analysis of the meeting industry in baku and opportunities for its further developement
TRANSCRIPT
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ANALYSIS OF THE MEETING INDUSTRY IN
BAKU AND OPPORTUNITIES FOR ITS FURTHER
DEVELOPEMENT
BACHELOR THESIS ISubmitted at the
IMC University of Applied Sciences Krems
Bachelor Programme
Tourism and Leisure Management
by
FARIDA BABAYEVA
Specialisation Subject: Meeting Industry Management
Supervisor: Irfan Arikan
Date of submission: 07/02/2011
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STATUTORY DECLARATION
I declare in lieu of an oath that I have written this bachelor thesis myself and that I
have not used any sources or resources other than stated for its preparation. I
further declare that I have clearly indicated all direct and indirect quotations. This
bachelor thesis has not been submitted elsewhere for examination purposes.
Date Signature
February 7, 2011 Farida Babayeva
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TABLE OF CONTENTSSTATUTORY DECLARATION ..........................................................................2LIST OF FIGURES AND TABLES..................................................................... 4LIST OF ABBREVIATIONS .............................................................................. 4ABSTRACT5
1. INTRODUCTION ...61.1 Research Aim and research questions...............................................61.2 Importance of the study...61.3Research method. 7
2. DEFINITION...... 82.1Business tourism.......9
2.2Meeting industry and its structure...102.2.1 History and development...122.2.2 Baku as MICE destination..132.2.3 Buyers...142.2.4 Suppliers...162.2.5 Agencies and Intermediaries..17
3. Empirical Research .193.1Description of the method ..193.2Research Design203.3Primary data 20
3.3.1 Industry expert interviews21
3.3.2 Questionnaire21 3.4Secondary Data22
3.4.1. Statistics on Business Tourism in Azerbaijan.22
4. Results and Analysis...254.1Theoretical Framework..254.2The phases of tourism experience.25
4.2.1. Anticipation and Planning..264.2.2. Travel to and Return Back... 274.2.3. Participation....28
4.2.3.1 Accommodation 284.2.3.2. Conference Venues294.2.3.2Catering Services..31
4.2.4. Recollection31
5. SWOT Analysis..335.1 Strengths ...335.2 Weaknesses..335.3 Opportunities.345.4Threats35
6. CONCLUSION....36LIST OF REFERENCES....38 APPENDIX...39
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ABSTRACT
The meeting industry is a newly born segment of business tourism, which has
become very common in Baku recently. Since the industry is very young in Baku,
there is a shortage of statistics as a separate element of business tourism.
Consequently, to identify the situation of the industry and to understand its strengths
and weaknesses, the industry needs to be investigated appropriately.
This thesis is aimed at exploration of current situation of the meeting industry, to
be more precise the level of industry related services and opportunities for its
further development.
The proper review of literature helped to identify what the meetings industry is,
what its major components are and the structure of the industry was understood
more clearly. Furthermore, the history of development of this field globally was
confronted with historical growth in Baku.
The interviews with industry experts were a great contribution to the development
of the research. Similarly, the questionnaires designed to reveal the opinions of
meetings and exhibitions attendants played a significant role to formulate
suggestions for the further development of this segment.
Additionally, the findings of this study can be a great contribution to the industry
since it shows the weaknesses and strengths and demonstrates the opportunities
from which the meetings industry can benefit.
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1. INTRODUCTION
1.1 Research aim and research questionsAs a newly born segment of the tourism industry in Baku and lacking proper
information and data, the meeting industry is in need of the appropriate research in
this area. Furthermore, there is a lack of the statistics on the meetings industry as
a separate element of the business travel.
The research aim of this bachelor thesis is to analyze the situation of the meeting
industry in Baku, to find out the quality of conferences including delivered services
in this sphere and to identify the future development opportunities as well.
The research questions are as followings:
1. What is the quality of the meetings and conferences which are organized in
Baku?
2. What might be the possibilities for further development of the meeting industry
in Baku?
The first research question allows further examination of the satisfaction of visitors
coming to Baku. Once the quality of conference organization has been revealed,
the second research question can be explored in more detail.
To answer these questions it is important to analyze to which factors visitors pay
attention more when choosing a destination, which needs and demands should be
met and satisfied and what service level is expected by business travelers visiting
Baku.
1.2 Importance of the study
The international tourism industry is an industry which is flourishing and growing
continuously all over the world. Being a very dynamic sector, tourism industry is
always in a state of flux, ever changing through years. It generates millions of job
opportunities for people every year, improves relationships with neighboring
countries and establishes newer networks across the globe. Apart from these
facts, one of the most important advantages of this industry is its contribution to
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the economy of a host country. It is assumed that, the contribution towards the
GDP by the World Tourism Industry will be approximately 11 % by 2011.
Furthermore, the development of tourism creates a multiplier effect, which is
mainly because of impacts on related industries such as transportation,
entertainment and catering services.
