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Click Here to View Comparison of DMC and Meeting Planners Views

In This Section

3.1. Focus Group 

3.1.1. General Issues 

3.1.2. Major Competitors of DMCs 

3.1.3. Strengths 

3.1.4. Weaknesses 

3.1.5. Opportunities 

3.1.6. Threats 

3.2. Survey Findings 

3.2.1. Sample Characteristics 

3.2.2. Business Characteristics 

3.2.3. Collaboration with DMCs 

3.2.4. Additional MP Organization Characteristics 

3.3. SWOT Analysis

3.3.1. Strengths Rated 

3.3.2. Weaknesses Rated 

3.3.3. Opportunities Rated 

3.3.4. Threats Rated 

 3.1. Focus Group 

To achieve high comparability, we followed the same discussion procedure for the MP focus group as we did with the DMC group. The MP focus group consisted of all female participants and their age varied between 20s and 70s. Of them, 75% completed undergraduate studies and another 15% finished a Master’s degree. On average, event planners had 11 years of work experience in the field. As detailed below in this section, the results of this MP focus group are remarkably consistent with those of the DMC focus group, providing highly converging findings. Also, much of the information provided by the two groups are somewhat repetitive, again with key issues converging to the same point. 

 3.1.1. General Issues 

First, we asked MP professionals to talk freely about current situations of DMCs from their perspective. They agreed that DMCs had small planning teams and that DMCs help MPs achieve business goals. MPs perceived DMCs as an asset to the industry for assisting MPs to keep up with the most current destination information. Due to the industry structure, MPs viewed DMCs as industry partners that co-create values for clients. Moreover, MPs agreed that with DMCs’ help MPs could design more creative events to ultimately result in more satisfied clients. When an event takes place, DMCs are the ones who create the first and the last impressions of the event and, hence, DMC services are invaluable to the successful events and to the meeting planning industry. Especially, if the event venue is international, DMCs’ roles become even more critical. However, MPs seemed to lack knowledge about DMC services and this often caused MPs to deal with the clients who did not see the values of hiring DMCs in executing events. 

 3.1.2. Major Competitors of DMCs 

MP professionals similarly identified Internet (Google), local CVBs (they have their own department), other DMCs, MPs, and vendors (for pricing in particular) including local hotels (having their own department to provide services similar to those of DMCs’). These competitors are nearly identical to those identified by DMC professionals in the other focus group. 

3.1.3. Strengths Rated 

From their own perspective, MPs agreed on a strength of DMCs that DMCs provide one-stop shopping solution for MPs. Equipped with local expertise (local knowledge and relationships with local vendors), DMCs can provide more creative event ideas at the destination and can offer significant buying power for MPs. Another major strength quoted by MPs was that DMCs could manage a wide range of possible risks at the destination (e.g., quality assurance, legislative issues, etc.) and, if problems arise, resolve them quickly. DMCs also can provide site inspection services for MPs and add more values to MPs’ events. 

 3.1.4. Weaknesses Rated 

As weaknesses of DMCs, MPs mentioned added costs to their clients for having DMC services, which also makes it difficult for MPs to convince their clients about hiring DMCs for the execution of the event. Clients of MPs generally view DMC services as unnecessary additional costs to them and, hence, MPs need to explain the values of DMC services to the clients every time. The client’s lack of knowledge about the role of DMC services, therefore, is perceived as one of the major weaknesses of DMCs. MPs also pointed out that if DMCs lacked creativity as they often rely on the same vendors repeatedly over time for their business operations. Moreover, MPs observed that many DMCs were attempting to create larger networks and such network operations could standardize their services undermining their business creativity. Finally, meetings and events do not always require DMC services, which gives a limitation to the marketability of DMC services, another weakness observed by MPs. 

3.1.5. Opportunities Rated 

 MP professionals cited advances in technology as an excellent opportunity for the DMC business. DMCs could actively utilize the new technology and demonstrate their technology ability and expertise to MPs for more business opportunities. A good web presence and use of social media platforms could increase DMCs’ exposure to the public, allowing MPs to reach out to them easier. MPs believed that some of the services DMCs provided locally (e.g., transportation and meet-and-greet services) could not be replaced; therefore, DMCs will continue having business opportunities by building on their uniqueness in services. Over the years, MPs have witnessed that DMCs have been growing larger and banding together to survive. Although MPs worried that such alliances might standardize DMCs’ offerings and, therefore, undermine the creativity of individual DMCs, they could also understand such a trend as a case that smaller DMCs were trying to get more business opportunities through the larger consortiums. Additionally, if DMCs and the industry could educate people, especially the clients of MPs, to appreciate the critical values of DMC services, MPs could see more business growth for DMCs. Finally, MPs had seen an increased number of DMCs attempting to offer office demonstrations about their services (e.g., sample programs and well-presented websites) and express their creativities to MPs. These recent moves by DMCs are viewed positive as MPs could see them using DMCs more in the future. 

 3.1.6. Threats Rated 

Seen from the perspective of MPs, one of the greatest threats that DMCs might encounter soon is the competitive market situation where all businesses would be trying to seek extra revenue sources that happen to overlap with DMCs’ major service offerings (e.g., hotels launching their own DMC services). Technology development allowed MPs to be able to find destination vendor information easily, downscaling what DMCs used to monopolize. This makes MPs to contact vendors directly and cut into prices. This happens more frequently when MPs do not know much about DMCs’ capabilities and services. MPs also mentioned that CVBs providing site inspection services and unbiased destination information could threat the future of DMCs. MPs asserted that DMCs were quite fragile to economic crises. However, the most possible threat that could hurt the DMC business was the DMC services being repeated losing creativities over time due to reliance on the same vendors. Finally, MPs mentioned that DMCs should manage their social media images and online reviews more proactively. Otherwise, technology development could counteract the DMC business. 

