Incentives have taken a significant precedence in the fledgling Indian MICE market
Yes, as the Indian economy grows, even though currently spluttering, the MICE (Meetings, Incentives, Conferences and Exhibitions) business is only growing as companies seek greater productivity from their employees and more sales from their dealers. Board meetings in Bora Bora, or is it Boracay, are just a way to reward top management! Whatever be the reason, corporate India is pulling out all stops to retain the productive worker and reward the biggest revenue generators. And one of the best ways of doing this – by unique MICE experiences. Amway India closed revenues at Rs 2,400 crore mark last year, and CEO William Pinckney says the incentive trip is getting bigger each year. “Incentive trips are popular,” he says, explaining that the qualification mark for this trip lasted 18 months, and saw an unprecedented number of qualifiers. Nor is the company alone as companies from sectors such as FMCG, pharmaceuticals, automobiles, auto ancillaries, IT, cement, paints and insurance vie to incentivize through incentive trips.
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| Mauritius is a favoured destination for incentive travel |
“MICE as a concept has matured over the years and clients now seek fresh new and exciting destinations to provide impactful and engaging experience to their top performing dealers, partners and employees,” says Kale. “Given that the MICE market is rapidly evolving with increasingly sophisticated preferences and interests, our corporate clients are looking for experiential trips and hence higher budgets - music to our ears!” Budgets for incentives are already pre-approved and decided for incentives which is helpful, adds Sushil Wadhwa, Chairman & Managing Director, Platinum World Events. “Other sections are perceived more as a luxury than necessity, hence the growth is not as fast as the incentives.” He estimates incentives to be around 40-50% of $2 billion total MICE market in India.
Budgets are still in place. Anand says the incentive market is predominately dominated by countries in South East Asia - Thailand, Hong Kong, Malaysia, Macau. The reasons for this include convenient connectivity from most of our airports, a vibrant night life and also casinos, availability of Indian food and ease of negotiating one’s way through in these destinations. Corporates usually look at one tour a year per segment of dealers. The duration varies from a 3 to 5 night programme with budgets varying from Rs.30,000 to Rs.1.7 lakhs per person, depending on the destination, says Kale.
Indians are value seekers, points out Wadhwa. “At the same time, they have the capacity to buy luxury products and services. I have seen Indian clients pay $ 900 for a room per night and then contemplate before spending $10 on a bottle of water in the room! Typically good access, value for money hotels and services, good venues, easy visas, good nightlife and shopping are some of the things that Indians are constantly seeking.” Yeishan Goel, Chief Operating Officer, THRS, says the factors that influence the choice of a destination vary as per the kind of the movement. “For example, a group of 75 top executives on their annual company offsite with high budgets may be influenced more by the destination profile/image, experiences, security, gastronomy and luxury. However a group of pan India sales professionals on their bi-annual incentive trip are more likely to be influenced by visa procedure, connectivity, accommodations, Indian food, entertainment options and price. Having said that, we are all big on the value for money sentiment and negotiate relentlessly.”
Despite improvements, challenges for the sector remain. Along with the given challenges of logistics for a tour, challenges include limited airline connectivity and often lengthy visa regulations. Added complications include currency fluctuations, airline taxes, and concern over room sizes, especially in Europe. However changes are creeping in. Kale says “Given that our MICE corporates are increasingly looking for that special ‘wow factor’ with fresh destinations coupled with unique experiences, we observed that the traditional deciding factors have become almost redundant! Our movement of about 1,100 MICE travellers to Russia is a case in point. Despite strong concerns including language, infrastructure, governmental approvals, our MICE movement to Russia was a resounding success with the delegates with reviews like “a once in a life time experience that will be difficult to beat!” Wadhwa also points to the considerable taxes. “The government is levying a service tax of 12.36% on the entire invoice, which drives up the cost substantially,” he says.
