Groups and Meetings 2009 Prospectus

Groups & Meetings:Driving Success in Travel’s Most Complex Market

A PhoCusWright Special Report

Research Prospectus

January 2009

© 2008 PhoCusWright Inc. All Rights Reserved. 2

Agenda1. Impetus

2. Overview & Objectives

3. Approach & Methods

4. Timeline & Deliverables

5. Participation

Groups & Meetings:Driving Success in Travel’s Most Complex Market

PhoCusWright project team

Bill Carroll Senior Hotel and Lodging Analyst

Douglas Quinby Senior Director, Research, and Project Manager

Diane Shuart Project Coordinator

Lorraine Sileo Vice President, Research

Susan Steinbrink Senior Research and Corporate Market Analyst

Mary Pat Sullivan Leisure Travel Analyst


Impetus


Why Groups & Meetings? Because…

PhoCusWright’s landmark 2006 study revealed a $170 billion market undergoing rapid change

• Online penetration of travel spend projected to pass 40% in 2008

• Planning and booking drivers and practices vary dramatically across different group travel segments

• Online group and meeting planning tools were proliferating

• But offline channels for planning, booking remain influential

It’s time for a reality check!

Source: PhoCusWright’s Groups and Meetings: Market Opportunity Redefined, 2006


Where Is the Groups and Meetings Market Today?

• Did the market reach projected growth targets?

• Has online adoption slowed?

• Who raised capital and who failed?

• What segments have embraced/not embraced online tools?

• How have social networks redefined the consumer opportunity? What about the corporate opportunity?

• To what extent are meetings centrally managed and policy-driven?

• To what extent will the economy impact the incidence, revenues and distribution of groups and meetings?

• What will the groups and meetings landscape look like in 2009 and beyond?

• What trends are shaping key market segments: corporate, association, leisure?

• How will video conferencing impact corporate meetings travel?


84.988.6 91.7

95.3

28.6 32.8

36.3 39.1

0

20

40

60

80

100

120

2005 2006 2007 2008 2009 2010 2011

Travel Online

Note: Online percentage of travel products only (Air, Hotel, Rental Car, Ground, Other), NOT including meeting spaceSource: PhoCusWright Inc.

U.S. Groups & Meetings Total Travel Market & Online Penetration Forecast (US$B)

34% 37% 40% 41%

?


> Corporate Travel

With procurement at the helm but meeting decision-making fragmented across the organization, most corporations still don’t have a handle on meetings spend. Meetings must play a more central role in corporate travel budgets. Managing vendors offers tremendous cost savings, but has online purchasing finally arrived?

> Leisure Travel

Travel agents have long held sway of the leisure group market; some 55% specialize in groups.* But a handful of online travel companies are carving out a meaningful role. And consumers are taking on self-planning and booking directly with destinations and suppliers. This study will sort out this segment and assess the key dynamics and trends.

> Social Travel

Social media such as Facebook and MySpace have redefined the online world. The opportunity for travel may not be entirely clear, but it is significant and palpable. What role will social networks play in leisure and corporate group travel: Are members using these tools to organize, plan, collaborate? Who are the key players and how can travel providers leverage social media?

Influences, Planning and Booking Remain a Multi-Source, Multi-Channel Mix, but What Is the Future?

Mastering this maturing market now will ensure success as technologies evolve in the future.

* Source: PhoCusWright’s Travel Agency Distribution Landscape Special Report


Objectives & Overview


Research Objectives

• Total market and key segments• Travel and non-travel

• Travel segments: air, hotel, car rental, cruise, tour, ground transportation• Non-travel: hotel meeting space and F&B for corporate meetings and events

• Channels: online / offline, direct (supplier) / intermediary• Meeting types: corporate, association, leisure• Impact of virtual meetings / video conferencing

Group/meeting planner and supplier dynamics• Traveler planners (consumers):

• Demographics, behavior, influencers and preferences

• Corporate meeting and professional group planners:• Corporate meeting planners, group travel planners / travel agents (with leisure

and/or corporate groups business)• Profiles, priorities, influence, drivers, behavior, preferences, needs and tools

• Suppliers (of travel products, services and technologies):• Strategies and tactics, innovations, opportunities and challenges

Groups and meetings market sizing


Research Objectives (cont.)

• What is the size of the total and online groups and meetings market by segment?

• How will groups and meetings demand change in 2009-2011? • What role will virtual meetings play? What will be the impact across market segments and

channels?

• What current and future technologies are driving these changes?

• Will social media transform the market for leisure gatherings? If so, how?

