china's outbound event business and how it will affect icca members #icca12 monday 22/10/2012

51st ICCA Congress

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China’s Outbound Event Business- and how it will affect ICCA members

Interim Report of a joint Research-Project of Hochschule Osnabrück (HSOS) andShanghai Institute of Foreign Trade (SIFT)

San Juan, 22. October 2012

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1. Who we are2. Meetings, MICE or Business Events?3. Aim and Methodology of the Research Project4. Analysis of potential Driving Factors for outbound Event

Activities5. Competitiveness and Brands of Nations/Destinations6. Summary

What you will hear today

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Since 1993,Hochschule Osnabrueck, Faculty of Business Management & Social Sciences offers Event Management with a focus on Business Events.

We are a Pioneer in Germany and the only German university, which has exported its EM-Programme

1. Who we are

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International Event Management Shanghai (IEMS)

Since 2004 we offer the Double-degree Bachelor Programme

International Event Management Shanghai (IEMS)

We are the only Sino-Foreign Event Management Programme in China!

as a joint venture between

• Hochschule Osnabrück and

• Shanghai Institute of Foreign Trade (SIFT)

• in Shanghai for Chinese students

• More than 350 Graduates so far

• 50 % of curriculum by German lecturers

• http://www.wiso.hs-osnabrueck.de/iems.html?&L=1

© Prof. Helmut Schwägermann, FH Osnabrück

First Graduation Ceremony 2008

Exchange Students in Osnabrück

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• Prof. Helmut Schwägermann, HS Osnabrück, ICCA-member since 1986 (ICC Berlin, ConEcon Management Berlin, HS Osnabrück)

• German Programme Director of IEMS

• Prof. Lan Xing, SIFT, vast experience in the Chinese and International Exhibition and Event Industry

• Chinese Programme Director of IEMS

• Dr. Ding Yi, SIFT, researcher with an international background/education

The Research Team

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Business Events (B2B-Events) are events for participants, (target groups) who visit these events for professional reasons.

Business Events include •association meetings and other NPO-meetings•corporate events as well as •trade fairs and exhibitions

The reasons, we chose the broader approach (BE):1.We find these events often in a combination (meeting plus exhibition)2.Most ICCA members (Destinations, Venues, Agencies, etc.) are not only interested in Association Meetings, but in international Business Events of all kind!

2. Meetings, MICE or Business Events?

9

Types Of Events

1. Events of associations and other non-profit organisations

Congresses, conferences, seminars

Board meetings, committee meetings

Congresses, conferences, seminars

- Annual meetings- Other educational

events, trainings- Political party

conventions- Election campaigns- Trade union

conferences- Government

conferences (NGO / INGO)

- press conferences- Etc.

2. Trade fairs, exhibitions

- Trade fairs- Exhibitions- World exhibitions- Etc.

3. Corporate events

- Board meetings / management meetings

- Staff meeting / employees meetings

- Sales force meetings- Incentives

(competitions & travel)

- Product presentations- Dealers meeting- House fairs (corporate

exhibitions)- Roadshows- Education trainings- Press conferences- Shareholder meetings- Open door event- Etc.

4. Sport events

- Competitions / championships

- Trainings- Olympic games5. Cultural events

- Theatre plays- Musicals, opera, operettas- Concerts- Circus, varieté shows- Art exhibitions- Religious events (church

congress, mass)

6. Social events, parties

- Dancing balls / galas- Opening events- Sponsoring / charity

events- Street district / city parties- Discos- Weddings- Other private events

Business Events Consumer Events

© Prof.Helmut Schwägermann, HS Osnabrück

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Research Question:

How will the development of China`s Market for Business Events affect the international Event Industry with a focus on ICCA members?

3. Research Aim and Methodology

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We will research

•the characteristics and development of the Chinese market for meetings and other business events •And analyse potential driving factors for global event activities •and ask for the regional/national distribution of these activities.

•Finally we will end up with some strategic advices to ICCA-member as how to cope with this emerging market.

Research Scope

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1. Chinese Event Business will affect the Meeting Industry sooner than many of you think (Case: Trade Fair sector in China!)

2. More individual or group of delegates/visitors will take part at international meetings/business events worldwide

3. More Chinese decision makers (e.g. Board members in Intl. Associations or Corporations) will be influencing international meetings and the selection of destination

4. More China-based or influenced business events will be going abroad, starting with incentive travel to Asian countries

5. Countries with a high general and/or specific (BE) competitiveness will be gaining most from this development

Our Research Statements:We expect that….

Phase-Model ICCA-China Research

© Prof. H. Schwägermann, Osnabrück / Berlin / Shanghai

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As we started recently, we have many indicators and interesting data,Examples and case studies.

