the participants in their meetings. Step 3: Examination of inbound and domestic visitor survey data to identify the number of participants who were visitors to the region in each category. Step 4: Estimation of the number of local participants by subtracting the number of participants who were visitors (Step 3) from total number of participants (Step 2). Step 5: Participants’ expenditure data would be collected through a survey, possibly administered via the web, of the participants identified in the survey frame (Step 2). See Appendix G for examples of questionnaires to collect this data.

4.4 Lessons from Previous Research in the Meetings Industry The consultants have past practical experience in the collection of data on both the demand and supply side of the Meetings Industry through their National Business Events Study (2005). Following is a brief summary of some of the difficulties experienced during that study presented here in the interests of designing a data collection program that mitigates these difficulties. 1.

At the national level (or even at a large sub-national regional level) it is difficult to identify a comprehensive sampling frame of commercial meeting venues unless they are members of an industry association. If an industry association does not exist, or there is reason to believe that its membership is not comprehensive, then a simple rule for inclusion needs to be developed, such as the venues marketing of their services in a business directory. Ideally the criteria for inclusion in the venue sampling frame should be consistent across all regions and countries undertaking this exercise and it might therefore be appropriate for the UNWTO to define this.

2.

The information required from venue managers is complex and it may take them some time to collate this depending on the way in which such information is stored. It will also depend on the time period being covered, e.g. a year, a quarter, a month, etc. Difficult survey questions often lead to non-response (because respondents are unable or cannot be bothered to supply the information) or to survey error (because respondents do not take the time to accurately collate the information). To promote accuracy, effort should be made to simplify the task as much as possible for the respondents. One initiative in this regard is a project by the STCRC investigating methods for extracting venue information directly from booking systems rather than requiring venue managers to complete a survey.

3.

It has been suggested that inbound and domestic tourism surveys can be used to derive an estimate of the number of meetings’ visitors. However, people may have multiple reasons for their visit and everyone attending a ‘meeting’ may not identify this as their main purpose. These surveys therefore need to have an additional specific question asking whether they attended a meeting, conference, exhibition or incentive event during their trip.

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4.


Initial response rates from supply side operators (organisers and venues) were very low, and it was only with extensive and labour-intensive follow up (through repeated telephone calls and emails) that acceptable response rates were achieved. It appears as though operators in the Meetings Industry are extremely concerned about the competitive implications of sharing information about their businesses. For this reason it is suggested that the data be collected by an independent research organisation through industry associations who should promote to their members the importance of their participation in the interests of the industry as a whole.

4.5 Surveying Participants in Meetings There are two ways of obtaining visitor expenditure associated with the Meetings Industry: a)

from the surveys of total visitors conducted for general tourism statistical purposes, e.g. national or regional tourism surveys of international or domestic visitors; and

b)

from customised surveys specifically targeted at participants during or soon after their attendance at meetings.

a) From tourism visitor surveys Some countries specifically include attendance at meetings in their tourism visitor surveys. For international visitors, this may be by way of the official Immigration Arrival/Departure cards completed by international visitors at border posts or by way of tourism specific surveys of international visitors. These may be a useful tool for estimating total attendance at meetings by international visitors and possibly for weighting purposes for other more detailed survey data. Expenditure undertaken by meetings’ participants can be estimated from general tourism surveys which include expenditure information. These are conducted in many countries by government tourism authorities or joint government/tourism industry agencies. They use techniques such as household surveys, sample exit surveys or diary records maintained by sample visitor groups recruited for the purpose. These surveys will normally be managed by government agencies and involve large scale sampling with large numbers of questions. The extent to which individual small groups (such as meetings’ participants) can be identified will depend on the sample size and consequent level of sampling error. It could be expected that sample sizes would need to be very large and indeed larger than most current national tourism survey samples, to ensure statistically significant results for Meeting Industry participants. Increasing the sample sizes to achieve statistically significant results can be expensive and would require strong government and industry commitment to the objectives to be achieved by doing so. A problem in measuring visitors’ participation in meetings relates to the way such participation is to be identified in the tourism survey question. For example, can the sort of label, which is usable in a large tourism survey accurately, reflect the Meetings Industry as we may propose to define it? A question such as “Was the main purpose of your visit to attend a conference or convention?”, may not catch all of the nuances of attendance at a possible Meetings Industry event, but expanding the survey wording, in an already large tourism survey, will add expense and possibly contribute to respondent fatigue. Alternatively, the use of the more general term ‘meeting’ may involve considerable ambiguity for many travellers who will be engaging in meetings during their visit which would not fall within the activity of the defined Meetings Industry referred to here. It will thus be necessary in the context of the survey instrument to find a simple way of conveying the relevant definition of ‘meeting’ in the context of the survey instrument. A further complication arises when a traveller has dual motives for visitation (e.g. attending a conference and also visiting family, or having a holiday). The survey questionnaire should allow visitors to subsequently identify other purposes of visit in addition to their main purpose of visit to the


37

destination. Secondary purposes should include ‘participating in meeting/conference/convention/etc.’. This will ensure that all visitors who participate in a meeting, and not just those who visit for the primary purpose of participating in a meeting, will be identified. It is recommended that all such identified persons who participate in a meeting, whether this is the primary or a secondary purpose of visit, should be included in the measurement. This will provide a more accurate measure of the contribution of all meetings’ participants. Another issue relates to persons accompanying meetings’ participants. It is common for spouses to accompany a meetings’ participant and to identify their main purpose of visit as “holiday” (or some other purpose). Any accompanying person’s expenditure should be included in the meetings’ related expenditure. This is because of the principle that the purpose of visit should be identified as the purpose ‘in the absence of which the visit would not have taken place’. In this case it is assumed that the accompanying person would not have visited the destination if the meeting was not taking place (even though that person him/herself was not participating in the meeting). It is recommended, to assist this, that the list of (main and secondary) purposes of visit should include ‘Accompanying convention/conference/seminar/trade fair/exhibition visitor’. b) From Customised Surveys The expenditure of participants within the destination can be estimated using customised surveys carried out on participants in ‘meetings’ which meet the definition of the Meetings Industry. These would need to cover a sufficiently large number and range of such meetings to achieve a level of statistical reliability. As such, this approach is also expensive. If the survey process is to be driven by the industry rather than by government, this approach will probably be the only option available. Such surveys will require the active participation of individual Meetings Industry organisers. They would be subject to the normal limitations of survey use and caution would need to be exercised in the use and interpretation of results. Continuous surveying is, however, an expensive undertaking. An additional issue arises in respect to surveying participants in meetings who are residents in a host country. These residents can be classified as either ‘domestic visitors’ or ‘local residents’. The domestic versus local distinction would be made (according to UN/UNWTO tourism statistics’ standards) primarily on the basis of whether the visitor/participant has travelled outside his/her usual environment. As for international visitors, the expenditure of destination residents (domestic visitors or locals) can be estimated from general tourism surveys or specifically targeted to meetings participants. Specific surveys are likely to be clearly preferable in this case, in order to pick up expenditures by local resident meeting participants who will be omitted from tourism surveys.

4.6 Expenditure on Travel to Meetings in Other Countries An issue arises in relation to the treatment of expenditures in the meeting participant’s country/place of origin in relation to attending a meeting or event in another country/place. Some of this expenditure will contribute to the economy of the origin country/place while some will contribute to the economy of the destination country/place. For example, the participant may pay a travel agent in the origin country/place for accommodation in the destination country/place. This payment contributes to the economy of the destination country/place and not the economy of the origin country/place. Therefore this expenditure should not be included in a measure of the contribution of meetings to the origin country/place. However, the GVA of the travel agent does contribute to the economy of the origin country/place and so should be included. This will be only a small part of the payment made to the travel agent by the meeting participant, but it must be included in the measure to ensure that the full value of meetings’ activity to the economy is measured. Where such payments are made to a meeting or event organising business in the country/place of origin and must be passed on to the meeting organiser or service provider in the destination country/place,

38


for example as a payment for conference fees or accommodation, these payments become the revenues of the Meetings Industry in the destination country/country. A component of such payments may, however, relate to services provided in the originating country/place, in effect the value added provided by staff of the meetings organising firm in the country/place of origin. In national accounting terms and for consistency with the TSA, this value added generated in the country/place of origin should be included as part of the production of the meetings and events industry in the origin country/place rather than in the destination country/place. The over-riding principle here is that any GVA by a business which is resident in the origin country/place which relates to meeting activity in another country/place should be included in the measure of meetings’ contribution to the origin country’s/place’s economy.