• How is meetings spend managed in the corporation? • Is it part of transient travel budget within each department, separate meetings line item, etc.?

• Is "virtual" meetings spend allocated to the same budget, telecom or elsewhere?

• What drives destination, product, venue and channel selection?• What brands resonate with groups and meetings travelers? And planners?

• What elements influence purchase on the various channels (e.g., virtual tours, video, blogs, user reviews)?

• How does groups and meeting technology square with corporate priorities?

• Who are the key players, who has survived the first wave of market entry, and who will be the newest market entrants?

This study will answer questions such as:


This research will enable partners to prioritize their

investments across channels and segments to meet consumer and planner demand – and anticipate

key trends


Research Overview: Markets and Key Players

SuppliersLarge properties rely heavily on group events, while medium- and smaller-size properties support and even foster small group business for family, reunion, alumni and other leisure or business activities. Transportation to and from these events are an important but untapped revenue stream for car rental companies, tour operators and other suppliers.

Representative Targets:Hotels, Airlines, Car Rental, Ground, Tour Operators

Online CompaniesOnline travel intermediaries have the potential to support group bookings of air, hotel and other destination services, and they possess the mass market reach and marketing budgets to support the effort. Social media sites and portals aggregate demand and generate leads.

Representative Targets:Online travel agencies, group travel planning sites, self-booking tool providers, portals, social media / community sites, media sites

PhoCusWright will size the market and likely growth trends for the following key players:

Event Management / Solutions ProvidersOnline meeting and event planning, procurement and management companies facilitate the organization of larger meetings for planners. They provide a group interface with property PMSs, RMSs and reservation systems to enhance group management at the property level or even across multiple properties for major area-wide events. Such systems give event planners more control over information distribution, event registration and hotel bookings.

Representative Targets:Large event planners, TMCs, DMO/CVBs, technology providers, hospitality systems and software, virtual meetings technology providers


Key Market Segments

• Leisure Gatherings• A small group organizing travel and event services for leisure purposes • Planned directly by the travelers or via a professional planner or travel agent• Examples: weddings, family (or other) reunions, sporting events, religious and other

themed travel• Services: transportation, accommodation, meeting and event services, F&B

• Small Corporate Meetings• A small group using hotel services for business purposes• Example: small business meetings with fewer than 50 guests • Services: transportation, accommodation, meeting and event services, F&B

• Large Meetings• A large event from 50 to thousands of guests and attendees• Examples: large company meeting, incentive travel, large associations, etc.

• Services: transportation, accommodations, meeting and event space, F&B.

PhoCusWright will assess key market segments to identify distinct trends and opportunities:


Research Overview: Key Components

Traveler Planners (consumers)

•Demographics and preferences•Shopping and buying influences and behavior•Channel selection by product category and type of event•Valued tools and features•Types of social gatherings•Impact of social media•Role of brands

Professional Group Planners

•Profile and preferences•Research and booking influences and behavior•Key differences across leisure and corporate planners•Booking method by product category•Role of groups and meetings sites in travel value chain•Valued tools and features•Types of social gatherings•Role of brands

Corporate Meeting Planners

•Profiles•Destination and venue selection/ decision making process•Role of procurement•Types of corporate meetings•Use of virtual meetings•Adoption of online booking tools•Management of transient travel and groups and meeting spend

Travelers and Decision-Makers


Suppliers• Groups and meetings sales by product segment:• Hotel & Lodging

• Car rental companies

• Tour operators

• Cruise lines

• Airlines

• Ground transportation

• By travel segment• Leisure/Unmanaged

business

• Corporate

• By Channel (online/offline)

• Technology investments

• Strategies and trends

• The role of partners and intermediaries

Event Management Companies/Solutio

ns Providers• Meetings and events

planning tools

• Buyer and seller networks

• Hotel lead generation

• Registration/hotel bookings

• PMS/RMS interface

• Meetings procurement/eRFPs

• Revenue and channel management

• Video conferencing

Online Companies

• Groups and Meetings market share by segment:

• Online travel agencies

• Event planning sites

• The role of influencers:

• Search portals

• Media sites

• Social networks

• New Market entrants

• Lessons learned

Travel suppliers and technology companiesResearch Overview: Key Components


Research Benefits

1. Understand the Driving Dynamics of Group Travel Decision-Makers: Travelers, Professional Group Planners, Corporate Meeting Planners and Associations

• Understand how leisure travelers and travel agents plan and book events Identify their preferences, drivers and behaviors

• Profile corporate event and meeting planners Identify their priorities, drivers, practices and needs

