For many companies, events such as conventions and exhibitions can be a more cost-effective form of advertising and getting to know their customers than traditional marketing. Large-scale and face-to-face approaches often become successful marketing events, which can garner clients and sales, generating revenue in addition to the obvious opportunities for advertising the company and its products. Essentially, meetings, incentives, conventions and exhibitions (MICE) are a growing part of the tourism industry and are gaining serious traction with corporates. This has fostered a broader need for suitable locations that can accommodate MICE events on a small and large scale, for various companies with different needs.
The Russian city of Sochi, as a growing tourist location, has become a popular base for international events, both for marketing products and corporate seminars. Following the Winter Olympics, its wide range of facilities are being put to good use and event planning has become one of the city’s specialties. MICE has great potential for development and growth as a key sector in Sochi, despite the political turmoil currently surrounding Russia.
MICE has great potential for development and growth as a key sector in Sochi, despite the political turmoil currently surrounding Russia
The MICE industry is complex. Participants, sponsors, planners, convention and visitor bureaus, meeting venues, accommodations, and suppliers all have to be taken into account when planning an event. The sector has experienced rapid growth as a result of equally rapid globalisation, technological deveopments and the expansion of
service industries.
“This is a sector that has shown significant growth in every single year since the financial crisis hit the world economy in 2008,” says Martin Sirk, CEO of the International Conference and Convention Association. “The international association meetings sector is a solid, reliable performer. I am convinced that every serious meetings destination, internationally ambitious venue, and forward-thinking meetings management company should include international associations in their marketing and development strategies.”
Thriving industry
Recent data from Meeting Professionals International said meeting and event professionals expect to see a significant improvement in the industry as the global economy continues to rebound. US meeting professionals generally expect a 3.9 percent increase in meeting attendance and a 2.4 percent hike in budgets, while the European industry forecasts a 2.4 percent rise in attendance and a 1.6 percent increase in budgets. Overall employment is also picking up.
Not surprisingly, economic uncertainty is still a worry, the data revealed, but this is not necessarily bad news for the industry. The turbulent economic climate in recent years, as well as the changing ways in which audiences consume and are influenced by media to make purchasing decisions, has pushed C-suite executives and the boardrooms of major brands to look to senior marketing and sales executives as a source for innovative strategy, with measurable ROI on every investment. This need for immediate value-creation has led an increasing number of brands to break away from their ad-centric past, and focus instead on campaign strategy across targeted mediums that engage with customers – such as MICE.
MICE in Sochi
Russian Olympic organisers are predicting Sochi will become one of the most important Russian meetings industry centres. They have opened the Sochi Convention Bureau in order to drive MICE traffic to the region. Until the middle of last year, Sochi had some 31,000 hotel rooms, with the majority below modern standards. However, in preperation for the 2014 Winter Olympics, 25,000 new hotel rooms and 17 new hotels were created. Of the latter, almost all have congress centres.
As of February 2014, Sochi had 55,600 hotel rooms, with the majority owned by international hotel chains, concentrated in two main Olympic clusters, 45km apart: the coastal cluster has gained approximately 8,000 new hotel rooms within the Olympic Park; on the coast between the Sochi centre and the Olympic Park there are 5,300 new rooms; and in the city centre, there are 1,200. The Krasnaya Polyana mountain cluster is richer for 1,600 new hotel rooms. This is supported by a slew of infrastructure projects – amounting to a $51bn investment in the region surrounding the Black Sea – allowing easy access to Sochi’s newly renovated airport.
The first major hotel chain to invest in the local meetings industry was Nordic giant Radisson, which built the largest multifunctional congress centre in the Olympic village; the Radisson Blu Resort & Congress Centre, Sochi. Multiple restaurants and bars cater to guests along with a banquet hall that can accommodate up to 1,300 participants and a fully functioning press room. Such major investments by key hotel chains has transformed Sochi into a destination of diverse convention facilities suitable for all kinds of events.
Post-Olympics
This does of course raise the question of whether or not the volume of rooms and convention halls is oversized due to the Olympic Games, and whether the local industry is sustainable. However, International Meetings Review said hotel investments had remained relatively small and diverse, ensuring a strong MICE industry in Sochi that can accommodate many different events.
What’s more, previous Olympic hosts have proven it is possible to foster a strong MICE industry post-Games, ensuring the usage and sustainability of Olympic facilities for years to come. Vancouver, a popular Winter Olympics choice, is known for its impressive meetings industry, which ranks 43rd on ICCA’s 2012 rankings, thanks to a total of 49 conferences. London, having hosted the Summer Olympics in 2012, ranked seventh in the world in 2013, primarily thanks to the use of the Olympic Park and related facilities for further conferences and events.
Sochi is becoming a competitive choice compared with other Russian locations – including Moscow, which tends to have higher accommodation and events prices. This is a key selling point for the Sochi Convention Bureau, which also points to the spectacular scenery in the area, the historic city combined with modern infrastructure and amenities, and the mild climate, which allows for outdoor events too. It’s not hard to understand why Sochi has long been a destination favourite for Russian tourists, and may soon be the MICE location to know.