As the fastest growing sector, tourism continues to recover from the decline of
4.2% suffered last year under the impact of the economic crisis as per results
through 2010. In the first eight months of this year, the number of international
tourist arrivals exceeded the record achieved during the same period of the pre-
crisis year 2008. According to the latest issue of the World Tourism Organization
(hereinafter referred as UNWTO) Tourism Barometer, worldwide arrivals between
January and August 2010 totaled 642 million, some 40 million more than during
the same months of 2009. Based on current trends, the number of international
tourist arrivals is projected to increase in the range of 5%-6% over the full year. In
2011, growth is expected to continue at a more moderate pace, at around the
long-term average of 4%. (UNWTO press release).Thus, one of the leading and
most dynamically developing segments of tourism is business tourism, because a
successful business is impossible without contacts, exchange of technologies and
information, exhibitions, congresses, and business trips.
After having restored its independence, tourism in Azerbaijan started to develop
and beginning from 2000s the establishment of Ministry of Tourism and Culture of
Azerbaijan was one of successful attempts to develop it systematically.
Although there is quite enough information on tourism potential of the country,
including the statistics and many relevant data, still there exists a shortage ofinformation on MICE tourism.
This research will provide an overview about the situation of meeting industry in
Baku, as the opinions of experts from the Ministry of Tourism of Azerbaijan and
hotels will be taken into consideration. The study will contribute to the
improvement of delivered services in this area by revealing insufficiencies so that
they can be eliminated in the nearest future and thus the level of service towards
the guests can be improved.
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1.3 Research Method
This thesis is based on empirical research method involving collection andanalysis of primary data which is obtained through quantitative and qualitative
research methods. As per qualitative data face to face interviews with industry
professionals, to be more precise with employees of ministry of tourism and
culture, hotel conference organizing staff was conducted. Furthermore, for
quantitative method questionnaire containing 10 questions were distributed to
business travelers via e-mail. Additionally, as the secondary data the use of
already existing data has been applied.
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2.DEFINITIONS
Tourism is the worlds largest industry, responsible for more than one in ten jobs
globally (International Trade Centre web page). This trillion-dollar industry is
booming around the world even in times of recession, military conflicts, natural
disasters, and energy problems (Nickerson, 1996, 2). Tourism can be considered
to be a complex industry combining a set of interdependent businesses because it
focuses on travelers away from home and on all the services they utilize, including
the means of transport, food and lodging services, travel expediters such as travel
agents, tour operators, and reception services(Lundberg and Lundberg, 1993, v)Over time, more and more destinations have opened up and invested in tourism
development, turning modern tourism into a key driver for socioeconomic progress.
For many developing countries, it is one of the main income sources and the
number one export category, creating much needed employment and opportunities
for development. (UNWTO publication)
A business traveler coming to attend conventions or exhibitions spends money to
stay at a hotel and this money creates job in the hotel as well as transfers to
suppliers who procures this hotel with products and other goods. Additionally, when
this tourist buys a souvenir or other related commodities, the demand for such type
of local products become higher and higher. Such circulation of money in the
economy of a country is called a multiplier effect in tourism. This expansion of
money supply caused by tourist expenditure continues to circulate until the money
leaks out of the country.
One of advantages of tourism is exchange of cultures, which undoubtedly serves for
improvement of the relationships between countries and contributes to economic
growth and prosperity. Furthermore, it allows countries to share and know their
cultures, language and even business.
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2.1Business Tourism
Business tourism is the category of the travel and tourism industry concerned with
travel for business purposes, rather than travel for leisure purposes (leisure
tourism). Business tourism includes travel for meetings, exhibitions, trade fairs,
conferences, conventions and incentive travel (Yonell, 1996, 33).
Business travel accounts for approximately 9% of all international travel. Business
tourism is defined as leisure activities in conjunction with business travel. Business
tourists are less cost-sensitive than leisure tourists, spending on average twice as
much per day. Their purchase decisions are influenced primarily by their ability to
use time efficiently within business travel schedules.
As two-thirds of business travelers extend their business trips for pleasure when
they can, there is enormous potential in this market. Business tourism is expected
to be one of the hottest growth markets for travel industry providers in the years
ahead. Developing and transition economies interested in expanding revenues from
business tourism need to focus on both the individual business traveler and the
meetings and conventions market. (International trade center/UNWTO)
As the speed of international tourism accelerates, MICE tourism (meetings,
incentives, conventions and exhibitions) gets more and more popular, attracting
business tourists from different parts of the world. As a result of increasing numbers
of tourists travelling for business purposes, countries start making investment in the
infrastructure to enhance the attractiveness and convenience of the destinations
being visited.
International trade shows and conferences attract hundreds to thousands of
delegates, often from many countries. Tourism and convention planners often
include tourism add-ons for delegates. These events may include city tours, golf
and sightseeing as a regular part of their programs. (International trade
center/UNWTO).
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2.2Meeting Industry and its structure
MICE is an English abbreviation standing for Meetings, Incentives, Conventions and
Exhibitions. MICE - the new form of business tourism is the fastest growing section
of the International tourism market. It caters to various forms of business meetings,
International conferences and conventions, events and exhibitions and is slowly but
steadily capturing every big hotelier's attention. MICE tourism is the new buzzword
in the international tourist market and relates to various business groups and
individual travelers.(India Travel web page)
The potential of the global MICE (Meetings, Incentives, Conventions, Exhibitions)
industry is evident. Statistics indicate a total of 400,000 conferences and exhibitions
are organized worldwide every year, with a total outlay of US$280 billion. [Source:
International Congress &Convention Association (ICCA)
ICCA gives definitions for meeting as having minimum of 50 participants, be held
regularly and involving at least 3 different countries. This definition was approved by
UNWTO during data collection for its Tourism Market Trends.