4.7 The Use of Survey Data to Measure the Economic Contribution of the Meetings Industry The expenditure data can now be employed to estimate the economic contribution of the meetings industry. The expenditure of meetings’ participants (and those accompanying them) is a major input into the estimation of the economic contribution of the meetings industry in respect of variables such as Gross Value Added and employment. The method outlined introduces consistent and credible techniques for measurement, using TSA concepts and methods, but inevitably relies heavily on industry surveys and existing data types. Since expenditure pertaining to different industries (e.g. accommodation, air and water transport, casinos and other gambling services) will have different effects on value added and employment in the wider economy, it is crucial that the expenditure surveys reflect accurately the patterns of purchases by meetings’ participants. Every care needs to be taken that the surveys conform to correct statistical sampling requirements and sound statistical methodology. A problem with expenditure surveys is that the information they yield is invariably very aggregative or ‘blunt’. Surveys generally will not provide sufficient detail to enable us to know what specific products and services are purchased by meetings participants except under general categories such as ‘shopping’ or ‘accommodation’ or ‘tours’. Gaps in our knowledge here will affect the estimated economic contribution from meetings’ participants since purchases of the different products are associated with different value added and employment effects. This problem is no different for ‘meetings tourism’ than it is for ‘leisure tourism’ or ‘business tourism’ generally and highlights a more general concern with use of the TSA generally to estimate tourism’s contribution to the economy. Of course, more detailed survey instruments can be constructed which distinguish a greater array of products and services purchased by meetings participants, but this brings with it the likelihood of a much lower survey response rate from delegates, with corresponding loss of survey accuracy. Since it is impractical to construct surveys that are so detailed as to cover all specific goods and services purchased by meetings’ participants, analysts’ judgements will be called for. It has been indicated previously that expenditure surveys can be based upon a general tourism survey approach or by customised surveys of meetings’ participants. On either method, the financial costs are significant to gather consistent and acceptably reliable data. Not all countries have extensive international and domestic visitor surveys which include expenditure information. Even those that do would have to add questions and would probably need to expand sample size to ensure statistical significance of sample results. This will involve considerable expense and political commitment. No matter how accurate the surveys might be at a given time, expenditure patterns can change over time in unpredictable ways. As new products and services become available, meetings’ participants may change their patterns of expenditure. Such changes will affect the economic contribution of meetings’ participants to a destination.


39

It is also the case that the level of detailed data required to produce the estimates of the economic contribution of meetings is much greater than that normally provided in the national accounts. Some of the industries and products identified in the literature review as relevant to expenditure on meetings are at a more detailed level, or do not directly concord, with the industry and product categories in the national supply and use tables or the TSA.

4.8 Quarterly Measures of Meetings Industry Performance The measurement of activity relating to meetings addressed in this report covers activity in the sector over a period of a full year. This would usually be for a calendar year or a financial year. For most countries this measure would not be produced for every year. This is because the TSA, which the measure is based on, is usually only produced periodically – for example every five years or so. In addition, the TSA can take a number of years to produce after the reference year. This is because the data in the TSA takes considerable time to collect, process and manipulate before the TSA can be produced. A TSA could typically be produced two or three – and even more – years after the reference year. If the TSA is produced on a five yearly cycle, then the latest results could relate to the period seven, or even more, years ago. The tourism sector is one which is subject to very rapid short term changes in demand. Not only is it subject to seasonal changes – and in many destinations these can be significant – but it is also subject to a wide range of influences. These include economic conditions in the source countries/regions and globally, international events such as terrorist activities, wars, epidemics, etc., events in the destination country/region, e.g. Olympic Games, political relations between a source country and a potential destination country, and many other factors. Because the level of tourism demand can change significantly and unexpectedly in a very short time, there is a need for up-to-date measures of what is happening currently rather than historically. The traditional measures of tourism demand typically relate to a period six or more months previously. These data are essential for monitoring movements in tourism activity, composition and trends over time. However, they do not reflect current activity. The increasing sophistication of the tourism industry has led to growing demands for indicators of current demand. Operators in the industry need this information to assess how their business is performing compared to the wider industry and which sectors are performing better than others. This information is needed as the basis for decisions on whether current business strategies need to be changed. Some sectors which are not performing well may require special assistance which can only be provided by governments. While this discussion has related to the wider tourism sector, it applies also to the related Meetings Industry. While this industry is not as heterogenous as the wider tourism industry, and at the destination level may be easier to monitor on an anecdotal basis, its growth in size and competition means that the availability of up-to-date measures is increasingly required. Ideally it would be useful to be able to up-date the results of meetings’ data in the TSA on a regular short-term basis. However, this is not practicable as the data required to produce the TSA is not available on a short-term basis. Even if this data were available, the cost and resources needed to produce, in effect, a regular short-term TSA could not be justified. This is not necessarily a particular problem as the range and depth of data from the TSA is not essential for the monitoring of short-term changes in meetings’ activity. The TSA provides a wealth of data on the structure, composition and economic contribution of the sector on a longer-term time series basis. It enables trends over time in these variables to be examined and provides the rich database on which further research into the sector can be built. It provides the basis for strategic decision making on such issues as investment, business policy, training needs, structural change and other long-term development issues. The short-term monitoring of the sector does not need this range and depth of information.

40


For such short-term monitoring, it is suggested that the following measures would be sufficient to indicate short-term movements in the sector’s activity and health. 1.

on the demand side: numbers of meetings’ participants and total expenditure by these participants; and

2.

on the supply side: industry GVA, employment and possibly export earnings (i.e. earnings from international participants).

In relation to the demand side indicators, where a country has in existence on-going surveys of international and domestic visitors, these surveys should be used to provide these measures. Such surveys typically ask for the visitor’s purpose (or purposes) of visit, and attendance at a meeting/exhibition/etc. should be identified as one of the main (and secondary) purposes of the visit. Typically also, these surveys collect details of total trip expenditure by visitors. For those whose main purpose of visit – i.e. the purpose, in the absence of which the trip would not have taken place – is to attend a meeting/exhibition/etc. total expenditure for these visitors should be identified and aggregated. This should be done separately for international and domestic visitors. This procedure will provide data on numbers and total expenditure by visitors to a destination who have attended a meeting/exhibition/etc as primary purpose of visit. However, this is not a complete indicator of meetings activity as it excludes local residents who attend such events. To produce such an indicator, it is suggested that a survey of the meetings organisers/venues be conducted. The population of businesses to be surveyed could be those businesses falling into the new ISIC 823 class. Alternatively, in a regional destination where the number of relevant businesses may be small, the local industry association would know of all such relevant businesses and these could be surveyed. Such surveys, depending on local conditions, may be conducted by the industry association, or preferably by a professional research agency on behalf of the industry association. At the national level, it is suggested that such industry surveys should be conducted by the national statistical agency, in conjunction with the national industry association. The collection of accurate and reliable data is not an easy exercise and should be undertaken by, or at the very least be overseen by, a professional data collection agency. On the supply side, it may be possible to collect the data for the indicators through the industry surveys discussed above. However, only data which can reasonably and easily be provided by businesses should be included. For example, it may be easy enough for businesses to provide good data on numbers employed, but it might be difficult to provide data on GVA, for the reference period. Collecting data on such economic variables as GVA on a regular basis may result in the survey becoming too burdensome for the responding businesses. This could result in low response rates and thus unreliable and possibly unusable information. It is advisable to keep any such surveys as simple as possible. The demand side indicators discussed above can be used to approximate movements in industry GVA. The TSA will provide benchmark measures of GVA, and changes in the short-term demand side indicators can be applied to this benchmark data to provide estimated indicators of movements in GVA. This, of course, assumes that the relationship between demand side numbers and GVA is constant, which may not actually be the case. However, in the absence of actual GVA data, such a broad assumption may provide short-term estimates which are sufficiently reliable to monitor the general health of the sector. Any such short-term indicators would be recalibrated each time a new TSA is produced. This would then provide a time series of short-term indicators of industry GVA. The question arises as to what is a reasonable period for a short-term indicator to refer to. Typically, ‘short-term’ would be considered to relate to a period of a month or a quarter. Which of these would be most appropriate depends on a number of factors relating to the needs of the industry and the cost and practicality of the data collection and production. These are considerations relating to any data collection exercise. The more frequently a data collection is conducted, the more onerous it is for the


