In the United States, the integration of event-related expenditure into corporate travel policies has been a major trend in travel management for some years now. On this side of the Atlantic, however, progress has clearly been slower in this segment known by the acronym MICE (Meeting, Incentive, Convention, Exhibition. "At present, French companies have little or no policy on this subject. Training and compliance with internal rules for event management are lagging far behind in the United States, unlike what has been put in place in the field of business travel".says the white paper Travel management et MICE, recently published by the AFTM (Association française des travel managers).
The study shows that over 90 % of French companies do not have a truly formalised events policy. This is a particularly high figure, but it should be seen in the context of the complexity of the subject.
The MICE family is made up of some fifteen segments that are as diverse as they are varied. If we look at the breakdown of events by number (source: ANAé Bedouk 2011), seven categories stand out: corporate/corporate events, in-house events, trade fair events, conferences/symposiums, events for the general public, commercial events and cultural events. Each of these types of event has its own specific characteristics in terms of audience and objectives. Unlike an internal event, for example, the launch of a new product on its market may represent such a strategic challenge that the company will be tempted to put cost control in second place. However, these major gatherings, in the more or less short term, should not escape the rule of globalisation of purchasing either.
However, there is still a long way to go to optimise expenditure on events. Firstly, because this budget remains difficult to evaluate when meetings are not managed centrally. According to a study by the CWT Travel Management Institute, companies spend an average of 1.5 % of their annual turnover on meetings and events. In some sectors, this figure rises to 4 %. However, in all these companies, the rule is still to spread the expenditure too thinly, as the management of these various events - conventions, seminars, study days - has until now been the responsibility of the departments organising them, essentially the sales, marketing and communications departments.
Under the leadership of the General Purchasing Department
So, if we take the example of a large company which brings its regional sales teams together in Paris for an annual convention and at the same time organises half-yearly study days in the provinces to motivate its teams, the orders for these events are generally placed in dispersed order. And more often than not, without taking into account any annual agreements the company may have signed with hotel groups or airlines for individual travel.
On the other hand, as soon as the general purchasing department takes charge of the MICE budget, the process of rationalising this expenditure can be put in place more quickly. So, ideally, internal requesters, such as the sales, marketing or communications departments, should give priority to asking for quotes from approved service providers. "The fact that we are involved upstream, rather than just validating orders, means that we can globalise our requirements. We can also ask hotel chains about a certain forecast volume of rooms required for business meetings", confides a travel manager in charge of travel and MICE.
Another observation: when it comes to business travel, companies are used to codifiering a travel policy and using online booking tools. But the MICE sector does not fit neatly into these boxes. If only because booking event venues is first and foremost a made-to-measure process. What's more, MICE involves more items than individual business trips. In addition to transport, accommodation and catering, we need to add video, entertainment, decoration and so on. "In France, while all sectors of activity are more or less mature in this area, the pharmaceutical industry is the most advanced. They are major consumers of seminars, which are the main vehicles for communicating with their target audiences, and are taking action under pressure from legislation governing expenditure on health professionals", says Agnès Benveniste, Deputy Director of Meetings at CWT Meetings & Events.
Consolidating expenditure
As there is a coherence between certain expenses linked to business travel and those relating to meetings and events, companies' purchasing departments are now keen to rationalise and manage their costs. "The complementarity between individual business travel and MICE essentially comes into play on two levels: transport, particularly air travel, and accommodation in the broadest sense. In other words, hotel nights, catering and even meeting rooms. Being able to consolidate these expenses makes it easier to manage your annual contract with an airline or hotel group".continues Agnès Benveniste.
When it comes to air and hotel programmes, it is in a company's interest to highlight the importance of MICE at the same time as business travel, in order to negotiate more favourable rates. Suppliers see all this in a positive light, as they will be given preference when invitations to tender are issued for the organisation of meetings or seminars.
Hotels such as Hilton, Mariott, Starwood and Accor are well aware of this, and are courting this niche segment of their business clientele. Today, meeting and event organisers have online tools to identify the hotel offer best suited to their needs, in particular on our meetings.accorhotels.com website," explains Ludovic Dupont, Vice President Travel Agencies - Meetings & Events at Accor. They can find out about meeting spaces and the number of rooms available. They can request a quote from the establishments they have previously selected, compare services and deal with the organisational details directly with the selected hotel."