Another definition provided by the UIA (Union of International Associations)
highlights following important criteria for international meetings:
A minimum 300 participants
Lasting at least for 3 days and
With the representative of minimum 5 different countries.
Meeting industry has three main components, which are meetings and conferences,
incentives and exhibitions.
Among above mentioned components, meetings and conferences are being
researched and studied more in comparison with incentives and exhibitions. This is
explained by the fact that, the organization of meetings is more developed than the
other ones. Although meetings industry has been researched by different authors, it
is a fact that definitional problems still continue existing. There are different
definitions provided by several meeting associations and organizations.
According to Rodgers, the structure of the meetings industry is comprised of buyers,
suppliers and intermediaries.
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Suppliers include conference venues and destinations, accommodation providers
and transport companies, agencies and specialist contractors. Both buyers and
suppliers are welded together and supported by national bodies and associations,
trade media and educational institutions, each contributing to the overall structure of
this fast developing, global industry. (Rodgers, T. Conferences and Conventions)
2.2.1 History and development
The phrase conference industry is of very recent origin, and is certainly not one
that would have been heard until the second half of the twentieth century. Yet
peoples need to congregate and confer is one of the things that defines our
humanity and, for a multitude of different reasons, meetings and gatherings of
people have taken place since the early days of civilization. (Rodgers, T. p 2)
One of the highest profile events in the past couple of hundred years, perhaps
almost a launch event for our contemporary conference industry, was the Congress
of Vienna held from
September 1814 to June 1815. The Congress was called to reestablish the
territorial divisions of Europe at the end of the Napoleonic Wars and representatives
included all of the major world powers of the day (with the exception of Turkey). It is
tempting to imagine what the delegate spend must have beenlike, with delegates
such as Alexander I, Emperor of Russia, Prince Karl August von Hardenberg from
Prussia, and Viscount Castlereagh and the Duke of Wellington as the principal
British representatives. Each representative would have been accompanied
by a substantial delegation of support staff and partners, requiring accommodation,
social programs, lavish corporate entertainment, ground handling, not to mention
state-of-the-art conference facilities. The Vienna Convention Bureau no doubt
celebrated long and hard its success in attracting such a high profile, high-spend
event to the city!
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As the nineteenth century progressed, universities increasingly provided facilities for
the dissemination of information within academic circles, while the boom in spa
towns and, in the UK,
Victorian resorts with assembly rooms began to make available larger public spaces
for entertainment and meetings. At the same time, the development of the railway
network was accompanied by the construction of railway hotels alongside major
stations. Many of these hotels had substantial function rooms available for hire.
(Rodgers, T. p 4)
The situation was somewhat different in North America during the latter half of the
nineteenth century, particularly across the eastern seaboard of the USA where
various trade and professional associations, as well as religious groups, were being
formed and, as they became more established, beginning to hold conventions for
their memberships. (Rodgers, T. p 5)
As towns became more and more aware of the value the organization of meetings
had for them, a group of businessmen decided in Detroit, Michigan, for the first time
in history, to employ a salesman to invite meetings to be held in their town. In this
way, the first convention bureau was established, and so 1896 was the year when
the industry officially came into being. (Business Travel& Meetings Magazine)In Azerbaijan, the roots of business tourism are connected with Great Silk Way,
being as a stopover on this trade route for its geographical location. In addition, the
trade caravans passed across the territory of Azerbaijan through Silk Way
connecting East Asia with the West.
2.2.2 Baku as Meeting Destination
Rapid growth of business contacts with foreign partners is typical of Azerbaijan
which is undoubtedly due to the development of other industries such as oil,
construction, telecommunication and etc. That being the case, the meetings
industrya sub segment of business tourism became popular in Azerbaijan in the
last decade.
Today Azerbaijan is a dynamically developing country that holds a solid position in
the world. Very favorable conditions have been crated lately for doing business as
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per the government policy paying a great attention to the development of non oil
spheres of economy. Dozen of hotels and business centers, and a lot of cultural and
tourist facilities have been built recently.
All the above mentioned positive changes have led to the fact that Azerbaijan is an
attractive arena for business tourism as well. It is also promoted through various
types of economic forums, exhibitions and conferences being held on diverse
subjects on a regular basis. Both governmental and private organizations take part
in the realization of these events.
Nowadays all conditions are created for the comfortable arrival of businessmen as
well as their involvement in doing business. If business meetings were mainly held
in Baku in the past, today the majority of the regions of the country are capable of
hosting business meetings at the highest level.
2.2.3 Buyers
In the meeting industry buyers can be classified as corporate, association, public
sector and entrepreneurial buyers.
