Our Vice President of Global Sales Cindy Hartner recently joined industry colleagues at the Incentive Research Foundation (IRF) Leadership Insights Forum in Frisco, Texas, for a packed panel discussion about the future of incentive travel.
Cindy was joined by Nicky Baumohl (Evolutionary Events), Seth Ryan (Omni Hotels) and IRF President Stephanie Harris to dig into predictions, backed by findings from the 2023 Incentive Travel Index (ITI).
Top priorities as Cindy sees them are to embrace new ways of working. We just can’t do things the way we’ve always done them, she says, with these new circumstances. The future is about honest communication and collaborative solutions between all entities.
Here’s just a small sampling of other takeaways from the panel, including insights from Cindy herself.
Driving dollars vs. retaining top talent
The 2023 Incentive Travel Index pointed to at least somewhat of a resurgence of “hard power” metrics (e.g., sales growth) as a driver of incentive travel.
Cindy, along with her fellow panelists, agreed that hard metrics are still powering incentive travel, but also called out that businesses are equally concerned about recruitment and retention — and paying attention to the soft power impacts of incentive travel here, too.
Still, the group agreed with many planners at the IRF Forum that decision-makers are pushing for clear evidence of hard metric returns — with planners now facing the challenge of finding the right combination of hard and soft benefits to sell incentive travel’s true, fullest impact.
Budgets, costs: it’s (still) complicated
Turning again to ITI data, suppliers shared that they see budgets increasing in 2024 and 2025 more than third parties or corporate planners. Cindy said that indicates a longer-term sellers’ market. Hotels especially still have high demand and expect to be in a seller’s market situation through 2024 and into 2025.
Interestingly, 76 percent of third-party and corporate respondents also said rising costs are their biggest incentive travel-related challenge.
There’s definitely a disconnect, the panel agreed, between higher costs without subsequently increased budgets. Some organizations are instead raising the bar for qualifying, limiting the number of attendees, reducing programs by a night, or exploring all-inclusive options as “budget friendly” solutions in response to this challenge.
Also complicating the budget-cost balance is the fact that hotels and supplier vendors are embracing a post-pandemic strategy of not holding space or services without a contract; staff shortages that lengthen response times; and new hires who are unable to provide answers or may not have the authority to make negotiation decisions.
Building back better, with a focus on relationships
When asked to describe channel relationships, 41 percent of 2023 ITI respondents described current relationships as “challenging,” “difficult,” “uncertain,” or “weakened” — with another 25 percent indicating relationships are “complex.”
Cindy and her fellow panelists concluded that the best solutions to moving toward positive relationships include honesty, collaboration, trust, and good communication.
For DMCs specifically, many companies emerged from COVID with a revamped business model that prioritizes quality over quantity — a strategy Cindy advises DMCs continue to follow, especially as event professionals are again scrambling to keep up with demand. Understand the capacity of any DMC you engage, Cindy advised. Your DMC can be your best partner and idea generator when given time to stop and think.
This also means being open to new ways of working. Gone are the days of responding to RFPs by planning entire programs to see if that specific DMC will be selected, said Cindy. Ideation, program design, and unique solutions are the products that DMCs provide — so they cannot offer everything up only to have contracts reduced post-RFP response.
Where in the world are we actually going?
It wouldn’t be an ITI discussion without touching on destination selection trends!
This year’s survey showed significant increased interest in all-inclusive and cruise offerings — but clients are still somewhat conflicted if experiences don’t feel customized.
The panel noted that clients are also looking for new destinations not used before, with traditional standbys like Mexico feeling oversaturated post-pandemic despite an influx of new hotel product.
However, costs come into play with new and emerging spots and can force planners to start searches all over again if alignment is off. Panelists described seeing requests or interest by planners for Western European destinations, for example, but then receiving RFP responses with less-than-friendly pricing.
Still, creativity remains key. “There’s only so much you can do,” as the panel said, with beach and seaside destinations. Exploring mountainside ranches or cities that offer immersive cultural experiences are proving to be real mindset shifts with transformative payoff, for those willing to front appropriate budgets.
You can dig into further Incentive Travel Index data via the survey website here.
Ready to put this research into practice during your next incentive travel program? Connect with one of our DMC partners to start exploring all they have to offer!