With corporates looking at experiential trips to wow their customers, MICE travel is no longer restricted to traditional destinations and experiences. Newer areas are emerging. Scandinavia, South America, Japan, New Zealand, Morocco, Kenya, east Europe, Borneo are among the for the Indian MICE tourist is beginning to explore. Goel says that amidst the diverse new destinations trying to court the Indian customer, there's a keen interest in cruise based incentive trips this year. “Clients are also expanding their focus from entertainment and accommodations to include activities and experiences build around adventure, culture, gastronomy and wellness,” he says. Wadhwa expects East European countries such as Croatia, Ukraine, Slovenia, Hungary, Lithuania and Latvia to gain popularity. Suri says the trips have great inspirational value, and those who qualify for overseas trips tend to perform better than their peers. New opportunities for tourism boards and travel companies are key to fuelling this potential. Ease in visa regulations, increased air connectivity from India regional hubs, increased flexibility from international hotel chains towards Indian consumer sensibilities, would be invaluable in expanding the scope of MICE.
Welcome India
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| Thailand had about 75,000 MICE travellers from India last year |
Incentive tourism is on the rise on Turkey as well, which was the sixth most popular destination for tourism globally in 2012, with 31.8 million inbound travelers (India had 6.2 million). Today most of the big group companies and even upper-middle size ones can afford and easily consider overseas “annual meetings” for their directors or even employees, usually around 50 to 100 people,” says Ozgur Ayturk, Culture and Tourism Counselor, Turkey. “Last year was a very good year with regard to MICE tourism in Turkey and we looking at an increasing rate this year as well,” he says. Turkey hosted some big MICE groups from travel industry as well like TAAI (Travel Agents Association of India) and ACAAI (Air Cargo Agents Assocation of India). The country wants to up numbers out of India and Ayturk says “as Turkey’s tourism board, we regularly participate in trade shows and conventions and hold seminars for travel agents to market Turkey as an attractive MICE destination by offering advice regarding accommodation, venues, transportation and other services”. While Istanbul is the most popular destination, the board is looking to increase visitors to places such as Cappadocia and Antalya, which are also popular MICE destinations for Indian organizations, he says. A major challenge he mentions is the lack of load factor in flights to Turkey, though Turkish Airlines has already applied for an increase in the number of the flights and get new slots pan India. Almost 91,000 Indians visited Turkey in 2012 and the growth rate was 24% over 2011. Ayturk expects a growth rate between 25 to 30% from India this year.
Malaysia is strongly perceived to be a real value for money destination in India and we will continue to be a favourite with the Indian traveller, says Manoharan Periasamy, Director, Tourism Malaysia. “Malaysia offers an extensive and affordable choice of exotic, beautiful and exciting experiences within one destination. Indians are amazed by lush tropical rainforests, idyllic island resorts, abundant wildlife, historic towns and UNESCO world heritage sites. Where MICE movements from India are concerned, most of the pharma sector considers Malaysia as a MICE destination. 2011 and 2012 saw a large number of IT companies and banks consider Malaysia for their team-building off sites. “There is a demand from Indian companies for new activities and destinations every year they visit Malaysia. MICE movement from India to Malaysia has multiplied in recent years, largely due to the efforts of the Malaysia Convention and Exhibition Bureau (MYCEB), which drafted the theme “Malaysia – Asia like Never Before” for the corporate and incentive market.”
Hongkong is not just a financial centre, but as one it attracts a huge number of tourists, many of whom combine business with pleasure. It offers an elegant mix of authentic cultural sites and modern facilities that MICE groups can enjoy Chinese tea appreciation, Chinese cake-making as well as to learn about the development of local food delicacies. Special moments could include a unique theme party or travel back in time and enjoy an evening ride on a vintage, open top tram or join the nightlife at Hong Kong’s legendary hotspots like Lan Kwai Fong, SoHo and Knutsford Terrace or watch handcrafted chocolates being made whilst listening to a wine master talk about wine pairing. The city earmarked HK$12.5 million as its marketing budget in 2012-2013 to target key growth cities in India, and expects a rise of about 5.5% in overall visitor arrival numbers.
