We have prepared an exciting scoping study for a new Business Tourism strategy for Wales.
This study looks at the best approach for future development in order for Wales to increase market share and showcase the capabilities of Wales’s key sectors.
The tourism strategy for Wales 2013 to 2020 Partnership for Growth highlights that Wales is underperforming in attracting sufficient volume and value of Business tourism. In addition to establishing an international convention centre by 2020, the report identified the need for a range of support activities that benefit business tourism including better transport links, skilled and customer focused workforce, a range of quality accommodation and a reputation for high quality local food and drink.
In addition, the success of, and return on investment for government funding contributions to WICC (Wales International Convention Centre), will be heavily dependent on support from both national and regional (Cardiff city region) business tourism activity.
The UK Business Events sector (also known as MICE or business tourism) has recently been estimated to be worth £35 billion in terms of direct expenditure. In addition business events make a significant contribution to:
- attracting inward investment
- knowledge capital -raising awareness of industry, academic and medical/scientific expertise
- all year round demand for hotels, restaurants, retail and entertainment
- enhanced quality of life as public realm developments for business visitors improve the environment for all who live, work and study in the country
- generation of add on stays and returning business visitors as leisure tourists, estimated at between 25 and 40% of conference visitors.
Business tourism in Wales
Wales is already attracting business conferences and meetings to the value of an estimated £343.4 m in 2014, just 1.59% of the £21.6 billion value for the UK as a whole. Although Wales is attracting events of all types – national and international associations, corporate conferences and meetings, exhibitions, incentives and team building events and corporate hospitality, the greatest potential for increasing market share is with national and international associations, corporate meetings and to a lesser extent team building.
Key factors influencing destination choice are location and access, transport links, costs/value for money and supply of hotels and venues. Wales is perceived to be less accessible than other areas, despite the proximity of Cardiff and SE Wales from the Midlands and South of England, and North Wales from Liverpool and Manchester. These perceptions can be overcome with improved awareness, particularly as travel times improve. There is generally a reasonable supply of hotels and venues (our analysis suggests over 250 sizable venues). However, until WICC opens, the only purpose built conference centre is Venue Cymru. There is also a lower supply of hotels in the cities than elsewhere in the UK and lower numbers of international brand names. The supply has fallen behind the quantity and quality provided in other areas.
Businesses in Wales are already benefitting from incentives and team building events, albeit limited demand. Incentives rely heavily on the appeal of the destination(s) and the wow factor in addition to exclusive experiences and high end hotels and venues. In addition to improving supply, Wales can increase demand by marketing more strongly how these requirements can be met and raising perceptions of the opportunities.
Hotel room occupancy in Wales in 2014 was 66%, the highest it has been since 2004, with the average over that period of 58.5%. These are lower than the UK averages outside London, most recently 69%. Cardiff performs below average in occupancy and RevPar. While this suggests weaker demand, it also means there is potential capacity to meet the increased demand that will be generated by WICC and increased levels of business events overall. Major events for SE Wales will create displacement and increased demand for elsewhere. Cardiff has some competitive advantages over other UK cities in terms of costs and value for money although it is important that it is also supplying the products and services that business visitors require.
The potential for the future
Much of business event demand is driven by the indigenous resources of an area – its economy and companies, its population, its universities and hospitals and their specialisms. Currently the Welsh economy underperforms the UK as a whole and the economic strategy for the future focuses on improving the GVA. The nine key sectors identified as growth targets by the Welsh Government all have potential to generate business events with the key ones likely to be advanced materials and manufacturing; Energy and environment (particularly nuclear energy) and Life Sciences. These sectors in turn would benefit significantly from the raised profile and focus created by events for their sector, helping to achieve the government targets for growth.
The nine universities also have research strengths and areas of expertise that are vital in the attraction of conferences and events. Cardiff University, ranked 3rd in the UK for medicine, specialises in many fields including dentistry, pharmacy and optometry. Swansea, Aberystwyth and Bangor are also centres of internationally renowned research. These fields of science and medicine, together with expertise within hospitals enable bids to be submitted (invitations to host) for association conferences. By hosting the conference the universities and regions often benefit from increased exposure to research funding and raised profile for their academics and specialists. Initial research into the ICCA (International Convention and Congress Association) database has already identified 80 international conferences for which Wales could bid.
Wales’s strengths and opportunities to attract business events include many potential ambassadors, a varied offer and strong national characteristics to support national branding and enable Wales to be distinguished from other UK regions. The weaknesses have already been mentioned in terms of transport & access, venues and hotels supply. Changing perceptions is a challenge. So too is the need to resource and engage the public and private sector for all activities. In contrast to England and Scotland where respected and recognised convention bureaus exist in the major cities, Cardiff is the only destination within Wales that has dedicated public sector funded support for business tourism although the level of resources and funding is very low.
Wales’s ability to meet the needs of individual sectors of business events could be increased substantially with intervention. The recommended interventions centre around three pillars of activity -product development, marketing and service. These will have impact throughout Wales.
The options for delivery vehicles for these interventions range from increased marketing for Business Events Wales to a national convention bureau or national funding and resources for regional activity.
The results gained from the interventions will depend on the option(s) selected for delivery, the degree of resources and funding available. However it could result in significant increase in volume of delegates and their associated spend in Wales of more than £20 million per annum in direct spend plus additional benefits to the economy overall.
Let us know what you think. email us email@example.com or phone 01442 450422
WICC at Celtic Manor opens 2018