Venues should remain firm on their pricing as we come out of the pandemic, was the clear message from panellists of the Meetings Industry Associationโsย (mia) Extraordinary Matters anniversary event.
Taking place a year after the first session of the popular series, the mia welcomed seven prominent industry figures who have all appeared as panellists during the last 12 months, supporting the associationโs ongoing work to provide best practice guidance and clarity to the sector.
The speakers, who were expertly facilitated by Peter Hancock, included Kate Sargeant, managing director of Bioscientifica; Danny Pecorelli, managing director of Exclusive Collection; Vassia Birliraki, managing director of EZGReece; Purusha Gordon, founder of Zest Global Events; Sean Spencer, head of venues and facilities at IET Venues; David Taylor, managing director of Adriatic Hotels and Neil Baylis of Mishcon de Reya.
Reflecting on pricing, Purusha Gordon said: โOur industry has been hard hit and has had to support itself. Our encouragement from an agency perspective would be for venues to hold the value of their product. I do believe itโs going to take a little while for the confidence to get there but there will be enough business in the future that venues should hold firm on their rates.โ
Sean Spencer explained how rates need to be held as the revenue mix will slightly change. He said: โCatering will be pressurised. A lot of our AV equipment is already included in the package, but we have had to bolt on filming and streaming and the use of our colleagues from IET TV at additional cost, but you canโt mark it up, it has to be almost at cost. So, what you are left with is your room hire which is where you need to help protect and cover the overheads, so rates do need to stick where they are.โ
Talking from a medical associations point of view, Kate Sargeant agreed with venues holding the value of their product. She said they are currently having to dispel a number of misconceptions surrounding costs coming down as hybrid meetings actually require a greater investment to manage both the physical and virtual delegate experience, and rental space will not be lower merely because physical meetings will be smaller.
She said: โWe are trying to educate association leaders. As meeting professionals, we need to really support clients. What events and meetings space requirements will look like going forwards is going to be shaped on a new version of what we come to expect out of the value from getting together in a physical form and what we take with us from the virtual world. So, I think thereโs a lot more to do around shaping this up in the future.โ
David Taylor argued that the sector needs to learn from how it has responded to crisisโ in the past. He said: โThe difference this time is that demand will come back quite strong, and we are already seeing that. We already have much better data than anything we have had in the past, so we can really understand the costs and we can really understand the value.
โSo, I think we should have much more confidence in the value of the product and the service that we offer to be able to be strident in terms of recovery and make sure we get through this particular episode in a much better way than we have done in the past, where it has taken the industry three to five years or more to recover. Iโm confident that if those previous learnings have been absorbed, then weโll see much more strength in rates than we have seen in the past.โ
Danny Pecorelli said: โOur rates are at the highest they have ever been, but I do think there will become a divide depending on what market segments you are in. We are in leisure and meetings. Hundreds and thousands of weddings have had to be cancelled, for example, so thereโs a lot of demand for mid-week weddings. Balance sheets have been shot to pieces and city centre properties may need to make different decisions. My personal strategy is that demand supports full rate, but it could be pure survival for some.โ
Steve Jones, chair of the mia, said: โWe are urging our members to stand firm on rates. The costs of operating our businesses are only rising, they are not going down. I think everyone in business has been there and there is a temptation to reduce rates, but that forms an ever-decreasing circle, and we have to believe in the great value that we offer. Our rates have been very fair in most venues across the UK, so everyone should do their best to stand firm.โ