The buyers are conference organizers and meeting planners who buy or, more
accurately, hire conference venues and related services in order to stage their
events. [...] The term corporate is used to describe conference organizers often
called meeting planners who work for corporate organizations. These are
companies established primarily to generate a profit and thus provide a financial
return for their owners. They can be manufacturing or service companies which may
be found in oil and gas, pharmaceutical, IT and communications, financial services
and travel industries. (Rogers, 2008, p. 28)
a) Corporate buyers
Decisions about the conference or meeting (choice of venue, budget, size of event,
visiting speakers, programme content, and so forth) are taken by the corporate
conference organizer or a line manager or the managing director, or by a group of
such people in consultation. The decision-making process is relatively
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straightforward and more-or-less immediate. (Rogers, 2008, p. 36) . Corporate
events can be of different types and sizes as shown in the below table.
Table 1. Types of corporate meetings (Rogers, T)
b) Association
The term association organizer or buyer covers those representinga wide range of
organizations, including trade associations (whose members share the same
profession), voluntary associations and societies (whose members join for the same
interest), charities, religious organizations, political parties and etc. There are also
certain organizations which are not work related and therefore referred to as
SMERF groups (social, military, educational, military, religious and fraternal).( Rogers, 2008, p. 61)
Association conferences are large scale meetings with longer periodicity often
involving hundreds of attendants. The decision regarding destination and venue is
made by a committee after conference organizer presents a relevant list of
destinations to be chosen.
c) Public Sector
The public sector, sometimes referred to as government includes organizations
such as municipalities, local executive bodies, and educational bodies. These are
nonprofit organizations and therefore the delegates attending such conferences are
expected to cover their own expenses.
Annual General Meeting (AGM) Product Launch
Board Meeting Sales Conference
Corporate hospitality/entertainment Training course/seminar
Exhibition/exposition Technical conference
Incentive travel Team building events
Roadshow Symposium
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d) Entrepreneurs
According to Rogers T (2008, p 53), this fourth type of the buyer has quite important
role for the meeting industry. He defines entrepreneurial buyer as someone who
identifies hot topics in the business or academic world and then plans and
produces a conference at which the topics can be presented, discussed and
debated by high profile speakers and experts.
2.2.4 Suppliers
The suppliers are those who make available for external hire the venues,
destinations and many other specialist services without which todays conferences
could not take place.
The supply side of the conference industry is divided into three categories which are
venues, destinations and other service providers.
a) Venues
As per Rodgers (2008, p 56) any type of the building could be promoted as
conference venue. This is due to the fact that, there has not been established anyclassification and grading system for venues yet.
However, over half of all conference venues are located within hotels being
particularly important for corporate market sector. These can be city center hotels
or hotels close to airport, highway and motorway.
That being the case hotels benefit when important and large scale association
meetings come to town. Aside supplying conference with venues, hotels become
accommodation provider for conference attendants. Additionally, it is oftenobserved that, associations choose the hotel as headquarters during their stay and
thus it produces public relations benefits for the hotel (such as being featured in
national and international media coverage).
Besides hotels, there are other venues, which are
purpose bu i l t venues designed for hosting both large scale and
smaller events
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univers i ty and o ther academic venuesare used for different kinds of
meetings during vacations
civ ic venuesfor instance council chambers or town halls functioning as
venue
unusu a l venuesunique venues which add special charm the event and
making it memorable.
b) Destination
The destination is very important criterion in decision making process regarding
the event to be staged. Therefore, conference organizers pay great attention to the
location, i.e. destination. To attract meeting business, each destination must have
venues, attraction, and well developed infrastructure.
c) Other
Alongside above stated suppliers, there are also others such as audio visual
contractors, telecommunication companies, transport companies, floral
contractors, and interpreters. (Rogers, 2008, p 60)
2.2.5 Agencies and Intermediaries
Meetings or similar events can both be organized and run by employees of the
buying organization, or by intermediaries or agencies hired by an organization to
plan and run their events on behalf of them (Davidson & Cope, 2003, p. 113).
Rogers also claim that, intermediaries act as buyers on behalf of their clients and
at the same time deals with organization and planning of the event. These are
PCO (Professional Conference Organizers), Venue FindingAgencies, Conference
Production Companies, Incentive travel houses, DMC (Destination Management
Companies), corporate event companies, exhibition organizers, and etc.
a) Professional Conference Organizers
A PCO is an event management firm that is employed to assist companies in
conference organization. Its responsibilities include researching and
recommending a suitable venue, helping to plan the conference programme
including the social programme, marketing the conference and handling delegate
registrations, booking accommodation/housing for delegates, planning an
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exhibition to run concurrently with the conference, producing a budget and
handling all of the conference finances. (Rogers, 2008, p. 61).
b) Venue Finding Agencies
In comparison with PCO, the role of venue finding agencies is limited to
researching and recommending a suitable venue for a meeting. Additionally, their
responsibility is finding and presenting at least three potential venues to the
conference organizers.
Venue finding agencies may also get involved in booking accommodation for
delegates, and
again would expect to charge commission to the hotels and other accommodation
providers. (Rogers, 2008, p. 61).
c) Conference Production Companies
These are companies specialized in technical organization of meeting, i.e. dealing
with set up, lighting, sound system, installing audio visual equipments and etc.
