With many sectors of the economy having enjoyed an upswing over the past couple years, spending on meetings is keeping pace as events are growing discernably more lavish.
The heightened expenditures are coming in a variety of areas, from food and beverage to audiovisual and signage to the general ambiance of the meeting.
"No question, meeting budgets are larger today than they were a year and a half or so ago," said Ty Helms, senior vice president of sales at Hyatt Hotels.
"What we're seeing is that a lot of people are trying to improve the overall quality of their events," said David Weil, senior director of convention and trade show services for asso-ciation management firm SmithBucklin. "Attendees are looking for more of an experience for their dollar. Things that were considered extravagant in the past are now basic expectations of meetings."
For example, he said, rear-screen projection has become a standard element at meetings.
In addition to associations, sponsors are spending more as well, according to Weil. "They're spending on opportunities for companies to feel unique at conferences, to get more exposure, and to give more value to attendees," he said. "But while we're seeing more money being spent, we're seeing more revenue opportunities too."
In addition, associations are feeling the need to compete with increasing corporate meeting budgets, as corporate-meeting attendees who also attend association conventions bring with them heightened expectations. "We need to make sure we're raising the bar," Weil said.
According to Jay Roseman, vice president of corporate meeting solutions for American Express Business Travel, corporations are making typically short meetings even shorter, but spending more on food and beverage. And typically medium-length to longer meetings have grown even longer, Roseman said, causing an overall increase in spending.
"We think that spending per attendee is actually trending up, and that is because of longer stays," Roseman said. "Spending is getting back to where it was before 9/11."
Carol Gillenwater, president of The Woodlands, Texas-based Corporate Meetings Unlimited, said she has expanded her client base as companies that are faring better financially have become willing to hire a meeting planner.
"They are willing to pay more for travel to and from the meeting venue, food and beverage, audiovisual production, entertainment, more elaborate printed materials, spouse programs and recreational activities," Gillenwater said.
Gillenwater has some clients who recently have requested elaborate, customized video presentations, including original music, audience-response systems, plasma screens, video boards and live feed presentations from industry experts or corporate management. In recent years groups had opted to bring their own LCD projectors and get the rest of their AV equipment and technical support from the hotel.
Some groups are booking more knowledgeable, experienced and dynamic and therefore more expensive speakers than they did in the past, Gillenwater said. Others are paying extra for wireless Internet access outside meeting rooms.
Another increasing expenditure is hotel buyouts, according to Gillenwater. "Many groups like having hotel exclusivity, but obtaining it through a costly buyout is something they would not have supported in previous years," she said.
Hyatt is also seeing more expansive audiovisual set-ups, according to Helms. "There's been a greater emphasis on high-end speakers and entertainment," he said. "So a group may have Cirque de Soleil perform, for example, and we have to worry more about the hang points than when they were just being used for lights."
Meeting planners are giving attendees more options when it comes to food, Helms added. "We have seen a huge increase in use of our 'personal preference' menus, which provides restaurant-style catering, despite the fact that there's a price premium for that," he said. "Personal preference creates greater flexibility for customers than standard banquet menus, allowing groups to have two or three entrée choices, for example, instead of one or two."
Personal preference events have doubled each month, year over year, since the beginning of 2006, Helms said. Overall, Hyatt's food and beverage sales per group room night are up 10 percent year to date.
Atlantic City's Borgata hotel-casino opened only three years ago but had such success with its upscale product that it already is expanding, with a first phase having opened last month. And willingness to pay the Borgata's 25 percent premium over many of the city's other hotel-casinos is only accelerating, according to director of sales Bob Franklin.
"Companies have been more willing to accept higher pricing for the product, whereas before there would be a little pushback," Franklin said.
Group volume at Borgata's spa has approximately doubled since it opened. One company recently booked a full spa day, including lunch, for its meeting attendees, noted Franklin.
Maggie Browning, meetings director for Crowne Plaza in Atlanta, also has noticed a significant upturn in meeting upgrades recently, she said.
Clients are requesting themed meals requiring specialty linens and extra props, and event bars are stocked with higher-end liquors. Also, some groups are now willing to pay for Crowne Plaza office supplies instead of bringing their own, which comes at an extra cost of $4.50 to $5 per person, per day, Browning said.
"With the steady climb in spending extra dollars on food and beverage and specialty items, we have had the opportunity to raise our catering menu prices," Browning said. "We thought we might see some frustration from clients, but so far we have had smooth sailing on the new menu prices."
Liz Piacentini, Crowne Plaza's meetings director in Hartford, Conn., said planners are asking for more varied breakfast choices, more elaborate snack displays at breaks, and more meeting space, and they more often are having welcome receptions.
Other Perspectives
Certainly, not every organization is spending more. At Sargento Foods Inc. in Plymouth, Wis., there have been budget increases only for teleconferencing and web-based meetings, according to Sylvia Hemauer, the company's manager of special events and travel.
And not everyone is convinced that the overall spending trend is upward, either.
"For the expendable income attendees have, with high gas prices and everything else, they have to make choices," said Jennifer Watczak, manager of U.S. events for St. Cloud, Minn.-based direct selling company Creative Memories. "I just don't think the economy is so great right now."
Pharmaceutical meetings, in particular, have had to hold the line on spending because of recently enacted federal regulations that prevent lavish events, which could unduly influence attending physicians' decisions on what drugs to prescribe.
"Budgets have not gone up much," said James Montague, chairman and president of Durham, N.C.-based Professional Meeting Planners Network, which provides onsite staffing for meetings, many of which are pharmaceutical meetings. "There's concern about what it's OK to spend money on. There's a lot of wariness around that, especially as it relates to physicians. The companies are being careful with how they flash their money."
Pharmaceutical companies have downgraded from five-star to four-star properties, according to Montague. But they're looking to maintain an upscale ambiance in other ways, such as by offering breakfast or valet parking, he said.
Meanwhile, SmithBucklin's Weil said companies and associations need to scrutinize budgets to ensure they don't reach an unsustainable level of spending.
"We need to make sure we're watching our expenses you don't want it to get out of line," he said. "If you get to certain price points, people step back and say, 'Was this worth that much money?' You've got to make sure what you're delivering is quality in relation to those expenses. Each conference needs to evaluate that."