Meeting News - February 2, 2009 - (Page 18)

Insider Report: Insurance Meetings Edited by Rayna Katz rayna.katz@nielsen.com Budgets Are Spared While several of the nation’s largest insurance giants—like AIG, State Farm, and Allstate— reported billion-dollar losses in the fourth quarter of 2008, a recent study by Meeting Professionals International (MPI) and American Express predicted that spending cuts on insurance meetings in 2009 won’t be more than cuts across other corporate sectors. “In these tough economic times, it’s not only the financial industry that has been hit extremely hard,” said Katie Callahan-Giobbi, executive vice president of MPI. “Comments from the insurance sector were consistent with what we were hearing across all corporate segments.” MPI will release the full results of its FutureWatch 2009 study—documenting the major trends predicted to take shape across the meetings and events industry this year—at its MeetDifferent conference in Atlanta next week. The study predicted that meetings and events budgets will decrease by 6 percent. But the economy’s effect on meetings is not as severe as many people first anticipated, according to the survey’s 2,700 respondents. Spending on insurance meetings will be tight, though cuts don’t appear to be draconian, said one hotelier. “My perception, based on the recent pace, is that most of the major insurance firms are not necessarily scaling back, but they are booking conservatively,” said Gus Vonderheide, vice president of group sales at Hyatt Hotels Corp.“Many are considering bundling of sorts: multiyear contracts or like-property deals to save costs.” While face-to-face meetings have the highest ROI, the study said, 11 percent of meetings professionals across all industries expect an increase in the use of technology in order to help lower overall costs. Insurance companies are not immune from this trend. “Our associates’ time is very valuable, and with videoconferencing they can be out of the office for an hour instead of two days,” said Liz Christopher, a spokeswoman for Nationwide Insurance. While not necessarily new, the emphasis on making such artificial mediums engaging will be more important than ever.“Innovation and creativity really are going to become more critical skills for meetings professionals as we look at the tightening economy and tightening budgets,” said Callahan-Giobbi. Added Christopher: “Nationwide’s associates and managers know they have a responsibility to wisely manage travel costs,” she said.“With associates spread throughout the country, it is important that we find ways to stay connected, while being conscious of expenses and use of time.” Insurance Incentives Are Still on the Books, but They’re Scaled-Back Programs Employee perks are often among the first cuts made by corporations during slow economic periods. But insurance companies are forging ahead with incentive travel programs while being more mindful of travel costs and related expenses than before. Meanwhile, incentive travel industry officials are continuing to emphasize the importance of incentive programs during tough times. Incentive trips, which have traditionally been a motivator for insurance companies with many salespeople and independent agents, remain strong, according to Jennifer Adair, senior sales manager at the Waldorf=Astoria in New York. “We host a lot of incentive programs, and they’re moving forward,” she said. At the November annual conference of the Financial & Insurance Conference Planners (FICP), Adair noticed in live polling a general optimism within the incentive travel business. “The information that came back was that budgets were going to be increasing and that meetings were still being planned,” she said. 18 MeetingNews February 2, 2009 Still, Adair, who has been coordinating incentive programs at the Waldorf for five years for companies like Allstate and State Farm, has noticed some adjustments recently. For example, one insurance company she’s working with is a first-time customer that has traditionally opted for international destinations. The company is going domestic this year to cut costs. “In the past, a lot of companies haven’t been able to afford New York,”Adair said.“Now, [with economic woes being faced by corporations, and deals being offered by suppliers] they’re taking advantage of opportunities to bring their top performers to the city.” The balance between creating a rewarding incentive and staying within a budget is tight now, but planners are being careful to strike it. “We’re always looking at what makes sense from a policyholders’ standpoint, because it is their dollars that we’re spending,” said Kip Diggs, a spokesman for State Farm. Incentive trips now in the planning stages— and which have previously gone to destinations ranging from Florida to the Mediterranean—are being carefully budgeted but not scrapped, because canceling with tour operators with whom State Farm has multiyear commitments would be costly, Diggs said. While remaining conscious of customer dollars, Diggs underscored the importance of incentive trips as a vital method of rewarding and retaining top talent. “These are the people who have really performed, and we believe that they’ve earned these trips and earned these opportunities,” he said. “When they set goals, they think about being able to take this trip or that trip, and they say, ‘I want to be a qualifier.’” Added Padraic Gilligan, president of the Society of Incentive & Travel Executives, in a statement: “In our ever-changing, global business world, the most prized asset remains constant, excellent performance.“The highest levels of workplace performance are reached by individuals and teams that are highly motivated.” H —Section by Phillip Hennessey www.meetingnews.com http://www.meetingnews.com

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