In July, we asked our readers to peer into their crystal balls and predict what their 2014 meetings budgets would look like. Three months later, in late October, we repeated that survey to get a sense of whether meetings budgets are tightening or loosening as the year draws to an end.
The results are fairly clear: Budgets are getting smaller and meetings and convention planners are trying to figure out how to stretch already tight budgets even further.
The basic question we asked was, "How does your 2014 meetings budget compare to 2013?" The number who said it would decrease stayed relatively stable, at about 33 percent. But in October, at the beginning of the fourth quarter, those who expect a significant decrease, as opposed to a slight decrease, grew to 10.7 percent. That's up from 4.7 percent in July, at the beginning of the third quarter.
In addition, those who expected a slight budget increase dropped to 22.8 percent in Q4, down from 29.3 percent in Q3.
A planner for a Midwestern manufacturer of scientific equipment said the biggest challenge she is facing in 2014 is "budgeting constraints — they are being tightened and will be reviewed again mid-year to see if further cuts need to be made."
While many planners will look to squeeze the accommodation and food-and-beverage budgets, as well as optional activities, some companies seem to be turning more to cutting meetings or attendees. For example, 29.9 percent of those who are facing cost-cutting demands said they are booking lower-tier hotels in Q4, down from 35.6 percent in Q3; and 43.6 percent said they were reducing their F&B budgets in Q4, down from 55.9 percent in Q3.
One planner for a mid-Atlantic distributor of medical equipment said his biggest challenge in 2014 will be "maintaining the budget line while faced with increasing hotel and airfare costs." The ways his company will be doing that includes booking less-expensive hotels and offering fewer optional activities.
Even though his overall budget is expected to grow slightly in 2014, another planner who answered the survey said his biggest challenge next year will be that his "food and beverage budget and audio-visual budgets are not being allowed to grow with inflation." He added: "I'm still expected to deliver the same number of food and beverage events and same quality of A/V, but technically for less."
In addition, 27.8 percent of the planners who answered this survey in Q4 said they plan to maintain engagement levels by combining a cancelled meeting with another event, up from 19.4 percent in Q3.
When asked to compare attendance levels expected for 2014 events with those held in 2013, more planners said they expect to see a decrease in sales meetings, trade shows, association meetings, and incentives than those who expect to see an increase.
On the association front, one planner for a statewide insurance agent association said, "planning is the easy part. Getting attendees to register has become a nightmare."
Another planner for a scientific association agreed, saying her biggest challenge is "estimating attendance." She notes, "We are already locked into hotel contracts for 2014, which were signed two years ago, and now we are faced with declining attendance. We have to hope to make our room block and F&B minimums."
At the same time, one executive of a major meeting management and site selection firm said her biggest challenges looking into next year will be "space and availability over preferred date patterns."