Such type of companies assists in the organization of high profile events, including
presentations, press conferences and product launches which necessitate
advanced technology and equipment.d) Incentive Travel House
Incentive Travel is a motivating tool used by companies to reward or stimulate
the employees of the organization.
Incentive Travel is a global management tool that uses an exceptional travel
experience to motivate and/or recognize participants for increased levels of
performance in support of organizational goals (SITE, 2006).
The specialized nature of the incentive sector has led to the growth of IncentiveTravel houses, as these agencies are generallyknown. (Rogers 2008, p 70)
These organizations create special incentive programs for companies to
accomplish their mission and motivate their employees.
e) Destination Management Companies
SITE defines a DMC as a local service organization that provides consulting
services, creative events and exemplary management of logistics based on an in-
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depth knowledge of the destination and the needs of the incentive and motivation
market.
DMCshave detailed knowledge and expertise of a specific destination, be this
city, an island or other discrete region, and sometimes even a whole country
(Rogers 2008, p 71). Their role include locating venues, providing delegates with
accommodation, arrange transportation and organize pre or post conference
programs, as well social programs for spouses.
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and put into the force. This helped to find out that questions are accurately
formulated and dont have a concealed meaning behind.
The addressed population was chosen to be business travelers who have been toBaku at least once. Therefore the vast majority of questionnaires were sent to the
business travelers via e-mail and the answers were analyzed with help of special
computerized statistics program.
Secondly, as previously collected data the statistical reports were used so as to
contribute to the development of the research. Furthermore, information taken
from media articles and relevant websites was quoted throughout the study.
Due to the low season and delimitations, sampling size for survey was 100 people
and most of them were distributed online.
3.3 Primary Data
3.3.1 Interviews with Professionals of the Industry
In depth interview is a way of asking questions which allows the interviewee to
have more control of the interview. Here the aim is to explore the interviewees
feelings about the issue being explored. (Social research methods)
To find out the current situation and the relevant up to date information, 3 industry
professionals have been requested to participate in the interviews. Among them,
there were representatives of Ministry of Tourism, C&B Managers of popular chain
and local hotels, who answered the questions with a great enthusiasm. It should
be noted that, the list of interviewees could be enlarged, however it occurred to be
a problematic issue due to the time pressure.
Since the interviewed people are experts of their field, the information they
provided was a great contribution to the progress of the research.
It should be mentioned that, the average duration of conducted interviews was
about 30 minutes and the responses to the questions were captured through note
taking.
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3.3.2 Questionnaire
A particular questionnaire was designed to distribute among respondents. To
assure the validity of the collected data the pilot survey was conducted in order
to ascertain the selection of right questions and the fact that they dont imply any
hidden meaning.
The content of questionnaire is designed so as to find out the main research
questions. Nonetheless, not all the issues were covered, but all necessary
questions were included to the list.
The main questions were regarding the planning phase to visit Azerbaijan, the
evaluation of onsite experience and the questions which are meant to find out the
post travel imagination of the tourist.
Moreover, some questions were asked to be answered on 5 scale evaluation,
which can be a good method to avoid neutral evaluation. The section where
respondents were asked to provide their suggestions to improve the quality of
delivered services in tourism field was also included to the survey.
3.4 Secondary Data
As the secondary data, the statistical report of the incoming tourists was taken
from the State Statistical Committee of Azerbaijan (AzStat), since it is the major
source of data relating to the overall business travelers including the conference
and meeting attendants. It will be a great contribution to find out what are the top
countries that business tourist come from, what the length of their stay is, which
type of the accommodation and transportation they use and etc.
Furthermore, brochures and promotional materials published by the Ministry of
Tourism and Culture were used throughout the study. It has also be mentioned
that, the previously conducted research with the purpose of exploration the attitude
of foreign travelers to the tourism in Azerbaijan was analyzed and added to the list
of the secondary data.
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All the secondary data are of high reliability, since they belong to the 2010 year
and also were collected by experts of this field.
3.4.1 Statistics on Business Tourism in Azerbaijan
Before passing examining the existing data, it is worth to note that, there is not any
specified statistics particularly on MICE tourism. That being the case, the only
source to depict the data on meeting industry, is to consider it as a sub segment of
business tourism. The following data were collected from State Statistical
Committee of Azerbaijan to undertake this research.
- Visitors origin
- Length of stay
- Accommodation
- Usage of transport
The yearbook Tourism in Azerbaijan which consists of data on number of
enterprises such as hotels, number of foreign citizens traveling to Azerbaijan by
countries, as well as number of nights spent in hotels and etc.
According to the yearbook, it can be seen that, there is a significant increase in the
number of tourists coming to Azerbaijan. This can be explained by the fact that,
availability of tourism information has been increased throughout these years.
There are certain countries from which people travel to Azerbaijan with different
tourism purposes. As indicated in below chart (chart 2), the regions which
generate the majority of tourist inflow to Azerbaijan are the neighboring countries -
Russian Federation and Georgia. This is due to the economical, social and cultural
interrelations between the countries. The next countries are Iran, Turkey and
others. The others, which constitute minor percentage, include United Kingdom,
Kazakhstan, USA, Germany, Uzbekistan, Turkmenistan and etc
Travelers by Countries of Residence
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Figure 1. Travelers by Countries of Residence Source: AzStat, Tourism Yearbook
2010
Correspondingly, these data proportions have not changed during the last 4 years
from 2007 to 2010. This leads to an implication that, there is a specific percentage
of people coming from particular regions each year.