Bali of course is one of nature’s most blessed corners on this planet, and great for tourism. Indonesia however has much else to offer and is Indian friendly, stresses Vasudha Sondhi, Managing Director, Outbound Marketing. “Visa is provided on arrival and there is good connectivity provided by various airlines. Also Indian vegetarian food is readily available and English is widely spoken throughout the country.” Apart from Bali and Jakarta, other potential MICE destinations in Indonesia include Batam, Medan,Padang, Palembang, Bandung, Surabaya and Yogyakarta among a host of others – and with 13,000 plus islands on offer, there’s more than ample tropical paradise spots for all.
An emerging Asian destination for Indian MICE groups is South Korea, and 92,000 Indians visited Korea in 2012. “Business, technology and leisure blend well at the same time in Korea. For Indians who need to find the business opportunity, to search technology and quality with extra leisure and fun, Korea is the best destination,” says Jae-Sang, Lee, Director, Korea Tourism Organization. “Korea is an untapped holiday destination for the Indian market and hence there is a sense of curiosity in the minds of the Indian traveller.” Well for a nation that is simultaneously one of the most technologically advanced and offering the best of traditional culture, including cuisine, Korean themed meetings, to more outdoor activities, there’s a lot on offer.
Jordan has been emerging as a major incentive destination in recent times. Ashit Taneja, Country Head, Jordan Tourism Board, India Office says that “Going by the number of Indians that travelled to Jordan last year, we are aiming to increase these numbers significantly by focusing more on the MICE segment. Till recently, people were travelling to Jordan more as a transit destination or for two nights. Focusing on MICE will ensure that the length of stay in Jordan will increase as incentive groups usually stay for 3-4 nights. What helps is that Jordan has a VOA (Visa on Arrival) scheme for Indian travelers. However it is Jordan’s wow factors that it counts upon to woo more Indians. Whether it is the long lost magnificent city of Petra, or the experience of floating on Dead Sea, dune bashing in Wadi Rum or even the re-enactment with legionnaires, gladiators and chariot races as they were 2000 years ago at the Roman ruins of Jerash, diving in the Red Sea, great cuisine, luxurious hotels and great shopping, Jordan often catches the Indian visitor by surprise for its wealth of diversity. Taneja also says that direct flights from Delhi and Mumbai and the ease of travelling within Jordan helps cut down on domestic travel time and cost.
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| European destinations such as Barcelona are a favourite with sectors like pharma |
Neighbouring Ireland is on to the MICE bandwagon too, and already about 30% of the business out of India comes from MICE, most of which is incentive travel. Ireland is strongly promoting MICE in India, says Huzan Fraser of Tourism Ireland. It has extended the short-stay visa waiver programme, by which tourists or business people who have lawfully entered the UK, including Northern Ireland, on a valid UK visa are able to travel on to Ireland without the requirement to obtain an Irish visa. This scheme has helped us increase movement to Ireland in 2012 and has also seen a rise in MICE movements to Ireland for 2013 as well, says Fraser. Tourism Ireland usually assists with Irish visa process for big group movements to the Republic of Ireland. Ireland’s iconic attractions besides Dublin and Belfast, include the Giant’s Causeway and the Cliffs of Moher, the newly opened Titanic Belfast, built to commemorate the 100th anniversary of the demise of the Titanic. But perhaps you would like to live like a king in a castle, complete with a medieval banquet?
If its high end precision engineering, luxury cars, and autobahns, Germany has to be part of that sentence. “Over the years Germany has maintained its leading position as the top MICE destination for Indian MICE travelers to Europe and many of our trade fairs and events are well known must visit industry events for Indian business travelers,” says Romit Theophilus, Director Sales & Marketing, German National Tourist Office, India. “Our 2012 Indian arrivals stand at 5,84,508 overnights. Out of this number MICE is the major contributor with a share of roughly 60%. So you can make out its great importance for us as a segment.” With about two-thirds of global trade fairs happening in Germany, it stands out in terms of facilities, trained staff, innovation and reach. However it is Germany’s considerable other offerings that the nations seeks to promote – its great cities, vibrant art and architecture, high quality urban living, cuisine and varied landscapes. Then there are unique experiences - driving a World War II tank just outside of Berlin or going skydiving by jumping off a World War II plane. Then there is the Don 2 base jump from the roof of the Park Inn, Berlin Alexanderplatz, 125 metres off the ground. Or the Munich Beer Tour – a tour of breweries, beer gardens and cellars and the legendary Oktoberfest. Among major trips to Germany include one by Asian Paints for 1,200 people in 2011, besides significant ones by Sony Set Max and Standard Chartered. ICICI plans to take 1,800 persons on an incentive trip in 2013.
