STRONG AND STEADY: Financial services and insurance planners say incentive spend and salaries ticked up in 2005, and they expect the same next year.
No one would say that 2005 was an easy year for the meeting industry. But, according to the results of our annual reader survey of(formerly ICPA) members, insurance and financial services meetings held steady, with a particularly strong showing for incentive programs.
Our respondents' companies held an average of 3.6 incentive travel programs in 2005, and used an average 2,359 room nights. Eighty-four percent of respondents expect to plan more or the same number of incentive meetings in 2006.
It's interesting that while the average yearly incentive meeting budget increased to $3.2 million — from just over $3 million in 2004 — sales incentive qualification requirements increased at 51 percent of our respondents' companies.
As the qualification bar is raised, the competition to wow an increasingly elite pool of producers intensifies. Our study suggests that spa services and golf continue to be top motivators, with 76 percent of respondents saying that full-service spas are extremely or somewhat important for incentive meetings held at domestic resorts, and 77 percent saying that on-site golf is extremely or somewhat important.
International destinations appear to be on the upswing as well. Eighty-nine percent of respondents hold international incentive trips; nearly half are planning an international incentive in the first nine months of 2006.
Unlike incentives, the average training meeting budget of $691,393 was down about $100,000 from 2004. But the volume of training meetings and number of attendees was up, with respondents' companies holding an average of 52 meetings for a total average of 3,150 attendees. Tight budgets may help explain why about 30 percent of these were day meetings.
Seventy-four percent of respondents expect that the number of training meetings will increase or stay the same in 2006, and 78 percent expect the training budget to increase or stay the same.
Change remains an industry constant. More than one-fourth of respondents (26 percent) experienced departmental centralization, 25 percent went through a corporate merger or acquisition, and 21 percent saw a hiring freeze in their department. Procurement participation in meeting spend is gaining ground, with 30 percent of respondents reporting procurement involvement in hotel, versus 19 percent in 2004. And 40 percent said that compliance with Sarbanes-Oxley legislation is a corporate mandate.
With an average age of 43 and 10 years of experience in their current positions, survey respondents are industry veterans. Their salaries grew modestly last year, to an average of $66,796.
Our e-mail study of 430 FICP planners was conducted in October and November 2005 by Prism Business Media Market Research (a unit of Financial & Insurance Meetings' parent company, Prism Business Media). It generated 176 complete surveys, an effective response rate of 41.7 percent.
Certain numeric totals on the survey charts that follow will not add up to 100 percent. The greater totals are due to multiple-answer questions, and the lesser totals occur in cases when no response was given. All statistics are for the year 2005, unless otherwise noted.
WHO YOU ARE
- Vice president: 13%
- Director/manager: 36%
- Meeting planner: 44%
- Average annual salary: $66,796
- Female: 78%
- Male: 22%
- Average age: 43
- Average years of experience in current position: 10
- Average number of people in meeting department: 5
HOW YOUR DEPARTMENT WORKS
- We use meeting-specific software to plan meetings: 29%
- We are considering using meeting-specific software to plan meetings: 22%
- We use a third party for site searches, always or occasionally: 40%
- We use a third party for functions other than site searches, such as registration, housing, or travel, always or occasionally: 50%
- Average salary of respondents under the age of 30: $40,000
- Average salary of respondents with two to three years of experience: $53,696
- Average salary of respondents with 11 to 15 years of experience: $70,741
- Average raise expected in 2006: 3.4%
INCENTIVE MEETING PROJECTIONS
- Average number of room nights for 2005 incentive meetings: 2,359
- Average number of incentive meetings, per company, in 2005: 3.6
- We'll hold more incentive meetings in 2006 than in 2005: 15%
- We'll hold the same number of incentive meetings in 2006 as in 2005: 69%
- We held an international incentive in 2005: 52%
- We'll hold an international incentive meeting within 12 months: 46%
TRAINING MEETING PROJECTIONS
- Average number of training meetings, per company, in 2005: 52
- Average percentage of 2005 day meetings, with no overnight stay: 30%
- We'll hold more training meetings in 2006 than in 2005: 30%
- We'll hold the same number of training meetings in 2006 as in 2005: 44%
FICP's new president MICHAEL BURKE hit the ground running when he stepped into the job five weeks earlier than planned. And now, with the association's biggest-ever annual meeting behind him, he's hit his stride.