From this chart, it can be observed that, even more than 50 % of travelers are from
miscellaneous countries and their proportion even doesnt reach 1 % as a separate
tourist generating region.
The purpose of the travelers visiting Baku varies from visitor to a visitor. From thegeneral observation, one can come to the point that, the most represented type of
inbound tourism is business tourism, which directly contributes to the economy of
the country. (see chart 3)
Dynamics of number persons arranged by purpose of trip
Figure 2, Dynamics of number persons arranged by purpose of trip Source: AzStat,
Tourism Yearbook 2010
Russia
17% Georgi
a
14%Iran
7 %
Turkey
4%
Ukrain
e
1%
Others
57%
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As a consequence of purpose of the trip, there exists a trend that, business tourists,
particularly, conference and meetings attendants stay less than leisure travelers.
The MICE tourists are business people who are short on time and travel specifically
to make business deal in a timely manner. That being the case, the average
duration of their stay is around 13 days. (Chart 4)
Structure of tourists arranged by duration of stay in 2010, per cent
Figure 3, Source: AzStat, Tourism Yearbook 2011
4 Results and Analysis
4.1 Theoretical Framework
To measure the satisfaction of the guests travelling to Azerbaijan, the phases of
tourism experience are analyzed separately. Different authors define the tourism
experience cycle in a different way. Killion (1992 after Clawson 1963) defines the
tourism experience as four stage tourism cycle, which are planning, travel to,
return travel and recollection.
On the other hand, Nickersons model of travel phases is comprised of five steps,
which are indicated in below table:
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.
Figure 4, The six travel experiences. Norma Nickerson (1996)
4.2 The Travel Experience
The travel experience is formed while a tourist passes through all elements of
the above illustrated travel phases cycle. After all these phases are passed, a
certain image of a country is formulated. Therefore, to obtain a positive image is
very important for a destination. Thus, destination managing organizations put
very much effort to sustain the positive image and keep the reputation of the
country in a very high level.
Once a person comes back home satisfied with overall travel experience, he or
she becomes a live promotion for the destination, i.e. gives a positive feedback,
recommend friends or colleagues and etc. This is the point where word of mouthbecomes a very effective marketing tool for a destination. Correspondingly, to
make the travel experience successful, memorable and profitable for tourists
visiting destination, the quality of delivered services should be assured and
maintained in a high level.
Anticipation
Planning
Travel to
Participation
Travel
back
Recollection
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In general, respondents have a very positive opinion about the image of
Azerbaijan. The majority of travelers added that, they enjoyed their trip to Baku.
This argument is also backed up by the chart 9.
4.2.2 Travel to place and back
These phases of travel are closely connected with transportation. According to the
results of the survey, 92 % of the travelers reach Baku via plane. In comparison
with this, the other means of transportation are less preferred by survey
participants.
The international carriers which provide flights to Baku are the followings:
- No frills carrier Air Baltic
- Turkish Airlines via Istanbul (more expensive)
- Austrian Airlines via Vienna
- Aeroflot via Moscow
- Emirates via Dubai
- British Airways nonstop connection (from England)
The general results obtained from questionnaire, demonstrate that, the meeting
attendants travel use organized (coached) tours when being in Baku.
The survey results show that, the respondents were not satisfied with the level of
transportation of services within Baku, when it comes to the availability of
information and possibility to find a destination place. Correspondingly, on the
scale of evaluation from 1 to 5, the current situation of transportation services was
evaluated as 2.5 points.
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4.2.3 Participation
This part of travel is the core phase of travel cycle in which attitudes and opinions
about the destination are formed, as a traveler experiences all the activities thathave been foreseen in the anticipation and planning phases. The other reason
why this phase is so important is that, after a tourist undergoes all phases, he or
she will have a certain impression and thoughts about the destination. It is the
phase that, that has a great impact on the travelers decision whether to come
back or not. Therefore quality of delivered services and all other related things
concerning the comfort of a MICE tourist becomes the priority. That being the
case, this part will be analyzed in detail compared to the other stages of travel
experience. Therefore, the issues such as accommodation, conference venues,
catering and other related services will be considered in this section.
Additionally, travelling habits of the meeting attendants (for ex: with whom they
travel) will be examined, since they may moderate other interrelated components
of the participation phase, such as accommodation options or accessibility of pre
or post conference tours and etc.
According to the results of expert interviews, the business travelers mostly travel
alone, because the events which they attend are scheduled for the whole duration
of the occasion. This fact is also backed up by the answers of the respondents,
saying the majority of them travel to meetings on their own. However, the second
large population of survey participants stated that they travel with groups.
