Chart of the week: cuts to corporate travel?

The event industry is changing rapidly. Each week we illustrate how this is happening and what it means for your business.

Corporate travel could be cut by around 20% of its pre-pandemic levels as the digital transformation of industries continues, according to new research.

McKinsey & Company’s study looked at sectors of people who travelled for business in 2019 before grouping them by the likelihood of them going back after the pandemic.

The “never returning” segment was found to have made up one-fifth of corporate travellers pre-pandemic, which offers firms an opportunity cut costs on work trips.

Those who never stopped travelling for work made up 15% of the findings, with those who had a fear of missing out (FOMO) accounting for 60%, while business people who will “wait and see” made up 5%.

Here’s how McKinsey categorised the four groups of corporate travellers:

• Never left includes employees who need to travel and resumed their trips as soon as restrictions allowed eased. For example, this group includes manufacturing company managers with a wide spread of factories, plants and workers.
• Never returning is made up of staff who can achieve high levels of effectiveness while working remotely, so may never return to corporate travel. Although some business trips will resume post-pandemic, McKinsey predicts they will do so at much lower levels.
• FOMO makes up the largest segment in business travel and consists of those traveling to build important client relationships. These firms want to get a first-mover advantage by getting ahead of competition.
• Wait and see includes workers in industries or roles which are relatively noncompetitive. These travelers are usually from the public sector, professional associations and nonprofits. People in this segment could hold virtual events to replace in-person conferences during the pandemic and may be uneasy about a return.

Behind the figures

Many businesses underwent a digital transformation during the pandemic to keep running effectively despite lockdown restrictions.

The study from McKinsey identifies around a fifth of pre-pandemic corporate travellers are likely to have drastically changed how the the need for business trips, which could include for exhibitions and conferences.

Leading organisers have already seen the benefits of implementing a digital strategy. It can help bring year-round monetisation opportunities and open doors to those who are unable or unwilling to make business-related journeys.

This development was partly meant to “pandemic-proof” organisations, but is likely to remain crucial to meet the new expectations of attendees and sponsors.

Having to make quick changes to how business travel is done will remain an issue for many in corporate workforces, although others will be able to get back to it over a longer period.

This uncertainty is to remain for the foreseeable future, but resumption of corporate travel and audience engagement is possible by using technologies and processes already available.

Read how hybrid events can help your success with our complete guide.

What does this mean for organisers?

In-person events will remain the highlight of the calendar for the majority of organisers, but this study suggests around a fifth of corporate workers could be more reluctant to travel for business.

This opens new opportunities for event producers who can take advantage of this change through a hybrid event model. Here’s why:

Engagement: The greater accessibility offered by virtual events means there are endless opportunities to get more people signing up. Hybrid events allow you to significantly increase audience participation by reaching the right people across the globe – even when industry expectations have changed.

Accessibility: Even sectors which can’t wait to return to in-person events have parts of their workforce who are unable to. Some are can’t due to health or personal reasons, while the potential for pandemic travel restrictions remains a threat across the world. Having online options alongside your physical event is a good way to open doors to those who can’t attend.

Monetisation: Potential for monetisation through virtual has been historically under-valued by exhibition organisers, who now need to re-balance the pricing of digital and in-person in their budgets. This can ensure that even when corporate workers no longer see a need to travel, a healthy amount of revenue can still be brought in.

For more on this download ExpoPlatform’s Hybrid Blueprint ebook.