Spain has been high on recall value for many Indian since the success of Zindagi na Milegi Dobara. Arturo Ortiz, newly appointed director of Tourism Office of Spain says Indian MICE represents about 15%, and up to 25% including business trips. For Indians, the most popular destinations till date have been Madrid and Barcelona, both offering a vibrant cultural and nightlife, with shopping facilities and gastronomic offers, not to speak of the flamenco and tomatino experiences, combined with tapas or sangria making classes. Already on the horizon are other popular centres such as Valencia, Sevilla, Toledo, Cordoba, Segovia, and Malaga-Costa del Sol. “We assist in recommending vegetarian or Indian restaurants in Spain, but mainly we help to speed up the visa process and make it smoother, issuing it within five days, even if it is a larger incentive group,” says Ortiz. “We can put them in touch with the local tourist boards, to get some maps and brochures delivered in the hotel. And of course assist them finding the right providers and hotels in the destination.”
Leading the emerging east European destinations is Poland. Soćko Kinga of the Poland Convention Bureau says MICE has always been a significant part of our promotions in India. “Despite the lack of direct flights, we have been host to many MICE groups, especially to Warsaw & Krakow, ever since we have been promoting Poland as a leisure and business destination since 2006.” Kinga says “Krakow has always been an all time favorite, not only for Indians but the world over. Warsaw gets its share and so does Poznan. We are now focusing more to divert some movements in to Zakopane, Wroclaw and Gdansk regions.”
Globally is the flavor of the season as far as tourism goes, and leading African nations are eyeing India as an important source market. Kenya has been marketing its safaris, and been drawing good response out of India. Egypt has been the most popular destination, but the events of the previous year have seen a drop in visitor numbers. Adel El Masry, director, Egypt Tourism Office, says MICE is a priority and incentive travel to Egypt had always been popular. The Egyptian Minister of Tourism Hisham Zaazou was recently in India to promote tourism to Egypt. Egypt is looking at visa-on-arrival to Indian tourists visiting Egypt and increasing flights to India, he said. “India is a high potential market for Egypt and the current inbound numbers from the country doesn’t justify the potential the market holds. We haven’t given the required attention to India so far. It is time we evolved some innovative and tactical steps to improve the engagement with this market,” he said.
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| Paragliding in South Africa is high on the agenda of the MICE traveller |
One of the most aspired for destinations, for most a once in a lifetime travel is to New Zealand. Mischa Mannix-Opie, Regional Manager South & South East Asia says incentive travel to the country is growing fast, and last year a group of 470 went. Along with the honeymoon and family segments, incentive is a priority area, especially as Indians tent to stay long – about 11 days. A number of groups have been travelling, she says, from about 40 people to 200 is the usual number per group. And there a lot on offer for the lover of outdoors – from scenic flights to penguin and whale watching, glacier lakes, tropical forests, bungee jumping, skywalking, kayaking, punting, even star gazing - truly Lord of the Rings country. Mannix-Opie is confident the market will grow this year. She says that if one company from a particular industry makes a trip, there is a tendency for other companies to follow suit.
An unusual, but emerging destination is the Pacific nation of Fiji. “Fiji is best suited for high-end, small MICE groups for whom budget is not a constraint and who are searching for new, never-before-explored destinations and experiences,” says Kajal Somaiya India Representative, Tourism Fiji. “In May 2012, we had our first incentive group from Deutsche Bank to Fiji. Their 4-night Fijian itinerary included activities like island hopping, jet boat, Nadi city tour and culture tour. Since Fiji is a popular honeymoon destination, our main focus for 2013 is to target other segments like high-end MICE, family and scuba divers/ adventure enthusiasts out of India.” She says that with several resorts offering fantastic packages for children under 14, Fiji is an ideal destination even for children with several water and land activities to choose from.