4.2.3.1 Accommodation
Most of the time, the choice of accommodation is made in the planning phase oftravel. Usually the extent of the event is the main influencing factor when it comes
to accommodation preferences. According to the representative of the Ministry of
the Tourism and Culture, the reservation procedures are undertaken by
employees of the ministry, when a large scale event is organized. However, in
some small scale events, the participants are required to make selection of the
hotels on the basis of offers sent by the ministry. Furthermore, the payment
obligations also influence the choice of accommodation, according to the results of
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conducted interviews. When the accommodation expenses of event attendants are
covered by the government, the choice is usually made by employees of the
ministry.
Another principle for the selection of accommodation is the location, i.e. the
proximity of the conference venue to the hotel. Below, are mentioned five Baku
hotels which are mostly preferred by conference organizers.
Chart 2, Hotels accommodating meeting attendants.
4.2.3.2 Conference Venues
In general, there are not so many conference and exhibitions centers throughout
Baku. The majority of them are located in the city center. However, with regard to
the development of tourism, namely the business tourism, many efforts are put to
meet the requirements of high level and demanding business clientele. Therefore
a number of conference and business centers supplied with modern and up to
date technology are being built.
In order to promote Baku as the center of MICE industry in the region, a
specialized exhibition complex, Baku Expo Center was constructed on the way to
Baku Airport. It is the second biggest exhibition center in CIS region, after the one
built in Moscow. The main purpose of its construction was to attract the attention
of foreign companies from all over the world to Baku. Furthermore, with its
construction, it was planned to highlight the historical significance of Azerbaijan
Hotel Name Location # of Rooms # of Beds
Airport Hotel Baku Baku Airport 207 231
Qafqaz Point Hotel Yasamal region,
K.Kazimzade 118
93 120
Hyatt Regency Baku Izmir street 182 230
Park Inn Baku Azadlig Avenue 248 372
The Landmark Hotel Baku Nizami str, 90 A 100 100
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and the whole Caspian region as a trade and commercial center throughout the
centuries.
The most exemplary as well as the biggest hall to hold official events is theGulustan Palace. After the Contract of the Century was signed in the Gulustan
Palace in 1994, it gained a public status: all important state events are conducted
here. Inauguration of the President of the Republic of Azerbaijan was held namely
in Gulustan Palace. International summits, conferences, award ceremonies as well
as various cultural events are regularly hosted in the hall. The fact of hosting
events gives a special significance and scale to the Gulustan Palace.
Another multipurpose venue is sports and concert complex named after Haydar
Aliyev. This complex enjoys all necessary conditions to hold large scale
international events.
Additionally, Baku Business Center is also in the list of the most convenient and up
to date conference and exhibition centers of the capital. This three storey building
hosts several types of events beginning from small conferences to large scale
cocktail receptions.
It has to be added that, all these convention venues are located in close proximity
with the leading hotels of the city. The respondents were asked to evaluate the
convenience of conference and exhibition centers, so as to find the answer to the
main research question, i.e. identify the level of service quality of conference
venues in Baku.
Convenience of Convention Centers
Figure 6, Convenience of convention centers
Excelle
ntVery
good
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4.2.3.3 Catering Services
To find out the level and quality of service in the restaurants and cafes of the city,
the survey participants were asked to evaluate the level of service and quality of
food. It was found out that although the majority of respondents were satisfied with
the quality of food served in restaurants and cafes, they are unhappy with the level
of delivered service. Moreover, there were complaints about the language
knowledge of restaurant staff.
Correspondingly, the overall assessment of restaurant service throughout the
capital was 3, on the scale of evaluation from 1 to five.
4.2.4 Recollection
The final element of travel cycle is the recollection phase. If the overall experience
is successful, it is probable that a MICE delegate could become a future tourist for
the country. Once the expectations of a traveler are met, he or she recommends
that destination to friends or colleagues.
The survey results explain that, meeting attendants have a positive image about
Azerbaijan, namely Baku, as proved by the chart 10.
Image of Azerbaijan
Figure 7, Image of Azerbaijan.
The majority of respondents stated that they will come back to Baku again with
great pleasure.
010
20
30
40
50
60
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Likewise, there is also lack of PCOs (Professional Conference Organizers) and
conference organizing companies specialized in the arrangement of meetings.
Therefore, some insufficiencies come out in the process conference organization.
The survey results show that, there are complaints about the avai labi l i ty of
tour is t in form at ion throughout the city. These include lack of maps, signs and
transportation information in Baku.
One of outspoken issues as the weakness is compl ica ted v isa procedures for
the travelers from western countries. Before, the visa was issued on arrival, and
now it is not the case for every tourist stepping borders of Azerbaijan. Travelers
from non CIS countries have to get a LOI (Letter of Invitation) from the Ministry of
International Affairs, which is time consuming procedure. However, the travelers
from countries which are close to Azerbaijan, as Turkey dont face these
difficulties.
5.3 Opportunities
The great opportunity for Baku to become one of the leading meet ing
dest inat ionsis the increase of promotion. If promoted well, the possibility to reach
this level is very high, based on the strengths mentioned above.
Likewise, there is an opportunity to open a Convent ion and Vis ito rs B ureau,
which will be responsible for increasing product awareness of potential visitors
and deal with the promotion of the meeting industry in Baku.
Another opportunity is to enhance the numb er of d i rect f l igh ts to Baku and
decrease ticket fares. Thus, the efficiency of transportation services can be raised
and more and more tourists will be attracted to Baku.
