A Perspective on the Size and Maturity of the East African Meetings, Events and Conference Industry

Transcription

1 A Perspective on the Size and Maturity of the East African Meetings, Events and Conference Industry April 2017 Allan Wantenaar Gillian Saunders for

2 Contents Objective and Methodology Understanding the East African Events, Conference, Meetings and Exhibitions Market SA Industry Interview Feedback on the Potential for B2B Event in East Africa East Africa Industry Interview Feedback on the Potential for B2B Event in East Africa SWOT Analysis of the East African Events, Conference and Meetings Landscape Conclusions

3 Objective and Methodology Background: Destinations Covered: East Africa - Kenya, Tanzania, Uganda, Ethiopia, Rwanda Two Key Aspects of the Study: Insight and understanding in relation to the East African Events, Conference and Meetings industry; and An understanding of the likelihood of the South African Events, Conference and Meetings industry supporting and participating in the event.

4 Objective and Methodology Methodology: Research Tools Interviews with key venues in East Africa Understand their interest in participating Find their buyers Interview key buyers in East Africa Investigate the supply of venues and planned new venues in the region Interview associations to further gain an understanding of the buyer landscape in Africa. Interview national, area and destination marketing organisations In South Africa: Interview a sample of possible exhibitors and buyers from Meetings Africa and SAACI, AXXO and EXSA membership lists.

5 Objective and Methodology Methodology: Interviews Over 90 industry surveys and interviews conducted 5 associations 29 venues 25 product / service suppliers 17 PCOs and Event Management Companies 2 DMCs 11 other industry experts

6 Understanding the East African Events, Conference, Meetings and Exhibitions Market Aspects of the East African market that influence / drive the events industry: Economic growth outlook Risk indicators / rankings Tourism Market overview Growth potential Business tourism market Overview of the hotel and venue supply Current supply quality, size and standard Future development pipeline

7 Understanding the East African Events, Conference, Meetings and Exhibitions Market Source: Adapted from Centre for the Promotion of Imports Europe, 2016

8 Understanding the East African Events, Conference, Meetings and Exhibitions Market The Value of the Events, Conference, Meetings and Exhibitions Industry: Stimulating the trade, investment, business, relationships and the tourism economy; Lead to the developing of better tourism infrastructure; Increasing tourism expenditure, business travelers generally spend more money than leisure travelers, in less time; Converting Meetings, Events and Conference travelers into leisure travelers. Business travelers can extend their stay, can be accompanied by their partner or can return with their family or friends; Hosting more events of this nature grows and develops professionalism within the industry towards maturity.

9 Understanding the East African Events, Conference, Meetings and Exhibitions Market Economic Performance and General Risk Indicators - GDP South Africa: $ billion (Ranked 3rd in Africa) projected growth 2017: 0.8% Kenya: $63.1 billion (Ranked 8th in Africa) projected growth 2017: 6.1% Ethiopia: $63 billion (Ranked 9th in Africa) projected growth 2017: 7.5% Tanzania: $46.2 billion (Ranked 10th in Africa) projected growth 2017: 7.2% Uganda: $24.69 billion (Ranked 17th in Africa) projected growth 2017: 5.5% Rwanda: $8.5 billion (Ranked 33rd in Africa) projected growth 2017: 6%

10 Understanding the East African Events, Conference, Meetings and Exhibitions Market

11 Understanding the East African Events, Conference, Meetings and Exhibitions Market Foreign Tourist Arrivals South Africa: 8,9 million (Ranked 31 st in world) growth 2015: -6.8% Kenya: 1.1 million (Ranked 71 st in world) growth 2015: -11.7% Ethiopia: 850,000 (Ranked 74 th in world) growth 2015: 10.4% Tanzania: 1.11 million in 2014 (Ranked 77 th in world) growth 2015: 4.7% Uganda: 1.27 million in 2014 (Ranked 112 th in world) growth 2015: 4.9% Rwanda: 926,000 in 2014 (Ranked 147 th in world) growth 2015: 7.2%

