2019 Industry OutlookDecember 21, 2018

With FICP Executive Director Steve Bova By
December 21, 2018

2019 Industry Outlook

With FICP Executive Director Steve Bova
FICP Executive Director Steve Bova, CAE

FICP Executive Director Steve Bova, CAE

FICP is a community of financial services and insurance industry meetings and events professionals dedicated to developing members and advocating the positive impact and value of their work. Executive Director Steve Bova, CAE, offers some insight into the challenges and trends facing this industry in the coming year.

Q Have there been any recent regulatory changes to the financial and insurance industry meetings, and if so, how will they affect the industry in 2019?

A According to the Q2 2018 FICP Pulse Survey, nearly half (49 percent) of respondents said they have not experienced impacts to their meetings due to the uncertainty in the regulatory environment, and an additional 9 percent were not sure. However:

  • 23 percent have made rules changes to their incentive program.
  • 20 percent have altered the number eligible to receive awards.
  • 16 percent have changed the name or description of their incentive programs.
  • 14 percent have changed the products included in their sales and incentive programs.
  • 10 percent have increased expenses to support compliance initiatives.
  • 6 percent have increased staff to support compliance initiatives.

The 30 seasoned meeting professionals attending FICP’s first Strategic Leaders Event in Chicago December 3-4, identified and discussed two critical areas of impact:

GDPR: The General Data Protection Regulation (GDPR) went into effect in May in order to modernize laws that protect the personal information of individuals within the European Union (EU) and the European Economic Area (EEA). The regulation addresses the export of personal data outside of these areas. Business processes that handle personal data must be designed and built with consideration of the principles and provide safeguards to protect data, and use the highest-possible privacy settings by default, so that the data is not available publicly without explicit, informed consent. The meeting professionals said that GDPR is affecting some of their registration processes. For example, attendees need to opt in before being able to register for an event — even if they do not do business in Europe but have attendees that do business there. One person stated that her company does not lay name badges on tables for pick-up because, technically, consent is not provided until the attendee picks up his or her badge. Clearly, we now live in an age where the risk of data breach is omnipresent. But how far is too far remains to be seen.

The DOL Ruling: While the Department of Labor Fiduciary ruling has been tabled, at least for now, meeting professionals are asking each other if companies are changing back to the processes they used before the ruling or are holding on to the changes they implemented. The overwhelming consensus among the group is that companies are staying with what they implemented. Why? Because the changes were made in the best interests of their clients. The greatest uncertainty about the future lies in what the States and the Securities Exchange Commission (SEC) will do.

Q What other challenges will financial and insurance meeting professionals face in 2019?

Disruption: If one thing is certain in our business, it is that some form of disruption is likely to occur. This year, members of the FICP Influence Committee identified disruption — not limited to risk management or security — as a key area of focus. The fact is, in our business, “it happens,” and “it” can be just about anything imaginable. For example, 65 percent of the FICP members polled in the 2018 Membership Needs and Satisfaction Survey stated that they have experienced some sort of event challenges either during the site selection process or during their event. Examples might include attendee health, media or police activity, protest or community event or last-minute speaker cancellation. In the same survey, 58 percent of FICP members responding said they have experienced an act of God in conjunction to a meeting they had planned.

People management: Here is another certain challenge: As long as there are people, there will be people management challenges and opportunities. The planners attending the Strategic Leaders Event made deep dives in five areas related to people management:

  1. Objectives and Measuring Performance: How to differentiate performance among employees and how to motivate the most effective contributors in a non-monetary manner.
  2. Ethics: Intellectual property of speakers, FAM trips, gifts and attending events and use of reward points.
  3. Flexible Working Environments: Teams that have virtual (work from home) employees, flex time, creating a team environment and how to be a successful manager.
  4. Building a High-performing Team: Potential disrupters, key areas of opportunity for an organization/manager to focus on, goals/criteria to drive high performance (not all monetary), ways to motivate and provide opportunity and reward to keep performance at a consistent high level and resources available for leadership development.
  5. Employee Engagement and Morale: Practices to put in place where there is limited room for advancement, and situations in which an employee does not work well with others.