• Gain critical insight for honing – or righting – your products, services and messaging to meet their wants and needs now

2. Dive Deep into Online Dynamics and Technology Trends• Understand the current state and prospects of online planning and booking and

future prospects

• Identify gaps inhibiting growth and opportunities for overcoming obstacles

• Learn how these trends are evolving across different group market segments


Research Benefits

3. Event Management Trends & Technology• Identify key development and future innovation in groups and meetings

management technology and best practices

4. Understand Supplier Needs & Challenges• Identify the key needs and challenges of suppliers to hone your offerings and

strengthen your supplier relationships


Approach & Methods


Events Management/Solutions Providers

Travel Planners

(Consumer

s and Agents)

Travel Suppliers

and Online Companies

2) Demand-side influence, drivers and behaviorTravelers: quantitative survey (1200)Corporate meeting planners: qualitative

survey (200)Travel agents with groups business:

qualitative survey (400)

A tight blend of surveys, executive interviews and third-party data analysis to deliver a 360° view of the groups and meetings opportunity

Project Plan of Attack: Three Pronged Approach

1) Current and future capabilities, strategies, partnerships

3) Supplier-side dynamics: strategies, tactics, priorities, challengesIn-depth interviews with select companiesTargeted questions in surveys (item 2 above)

Groups and Meetings

Opportunity

In-depth interviews


Research Elements Detail

Traveler Planner (Consumer) Survey• Online survey of U.S. travelers who have planned group travel• Approx. Target: 1,200 total respondents• Quantitative survey; online panel company

Professional Planner Survey• Online survey of U.S. group planners and travel agents (leisure and corporate)• Qualitative survey; 400 respondents; media partners, list sources to be identified

Corporate Meetings Planner Survey• Online survey of U.S. corporate meetings planners• Qualitative survey; 200 respondents; media partners and list sources to be identified

Suppliers / Providers / Associations: In-depth Interviews• Senior executives covering the G&M category for travel suppliers, distributors, online

players, technology providers and associations• Target: 40• Company list to be developed in consultation with research partners; interviews conducted

by senior PhoCusWright analysts


Timing & Deliverables


Our Proposed Approach Project Timeline• Phase one (6 weeks) Starts approximately XXXX

Meet with partners to understand key goals and desired outcomes. Partners will assist in a collaborative effort to shape interview goals and key findings.

• Phase two (10 weeks) Starts approximately XXXXField surveys and conduct interviews.

• Phase three (12 weeks) Starts approximately XXXConduct analysis, create deliverables. Present to partners/sponsors.

Month1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7

PHASE 1

PHASE 2

PHASE 3Kick-off Calls

SurveyDevelopmentAndEstablishmentOf Goals

PhoneInterviewsBegin Surveys and

InterviewsComplete Compile

AnalyzeDevelop ClientDeliverable

ConductClientPresentations

SurveysLaunch


Deliverables

• Findings, analysis and recommendations delivered as an in-depth PowerPoint presentation

• Analyst presentation via private two-hour Webinar, customized based on each partner’s key points of interest and success factors as noted at beginning of study

• Input into the consumer survey in an interactive process (for initial sponsors)

• Access to tabulated survey results from consumer survey. Note: customized data tabulations may be available for an additional fee

• Branding and publicity rights

• Participants also receive a PDF copy of a summary report that can be shared internally, with clients and partners. This report will be produced as an additional output from the study (anticipated publication date: first quarter 2010)


Workshop Participation at The PhoCusWright Conference, November 18, 2009

Available to the first five add-on purchasing sponsorsShowcase your knowledge and thought leadership in the Groups and Meetings space to a

highly targeted audience and reap valuable benefits including:

• Two (2) conference tickets good for the full four day event. (a $6,000+ value)• Co-Marketing by PhoCusWright which includes listing in all schedules, both printed

and on Web sites. Other marketing ideas will be jointly developed to maximize exposure for all participating sponsors by utilizing Sponsor's and PhoCusWright's existing databases.

• Workshop to take place in a private conference room in the event property meeting rooms can accommodate up to 200 attendees. Room assignment, furniture and room set-up will be based on the number of registrants for each session.

• A complete AV package will be provided for each session• Sponsor featured in the conference program (the “Playbill”) containing conference and

attendee listing details.• Sponsor press kits distributed to the Press in attendance.• Sponsor logo on the event Web site with a link to sponsor’s URL.


Research Contribution

Entire Study: US$20,000

Corporate/Leisure Only: US$15,000

Add-on for Workshop

Participation: US$10,000

Thank You!

Documents

Groups and Meetings 2009 Prospectus