12 Understanding the East African Events, Conference, Meetings and Exhibitions Market

13 Understanding the East African Events, Conference, Meetings and Exhibitions Market

14 Understanding the East African Events, Conference, Meetings and Exhibitions Market Globally, ICCA has a membership database of members classified as DMCs, Meeting Support, Meetings Management and Venues. Of this, 38 members (3,5%) are registered in Africa. Rwanda: 4 Tanzania: 3 Ethiopia: 3 Kenya: 4 South Africa: 23 Uganda: N/A No dedicated events industry associations in any county in East Africa 5 dedicated associations in South Africa

15 South African Industry Interview Feedback on the Potential of Hosting B2B Event in East Africa SA Market: Interest in Attending / Participating 40% 35% 35% n=54 30% 28% 25% 20% 22% 19% 19% 24% 15% 10% 5% 4% 4% 0% My primary interest would be to attend as an exhibitor 0% My primary interest would be to attend as a buyer My primary interest would be to attend as a visitor Not Sure if I would Attend Likely to attend Hhighly likely to Attend

16 South African Industry Interview Feedback on the Potential of Hosting B2B Event in East Africa SA Market: Preferred Style "Depends on the type of business but I think both would be nice." Some buyers want to see product, whilst others you want to engage in one-on-one discussions." An Exhibiton format; 67% A Tabletop format; 33% "Looking more at the quality of events and whether we are able to connect and communicate with the exhibitor" "Would like to have a conference to introduce the event and participants and then move on to the Tabletop setting to engage with the participants. " n=42

17 South African Industry Interview Feedback on the Potential of Hosting B2B Event in East Africa SA Market: Preferred Destination Destination Preference (1-lowest 10-highest) Ranking Kenya - Nairobi Kenya - Mombasa Tanzania - Dar es Salaam Tanzania - Zanzibar Rwanda - Kigali Uganda - Kampala Ethiopia - Addis Ababa n=40

18 South African Industry Interview Feedback on the Potential of Hosting B2B Event in East Africa SA Market: Events Hosted in Africa Events in Africa Events in East Africa No; 35% Yes; 65% No; 39% Yes; 61% n=51 n=33

19 South African Industry Interview Feedback on the Potential of Hosting B2B Event in East Africa Current Level of Business in East Africa (supply of goods and services to Events Industry): Two 3rds of respondents (33) host events, meetings and conferences on the African continent (outside of South Africa) Of these, two thirds (20) host events, meetings and conferences in East Africa The number of events hosted or products / services provided differ significantly between respondents: Average varies between: 1-4 per annum (most) 5-8 per annum (some) per annum (outlier cases) For east Africa, this number is lower Between 1-2 per annum on average Mostly in Kenya

20 South African Industry Interview Feedback on the Potential of Hosting B2B Event in East Africa Reasons for not being interested in attending Event in East Africa: Cost is a deterrent; Lack of mature industry in East Africa; Limited functional associations; Infrastructure still lacking in many countries; Industry professionalism not up-to-scratch; Logistical issues in the destination; High costs of products and services - thus cannot compete on price Local demand is strong, thus focusing on SA Established international B2B events are better and are more beneficial Wait and see approach

21 East Africa Industry Interview Feedback on the Potential for B2B Event in East Africa East Africa Market Perspective: Interest in attending B2B Event in East Africa Majority of respondents rarely attend B2B shows internationally and only on occasion in Africa Most common reasons cited include: the cost associated with travel. Venues are more prone to attending B2B events than PCOs and event suppliers. Venues, PCOs and event suppliers from Kenya and Tanzania have a higher propensity to attend B2B shows than Rwandans, Ugandans and Ethiopians. The most popular B2B events that the East African market attends are mainly general Tourism shows (of those who do attend B2B shows): IMEX (Germany) ATM Dubai We Are Africa WTM London INDABA ILTM

22 East Africa Industry Interview Feedback on the Potential for B2B Event in East Africa Out of 25 interviews 48% indicated that they would consider attending 16% indicated that they would definitely attend such an event. The majority of respondents showing interest are from Kenya and Tanzania. A quality event with and extensive range and mix of exhibitors would attract The cost of attending is a critical consideration (travel and exhibition cost) Most respondents preferred a tabletop format due to cost "These events tend to have mostly venues exhibiting / attending we know most of them and probably have some kind of relationship with them. These events need more diversity in terms of who attends, especially in East Africa.