Two pink elephants in the room were also addressed: sexual harassment and diversity and inclusion. For anyone in a people management role, these are business necessities to be addressed now. Meeting professionals organize events where each of these highly critical subjects provide an opportunity to create and demonstrate their value to the organization and show leadership.

Q Are the budgets for meetings increasing or decreasing? What steps are being taken to increase security at these events?

Budgets: Generally, budgets are increasing, especially in those organizations that are involved with planning incentive travel. Generally, there is optimism about the world and the U.S. economy. Despite some recent blips, it continues to grow over the long-term.

Optimism about the national economy is more pronounced among U.S. buyers. According to the new Incentive Travel Industry Index, powered by SITE, the IRF and FICP in conjunction with JD Power, the incentives industry outlook is very good. According to 1,016 respondents from 86 countries (half from North America), 2018 budgets were up.

More than half (54 percent) of buyers reported an increase in budgets year over year. At the same time, two-thirds of corporate users and more than 80 percent of incentive agencies are taking steps toward cost management, such as less-expensive destinations (30 percent), all-inclusive destinations (26 percent) and less-expensive amenities.

The industry has seen an increase in use of all-inclusive destinations from 73 percent of respondents in 2015 to 82 percent in 2018. Also contributing to the momentum, there were more qualifiers than ever. Globally, 65 percent of all buyers are increasing the number of qualifiers (58 percent in USA, 67 percent in the EU and 73 percent in Asia). The study revealed that per-person average spend for corporate buyers was $8,151.

Size of meetings: According to the latest FICP Q2 2018 FICP Pulse Survey, the size and number of meetings is increasing, as are the costs for food and beverage (F&B) and room rates. One would hope that they are increasing if only to allow for that growth!

Security: The majority of meeting professionals respondents in the same pulse survey reported an increase in the use of in-house security or security consultants for events in the past 12 months, with 66 percent indicating they used it for international events and 60 percent for domestic. Similarly, hospitality partners reported an increase in security requests for both domestic and international events.

Q What encouraging signs do you see ahead for the financial and insurance services meetings industry?

A In addition to size, there are signs of continued growth in the number of meetings. The Economic Significance of Meetings to the U.S. Economy, published this year by the Events Industry Council (EIC), shows that the finance, insurance and real estate industry was responsible for $141.1 billion in total economic output in 2016, making it the second-most impactful industry from an economic impact perspective, behind the business services industry.

In fact, the study was used to generate the first-ever worldwide study on the economic significance of face-to-face business events, which revealed that this is a $1.5 trillion industry that supports 26 million jobs! This ranks the sector as the 14th largest in the world, ahead of GDPs of Australia, Spain, Mexico, Indonesia and Saudi Arabia. Oxford Economics conducted the worldwide study.

A Focus on Culture: The 2018 Incentive Travel Industry Index revealed a few other encouraging signs. In addition to sales and profitability remaining as the top reasons to hold an incentive program, the option of “better relationship-building between employees and management” jumped from fifth in importance in 2017 to second in 2018. Also included in the top five were “improved employee engagement and morale” and “better relationship-building between employees.” Clearly, there is an added emphasis on workplace culture.

Emphasis on Wellness: The focus on living a healthy lifestyle while traveling is probably moving past the trend or fad phase and becoming a staple of the event experience. Eighty-six percent of buyers feature some form of wellness in their programs, while 73 percent of corporate buyers said they continue to offer a corporate social responsibility (CSR) component to their events, compared to 94 percent in 2017. Popular wellness activities are yoga and healthy meals, for example.

Q In your opinion, what are the biggest new trends for financial and insurance industry meetings in 2019?

A Social media is a topic we often hear in meeting professional conversations. What is surprising is how few refer to specific social media policies that relate to meetings, but there are many common practices. For example, some companies prohibit posting images from their live events. Some have security in place to remove cameras or phones from people who are seen taking pictures at an event. In fact, LinkedIn and other social media are still blocked at some companies. As an alternative, some companies provide internal mechanisms, such as an app, where they can post images. I&FMM

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