It’s not just tourism boards that are holding up the welcome placard. Major hotels such as The Venetian Macao, which along with other hotels on the Cotai strip offer some of the biggest convention facilities in Asia, actively market themselves in India. Natasha Tomé, Executive Director of Marketing, Cotai Strip Macao says “20% of our room revenue in 2012 was generated from MICE”. With about 9,000 rooms and 1.3 million square feet of meeting and exhibition space, nearly 60 international restaurants, bars and lounges, and around 600 luxury and mid-market retail shops, live entertainment it is surrounded by a unique cultural heritage, Cotai Strip Macao is the region’s event planning and management leader.
The rapid growth of India’s outbound numbers has made tourism players, private and public, take note. India’s outbound numbers have grown rapidly in recent years, and the final figure for 2012 is expected to be about 15 million, up from 5.4 million in 2003. About 50 million Indians are expected to travel overseas by 2020, estimates the Ministry of Tourism, a huge spurt, though this will still be half of 100 million outbound Chinese. No surprises then that national tourism boards are rolling out the red carpet, arranging for guides, facilitating visas, ensuring vegetarian fare, participating in Indian trade shows, and even learning about India beyond the clichés!
Given that Amway has set itself a target of doubling revenue by 2020, many of the partners at Melbourne were already planning ahead to where they would like to go on their next trips.
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INCENTIVE TRAVEL COUNTRIES: AN INDIAN VIEWPOINT
Very popular
Visa on arrival/ easy to get, high awareness amongst Indians about destination, multiple direct flights, value for money, easy to navigate, availability of Indian cuisine, language little or no barrier, range of destinations
– Thailand, Singapore, Malaysia, Hongkong, Macau, Dubai
Quite popular
Ease of visa/ visa, not always high awareness, fairly good connectivity, easy to navigate, availability of Indian cuisine, language no barrier, value for money / expensive, aspirational destinations
– Switzerland, UK, Germany, Jordan, Turkey, Egypt (currently off the radar), South Africa, Mauritius, Maldives, Sri Lanka, Bhutan, Nepal, China, Indonesia, Philippines, Australia, New Zealand, US, Canada
Emerging destinations
Visa process not always simple, awareness low, fairly good to indirect connectivity, not always easy to navigate, limited, though increasing availability of Indian cuisine, language often a barrier, value for money / expensive, aspirational destinations
– most Schengen countries including France, Spain, Italy, Belgium, Ireland, Poland, Finland, Greece, Austria, etc, Russia, Romania, Croatia, Slovenia, Serbia, Israel, Kenya, Tanzania, Ethiopia, Morocco, Botswana, Oman, Abu Dhabi, Central Asian nations, Mongolia, South Korea, Japan, Fiji, Vietnam, Cambodia, Laos, Taiwan, Papua New Guinea
Future destinations
Visa process not always simple, awareness low, mostly indirect connectivity, not always easy to navigate, limited availability of Indian cuisine, language often a barrier, expensive, aspirational destinations with high end potential
– Mexico, Brazil, Argentina, Peru and other Latin American nations, Bahamas and other Caribbean nations, Greenland, Iceland, Antarctica, most sub Saharan nations, Algeria, Libya, Tunisia, Cyprus, Qatar, Bangladesh, Myanmar, Brunei, Ukraine, Belarus, Latvia, Lithuania, Estonia, Scandinavia, remaining Balkan states, south Pacific islands
Off the charts
Little to no present incentive tourism potential
– some sub Saharan and south Asian nations, parts of west Asia, North Korea, Georgia, Azerbaijan, Armenia, Moldova, parts of central America
Suman Tarafdar
(This article was published in Business India in April 2013)
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