Industry remains upbeat despite gloom

PUBLISHED : Friday, 27 March, 2009, 12:00am
UPDATED : Friday, 27 March, 2009, 12:00am

Visitor numbers at next month's Canton Fair will give a strong indication of how Asia's meetings, incentives, conventions and exhibitions (Mice) industry is coping in the global economic downturn.

Already some positive factors were emerging out of the gloomy financial picture, observers said. Plusses include cheap airfares within Asia when compared with travel to the United States or Europe. Along with a raft of 'sweet deals', Asian cities, tourist authorities and hoteliers have quickly put together measures to ease the pain on corporate budgets.

This year's Canton Fair will be held in three phases - April15 to 19, and 24 to 29 and May3 to 7, providing 55,000 booth spaces in a total exhibition area of more than 1.1 million square metres at the Pazhou Complex. The one word that probably sums up the mood of the fair is 'caution'. But, even so, many overseas companies are nervous about ignoring the fair and providing competitors with an open day on hot-selling new products. They might send fewer buyers and station them in Guangzhou for less time than in the past, but every indication is that many are still going.

Keenly watching developments is UFI - the Global Association of the Exhibition Industry. It is the union of the world's leading trade-show organisers and fairground owners. Paul Woodward, regional manager, UFI Asia-Pacific, and CEO of Business Strategies Group, said: 'Almost nobody is expecting their business to bounce back in a matter of months, but over 90 per cent of our UFI members in Asia expect to see a return to growth in 2010. The situation is having a different effect depending on the type of trade fairs involved.

'For example, inevitably motor shows and real estate exhibitions around the world have all been hit hard, whereas capital goods fairs in Germany have held up pretty well.

'In Asia, it has been more of a mixed bag. It's too early to say how well the fairs, focused primarily on the Chinese and Indian domestic markets, are holding up. Those fairs focused more on export trades have, of course, been hit, although the drop-off in both exhibitor and visitor numbers has been less severe than some had feared.'

But Harald Weber-Liel, general manager at Hogg Robinson Group China, admitted there had been cutbacks. 'While corporate companies tighten their belts and scrutinise travel costs, clients are now opting for shorter and less elaborate Mice trips,' he said. 'In some cases, clients are booking into hotels with lower star ratings so as to minimise expenditure and squeeze maximum value out of their stays.

'With companies cutting back on budgets for overseas travel, airfares to destinations like the US and Europe are simply prohibitive for some. As a result, Asia becomes a popular choice. When selecting Mice destinations, clients will choose those offering the best value in the market, in terms of cheaper airfares, hotel and venue rates. Because of the favourable across-the-board price deals they are offering, destinations like Singapore, Thailand and South Korea are also gaining considerable popularity as Mice destinations.'

The mainland is less affected by the financial turmoil compared with most overseas competitors, according to Jonathan Kao, area manager at Shanghai Four Seas Travel. He said the strength of the economy partly shielded the mainland from the downturn. 'Another favourable factor is that the Chinese traditionally have a high savings rate so when good deals become available ... they are usually keen to take advantage of them. In fact, since they have the money, they can bargain hard for still better deals, knowing that the airlines and hotels need the business. In turn, some hotels are now quite aggressive in their pricing as they strive to win the business, giving them occupancies and much-needed cash flow.'

At the forefront of cross-border Mice activity are a host of luxury five-star hotels with deals and incentive programmes to lure the multinationals. And the attractions are becoming even more novel,with the Shenzhen InterContinental's Galleon offering themes for event planners.

Hong Kong has made an effort, with cut-price deals and other sweeteners. The Hong Kong Tourism Board's newly created Meetings and Exhibitions Hong Kong office teamed up with the Hong Kong Convention and Exhibition Industry Association to unveil a series of special deals to woo visitors here. Their punchy campaign, with the grabbing catch-phrase, 'Business Right Here!', includes air-fare reductions with Cathay Pacific/Dragonair and exclusive hotel perks for overseas trade exhibition buyers at 28 designated fairs in Hong Kong.

Naturally, the Singapore Tourism Board (STB) is also launching a strong pitch. Its S$90 million (HK$462 million) 'BOOST' campaign has come up with attractive travel packages - offered by STB and industry partners - comprising airfares, hotels, attractions and retail offers.

But some players said not enough people were thinking - and acting - outside the box. They argued there must be other imaginative incentives out there that could be thrown in to sweeten the pot to help the global Mice industry which was facing such a challenging period. Perhaps it was time for Hong Kong and other destinations to rethink both hardware and software and get the Mice back 'sniffing the cheese'.

Joao Manuel Costa Antunes, director of the Macau Government Tourist Office, certainly thinks so. At the recent Macau-hosted International Association of Professional Congress Organisers and Macau Regional Seminar on Organising Congresses event, he was optimistic for the future. 'Though the global economic downturn is hitting the business tourism industry hard ... trade must not be discouraged. We should take this opportunity to strengthen our fundamentals and turn challenges into business opportunities.'

His gung-ho outlook was an inspiration to the 100 Mice industry professionals from Macau and other parts of Asia who participated in the hope of learning how to assist the industry on the road forward.