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May

Six key takeaways from SITE GB’s incentives debate

Last week, we attended the SITE GB debate on the topic of Scaling an Incentive Business at Shangri La, The Shard in London. A panel moderated by Top Banana managing director Richard Bridge and featuring agency and corporate experts from G4S, Penguins Events, Purple Dog Solutions, Absolute Corporate Events and Delegate Wranglers, discussed the challenges and trends in the increasingly competitive UK incentive travel market in front of an audience of buyers and suppliers including hotels, venues, destinations, DMCs and representation companies. Here’s our key takeaways from the discussion…

Is Brexit a genuine concern or used as an excuse for delaying incentive programmes?

Kate Scully, group travel manager, G4S: “Brexit is genuinely making corporates nervous and less ready to put cash down. Nobody knows what is going to happen at the end of the day, nobody knows where we are going to be at the end of this process, so for a corporate, it is very unnerving.”

Richard Bridge: “I do think people use Brexit as an excuse in terms of making the decision there and then, so they are leaving it to a shorter lead time. But at the same time, I haven’t spoken to anyone here tonight that hasn’t said that 2019 has been their busiest year yet, so despite this uncertainty, the industry is quite buoyant and is spending more money than it has previously, which is great for all of us in terms of growing our businesses.”

Are lead times better or worse?

Chris Clarke, director, Purple Dog Solutions: “We just delivered an incentive in March in Hong Kong and the decision was made at Christmas. I think there is always something going on in the world that clients can blame it on, be it end of year or Brexit, there always seems to be a reason why things are late. Sometimes you just have to look at a project and decide if can you add the value you know you can add if you’ve only got two months to deliver it, and if you can’t, you might as well walk away rather than make a mess of it. We worked on one with 18 months lead time, which was a bit ridiculous – we couldn’t even get rates because it was so far out, but two-and-a-bit months is quite a stretch. Lead times are up and down, and I don’t think it’s just incentives, it’s all events.”

Chris Parnham, managing director, Absolute Corporate Events: “I don’t think the planning cycle has moved. Our clients are planning and deciding to do an event as far out as they always have done. What’s changed is the commitment window. So, for incentives, they might still be thinking about where they want to go 12- 18 months out, but they might not commit till nine months out.”

What can agencies/suppliers do to help get business confirmed in times of uncertainty?

Chris Parnham: “We have been looking at things like a no cash commitment, which has been really successful. We work with suppliers and venues that are happy to do that, and it means you can get the client to commit. They sign something, but they know there is a no cash commitment for the first three months for example. It is saying to the client – plan, book, commit, but you don’t have to pay anything yet. We have not lost anything on that no cash commitment yet, it just forces the client to commit without putting money on the table. It’s overcoming a mindset a corporate has that I am not prepared to sign and forgo a 50% deposit if I have to cancel this event for one reason or another. So, it’s removing the financial risk. If 0 is impossible, suppliers could ask for 5%.”

What are the benefits of working with smaller agencies?

Kate Scully: “I am a fan of the smaller agency. I am not a fan of the big agencies, because they can’t scale in the same way and because they can’t be flexible. We are the size of an oil tanker – you don’t pull an oil tanker with an oil tanker, you pull it with something that’s like a tug boat, that’s strong and fast and powerful. I don’t want to have my massive clunking processes up against somebody else’s massive clunking processes, because it just doesn’t work. For me it’s about trust, flexibility and all of those things.”

How are incentives changing?

Holly Mills, head of incentives, Penguins Events: “We’re seeing a big trend in non-sales incentives. The challenge that we have from an agency side and a client side, is how do people qualify for that incentive trip. We have been doing a lot of work behind the scenes to create an ROI model and the best solution we have found at the moment is to really try and understand the client’s values and try and align the qualifications with those values. That seems to be working quite well at the moment. As part of the wider health and wellbeing trend, people are looking to reward their staff a lot more and take more responsibility in the wellbeing of their employees. There has been a definite shift away from the traditional sales incentives into more company-wide incentives.”

Could venues and suppliers be more creative in their proposals?

Holly Mills: “I think they can be. I always want to do something different and I don’t want to do what everyone does, so I am always looking for something more creative. The most refreshing part is when you get a sales person showing you round who is open to new suggestions and ideas and says well we haven’t done that before but we’ll see if we can.”

Richard Bridge: “Venues and destinations have lots of great examples of what has been done before, but they don’t always share that information. If you don’t ask, then you wouldn’t know. There is an element of ownership on the agency to give creativity and personalisation ideas but it’s also a conversation about what’s possible and what’s not from the venue’s perspective.”

Elliott Grant, director of incentives, Top Banana: “I think the evolution of our industry is the creativity between the agency and the hotel. If you think about the amount of time a guest will spend in the hotel – check in, going up to their room, every single breakfast, maybe lunch, a gala evening and even an activity. There is a lot of time there that we as agencies might event take for granted and think “okay we’ll just do that there”.

“Whereas actually, the differentiating factor between you and another agency might be that you come up with a creative way to do breakfast or a creative way of checking in or taking them up to their room. A few years ago we were at an event at the Fairmont in Ajman, and every coffee break was a different set up, such as a beach scene or a kitchen scene. It was totally unnecessary and they could have just provided us with coffee, but they created something different and memorable. And I think that’s an area that we as agencies could work with venues and suppliers to really push forward.”

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