41

data providers, in this case the businesses, and for the survey organisers. The provision of such data and the processing and production of results on a less than quarterly (e.g. monthly) basis would, in this case, very likely be too demanding on resources, and therefore costs, than could be justified. It is recommended, therefore, that short-term indicators be produced on a quarterly basis. A caveat needs to be attached to this recommendation. While, ideally, the industry would like indicators to be collected and published in a very timely manner rather than over some longer period, we should not minimise the reality that the frequent collation of information relevant to such indicators can be very costly and may not yield benefits commensurate with the costs. Whatever the indicators developed, they will be ‘lagging indicators’ and thus of limited relevance for planning purposes. The question must be asked: what will the industry do with such indicators, particularly those that are published frequently? The answer given to this question will influence the view of how timely the indicators need to be, given the costs involved in their production. It may well be the case that, for many purposes, quarterly estimates of some of the indicators together with annual updates of others will provide a sufficient balance between the industry’s information needs and their cost of production.

Chapter 5 Proposed Broad Methodological Steps and Further Issues to be Considered

Having discussed the many issues relating to the measurement of the economic contribution of meetings to the economy, in this chapter we propose a standard methodology for consideration. The proposed steps below provide an outline of a broad methodology. There are many more detailed steps involved but these should be dealt with when a broad methodology is agreed on. This report has identified a number of issues still to be discussed and resolved before a final methodology could be adopted. This chapter also identifies those issues which need further consideration by the Steering Committee.

5.1 Proposed Broad Methodological Steps This proposed methodology relates to measuring the economic contribution at the national level. It is based on, and an expansion of, the Tourism Satellite Account. It is proposed that agreement be first arrived at for a national level methodology, before any methodology for assessing the local (sub-national) economic contribution is developed. 1.

Scope of industry and meetings participants a) Supply side • Decide scope of the “Meetings Industry”. (This might be a national equivalent of the ISIC 8230 category, if one exists). • Decide what industries should be identified as “meetings characteristic industries”. This would include, for example, the “Accommodation” industry and any other industries which host or provide venues for meetings/conferences/exhibitions/etc. as a secondary activity. • Identify a list of services provided by the Meeting Industry as a whole. b) Demand side • Broadly, the scope of meetings’ participants will be those participants at meetings as identified through international and domestic tourism surveys, and/or lists of participants identified by the in-scope supply side businesses. Participants will comprise locals, domestic visitors and international visitors. • In the case of visitors, it will also include persons accompanying meetings’ participants.

2.

Data requirements a) Demand side • The main data required are expenditure by meeting participants. For local participants, this will cover expenditure on registration fees. For visitors, it will cover expenditure on registration fees, plus all other expenditure on goods and services received in the


44


destination country/region relating to the trip taken. Expenditure on the main goods and services consumed should be identified. • Other information which would be of value relating to meetings’ participants would include: length of meetings attended, distance travelled to meeting, numbers in the travelling party. b) Supply side • Data required from the in-scope businesses (as per step 1) include the economic data required to measure Gross Value Added (e.g. income and costs) and employment resulting from the hosting or organising of meetings. • Also of interest are: data on the number of meetings held and the number of participants (broken down by whether local, domestic visitors or international visitors), and investment in facilities. 3.

Data collection methods a) Demand side. • For meetings’ participants who are visitors, the data collection should be primarily by way of existing tourism surveys of international and domestic visitors. In such surveys, meetings participants will need to be identified by a question asking respondents whether they participated in a meeting/conference/exhibition/incentive event/etc., or whether they accompanied such a visitor. For international visitors, such surveys are often conducted by way of a sample survey of visitors departing the country. For domestic visitors, the surveys are often conducted by way of a sample survey of households. • Customised surveys should be conducted of a sample of meetings’ participants. The list of participants should be provided by the businesses or a sample of them identified as being in-scope (in step 1). Such surveys may be conducted at the time of the meeting, or afterwards by contacting participants via the internet. • These two methods (or only the second one where a country does not have tourism surveys in existence) will identify expenditure separately by participants who are local, domestic visitors or international visitors. b) Supply side. • The economic data required to measure the industries’ GVA and employment, should be collected by way of the normal industry surveys conducted (usually) by countries’ National Statistical Offices for national accounts’ purposes. • Services produced by the industry will need to be identified and a selection made of the most significant items for measurement. (Note, as a starting point, the list supplied by IAPCO in AppendixA). Industries producing these services can also be identified for purposes of data collection. • These surveys will need to sample the Meetings Industry and the meetings characteristic industries (identified in step 1). • In any interim period before National Statistical Offices introduce the collection of Meetings Industry supply side data, it may be necessary to collect this information by separate supply side surveys. (An example of such a survey is attached at Appendix G).

Proposed Broad Methodological Steps and Further Issues to be Considered

4.

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Surveying organisation • Where possible the surveying organisation should be the organisation that collects the ongoing data for a country’s national accounts. This is usually the official National Statistical Office (NSO), but in some countries may be another organisation. • The demand side data relating to visitors’ expenditure may be collected by the National Tourism Agency (NTA). • The important thing, however, is that data collection should, where at all possible, be undertaken by those organisations who are collecting the data for the Tourism Satellite Account. • Where meetings’ data are not already being collected, these should, if possible be collected by the NSO or the NTA in close collaboration with the meetings’ industry association(s).

5.

Incorporation into the Tourism Satellite Account (TSA) • The data collected should all be provided to the compilers of the TSA. This will supplement the wider scope data inputted into the TSA. In the TSA, in addition to the identified tourism characteristic industries, the same data should be shown for the Meetings Industry and the meetings’ characteristic industries. This could be by way of additional tables to the standard TSA tables as previously mentioned in 3.6. • In these tables the meetings activity which results from participants who are locals (i.e. are not visitors and are therefore not included in the TSA data) should be added to the activity resulting from visitors who are meetings’ participants. • These tables will then show the measures of meetings’ activity from the supply side and the demand side, in the same way that the TSA does for tourism supply and demand.

6.

Output • The tables to be produced as supplements to the main TSA tables (see 3.6) could be set up along the lines of the TSA-RMF (consumption by products and visitors and production accounts for the industry).

5.2 Further Issues to be Considered Throughout this report, we have noted many issues that need further consideration, mainly by the Meetings Industry, and also by National Statistical Office counterparts and TSA compilers, to ultimately move the measurements towards international standards for all industries in the economy of a country. The following is an outline of the main issues that need to be considered to progress this exercise: 1.