When we spoke with Michael Burke, CMP, on a late November morning, he was at home in Worcester, Mass., having just sent one of his two sons off to his school Thanksgiving party with an ample portion of Burke's special mashed potatoes, made with garlic, butter, evaporated milk, and a dash of salt and pepper. But Burke, manager, conference and travel services, The Hanover Insurance Group Inc. (formerly Allmerica) in Worcester, Mass., had no recipe to follow when he took over the presidency of FICP (formerly ICPA) five weeks earlier than planned in late September, after 2005 president, John Touchette, accepted a position outside the industry. The whirlwind of activity that followed was intense as Burke came up to speed with his new responsibilities for the association's biggest-ever annual meeting held from November 6 to 10 in New York City. Despite his stepped-up calendar and overwhelming appointment book, Burke assumed his new role without a hitch, and his straightforward style and sense of humor were evident when he addressed the 720 attendees in New York.
Burke's background in both hotel management and meeting planning, as well as his company's recent name change and rebranding, gives him a unique perspective with which to lead FICP in the coming year. Here, he talks about his background, his take on industry trends and challenges, and his goals for the association.
As a child, what did you want to be when you grew up? How did you get into the hospitality industry?
I used to watch a television show called “Hotel” and always thought I'd like to have the glamorous job of the general manager, standing in the middle of the lobby directing things. I decided to get a degree in business administration, and started out as a front desk clerk at the Marriott in Worcester, Mass. That's where I met my wife, who was also a front desk clerk there, although we didn't start dating until a few years later. My first hotel management position was as a housekeeping manager at the Marriott in Trumbull, Conn., and then I moved up and out about every six months. My last hotel position, after nine years in the business, was as rooms director for the Sheraton Springfield Monarch Place in Springfield, Mass.
What caused you to become a meeting planner?
When I was rooms director at the Worcester Marriott, Sharon Gaudreau, director of meetings at Paul Revere Insurance in Worcester, Mass., brought a large group to the hotel. Sharon and I had known each other in high school, and she seemed to have a great job. I later took a position as rooms director at the Sheraton Springfield Monarch Place in Springfield, Mass. I liked my job, but it was an hour commute and I wanted to be closer to home. I told Sharon that if an opening came up, I'd be interested. About two years after their Worcester program, a position became available at Paul Revere, and Sharon called me for an interview.I was a meeting planner at Paul Revere for about a year and a half. Then Provident, now Unum Provident, bought the company and they eliminated the meeting planning function. I moved to their Boston branch and worked in operations. Three months later, Rich Granger called me about a meeting planning position at The Hanover. I started in July 1997.
What are the greatest changes you've seen in your company, and in the industry, since you started with The Hanover in 1997?
The biggest change in general has been the number of mergers and acquisitions in the insurance and financial services industry, and constantly having to identify and measure the value that the planning department brings to the company. Obviously, planners bring cost savings through relationships and negotiations. But at my company, it is not only the relationships with our hospitality partners that are critical, but also the relationships with our agents — with all the people who sell our products. We know what they like and what they don't like. These things can make a difference.
Why did The Hanover change its name, and how has it affected your department and your meetings?
When I started, we were basically a life company that had a property and casualty division. Now, the focus has changed. We recently sold our last piece of life business, and we are strictly a property and casualty company. Our new name became official on December 1. The purpose of the name change was to define us as a P&C company. The Hanover has always been a part of who we are, so the name recognition is strong. We've been a publicly held company since 1995.
When the company sold the bulk of its life business a few years ago, our department staff was reduced because it was assumed that the number of meetings would go down. But it was just the opposite. Every meeting of 10 or more people that involves awhere there's potential liability is handled through our department. We're now doing about 250 meetings and events a year. Several factors have caused the number of meetings to grow. We're rolling out new technology and teaching our agents and their staff how to use it, introducing new products, and initiating branding road shows that visit our branch offices. Another change is that our top execs attend more of these agent meetings, including President and CEO Fred Eppinger, who joined us two-and-a-half years ago, and has led the successful reorganization of our business.
What is your departmental structure, and where does procurement fit in?
We used to be part of procurement (now called strategic sourcing), but a few years ago the structure changed and our department now reports to marketing. That makes sense because our mission is geared more towards marketing. We also work closely with multimedia, another department within marketing. Having the same manager as multimedia creates great synergies.