23 East Africa Industry Interview Feedback on the Potential for B2B Event in East Africa Feedback from East Africa Industry Experts, Associations, etc. There are already MICE exhibitions in East (Ethiopia) and West Africa not clear whether they are successful Enormous potential exists but business events arena is still very young The local tourism industry is starting to embrace business events as a sector after primarily focussing on the leisure tourism sector gradual process as it requires a lot of awareness creation, market, branding and essentially an entirely new strategy to really grow the events industry. Hotels and event venues are starting to reposition themselves in order to capture this new revenue stream new hotel brands bringing in a lot of expertise from elsewhere in the world contributes to the education and up-skilling of the industry

24 East Africa Industry Interview Feedback on the Potential for B2B Event in East Africa Feedback from East Africa Industry Experts, Associations, etc. Most events that take place in hotels are local events, few international events are hosted in East Africa due to various reasons, including connectivity, the cost of travel, VISAs, the perception of safety, etc. Tourism boards are very keen to support the events industry. However, many lack funds and resources to support it. Role-players need to come together and start cooperating to help grow the events industry including airlines, hotels, tourism boards, associations, etc. Air connectivity is improving airlines are expanding their networks. The long-term goal of most countries is to grow the events industry, but it is not a short term priority.

25 East Africa Industry Interview Feedback on the Potential for B2B Event in East Africa Feedback from East Africa Industry: Needs of the East African Market Hosted buyers programmes are extremely important in bridging the cost gap Support for hosted buyers in terms of travel and attendance, as well as pre-and-post tours all contribute to likely attendance. Rotation most respondents will likely attend a B2B event if it took place in their country the likelihood of attendance drops considerably once travel is involved. There is generally a low level of understanding what a B2B event is and its benefits Thus marketing, awareness of, and knowledge sharing about the event becomes crucial in soliciting interest in the event.

26 East Africa Industry Interview Feedback on the Potential for B2B Event in East Africa Feedback from East Africa Industry: Needs of the East African Market Knowledge sharing education in market trends, the performance of the industry, thought leadership, etc. is very important and is expected to be a key driver of attendance. lack of interest in attending B2B event often associated with a lack of understanding of the industry or certain markets. also speaks to the general lack of functional and pro-active associations (and convention bureaus) help the local industry navigate markets and share knowledge.

27 East Africa Industry Interview Feedback on the Potential for B2B Event in East Africa Feedback from East Africa Industry: Needs of the East African Market Procurement of event suppliers and product is still a very closed process with a lot of bureaucracy involved. Many NGOs, Private Sector companies and Government clients appoint service providers through a tender or procurement process, smaller supplier cannot compete on this level attending a B2B event would not really help them sell directly to clients as buyers go through a bureaucratic procurement process. The main channel of procurement (from the point of view of corporates, NGOs and Government) is direct with a limited amount through PCOs Limited number of PCOs.

28 SWOT Analysis of the East African Events, Conference and Meetings Landscape

29 Conclusions Summary on Size of Industry in East Africa: One proxy indicator is the number of venues as a proportion of SA venues 5 East African countries - around 460 venues exist Benchmarking to South Africa, this amounts to 23% some may not be of high standard utilisation levels are often low ICCA membership East Africa 60% of SA membership combined GDP of East Africa 66% of SA GDP Number of events calculations range from 3% - 7.5% of SA industry

30 Conclusions Some attempts at a MICE B2B event has been undertaken in this market Lack of awareness and knowledge of B2B events East Africa is expensive (travel and stay) East Africa is 5 countries not a contiguous market like South Africa The industry is still quite small and dominated by local in-country activity Some of the key drivers towards maturity include: More PCOs needs to be established Proper and functional and organised event industry associations Political/Destination commitment and clear tourism strategies to grow the events industry and attract business tourism Logistical ease of access and connectivity Structural change of industry Monitoring of industry and knowledge sharing (collaboration)

31 Conclusions Hotel development and political will to promote tourism is driving momentum South Africa is only reaching a sustainable level of maturity now East Africa is at least 5 years away (but maturing at a rapid pace to catch-up) East Africa has the advantage of foresight can learn from what is happening in this space Some progress has been made by trailblazers "East Africa is where South Africa was years ago. However, East Africa will most likely catch-up in the next 5-10 years judging by the pace at which things are improving.

32 Questions?