Discuss with technical experts, such as National Statistical Offices, and other relevant international agencies, how an international standard method can be adopted, by building on the findings of this report. • are the recommendations of this report fully or partially accepted?; if so, how can the method be further developed?; if not, how can an alternative method be developed? • this will involve working with technical TSA and other experts to agree on the more technical issues discussed in this report, e.g. the “net” or “gross” approach to participants’ purchase of meetings’ packages; • also important, will be the decision on whether the proposed TSA extension (by way of supplementary tables to make explicit the Meetings Industry tourism connection) is seen, for the time being, as the preferred option (see 3.6).

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2.


Agree on the scope (and the name) of the industry and its products: • appropriateness of adopting the new ISIC 8230 category; • identification of industries for which meetings are a secondary activity (e.g. Accommodation); • exclusion of meetings not organised or hosted by a business undertaking the organisation or hosting of meetings as a business activity (e.g. excluding in-house meetings); • should Incentive Houses specifically be included as a meetings’ connected industry (perhaps only in certain countries?).

3.

How will national industry associations be “brought on board” in this exercise? • it is important that the national associations fully support any adopted international standard measurement of the industry; • also important is for these to assist with developing a list of services provided to participants at meetings.

4.

How will national industry associations educate their members and other industry participants to actively support the implementation of the measurement?

5.

How will industry participants be persuaded to fully co-operate with and contribute to the implementation of the adopted measurement of their industry, through: • working with the national and other industry associations to lobby for the expansion of the TSA to include the measurement of the meetings industry; • rovide funding for the exercise; • contributing the full range of data requested to ensure the credible measurement of the activity.

Appendix A Summary of Supply of the Meetings Industry Facilities by country

Africa North Africa Algeria

Palais des Nations holds major national and international congresses Wide range of smaller conference halls and meetings rooms available in hotels, cultural centres and youth centres

Morocco

No detailed information

Sudan

3 fully equipped conference halls Range of hotel facilities Large area suitable for international and regional fairs

Tunisia


West Africa Benin


Burkina Faso

Large conference halls with modern equipment

Cape Verde


Cote d’lvoire

Hotel Ivoire Convention Centre Cultural Centre

Gambia

Kariba Conference Hall

Ghana

Meeting rooms with capacity for 200 to 1,600 delegates International Conference Centre, International Trade Fair, Luxury hotels with conference facilities

Guinea


Guinea-Bissau


Liberia


Mali

Conference Centre with capacity for 1,000 people Cultural Centre with capacity for 300,000 people Many hotels with spacious conference rooms

Mauritania

Conference Centre with four meeting rooms and a large hall with capacity for 400 delegates Most 3-star hotels have meeting rooms

Niger

Convention Centre was renovated in 2004 Large hall with capacity for 3,000 delegates was added

Nigeria



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Africa West Africa Senegal

Large state-of-the-art conference rooms fully equipped for international conferences 40% of hotels have world class meeting facilities International Trade Centre has meeting rooms

Sierra Leone


Togo


Central Africa Angola


Cameroon


Central African Republic No detailed information Chad


Congo


Democratic Republic of the Congo


Equatorial Guinea


Gabon

Convention Centre Range of hotel meeting facilites

Sao Tome and Principe

Various hotels which can accommodate trade shows, congresses, meetings and conferences Convention Centre suitable for large meetings

East Africa Burundi


Comoros


Djibouti


Eritrea

Only one hotel (Inter Continental Asmara) has the capacity and necessary facilities and infrastructure to host business events

Ethiopia

United Nations Conference Centre Hotels such as Hilton and Sheraton Addis have meeting facilities Addis Ababa Exhibition Centre

Kenya

Kenyatta International Conference Centre

Madagascar

Hotels equipped with conference rooms that can hold hundreds of people

Malawi

3 international conference centres 1 trade fair

Mauritius

New convention centres being built

Mozambique

New conference centre in Maputo

Reunion


Rwanda

High capacity conference hall in Hotel Intercontinental 2 other new facilities opened recently

Seychelles

Usually organise small regional conferences (max 40 people)

Appendix A: Summary of Supply of the Meetings Industry Facilities by Country

49

Africa East Africa Somalia


Tanzania


Uganda


Zambia


Zimbabwe

The main auditorium in the Harare International Conference Centre has a capacity for more than 4,500 participants Recently opened Celebration Centre in Harare has a seating capacity of 3,000

South Africa Botswana

International Convention Centre attracts major international meetings and conferences

Lesotho


Namibia


South Africa

International Conference Centres in Durban, Johannesburg and Cape Town

Swaziland

Meetings Industry dominated by international chain establishments such as Sun Hotels and Orion Hotels

Americas North America Canada


Mexico


United States


Caribbean Anguilla


Antigua and Barbuda

3 venues available to hold meetings for over 50 people

Aruba

22,000 sq feet space available for meeting and functions Ballroom with 15,000 sq feet of pre-function space Convention facility can accommodate 1,000 people for banquet, 1,600 people for theatre style conventions and 500 people for classroom style meetings Many hotels have the facilities for business events

Bahamas


Barbados

Sherbourne Conference Centre

Bermuda

115,000 sq feet of meeting space

British Virgin Islands


Cayman Islands


Cuba

73 facilities (4 or 5 star hotels) which hold medical, scientific and social events 10 venues specifically for business events (including Havana Conference Centre and Hotel Nacional de Cuba) Further 14 facilities

Dominica


50


Americas Caribbean Dominican Republic

Many city hotels offer conference facilities Barcelo Bavaro Convention Centre

Grenada

Facility which can accommodate 250 to 300 delegates Trade Centre can accommodate international and regional trade shows

Guadeloupe


Haiti


Jamaica


Martinique

Four hotels with conference rooms for up to 800 people Conference centre with 10 meeting rooms (each room has 400 seats)

Montserrat

Small meeting facilities available in hotels Largest facility can accommodate 200 people in theatre style

Netherlands Antilles


Bonaire


Curacao

International Trade Centre with facilities for up to 1,200 people for meetings, 800 to 1,000 people for banquets Two auditoriums with capacity for 200 and 325 people 1,200 m2 of exhibition space Large hotels offer facilities for up to 300 people

Saba

Venues adequate to host 50 person conferences or meetings

Saint Eustatius


Saint Maarten

1 large facility Many small facilities

Puerto Rico

Puerto Rico Convention Centre being constructed

Saint Kitts and Nevis


Saint Lucia


Saint Vincent and the Grenadines


Trinidad and Tobago

Courtyard Marriott will be opened soon with conference facilities

Turks and Caicos Islands Convention facilities at major hotel properties United States Virgin Islands


Central America Belize


Costa Rica

4 or 5 star city and beach hotels can accommodate meetings for 500 to 2,000 people

El Salvador


Guatemala

23,000 m2 conference and meeting space (including convention centres, conference rooms, hotels, restaurants and a fair and exhibition site) New convention centre with capacity for 5,000 people


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Americas Central America Honduras


Nicaragua

New convention centres with capacity for 1,000 people

Panama

Largest Convention Centre in Central America Hotels providing a range of meeting facilities

South America Argentina


Bolivia


Brazil

Convention Centres

Chile


Colombia

Conferias (extensive meeting facilities) 4 or 5 star hotels caters for the business tourism sector as well

Ecuador


French Guiana


Guyana


Paraguay

2 venues for large events (Convention Hall of the Central Bank of Paraguay and Carmelitas Centre) Majority of the hotels can accommodate business events

Peru


Suriname


Uruguay

Four main sites for business events Montevideo and Punta del este have halls which can host large national and international events which can hold over 1,000 people These halls are mainly located in hotels, tourist ranches and purpose built convention complex

Venezuela

Wide range of convention facilities in various destinations

Asia Pacific North-East Asia China


Democratic People’s Republic of Korea


Hong Kong (China)

Hong Kong Convention and Exhibition Centre has 64,000 m2 of function space Hong Kong International Trade & Exhibition Centre has 16,000 m2 of usable space Over 60 hotels and other venues New international exhibition centre: Asia World Expo (70,000 m2 of space plus a multipurpose hall with 13,000 moveable seats) 109 new hotels New Disneyland theme park with rooms for corporate events (themed ballroom with a capacity for 1,000 people)

