SITE Global CEO Didier Scaillet on the impact of Covid-19 on the incentives business
The first week of August marked six months since the World Health Organisation (WHO) declared Covid-19 a Public Health Emergency of International Concern. At that time, humanity had fewer than 100 cases in China and no deaths. A lifetime ago, it now seems. But these strange times have also brought valuable lessons. Here are seven things I think we might have learned. 1. The global village This pandemic has shown us how inter-connected we are. And not only in terms of the virus spread but also in terms of common answers and connected economies. There is no question that we are dealing with a hyper-contagious virus. The question is: would it have spread as rapidly 20 years ago? The answer is clearly, no. A classic example of where the private sector has outgrown the public sector: the democratisation and growth of travel, fuelled by the growth of low-cost airlines, completely outgrew the crisis management and emergency preparedness protocols of the travel Industry. This is a re-set button and we need to ask ourselves how sustainable the previous model truly was. 2. The power of human connections Unprecedented crisis, unprecedented answer. At SITE, we’ve seen an amazing sense of community, solidarity, compassion and collegiality. Here are some numbers: over 200 webinars, gathering 23,000 registrants in 20 weeks… Unprecedented, you said? This crisis has been the catalyst for an entire industry to realise and demonstrate the power of human connections. We took it for granted that we could connect freely, hop on a plane, see each other, solve issues in a room, negotiate deals face-to-face…What a lesson this is! It is our ability to get together that defines us and our ability to advance society and humanity. It was true 1.2m years ago (first human settlements in the Gediz River in Western Turkey) and it is true today 3. The new norm Our industry is based on travel experiences, and these two words are key to our recovery. Travel: consumer confidence is everything. It is absolutely clear that all we do will be irrelevant if consumers, individuals, our own loved ones are not comfortable that they can travel in a safe environment. Regaining that confidence through demonstrating that we have collectively learnt from this crisis is quintessential. Experiences: even when we will travel again, it will be different. Sanitisation measures, social distancing, airport and aeroplane protocols, meeting room capacity to name but a few things. The key paradigm shift is that travel will be premium again. And this is certainly good news for incentive travel: the value of motivating, rewarding top performers by extraordinary travel experiences will be higher than ever. And Turkey is leading the way as it does become one of the most accessible places on Earth for foreign visitors (including Americans) while implementing some rigorous protocols. Another profound impact of this crisis will be on Destination Marketing Organisations (DMOs). The question here is: how do we measure success? In late 2019/early 2020, my conversation with policy-makers, mayors and destinations revolved around over-tourism. Here, as well, is the need for a New Norm; is success measured by number of visitors or by contribution to the local economy? Again, this is an opportunity for the incentive travel industry as it has the highest per capita spend within business events. 4. We need to revise our business model Many of our professionals have been devastated by this unique crisis. The entire supply chain has been impacted: from agencies to in-coming operators, to destinations, to end service providers. So, there is an absolute need to look at alternative business models: from cash flow management/deposit to force majeure and cancellation; from budget allocation for risk and crisis management to insurance policies, from return to travel to hybrid incentives. This crisis will give birth to profound changes in how we operate. 5. Co-opetition has a whole new meaning Always look at the bright side of life (yes, I confirm that I am huge fan of Monty Python). And here’s the bright side from this pandemic: despite all of our differences, we’ve ended up coming together. Not at first, clearly. Many were still believing that we could compete and win market shares in this environment. So not true. I have seen private entrepreneurs share information like never before, fierce competitors rally around regional and national initiatives, an entire industry mobilise itself to survive. And the associations have certainly been very pro-active in that space, too: Events Industry Council, Meeting Means Business Coalition (MMBC), Joint Meetings Industry Council, have all been catalysts to bring the industry together, despite the competing nature of their memberships. 6. Crisis as an accelerator of trends Back in 2018 (sounds like the last century), we identified these core trends for our incentive travel industry in our Bangkok Manifesto: Sustainability & Corporate Social Responsibility, Incentive Travel as a Builder of Corporate Culture, Incentive Travel as an Economic Driver, Incentive Travel as an Opportunity for Second and Third Tier Destinations, etc. These core trends were confirmed in Vancouver and, as this was pre-Covid-19, I’m often asked if these are still relevant in this environment. My answer is clearly, Yes. Sustainability, Corporate Culture and Economic Impact remain more important than ever and will be even more prominent in the Industry recovery. One additional trend that will clearly be accelerated is the prominence of digital/hybrid events. The opportunity to mobilise wide audiences through digital channels has clearly been proven and business models will need to integrate that component into how we design and plan incentives. 7. Conventional wisdom, cloud cuckooland and intuitive leadership As one of my favourite mentors always says: the prime responsibility of a leader is to confront the brutal facts. The dominant school of thought (I was told) was that a leader needs to be data-driven. But what happens when the data change by the day (if not by the hour)? The new reality is that we need, as leaders, to integrate the new dimension of connected leadership. Data have been, are and will remain crucial to how we make decisions. But, clearly, sharing the data and confronting viewpoints will be essential. I have seen many people not willing to confront the reality, wanting to diminish the impact of a hyper-virus, putting lives at jeopardy in the name of economic impact, etc. We need to build better mechanisms to evaluate, monitor and confront the feedback that we receive. At one point in time, humanity will have to accept a degree of health versus economic risk: we will only find that tipping point by connected leadership and exchange. This is a key take-away from this crisis. And, finally, this TOO shall pass. Resilience and agility are two characteristics of our association… and we will continue to live by them. Stay Safe, Stay Strong, Stay Confident.
