What's the good word from big DMCs this year? Good business—at least in some markets.
The view from Washington's CSI Capitol Services Inc. is that business is not only good but getting even better.
The CSI team still must contend with clients requiring short lead times, tight budgets and "lots of handholding," as principal David Hainline puts it. But not only are clients sweetening the pot with add-ons as the projects progress, he says, but business continues to strengthen.
"Last year was the second-best ever" for CSI, Hainline says, and his company is looking at almost triple the revenue today from the year-earlier period. As for 2012, corporations that downsized their in-house meeting planning are now committing to events for next year. "It's really unbelievable," Hainline says. "From June on, we are seeing a very strong 2011 in D.C., and it will be extremely strong in 2012."
In a similar vein, New York-based Briggs Inc. saw its best year yet in 2010, according to president Anthony Napoli, CMP, DMPC, after a "flat" 2009. "So we are nervous about achieving the same level of income for 2011," he notes. However, he adds, "We seem to be on track."
READY TO ROAM?
In the U.S., clients are beginning to roam a bit farther from home.
"We're slowly starting to see the West Coast groups rotate back through the East Coast," notes John Roth, CMP, director of sales for Orlando, Fla.-based CPS Florida, "since it’s been two years of staying close to home."
But clients are still skittish about traveling too far from home.
"Business is reasonable within each of the main global geographies," explains Padriac Gilligan, managing director of international DMC network Ovation DMC, headquartered in Dublin. That is, "European business is good amongst European destinations; U.S. business is good amongst U.S. destinations. However, international business or interregional business is still sluggish, with a big improvement not on the immediate horizon." He adds, however, that the RFP pace for 2012 and beyond is "encouraging."
BUDGETS DON'T BUDGE
Many big DMCs still grapple with tight client budgets.
San Antonio's CE Group is "doing more with less and making it look like more," explains Julie Trevino, DMCP, senior account manager. She adds, however, that business is up "a bit," and "clients seem to have more money for decor than last year."
One boon: As hotel-room attrition eats into client budgets less, clients have more money available for DMC services, Roth points out.Programs are running a big shorter, Napoli notes, "but that is a trend over the last decade." He adds, however, that they are "returning slowly in complexity."
And while the dreaded "AIG effect" no longer dominates discussion, "Clearly, issues around perception are still prevalent," Gilligan notes. He points to 2011 event programs featuring "a renewed focus on the meeting component of the program and the motivational or incentive element downplayed and deemphasized."
DMC WATCHWORDS FOR 2011
What will smart management at DMCs do to be effective and successful in 2011?
"Get back to the basics--great customer service and forming relationships with your clients. We must be a true value proposition." Julie Trevino, CE Group
"Be competitive, expect revisions and hang in there; it is going to be a bumpy ride." Sharon Siegel, president, DECO Productions, Miami
"Keep overhead low. Structure the organization to deal with short lead times for group bookings. Continue marketing to the smaller-than-normal-size groups as the head count on the big fish is still down. Stay on top of deposit requirements and turn final billing around quickly; the clients are still moving payments slowly through their systems." John Roth, CPS Florida
"Focus on value and creativity, be more immersed in meetings and on creating value in this sector, look outside of the tried-and-tested markets for new business opportunities, and use technology to do more with fewer resources." Padraic Gilligan, Ovation DMC
"Stay ahead of the curve, don’t rest on your laurels, don’t depend on loyalty—alas--be flexible and have a big sense of humor!" Anthony Napoli, Briggs Inc.
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