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Asia Pacific North-East Asia Japan


Macao (China)

3, 4 or 5 star hotels provide meeting facilities

Mongolia


Republic of Korea

4 state-of-the-art Convention Centres 5 more Convention Centres are being built

Taiwan (province of China)

Taipei financial centre New facility: Nangang International Conference Centre

South-East Asia Brunei Darussalam


Cambodia


Indonesia


Lao People’s Democratic Republic


Malaysia

Putrajaya Convention Centre Kuala Lumpur Convention Centre Melaka International Exhibition Centre Wide range of hotels with meeting facilities

Myanmar

Myanmar Convention Centre Yangon Trade Centre Other hotels and resorts

Philippines

Philippine International Convention Centre Hotels, Sports clubs and training centres

Singapore


Thailand


Timor-Leste

1 conference hall with capacity for 200 people

Vietnam


Oceania American Samoa


Australia

Purpose built convention centres in each state

Cook Islands


Fiji

Facilities available can cater for business event to a maximum of 1,000 people

French Polynesia

Total capacity of about 1,300 people in major hotels New hotel will increase capacity by 300

Guam


Kiribati


Marshall Islands



53

Asia Pacific Oceania Micronesia, Federated States of


New Caledonia


New Zealand

International Convention Centres with capacity for up to 2,500 people 4 or 5 star business hotels Specialist venues

Niue


Northern Mariana Islands


Palau


Papua New Guinea


Samoa

New facilities being built

Solomon Islands


Tonga


Tuvalu


Vanuatu


South Asia Afghanistan


Bangladesh

1 quality convention centre

Bhutan


India

2 largest convention venues (Vigyan Bhawan & Ashok Hotel) Pragati Maidan: Premier Exhibition Venue with 62,000 m2 of space 10 main convention centres in different cities New venues being built

Iran (Islamic Republic of) No detailed information Maldives


Nepal

International Convention Centre of Nepal has 7 meeting areas with the largest auditorium seating 1,046 persons Royal Nepal Academy has a capacity for 1,250 people Rastriya Sabha Griha seats 676 people Russian Cultural Centre seats 200 people Bhrikuti Mandap Exhibition Hall has 35,000 sq feet of space Various 5 star hotels in Kathmandu

Pakistan


Sri Lanka

Facility available for up to 1,200 delegates

54


Europe Northern Europe Denmark

Large variety of meeting and conference facilities (castles, hotels, International state-ofthe-art Congress Centres in 5 cities)

Finland


Iceland


Ireland


Norway


Sweden

3 main destinations for conventions and meetings Wide range of unique regions for smaller events

United Kindom

Purpose built venues in 14 cities 10,000 m2 of space in each venue in 5 cities for exhibition and fairs

Western Europe Austria


Belgium - Brussels

No detailed information Palais des Congres Convention Centre

France

2,000 establishments have the capacity to host professional events of at least 20 people 1,500 hotels have developed business services (including large capacity conference halls) 120 Convention Centres (15 centres in major cities with the capacity for 4,000 people, 30 centres with the capacity for 2,000 - 4,000 people) Total exhibit area of 1,586,878 m2 (with 2 exhibition centres in Paris of over 100,000 m2 each)

Germany

6 cities have the largest exhibition centres 4 of the 6 are among the top locations within Europe

Liechtenstein


Luxembourg

Luxembourg Congress Centre New Congress Centre (2005)

Monaco

Hotels and Conference Centres

Netherlands

8 main congress destinations

Switzerland


Central and Eastern Europe Armenia


Azerbaijan


Belarus


Bulgaria


Czech Republic

Prague Convention Centre

Estonia

Most meeting facility providers can cater up to 300 participants Few bigger conference halls with a capacity for 1,000 delegates One arena can seat up to 6,000 delegates Main conference and meeting destination is Tallinn


55

Europe Central and Eastern Europe Georgia


Hungary


Kazakhstan


Kyrgyzstan


Latvia


Lithuania


Poland

Increase in 4-5 star hotels New Exhibition and Fair Centres in Warsaw and Poznan

Republic of Moldova


Romania


Russian Federation


Slovakia

Different cities host different events (7 main cities for meetings, exhibitions and conferences) Other venues (resorts, castles)

Tajikistan


Turkmenistan


Ukraine

Big tourism exhibitions held

Uzbekistan


Southern Europe Albania


Andorra

Public centres host meetings and conferences 15 hotels specialise in business tourism

Bosnia and Herzegovina No detailed information Croatia

500,000 m2 of exhibition area Zagreb Fair and Congress Centre Plans for new multi-purpose Convention and Exhibition Centres in Zagreb with a capacity of 4,000 seats 3 other cities have plans for new convention centres with 1,500 seats each

Greece

15 Conference Centres 200 hotels with conference facilities

Italy

2,830 Congress Centres (1,979 are from hotels, 560 are from historic buildings, 291 are from other locations such as dedicated Conference Centres, Trade fair buildings and theatres) 5,231 meeting rooms (3,602 from hotels, 736 from historic buildings and 893 from other facilities)

Malta


Portugal

Increase in 4-5 star hotels Meeting rooms with a capacity for over 500 participants

56


Europe Southern Europe San Marino


Serbia and Montenegro No detailed information Slovenia

7 main congress destinations Building new congress infrastructure

Spain

More than 50 Convention Centres and 4 or 5 star hotels

The Former Yugoslav Republic of Macedonia


East Mediterranean Europe Cyprus

Cyprus International Conference Centre offers 2,916 m2 of function space which accommodates 1,600 delegates

Israel


Turkey

Wide range of hotels providing conference facilities Newly opened Lutfi Kirdar Istanbul International Conference Centre has doubled the capacity of facilities

Middle East Bahrain

Bahrain International Exhibition Centre Gulf International Convention Centre Bahrain Conference Centre Ritz Carlton (27 conference rooms) Hilton Hotel Diplomat Forte Grand (1,200 m2 of ballroom space which caters for 1,500 people and 6 rooms catering for 20 people each) Regency Intercontinental accommodates 800 for receptions or 440 for banquets Sheraton Bahrain supplies a conference hall for 800 people and 5 other conference rooms

Egypt


Iraq


Jordan

Growing investment in building more conference facilities

Kuwait


Lebanon

All hotels have conference facilities

Libyan Arab Jamahiriya


Oman


Palestine


Qatar


Saudi Arabia

61,000 m2 of conference and meeting space 29,000 m2 of exhibition space Hotels with capacity for 37,000 people (theatre style rooms)

Syrian Arab Republic

Many well equipped venues (such as Omayad Conference Palace)


Middle East United Arab Emirates Dubai

All leading hotels provide multi-purpose meeting venues and facilities Dubai World Trade Centre provides 53,000 m2 of exhibition space Other venues catering for smaller events Dubai Airport Exhibition Centre

Yemen


Source: Data collated by authors from UNWTO 2004, Tourism Market Trends, World Tourism Organization, Madrid.