The French group is already working on the next stage, initially intended for meetings with a maximum of 30 participants, with "an online booking tool meeting spaces, bedrooms and other services at the same time", he continues.
The HRS hotel reservation platform is also positioning itself in this area, which is still poorly mastered. For several years now, it has had a dedicated seminar portal where companies can find meeting offers from almost 35,000 of the 250,000 hotels offered for sale by HRS. "As the market matures, 1,500 hotels in Germany are offering online room reservations. The big establishments are going to move towards this kind of solution," notes Emmanuel Ebray, Managing Director of HRS France. We act as an intermediary between companies and hotels, but we can also support event agencies, whose core business is not hotel reservations. We can work intelligently with them.
The travel agency networks are also multiplying their initiatives. Agnès Benveniste concludes: "We have just launched CWT Meetings Services, a new service on the market designed to meet the expectations of buyers, their assistants and meeting organisers. This packaged service is based on three levels: definition of the meeting purchasing strategy, a free venue search, and the use of new technologies to improve the quality of service, while offering our customers reports on their activity".
Rationalising costs
Even if organising events remains an essential part of corporate life, the trend is to cut costs. But that doesn't mean we can't maintain the quality and frequency of our events. "Afin order to optimise a budget, you first need to be able to identificate all the expenditure linked to events and meetings over a recent reference period, estimate future needs, obtain the support of general management in this rationalisation process, select and negotiate with the various suppliers who best meet the company's needs. Enfin motivating and leading the internal meeting planners, so that they contribute to and support the recommendations put in place", advises Ludovic Dupont.
Just as travel managers have succeeded in tightening the screws on individual business travel, they are not despairing of doing the same in the MICE sector. Once expenditure has been centralised, savings of between 10 and 15% seem feasible in the short term. To be convinced of this, it suffices to study the evolution of the various events organised. "With an annual MICE budget of around €1 million, our customers keep a close eye on their spending. In the past, to bring together thirty or so sales representatives in Nice, each member of staff took the plane ticket of his or her choice. Now, the company sets the departure and return dates and groups together all the participants in the meeting. Instead of organising a seminar as usual at a Novotel in the Middle East, one of our clients opted for an Ibis in Geneva, a destination accessible by low-cost flight or even by train, says Christophe Hamonic, Operations and Customer Manager at Frequent Flyer Travel in Paris, an agency in the Tourcom network.
Specific payment methods
To support companies in their efforts to rationalise, payment specialists are offering appropriate solutions for companies wishing to control their event spending. American Express got the ball rolling in 2005 with the Corporate Meeting Card. This nominative card enables event purchases to be managed with flexibility, offering centralised invoicing of all expenses incurred with suppliers. What's more, it comes with insurance and services for event participants. Of course, the company can fix limits on card spending. As a result, the periodic statement is a perfect control and monitoring tool for each type of event, supplier or participant. When expenses cannot be paid using the Meeting card, a vPayment solution can be used. This generation of single-use virtual payment cards makes it possible, in particular, to definish the amounts and the period of validity of the payments.
Airplus has also recently started looking at the MICE sector. This specialist in payment and reporting solutions has just launched the AirPlus Meeting Card in France, designed to capture expenses specific to MICE. To date, several agencies have already introduced the card: CWT, Egencia and Bleu Voyages Affaires, part of the AS Voyages network.
The list is set to grow even further, as is the list of approved suppliers, including all the airlines. "The value of this type of card lies in the quality of the software used to report MICE data. It's important to know how much the company has spent. By event, by type of service, by supplier".explains one travel manager. When it comes to accommodation, the cost of the seminar will appear, as well as the cost of the seminar package with or without an overnight stay, technical costs, communication costs, etc. The fichiers provided to customers take into account expenses enriched with data such as costs for technical equipment, changes, advances and even no-shows. When an amount of expenditure is authorised on this Meeting card, it can be valid for up to 42 days. Far from penalising them, rationalising these events designed to stimulate teams or reward partners or customers could, on the contrary, boost them.
