by Leo Jakobson | September 30, 2014
TRAVEL
Travel's Coming Back


 Alison Metcalfe: There are two words that sum up key travel trends, both on the leisure and the incentives side. One is experiential, and the other is authenticity. The feedback we're getting from a lot of the destination management companies and incentive houses that we work with is that we need to build flexibility into those programs. Participants don't want to be overly programmed. They want to have time to go out there and scratch below the surface -- to do their own thing and connect with the people.


From Ireland and Europe's perspective the outlook is very good. This year has been very good and 2015 and 2016 are looking even better. We've seen a great rebound in the incentive market. It's great to see that companies are recognizing travel as a powerful motivator and retention tool to keep top talent.

Bello: Las Vegas took the biggest hit of anybody [during the downturn] and we probably had the biggest rise back. For group business, the best year Venetian and Palazzo ever had was 780,000 group rooms back in '07. This year we'll hit 850,000 group rooms at almost as high of a rate as we had back in '07.

Randall: The most recent IRF "Pulse Survey" showed that travel budgets are stabilizing. Fifty-two percent of respondents anticipated that their budgets would moderately increase for the coming year. When you dig into that information, that spending is going to non-food-and-beverage-related items. They're not adding more people to their programs; they're adding more experiential elements to it.

Leong-Lyons: Room rates are going up. Airfare is going up. We're feeling that on the food and beverage side. We're feeling that on the award's dinner -- the blow-out event that is really where they want to create that really meaningful experience.

Bello: In Las Vegas, a lot of their spend is on outside events. Driving exotic cars, Concerts at Red Rock. The LINQ [an outdoor retail/dining/entertainment district with a 550-foot-tall observation wheel like the London Eye]. Almost every incentive group is making that a part of their trip now.

Metcalfe: Ireland is a small destination, but the point of differentiation is really about the innovation and the creativity that can be delivered on the ground. It offers a multitude of experiences. Very often an incentive program to Ireland is a split program. It starts in Dublin and may go to the west of Ireland down to Kerry, or may go up north to Belfast. It's easy to do things -- food, golf, storytelling, music, all of those things are top notch. One of the greatest surprises for a lot of people is the food. A huge food movement developed over the last 10 to 15 years. Young chefs, the whole farm to fork experience.

 Lori Cassidy: I think planners are realizing that cruise ships today are very different from cruise ships in the '70s and the '80s. Cruising today is all about flexibility and choices. We can do team building events. We can do buyouts of our specialty restaurants -- there are 25 on the Oasis-class ships. They can have private entertainment shows or ice shows or Broadway shows. We can do VIP experiences for them onshore at a variety of different ports of call. In order to even be in consideration to win a piece of incentive business today, we have to work hand in hand with our partners and really create the experience out of the gate. If a client is just looking at price and itinerary we're never going to win as a brand, because our product has premium pricing.



Hot Destinations

Weede: Back in the '90s, we'd send people away for seven days. That's just not happening anymore. I don't think it will come back. The easy entry points to Europe are hot now. We look at Ireland, Scotland, Italy, Portugal. Mediterranean cruises are popular. Baltic cruises are popular. We're even seeing river cruises coming back. The entire cruise industry has spent a lot of money on its vessels and now these options look really good to a lot of potential incentive clients.

Leong-Lyons: Call it "easy international." It's really more about the experience than the destination. Because if it's an exotic experience, and even if the company can afford it and everyone wants to go there, if it is difficult to manage, logistically, it impacts the entire experience.

Randall: The IRF Pulse Survey this past spring found that 49 percent of respondents said that North America was their chosen region for incentive travel programs, and that the participant numbers and program length are remaining the same. Of those that go international, the top regional destinations were Caribbean (41 percent), Europe (41 percent), Central America (17 percent), South America (15 percent), and Asia (15 percent).

Weede: If I were just to look at our business, of how many are doing international programs, I would say it's close to 20 to 25 percent. It's greater when we're looking at future programs.

Cassidy: For cruising, I'd say the Caribbean is our No. 1 incentive destination, with Europe right behind. It's probably 60 percent Caribbean, 30 percent Europe, and 10 elsewhere, like Alaska. It could be Australia and Asia right now, and we're sailing out of Dubai. And our top-selling product for two years has been our seven-night product.

 

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