57

Appendix B Congress and Convention Centres in the Americas Region

Total (m2)

Region

Country

City

Congress and convention centre

North America

Canada

Montreal

Montreal Convention Centre

12,247

Quebec

Quebec City Convention Centre

21,170

Washington, DC

Convention and Tourism Corporation

11,617

New York

Jacob K. Javits Convention Center

73.296

Chicago

Navy Pier

USA

15,300

McCormick Place

198,000

Mexico

Mexico City

Centro Banamex

34,000

Central America and the Carribean

Panama

Panama City

Atlapa Centro de Convenciones de Panamá

80,000

Cuba

Havana

Centro Internacional de Conferencias de La Habana

5,783

Palacio de Convenciones de La Habana

2,100

South America

Chile

Espacio Riesco

8,000

Centro Cutural Estación Mapocho

8,000

Diego Portales

5,720

Casa Piedra

4,400

Centro de Extensión Universidad Católica de Chile

2,850

San Carlos de Apoquindo

2,200

Centro Cultural General San Martín

5,122

Argentina

Brazil

Santiago

Buenos Aires (1)

São Paulo

Golden Center

-

Paseo La Plaza Congresos y Convenciones

-

Punta Carrasco

-

Centro Costa Salguero

20,533

Centro del Gobierno de la Ciudad

23,403

La Rural

44,520

São Paulo Anhembi

77,424

Rebouças Convention Center Rio de Janeiro

Riocentro Congresses Hall

Uruguay

Montevideo (2)

Hotel Radisson Victoria Plaza Hotel Sheraton Montevideo

Source: Adapted from UNWTO Report, 2005


1,060 100,029 14,222 2,420

Appendix C Case Study

Case Study: Estudio del Mercado de reuniones en Espana 2003 (Instituto de Turismo de España) This study was undertaken by the Spanish Ministry of Tourism in 2003 and published in 2004. It represents one of the more comprehensive “economic impact” studies examined as part of this project and it collected data from the demand and supply sides of the Spanish Meetings Industry.

Method 1.

Demand side data collection. a. 1,816 completed questionnaires by meeting participants b. Every category had 3 dimensions: • Geographical: International, national, regional • Geographical: Size of host city • Type of event: congress, convention, meeting c. Delegate Expenditure captured information on accommodation, food, registration fee, shopping, leisure, local transport and “other expenditure” The participants of the study also had to rate the host city (architecture, cultural offer, etc.), the venue (interpretation service, facilities, hygiene of rooms, etc.), hotels (service, etc.), restaurants (service, quality of product, etc.), public transport, social programmes during the event (for themselves and companions)

2.

Supply side data collection. a. 126 completed questionnaires by hotels, city councils, Convention Exhibition Centres b. Every category the same three dimensions as above

Findings Average daily expenditure (including registration fee, leisure, accommodation) (€) Total

210

More than 1,000,000 habitants (2 cities)

642

Between 500,000 and 1,000,000 habitants (4 cities)

Between 200,000 and 500,000 habitants (17 cities)

442

Source: Spanish National Tourism Board, 2004, Estudios de Productos Turisticos


287

Less than 200,000 habitants (96 cities)

166

62


Average travel expenditure to the city Type of event

Congress

Convention

Jornado-meeting

275

310

120

International

National

Regional

377

151

54

Cost of travel (€) Type of event Cost of travel (€)


With regard to the “economic impact” component, the study incorrectly equates 'expenditure' or turnover with economic impacts. However, the study does provide a sound understanding of expenditure and the potential contribution made by the Spanish Meetings Industry to the Spanish economy. Economic impact/turnover (overall expenditures of participants and companions): 3,281 (€ 000)

Participants Companions Total

Total

> 1,000,000 habitants (2 cities)

500,000 -1,000,000 200,000-500,000 < 200,000 habitants habitants (4 cities) habitants (17 cities) (96 cities)

2.683

1.185

256

730

512

598

115

91

259

133

3.281

1.300

347

989

645


Appendix D Definitions

Definition/aim of meeting

Source

Any off-site gathering (including conventions, congresses, conferences, seminars, BECA workshops and symposiums) which brings together people for a common (Business Events Council of purpose, the sharing of information. This defines both corporate business (CB) and Australia) association meetings An event where the primary activity of the attendees is to attend educational CIC sessions, participate in meetings/discussions, socialise, or attend other organised (Convention Industry Council) events. There is no exhibit component to this event. A meeting is a coming together of a number of people in one place, to confer or Convention Liaison Council; carry out a particular activity. This can be on an ad hoc basis, or according to set CLC, 1993 pattern. A meeting is a general term indicating the coming together of a number of people ICCA (International Congress in one place, to confer or carry out a particular activity. & Convention Association); Frequency: can be on an ad hoc basis or according to a set pattern, as for instance IAPCO annual general meetings, committee meetings, etc. A meeting is an event where fifteen or more people meet on the premise for a Hughes, 1988 minimum of six hours with a fixed agenda. A meeting lasts less than two days and does not include overnight accommodation. A meeting is an event that brings people together for the purposes of sharing Rutherford, 1990 information and to discuss and solve organisational and operational problems. It is usually a small event, often involving only a few executives. It can be a corporate meeting, seminar, symposium, or training program. Definition/aim of conference

Source

1) Participatory meeting designed for discussion, fact-finding, problem solving CIC and consultation. (Convention Industry Council) 2) An event used by any organisation to meet and exchange views, convey a message, open a debate or give publicity to some area of opinion on a specific issue. No tradition, continuity or periodicity is required to convene a conference. Although not generally limited in time, conferences are usually of short duration with specific objectives. Conferences are generally on a smaller scale than congresses. Participatory meeting designed for discussion, fact-finding, problem solving and ICCA (International Congress consultation. As compared with a congress, a conference is normally smaller in & Convention Association); scale and more select in character – features which tend to facilitate the exchange IAPCO of information. The term “conference” carries no special connotation as to frequency. Though not inherently limited in time, conferences are usually of limited duration with specific objectives. A meeting of two or more people to discuss a common concern.


IACVB (International Association of Convention & Visitor Bureaux)

64


Definition/aim of congress

Source

1) The regular coming together of large groups of individuals, generally to discuss CIC a particular subject. A congress will often last several days and have several (Convention Industry Council) simultaneous sessions. The length of time between congresses is usually established in advance of the implementation stage, and can be either pluriannual or annual. Most international or world congresses are of the former type while national congresses are more frequently held annually. 2) Meeting of an association of delegates or representatives from constituent organisations. 3) European term for convention. Definition/aim of convention

Source

An event where the primary activity of the attendees is to attend educational CIC sessions, participate in meetings/discussions, socialise, or attend other organised (Convention Industry Council) events. There is a secondary exhibit component. Assemblage of delegates, representatives, and members of an organisation IACVB convened for a common purpose. A general and formal meeting of a legislative (International Association of body, social or economic group in order to provide information on a particular Convention & Visitor Bureaux) situation and in order to establish consent on policies among the participants. Usually of limited duration with set objectives, but no determined frequency. Definition/aim of incentive

Source

The term “incentives” refers to a global management tool that uses an exceptional SITE (Society of Incentive & travel experience to motivate and/or recognise participants for increased levels of Travel Executives), 2000. performance in support of other organisational tools. Meeting event as part of a programme which is offered to its participants to ICCA (International Congress & reward a previous performance. Convention Association); IAPCO Definition/aim of association

Source

In which the organiser represents an association with members from more than Tourism Australia one entity, which could include service and sporting clubs. (SITE Incentive Magazine, October 1996; Market Insights Unit Buyer InDepth Interviews Dreamtime September 2001) An organised group of individuals and/or companies who band together to CIC accomplish a common purpose, usually to provide for the needs of its members. (Convention Industry Council) Usually non profit. A grouping of individuals or companies that collectively serve the interests of their ASAE members that cannot be met effectively by individual action. (American Society of Association Executives) Organisation of people with a common purpose.

IACVB (International Association of Convention & Visitor Bureaux)

Appendix D: Definitions

65

Definition/aim of corporate

Source

In which the organiser represents a commercial entity.

Tourism Australia (SITE Incentive Magazine, October 1996; Market Insights Unit Buyer InDepth Interviews Dreamtime September 2001)

Definition/aim of governmental organisation

Source

In which the organiser represents the Commonwealth, state or local government Tourism Australia agency or enterprise. (SITE Incentive Magazine, October 1996; Market Insights Unit Buyer InDepth Interviews Dreamtime September 2001) Definition/aim of non-governmental organisation

Source

These are organised by or for federations, professional associations, universities, UNWTO NGOs. (World Tourism Organisation) An NGO is an organisation established and governed by a group of private citizens Model UNWTO 2000; for a stated philanthropic purpose, and supported by voluntary individual Accountability of NGOs contributions. The United Nations” term for a non-profit organisation.