However, I also oversee corporate travel, and strategic sourcing is a big help when it comes to negotiating big-ticket, complex travel contracts with preferred car vendors and airlines. Hotel negotiations are different because the value of our relationships with our preferred hotels is important, and strategic sourcing recognizes that. I'm still very involved with hotel negotiations and talk to our hotel hospitality partners on a regular basis, sometimes weekly.
Even with the inclusion of financial services, FICP is a very niched association. Why is this important?
The small size of the association, and the fact that it is all people doing the same thing, is a huge resource. I can call any of the roughly 400 members to bounce around ideas, talk about experiences, and get honest feedback. Because we're in a highly regulated industry, our members have to deal with unique issues and challenges and FICP can provide a helpful knowledge base for that. We don't share trade secrets, but we share best practices. Another benefit to being a small, niched association is that the vendors who attend our meetings cater specifically to our market.
Both The Hanover Insurance Group Inc. and FICP are going through major rebranding efforts. What have you learned from your branding experiences?
I learned a lot through experiencing the rebranding of our company, because it was a major project. The brand is not just the name: It's much more about the consistent performance of our people and the perception of our various stakeholders. Within our company, we have fabulous resources and a skilled marketing department behind us to make the rebranding happen. With FICP, it will take a little more time. But it was very clear from our focus groups that to attract more planners from the financial services side, we needed to change the name of the association.
One of the complications with the FICP rebranding is that hotel companies often have different people handling their insurance and financial sales offices. So part of our rebranding mission may be helping to educate hotel chains that financial services and insurance really aren't two different markets anymore. We've seen indications, from talking with our hospitality partners, that a few hotel chains are starting to recognize this.
Aside from the name, what else has changed about FICP since you became a member in 1995?
The growth of regional meetings. My first official involvement was as Northeast Chapter chair, about nine years ago. Back then, we had a day meeting that lasted from 9 a.m. to 2 p.m., with maybe one speaker and a few technology presentations. We were happy if we got 15 people to attend. Now, the Northeast Chapter has semiannual, day-and-a-half meetings filled with educational content that attract about 40 planners.
There have been changes on an association management level as well. The chapters now get financial support from headquarters. In 2006, for the first time, a board member has taken on the role of board liaison for the regional chapters. Next year, we're hoping to add an additional board member who will be the vice president of regional chapters. Our goal is to bring some consistency and best practices without changing the unique character of each chapter. For example, we've talked about creating an education bank that chapters could draw from when designing their educational programs.
What must FICP do to retain its identity and not get swallowed up by a bigger industry association?
We have to remember our roots and keep our niched focus. Insurance and financial services planners join FICP because of the manageable size of the association and the fact that we specifically target their needs.
What are your goals for your FICP presidency?
One of my personal goals is to improve the hospitality partner sponsorship model so that it is one that is more equitable to both the association and to our sponsors. Historically, we've offered event-specific sponsorship related to the annual meeting or the educational forum. Now, we're looking at a core sponsorship model that would allow a company to contribute a certain dollar amount to the association in exchange for other benefits, such as recognition in Newsnet (the association's e-newsletter). Also, we're looking at a different sponsorship model for the forum, which until now has allowed a sponsor to attend only part of the meeting. Last year we started a sponsorship committee, consisting of approximately 12 hospitality partners from various sectors. That committee is ongoing, and will be directed by a new board position: vice president, sponsorship.
How will the summer educational forum change to attract both novice and veteran planners?
Some things about the forum have changed, but others have not. We've expanded the educational content. For 2006, the education committee (headed up by the vice president, education) will research what specific topics both new and seasoned members would like to have covered. The dates have moved from July to June (Wednesday, June 14 to Friday, June 16 at Ritz-Carlton Lodge, Reynolds Plantation, Greensboro, Ga.). But this will continue to be a short, education-intensive meeting without a marketplace, and we will continue to limit the number of attendees to about 65. It's still a great program for new members to build relationships before going to the bigger annual meeting.
A year from now, how would you hope to describe your accomplishments as FICP president?
I would like to say that our hospitality partners are happier, that there are more members volunteering to serve on various committees, and that we have a great list of qualified board candidates. Most of all, I'd be happy if people say that I made a difference in the association, and that FICP is stronger than a year ago, both financially and in terms of membership.