But as of now this is more or less a patchwork

4. Analysis of potential Driving Factors for outbound Event Activities

© Prof. H. Schwägermann, Osnabrück / Berlin / Shanghai

2012

Business Events in China

Volume of BE in China

Volume ofOutgoing Business

Scenario A

B

C

2020+

Outgoing EventActivities

In order to predict the Future, you have to analyse Past and Present

Scenario A

B

C

Past Future

© Prof. H. Schwägermann, Osnabrück / Berlin / Shanghai

We have identified potential Driving Factors for Outbound BE = Our Research Fields

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Reveal the (co-)relation between the potential driving factors and the development of the outbound event business. Strong (A)? Medium((B)? Weak/Non-Existing(C)?

Are these Driving Factors relevant?(Co-relation and Factor-analysis)

Driving Factor x

Chinese Outbound Business

A?

B?

C?

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ICCA China: Growth of 125 % in ten years (no official Chinese statistics yet!)

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• All international trade fair companies have subsidiaries in China

• Some of them organise more and more important exhibitions in China than at home

• China is going to be the most important exhibition place worldwide

China‘s exhibition industry has developed much earlier than the meeting industry!

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Asia covers 20% of all exhibition space

Source: ufi

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China‘s share: 68%

Source: ufi

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Exhibitions in China 2010/11 grow by 18 %!

Source Statistics and Analysis report of China Exhibition Industry 2011

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Economy and Trade

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Growing Economy (GDP) indicate more chances for Business Events

Source: ChinaInNumbers BFC_Q1 2012

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China‘s Export = Business Relations1. US 2. HK 3. Japan 4.SK 5. Germany 6. Netherlands...

Source: ChinaInNumbers BFC_Q1 2012

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China‘s Import = Business relations1. Japan 2. South Korea 3. US ..... 6. Germany

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Yuan is getting stronger: Events outside China getting less expensive

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FDI-Outflows Are Growing Quickly Since 2005.Might overweigh inflows soon?

Source: ChinaInNumbers BFC_Q1 2012

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Chinese Direct Investment (FDI) in the US: Cas study Lenovo: will need meetings

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• The more co-operation between international universities and R&R Institutios, the more meetings will be held in the respective countries

Innovation, R&D, Co-operation between Universities

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Patent applications as indicator for R&D- activities and more meetings

Source: ChinaInNumbers BFC_Q1 2012

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Chinese Outbound Tourism to Europe (contradicting data and definitions (HK & Macao)

Source: ETC- July 2012 Trends and Outlook

35.9 million tourists travelled from China in 2011. Of these, 24.7 million travelled within Northeast Asia, while 11.1 million (31.0%) travelled to long haul destinations.

Chinese tourist arrivals to Europe in 2011 totalled 3.9 million, representing 34.8% of the Chinese long haul outbound market.

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2011: 70 Mio. Outbound Tourists,3,2 Mio. for outbound meetings

Source: Annual Report of China Outbound Tourism Development published 2012 by Beijing Tourism Education Press

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2011: Asia 51,6 mio., Europe 2,3 mio., America 1,5 mio.

Source: Annual Report of China Outbound Tourism Development> published 2012 by Beijing Tourism Education Press

36Tagungsstadt Rothenburg ob der Tauber 36© Prof. Helmut Schwägermann, Berlin, Osnabrück, Shanghai

For Germany, China will be the most important source market for tourists in Asia soon

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Growing Chinese Influence in International Associations.Case study Prof. Jianan LiThe International Society of Physical and Rehabilitation Medicine (ISPRM)

http://www.isprm.org/?CategoryID=232&ArticleID=93

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• Which countries will be affected most?

• What is the Image/Brand of your country?

• Is the Chinese Destination Selection Process different?

• Do You ICCA members (Destinations and other Suppliers have a clear Regional Strategy?

• And what about China?

5. Countries/ Destinations: Image/ Selection Process/ Strategy

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A positive nation brand provides a crucial competitive advantage.How is your country rated?

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Anholt-GfK Roper Nation Brand Index

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Destination Selection Factors: Price and location seem to be most important factors

Source: The China and Asia Meetings Industry Research Report 2011

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• Chinas Business Events sector has grown enormously in the last years

• Many related factors (Driving factors?) have shown a similar tendency

• But: how will China influence the international Event Industry in the years to come?

• Our findings will be presented at the next GA 2013 in Shanghai

Summary

51st ICCA Congress

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Session sponsored by:

Thank you!

Thanks to ICCA for their support!

Further Supporters and Sponsors are welcome!