ASAE (American Society of Association Executives)

66


CIC (Convention Industry Council) definitions Corporate Exhibit

An institutional exhibit telling the story of the company without intentionally marketing the product or service.

Corporate Meeting

Gathering of employees or representatives of a commercial organisation. Usually, attendance is required and travel, room and most meal expenses are paid for by the organisation.

Corporate Planner

Meeting planner who works for a corporation.

Corporate Rate

Special rate for sleeping rooms or other goods and services that is made available to business travellers. These rates may vary by corporation, depending on the negotiated agreement.

Corporate Show

An exhibition produced by a corporation where exhibits are limited to products and services of that corporation or its marketing partners; no competitors participate.

Corporate Travel

The market segment comprised of groups or individuals that work for a given company and are travelling for business reasons at the company’s expense.

Association

An organised group of individuals and/or companies who band together to accomplish a common purpose, usually to provide for the needs of its members. Usually non-profit.

Association Agreement

1) A union contract covering companies and unions that bargain on an area-wide basis. 2) A union contract negotiated by a group of employers through an employer’s association with the union representing their employees.

Association Booth/Stand

An exhibit booth/stand at which an association provides information about its purpose and services to members and prospective members.

Association Meeting

An event initiated by an association.

Association Staff

An individual who works for an association.

Government Meeting

An event at which attendees are civil servants, elected officials or service providers to governmental entities.

Governmental Conference

Technical or political events between governments with the aim of discussing national or international topics.

Appendix E: Example of Venue Identification from the National Business Events Study (NBES)

In 2005, the Australian Sustainable Tourism Co-operative Research Centre conducted a “National Business Events Study” (NBES), a national review of the business events sector. The key objectives of the NBES were: •

To provide an estimate of the sector in relation to its: -

Size;

-

Economic contribution

•

To provide increased knowledge of the decision-making processes of delegates/attendees in the Business Events Sector; and

•

To provide key indicators for monitoring the performance of the Business Events Sector in subsequent years.

Only venues that were members of a convention bureau were included in the study. This was felt to be overly restrictive as there are many commercial event venues that are not members of a convention bureau, especially in regional areas. As a consequence, it was decided to expand the range of venues included in the NBES. Excluded from the list of venues, however, were the following categories of venues as business events were not seen to be a core part of their overall business: •

Metropolitan community halls, school halls

•

Bowling clubs, scout halls

•

RSL clubs

•

Motels, serviced apartments, apartments

•

Restaurants

•

Cruise ships, boats

•

Leisure and aquatic centres, small sports clubs

•

Guest houses, cottages

•

Marquees.

There was substantial debate surrounding these exclusions between members of the steering committee due to the fact that major differences occur across states and more particularly between capital cities and regional areas. However, the above exclusions were finally agreed upon in the interests of ensuring comparability of the findings. It should be noted that because only commercial venues were included in the study, many meetings held in corporate offices and the like were not included. Additionally, it must be noted that only the venue where the meeting component was held was included, not any venue which may have hosted associated social functions. It was important to exclude the latter to avoid double counting. Source: Deery, M., Jago, L., Fredline, L. and Dwyer, L. (2005). National Business Events Study: An Evaluation Of The Australian Business Events Sector, Common Ground, Melbourne.


Appendix F: ICCA (International Congress & Convention Association) Categories

A:

Congress Travel Agencies & Destination Management Companies. These handle the ground arrangements and/or flight arrangements for conference delegates.

B:

Airlines and airline alliances. The code covers the departments responsible for selling and promoting special conference packages for large events; significant variations between the size and functions of these departments, or even whether they are a separate department or part of a “partnerships” department. Delegate expenditure on flights is a big slice of the value of the industry, but there are no decent estimates for how large this is, since airlines don’t segment by purpose of visit.

C:

Professional Congress Organisers. PCO’s typically handle international association meetings, but the larger PCO companies also handle corporate events. Other types of intermediaries (who would join ICCA as part of this group if they were to apply for membership) include: venue finding agencies; conference agencies (specialise in corporate events); production houses; marketing and communication agencies. A general term could be “event organising companies”. Exhibition organisers should in reality be a different segment altogether, we only have those who organise Meetings Industry exhibitions (see below for Meetings Industry types we don’t represent).

D:

Convention bureaux and tourist boards. These include national and city bodies with responsibility for destination marketing. Could be public sector, private sector, or more commonly partnership organisations involving public and private sectors working together. Frequently have responsibility for leisure tourism marketing as well as meetings business.

E:

Meeting information and technical specialists. This category of ICCA membership covers a range of different types of suppliers, of which the largest groupings are: Trade publications and media covering different aspects of the Meetings Industry; IT companies producing specialised software or electronic hardware to run meetings; Non-electronic hardware, such as seating systems or exhibition stand builders; and Consultants and marketing representation companies.

F:

Meetings Hotels. These include Specialist hotels with large meetings facilities.

G:

Convention and Exhibition Centres. These include a wide range of venues, from converted historic palaces to massive purpose built convention halls, including university facilities and some combined hotel/convention centre properties.

Supplier types not represented in ICCA include: •

Incentive Houses

•

Exhibition organisers

•

Exhibition contractors

•

Speaker bureaux

•

Corporate entertainment

•

Catering companies

•

Smaller hotels which host lots of meetings but wouldn’t regard themselves as meetings specialists


70


And in-house planners are not represented: •

In-house Corporate planners

•

In-House Association and not-for profit organisations (NGOs, government) planners

Appendix G Examples of Questionnaires to Collect Relevant Data

Questionnaire One: Venue Survey

1.

Where is your venue?

City State/Region

2.

What was the total number of “meetings” that your venue hosted over the period? (suggest the data collect period be either a month or a quarter) Of the total number of “meetings” how many were Government meetings? How many were association meetings? How many were corporate meetings?

Of the total number of “meetings” how many were predominantly conferences? How many were predominantly exhibitions?

Of the total number of “meetings” how many ran for a single day or less? How many ran for more than one day?

Of the total number of “meetings”, how many were small meetings (less than 100 delegates) How many were medium sized meetings? (100 – 500 delegates) How many were large meetings? (more than 500 delegates)

3.

What was the total number of delegates at these “meetings”? (all delegates at all meetings) Of the total number of delegates how many were attending Government meetings? How many were attending association meetings? How many were attending corporate meetings?


72


Of the total number of delegates how many were attending conferences? How many were attending exhibitions?

Of the total number of delegates how many attended “meetings” which ran for a single day or less? How many attended meetings that ran for more than one day?

4.

What is the total seating capacity of your venue with all “meeting” facilities combined?

5.

What is the seating capacity of your largest single space, that is how many delegates can you host in a single space?

6.

Which of the following best describes your venue? Purpose built conference/exhibition centre Large hotel (more than 50 rooms) with meeting facilities Small hotel (less than 50 rooms) with meeting facilities Other ______________________________

Appendix G: Examples of Questionnaires to Collect Relevant Data

Questionnaire Two: Organiser Survey

1.

Where was this “meeting” held?

City State/Region

2.

Which of the following best describes this “meeting”? Conference/convention with registration fees Conference/convention without registration fees Exhibition/trade show Incentive

3a. How many delegates attended this “meeting” in total? 3b. How many delegates came from the local area, that is, the city where your “meeting” was hosted? 3c. How many delegates came from a different region within the host country? 3d. How many delegates came from overseas?

4.

Which of the following best describes the host of this “meeting”; that is, the organisation that hired your company to organise the meeting? Government Association Corporate Other _______________________________________

5.

For how many days did the “meeting” run?

Days or hours

If less that 1 full day please report hours

6.

