Five trends driving incentive travel
11 Apr 2018 - by Euan McNeil
By Euan McNeil, general manager of FCM Travel Solutions
Although budget limitations will continue to put pressure on MICE spend in the year ahead, companies are more likely to try and organise Meetings, Conferences and Exhibitions themselves, than outsource these elements of MICE.
Recognising the value Incentive Travel brings to their business and the specialised nature of this kind of travel, most companies are reluctant to handle Incentives in-house and prefer to outsource this part of the MICE umbrella to professionals who are capable of delivering a safe and secure experience.
Here’s a closer look at some of the key factors we can expect to shape the incentive world:
1. More authentic destinations, but budget remains a concern
Craving new and authentic experiences, companies will prefer to steer away from the more mainstream, well-trodden destinations, in 2018.
Companies turn to incentive planners to deliver programmes that create truly immersive destination experiences by offering unexplored and undiscovered destinations. Places such as for example Slovenia, Columbia and Sri Lanka are sparking the interest of South African travellers and incentive organisers. Other trending destinations for the South African market are Peru, Jordan, Russia, Japan and the Baltics.
However, despite the desire to veer off the beaten track, budget-driven travel managers will continue to look for value-for-money destination where the exchange rate is favourable. As a result, South East Asia and Mauritius, although more mainstream, also continue to be popular options. The less-than-favourable economic climate in South Africa also means companies often wait till the very last minute to seal the deal on their incentive travel.
2. Education becomes key
The traditional ‘fun in the sun’ incentives are a thing of the past, as the more clients travel, the more demanding they are of the experience they want to have. Increasingly clients are looking for an educational element to be brought into their incentive trips: they want to learn about the country they are visiting and come back with more knowledge about the culture and the destination.
Incentive travel planners are satisfying this trend by incorporating locally authentic cuisine as a reflection of culture, entertainment that reflects the sights and sounds of the destination, and excursions centred on local practices and customs.
3. Sporting events drive incentive travel in 2018
With a number of high-profile events on the calendar for the coming two years, sporting events are expected to determine the choice of incentive destinations in 2018.
South Korea is expected to see a boost in arrivals following the Winter Olympics, which were held in February 2018. The advanced technology of the country’s meeting venues combined with its vibrant culture make South Korea an ideal incentive destination for South African incentive groups.
Russia will host the World Soccer Cup in June and July this year. Combined with the fact that South Africans don’t need a visa for Russia, the World Cup is expected to put the country firmly on the map for South Africans looking for interesting incentive destinations.
Also Japan will likely see a spike in demand from incentive travel organisers, as the country will host the World Rugby Cup in 2019 and the Olympics in 2020. The appeal of cities such as Tokyo is that Tokyo is a world city equal in sophistication to New York and London, yet offering its own distinctive charm.
4. Intra-African travel continues to grow
Barriers to intra-Africa travel are gradually being reduced as more countries remove visa requirements and open their skies.
Over a third of African countries have relaxed their visa policies in the last two years and four countries have moved into the top 20 most visa-friendly countries. Also in the aviation sector advancements have been made with 23 African states agreeing to open their skies as of January this year.
These positive developments on the continent have sparked a substantial amount of foreign investment within Africa resulting in an increase in intra-African travel. Service levels in Africa remain a challenge for incentive travel, but as a result of large investments on the continent and the increase in supply and demand, we will start to see a gradual increase in service levels.
5. Impact of terrorism
Even in the face of continued terrorism fears and political uncertainty, the demand for incentive travel has not diminished in the South African market.
However, corporate governance around security is taking centre stage with security becoming more pronounced in most corporate travel programmes and companies increasingly turning to their incentive house for security advice.
According to International SOS, the threat of terrorism remains one of the least likely issues to impact travellers, and they predict this will continue to be the case into 2018. The truth is that a standard set of precautions is typically effective enough to mitigate and reduce risks to minimal levels.
International SOS has advised that it is every companies’ duty to ensure that travellers receive adequate destination-specific training, which should include a comprehensive summary of threats at the destination, the best-practice mitigation measures for each and a practical understanding of how to respond to each in the unlikely event that travellers are impacted.
Faced with these requirements, companies rely on incentive houses like our FCM Events team to assist them in educating their travellers.
Africa still has a long way to go in terms of its service offerings, but the continent is constantly developing and is starting to keep pace with the rest of the developing world.
While there are certain drivers affecting corporate incentives, it is still one of the best ways to reward and incentivise employees.
A qualified Chartered Accountant (SA), with a passion for business, Euan McNeil joined the Flight Centre Travel Group in 2013 in the role of Financial Controller for the corporate travel brands. In his current role, Euan heads up the South African arm of FCm Travel Solutions, the business travel partner of choice for large national, multinational and global corporations, and Stage & Screen, a specialist travel service for music tourism and the film and production industries. Passionate about developing people, challenging the status quo and adding value to front-end business, Euan is inspiring his team to transform the business of travel. Having completed a B Com Honours in Accounting from the University of Johannesburg, Euan admits to being a big sports enthusiast. When he’s not blazing a corporate travel trail, Euan enjoys playing golf, watching sport and spending time with his wife and daughter.