 3.2. Survey Findings 

 3.2.1. Sample Characteristics 

We collected data from a sample of 131 MPs in the nationwide survey using the MP database we had. The sample was slightly skewed toward females (59%); the majority of the respondents completed college education (63%), followed by about 20% holding a post graduate degree. The average age was 51.5 years (median = 50). 

3.2.2. Business Characteristics 

The majority (87%) of the MP business represented in this sample had been in operations for more than 10 years. Only a small fraction (2.3%) of them started the business in the past two years. About 41% of the MP business were hiring more than 50 employees, while 30% were hiring fewer than 10 employees; about 8% were self-employed conducting the business by self. The majority (51%) of the represented MP businesses were categorized into incentive houses such as ITA, BCD, Martiz, etc., followed by 23% in corporate meeting planning. Approximately two third of the MP organizations were conducting both incentive planning and business meetings; those focused on incentive planning only were 21%, while business meetings were the major focus for about 11% of the MP organizations. About 40% of the MP organizations were conducting more than 250 events in the previous 12 months, while about 36% were handling 50 or fewer events in the same period. The total annual revenue in FY2013 was more than $10 million for about 44% of the MP organizations, followed by about 10% reporting an annual revenue of $5.1 to $10 million. In contrast, 5% were making less than $100,000 in the same FY2013 (see Figure 3.2). 

3.2.3. Collaboration with DMCs 

At least nine out of 10 MPs have collaborated with DMCs before. As shown in Figure 3.3, while 35% of MPs were encouraging collaboration with DMCs, nearly two thirds (65%) of them had no particular preference for either working with DMCs or not. Interestingly, though, almost no MPs were discouraging collaboration with DMCs. The majority (85%) of MPs viewed DMCs as a potential business partner, while only a small fraction (4%) viewed them as competitors. Nearly 44% of MPs collaborated with more than 10 DMCs in the past three years, but about an equal number of MPs had collaborated with six or fewer DMCs in the same period. About 57% of MPs were collaborating with DMCs in the past 12 months. 

 3.2.4. Additional MP Organization Characteristics 

As we provided analyses into additional DMC business characteristics earlier, we attempted to relate some MP organizational characteristics each other to see whether there were some noticeable patterns. Table 3.1 reals that both incentive houses and corporate MPs tend to be large often hiring more than 50 employees; in contrast, independent planners tend to be smaller with the majority hiring fewer than 10 employees.

 Similar to the employment size above, both incentive houses and corporate MPs tended to handle a larger number of events perhaps because of their large firm size and manpower. On the contrary, independent planners tended to handle a smaller number of events, as reflected in Table 3.2. 

 Table 3.3 shows a pattern that coincides with those in Tables 3.1 and 3.2 above. Perhaps due to the larger firm size and business volume, both incentive houses and corporate MP organizations tended to generate significantly larger revenues, compared to independent planners. 


3.3. SWOT Analysis 

We asked MPs to rate SWOT of DMCs. Although we followed the same procedure as we did in the DMC survey, these SWOT evaluations by MPs could be revealing from the perspectives of MPs as (1) a potential client, (2) a business partner, and (3) a competitor. The SWOT factors used for MPs are slightly different from the ones used for DMCs due to the discrepancies in the lists of the factors generated separately by the DMC and MP focus groups, respectively. 

3.3.1. Strengths Rated 

For DMCs’ strengths, MPs rated most highly DMCs’ in-depth local knowledge, expertise and networks with local vendors. The second highest rating was for DMCs’ services to help MPs save time for local arrangements. Factors like DMCs’ handling of local legislative issues and DMCs’ assurance of event quality and client satisfaction received relatively lower ratings as DMCs’ strengths (Figure 3.4). 

 3.3.2. Weaknesses Rated 

The MPs’ ratings for the weakness factors of DMCs tended to be generally lower than those for the strengths, with the mean scores ranged from 1.84 to 3.71. The weakest rating went to the fact that many DMC services could be performed by MPs themselves under budget constraints, followed by the similar fact that many DMC services overlapped with what MPs provided. Although the MP focus group listed as the weaknesses of DMCs such factors as MPs’ lack of understanding about the value of DMCs’ role, MPs’ difficulty to convince clients about the role of DMCs, and DMCs’ little marketing efforts, MPs tended to disagree that these were the weaknesses of DMCs (Figure 3.5). 

3.3.3. Opportunities Rated 

Of the nice opportunities for the DMC business presented, MPs rated most positively DMCs’ growing networks across the nation and DMCs’ potential to offer more creative programs. Somewhat disagreed opportunities for DMCs were ease of elimination of some DMC services and additional education for MPs about DMC service provisions. This might be due to the MP survey participants’ extensive industry experience (Figure 3.6). 

3.3.4. Threats Rated 

MPs rated eight potential threats to the DMC business. They agreed most with the fact that DMC services are not necessary for some events. They also tended to agree that DMCs did not exist in smaller cities and that CVBs could provide unbiased destination information similar to what DMCs used to provide. In contrast, MPs tended to disagree with such threats for DMCs that most DMCs were struggling to survive and that MPs often took advantage of DMCs without eventually contracting for DMC services (Figure 3.7). 

 

Click Here to View the Executive Summary and Focus Groups
Click Here to View Perspectives of DMCs
Click Here to View Perspectives of Meeting Planners
Click Here to View Comparison of DMC and Meeting Planners Views