In organising this “meeting”, how much money did you (or the host organisation) spend in each of the following categories? Venue Hire

$

Food and Beverage

$

Equipment/production/technical costs

$

Administration

$

Advertising and promotion of meeting

$

Keynote speaker and other sponsored attendees

$

Insurance

$

Other _________________________________________________

$

Total expenditure

$

73

74

7.


In organising this “meeting”, how much money did you (or the host organisation) receive in each of the following categories? Registration fees from delegates

$

Fees from exhibitors

$

Sponsorship

$

Advertising

$

Contributions from host organisation or other affiliates

$

Financial support (e.g. government, convention bureau)

$

Social events (e.g. official dinner, reception)

$

Other__________________________________________________

$

Total income

$


Questionnaire Three: Delegate Survey (Includes Conference Delegates and Trade Show Visitors)

1.

What is your normal place of residence?

City

State/Region Country

2.

Did you travel more than 40km to attend this “meeting”?

Yes No

3.

Did you stay away from home for at least one night to attend this “meeting”?

Yes No

4a. How many nights in total did you stay away from home on this trip? 4b. How many were for the purpose of attending the “meeting”? 4c. How many additional nights did you spend in the host city? 4d. How many additional nights did you spend in other regions on your way to or from the host city?

5a. Did anyone accompany you on this trip who was not attending the meeting”?

6.

How many accompanying people did you bring?

Yes (go to 6) No (go to 7)

Adults (not including yourself) Children

7.

Could you please estimate your expenditure in relation to your participation in the conference/trade show/meeting in each of the following categories? Please include money you spent personally PLUS money spent by your employer/company. Total meeting registration fees (include optional components)

$

Accommodation

$

Shopping (e.g. souvenirs, clothing, toiletries, etc)

$

Long haul transport (from the city you live in to the host city e.g. air travel, long distance train or coach, petrol costs if you drove)

$

Local transport (within the host city e.g. taxi, local public transport, car hire)

$

Food and beverage from restaurants, cafes and bars

$

Food and beverage from retail outlets (e.g. supermarket)

$

Entertainment (e.g. theatre, cinema)

$

Tours (e.g. sightseeing)

$

Other____________________________________________________________

$

Total expenditure

$

75

76

8.


Does the above expenditure relate to yourself only or does it include expenditure for the people who accompanied you? Myself only Includes accompanying people


Questionnaire Four: Exhibitor Survey

1.

What is your normal place of residence?

City

State/Region Country

2.

Did you travel more than 40km to attend this exhibition?

Yes No

3.

Did you stay away from home for at least one night to attend this exhibition?

Yes No

5.

6.

Could you please estimate your expenditure in each of the following categories associated with your exhibit? Please include money you spent personally plus money spent by your employer/company. Floor space rental for your exhibit

$

Stand construction cost

$

Equipment hire

$

Electricity/lighting

$

Advertising/promotion

$

Hire of temporary staff

$

Display material

$

Freight

$

Other __________________________________________________

$

Total expenditure

$

Could you please estimate your expenditure in each of the following categories for your trip? Please include money you spent personally plus money spent by your employer/company. Accommodation

$

Shopping (e.g. souvenirs, clothing, toiletries etc) Long haul transport (from the city you live in to the host city e.g. air travel, long distance train or coach, petrol costs if you drove) Local transport (within the host city e.g. taxi, local public transport, car hire)

$

Food and beverage from restaurants, cafes and bars

$

Food and beverage from retail outlets (e.g. supermarket)

$

Entertainment (e.g. theatre, cinema)

$

Tours (e.g. sightseeing)

$

Other __________________________________________________

$

Total expenditure

$

$ $

77

Bibliography

Brookings Institute (2005), The Realities of Convention Centres as Economic Development Strategy British Tourist Authority (2001), Estimating the Direct Expenditure Benefits of Conferences to a Local Area British Tourist Authority (2003), British Conference Venues Survey 2003 Canadian Tourism Commission (2002), US Business Traveller to Canada Study, Summary 2002 Deery, M., Jago, L., Fredline, L. and Dwyer, L. (2005), National Business Events Study: An Evaluation Of The Australian Business Events Sector, Common Ground, Melbourne Finland Convention Bureau (2005), The World of Meeting Statistic, Presentation by Tuula Lindberg, EFCT Summer School, Malta France Congres (2003), Survey of Economic Benefits, available: http://www.france-congres.org (30-8-2005) Heath, E., Pretorius, T. & Fairer-Wessels, F. (2005), Executive Summary: EXSA Extension 3 Research Study, University of Pretoria International Congress & Convention Association, ICCA Data, Statistics Report International Association and Corporate Meetings Market 2003, available: http://www.tourism.australia.com/BTEvents.asp?sub=0295 (20-5-2005) Incentive Federation Inc. (2003), Federation Study 2003: Incentive Federation Survey of Motivation and Incentive Applications, Centre for Concept Development Ltd. Instituto de Turismo de España (2003), Estudio del mercado de reuniones en España – 2004, Madrid International Congress & Convention Association, ICCA (2004), Statistics Report. International Association and Corporate Meetings Market, Netherlands Kim, S., Chon, K. & Chung, K. (2003), ‘Convention industry in South Korea: an Economic Impact Analysis’, Tourism Management, 24, pp. 533-541 Malta Tourism Authority (2003), The Conference and Incentive Travel Market in Malta for the Years 2000-2001, Malta Meeting Professionals International, MPI (2004), FutureWatch 2004, Colin Rorrie Ontario Ministry of Tourism and Recreation (2005), The Economic Impact of Business Conventions in Toronto in 2002, Toronto Society of Incentive and Executive Travel Executives (2004), available: http://www.site-intl.org/ (25-10-2005) Spanish National Tourism Board (2004), Estudios de productos turísticos Sri Lankan Convention Bureau (2004), ‘The MICE Report’, Sri Lankan Convention Bureau Research Bulletin Successful Meetings (2005), 2005 State of the Industry Report, New York Sultan, E., Ditzian, I., & Darsa, J. (2002), Characteristics of Conference Tourism in Israel. 6th International Forum on Tourism Statistics, Budapest, 25-27 September 2002

80


Tourism Australia (2005), Business Events, Presentation by Meg Yeates, Sydney (27-7-2005) Union of International Associations (UIA) (2003), available: http://www.uia.org/statistics/press/press03.pdf (30-8-2004) World Tourism Organization (2001), Tourism Satellite Account: Recommended Methodological Framework, World Tourism Organisation, Commission of the European Communities-Eurostat, Organisation for Economic Cooperation and Development (OECD) and United Nations Statistical Division World Tourism Organization (2004), Tourism Market Trends World Tourism Organization (2005), Basic Introductory Report: The Meeting Conventions Market in the Americas’, International Seminar on MICE Tourism and Business Tourism, World Tourism Organisation, Chile, 25-26 May 2005 Weber, K. & Chon, K. (2002), ‘Convention tourism. International research and industry perspectives’, The Haworth Hospitality Press, New York Weber, K. & Ladkin, A. (2004), ‘Trends Affecting the Convention Industry in the 21st Century’, Journal of Convention & Event Tourism, 6 (4), pp. 47-63

List of Abbreviations

Acronym

Meaning

CEIR

Centre for Exhibition Industry Research

CIC

Convention Industry Council

CPC

Central Product Classification

GDP

Gross Domestic Product

GVA

Gross Value Added

IACVB

International Association of Convention and Visitor Bureaux

IAPCO

International Association of Professional Congress Organisers

ICCA

International Congress and Convention Association

ISIC

International Standard Industrial Classification

MIAA

Meetings Industry Association of Australia (now Meetings and Events Australia)

MPI

Meeting Professionals International

SITE

Society of Incentive and Travel Executives

SNA

System of National Accounts

STCRC

Sustainable Tourism Co-operative Research Centre

TSA

Tourism Satellite Account

UIA

Union of International Associations

UNWTO

World Tourism Organisation


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