Subsequently, more in format ion about tour ism can be placed in differentchannels, so as to take away the insufficiencies regarding the tourist information
availability.
The next opportunity is to decrease the level of prices and promote PCOs, to
assure the attention to detail of conference organization.
After that, aside with Baku, other cit ies o f Azerbai janshould also be developed
as a meetings and convention center such as Ganja (the 2 nd biggest city after
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Baku), Nakhchivan and etc. Consequently, new hotels and offices are constructed
in these cities.
Moreover, the level of education in this sphere should be increased, by opening
the event management facultyat Azerbaijan Tourism Institute. This will directly
contribute to the quality of service in the meetings industry, as there will be
educated specialists in this field.
5.4 Threats
As said by industry professional, the development of te lecon ferencingcan be a
potential threat for the meeting industry not only in Baku, but also globally. Thus,
virtual meetings become popular with the advancement of technology. The
professionals explain that, the teleconferencing is used to replace face to face
meetings and hence the aim is to reduce costs.
In conference and meetings industry, there is a probability of having non
repeat ing customers, since most of conference attendants dont make choice of
the destination on their own. This process is done by the conference organizers
and therefore to grab their attention the uniqueness of Baku as meeting
destination should be marketed worldwide.
Another threat can be pol i t ica l instabi l i ty, in terms of relations with the
neighboring country. This might have a negative influence on the image of the
country as a tourist destination and eventually the attention and interest of foreign
investors can be distracted from the country.
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Furthermore, the number of carriers which provide direct flights to Baku should be
increased in order to improve the level of transportation services to Baku.
Additionally, the industry would benefit, if the government gave consideration to
the visa policy for EU citizens.
Also, the establishment of Convention and Visitors Bureau will be advantageous
promotional strategy, as more information will be available about Baku as meeting
destination.
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LIST OF REFERENCES
1. Berendien Lubbe , Tourist Distribution: Managing the Travel
Intermediary
2. Bilalov, B The business tourism in Azerbaijan Republic (2005) ,
Rebirth XXI century
3. Deborah Peters and Barry Jones, Size and Impact of Meetings
Industry, 1996
4. Gayle Jennings, Norma Polovitz Nickerson2006, Quality tourism
experiences5. Rodgers, T, Convention and Conferences, second edition.
6. State Statistical Committee of Azerbaijan, Tourism Yearbook 2010
7. The Travel & Tourism Competitiveness Report 2008 2008 World
Economic Forum
8. UNWTO, Tourism Highlights 2008 edition
9. William M..K.. Trochim,, Research Methods Knowledge Base10. http://www.seebtm.com/en/the-history-and-development-of-
meetings-industry/
11. www.themeetingsindustry.org
http://www.seebtm.com/en/the-history-and-development-of-meetings-industry/http://www.seebtm.com/en/the-history-and-development-of-meetings-industry/http://www.themeetingsindustry.org/http://www.themeetingsindustry.org/http://www.seebtm.com/en/the-history-and-development-of-meetings-industry/http://www.seebtm.com/en/the-history-and-development-of-meetings-industry/ -
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Questionnaire to Meeting/Exhibition Attendants in BakuThis research is conducted by the student of ATI (Azerbaijan Tourism Institute) in order to
evaluate current situation of meeting industry in Baku. Your contribution to the study ishighly important, as your attitude will allow investigating correctly the situation of theindustry in Baku and will contribute to its development.If you would like to obtain a copy of the study, please indicate your e-mail address below:________________________________________________________________________________________________________________________________________________
Please, choose one or multiple answers by marking a box, in questions whereoptions are given. There are questions have an evaluation scale with points from 1to 5, where you may either circle or cross the chosen number.
1. ____________________________________________________________
2. Personal InformationSex
MaleFemale
Age_____________________________________________________________3. Who you travel with
alonewith spousewith childrenwith group
with friends4. Where you have collected information about Azerbaijan from
internetexhibitionmediafriends or colleaguesdid not know anything
5. How did you reach Azerbaijan? byplanebuscar
trainship6. During your trip you travel by
own carpublic transportcar rentaltaxicoach (organized tour)
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7. Please, evaluate from 1 to 5: Very bad 1 2 3 4 5 Verygood
Transportation to Azerbaijan:
Agenda
The level of service
Transportation within Baku:
opportunity to find a place
Information about transport
Accommodation
Availability of tourist information
Knowledge of foreign languages
Level of service in restaurants/cafes
Quality of food in restaurants/cafes
7. How many conferences have you attended in Azerbaijan?0 1 2 3 4 or more
8. For you the image of Azerbaijan is?Very positive positive good satisfactory fair
9. Would you like to visit Azerbaijan yet again?
yes no10. Will you recommend Baku as a good meeting destination to your friends/colleagues?
yes no
Which country are you from?
______________________________________________________________________________________
_____________________________________________________________________________________
Your opinion or/and suggestions concerning tourism in Azerbaijan are highly appreciated
___________________________________________________________________________________
___________________________________________________________________________________
___________________________________________________________________________________
___________________________________________________________________________________
___________________________________________________________________________________
THANK YOU FOR COOPERATION!
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