Research: The congress industry is recording big losses, but hopes to resume activities in the fall

The Croatian Internet congress and event industry, PoslovniTurizam.com, investigated the extent to which the Croatian congress industry was affected by the latest global crisis caused by the coronavirus pandemic, PoslovniTurizam.com The research was conducted in the period ...

The extent to which the Croatian congress industry has been affected by the latest global crisis caused by the coronavirus pandemic has been investigated by a specialized internet portal for the Croatian congress and event industry, PoslovniTurizam.com

The research was conducted in the period from 24.03. to 27.03.2020. by the method of online survey, and included 79 respondents (congress hotels, specialized agencies and other entities operating in the field of congress and business tourism) throughout Croatia.

Tourism as well as the congress industry, which globally accounts for about 15 percent of total travel, are the most affected sectors of the economy in the current crisis. 

In the past month, especially since the recommendations and bans of the Civil Protection Headquarters relating to public gatherings came into force, most of the rallies scheduled for this spring have been canceled or postponed.

According to the statements of 45% of respondents, last year the MICE segment (acronym meetings, incentives, conventions, events) grew by between 10 and 30% compared to the previous year, and according to the announcements, 2020 should be a record year in terms of the number of meetings . But the current situation is very difficult and uncertain; a significant number of meetings have been postponed to the autumn or spring of next year, and there is already an increased demand for free conference space.

The loss of income caused by such a sudden cessation of every business activity in the field of business tourism is measured by 40% of respondents in the amount of up to half a million kuna, while in 25% of them the losses reach up to five million kuna this year. Although insurance does not cover job losses due to force majeure, almost 60% of respondents said they do not plan to lay off employees, but there have been salary cuts and streamlining of companies that currently survive mainly due to reserves from previous years.

An increase in virtual events is expected

The congress industry mainly relies on live meetings, but in a situation where there is uncertainty related to social and public gatherings, 45% of respondents expect that some events in the future will become virtual and virtual conferences and congresses, webinars and the like will be organized using technological solutions. , while 40% of respondents are not sure whether such events will replace the traditional ones. "Humans are first and foremost social beings and personal contact is still needed. Probably part of the gatherings will be done virtually, but people want direct contact and will return to such communication“, Is part of the commentary on the question of the future format of events. 

Travel insecurity and the economic crisis - the biggest problems facing the convention industry 

If the health situation stabilizes by the summer and the global virus pandemic is suppressed and confidence in travel and business gatherings is restored, a very challenging autumn awaits us. According to the expectations of the research participants, it will be marked by the lack of free dates for booking events (40% of respondents) and savings due to the economic crisis. The consequences will be a smaller number of events and participants and a smaller number of sponsors (75% of respondents). 

"After the global financial crisis in 2008, the congress industry managed to recover relatively quickly, and Croatia has recorded strong growth and growing popularity in the international congress and incentive travel market in the last few years. But now it’s starting all over again. Business meetings and trainings are mostly related to the business sector, and the recovery will depend largely on the state of the economy. Many companies will fight for survival, reduce costs and in such a situation it will be more difficult to decide on team building, seminars outside their own locations and the like.", Said Daniela Kos, project manager of PoslovniTurizam.

Almost 70% of respondents said that the state can help with concrete measures in the recovery of this business segment, primarily by reducing VAT in tourism and exempting businesses from paying contributions to employees' salaries and income taxes and levies such as tourist and HGK membership fees in the next 6 months.

Source: PoslovniTurizam.com / Photo: Forum Zagreb Congress Center 

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