Event houses in Asia-Pacific are reporting cancellations or postponements of outbound events in the next few months as corporates suspend non-essential travel and travel confidence plunge over the Novel Coronavirus outbreak.
Destinations with confirmed Novel Coronavirus cases – across Greater China and South-east Asia – are the worst hit, found event specialists who are taking postponements for trips that are supposed to happen over the next few months; decisions around events planned for the later part of the year are now in limbo.
The extent of damage is similar across markets, with most event specialists reporting most, if not all, gatherings being axed or rescheduled.
Dynasty Travel Singapore, for instance has seen 80 per cent of outbound business events scheduled for February and March 2020 being cancelled, while India’s A T & Seasons Vacations Travel has reported business to China has been “completely wiped off” along with cancellations for other Asian destinations like Hong Kong, Malaysia, Singapore, Taiwan and Macau.
Simon Er, general manager business events & marketing of Singapore-based Global Travel, told TTGmice that the reactions are due to “the fear factor of being in a confined space like an aircraft over a period of time”.
Destinations further afield relatively unscathed
Longhaul destinations have remained unscathed, with some rare exceptions.
“It is business as usual for Europe and the US. We are telling corporates that they can opt for these destinations (instead of Asia) if their budget can be increased,” said Chander Mansharamani, managing director, Alpcord Network Travel & Conferences. He added that the Middle East or CIS destinations were “similarly-priced” alternatives to Asia.
At FCM MICE, clients are considering the Middle East for events in the later months of April and May, taking South-east Asia off their shopping list, observed Manpreet Bindra, brand leader.
Sunflower Holidays Malaysia’s managing director Mint Leong said some clients had chosen to can their programmes in Europe this March and April despite the continent having comparably few cases than Asia.
While Melvyn Nonis, director of Singapore-headquartered MICE Matters, which specialises in mainly European and US programmes, expressed relief that he had only two cancellations so far – a very low percentage of his total business, he acknowledged that “decisions may change as things change”.
He added: “I think the crucial time is this month, in the next few weeks. Most of our longhaul groups are departing in April, and for now there are no cancellations yet. Groups that are leaving in June or later in the year, are taking a wait-and-see approach.”
Domestic events an option
For some event specialists, not all is lost as clients are choosing to shift their overseas gatherings to their own backyard.
Raaj Navaratnaa, general manager of New Asia Holidays Tours & Travel in Malaysia, said two out of eight affected meetings and incentive programmes were redirected to local destinations.
Gotz Travel Malaysia’s managing director, Sheikh Awadh Sheikh Abdullah, has reported the same. Two 100-pax incentive groups, one to Vietnam and the other to Thailand, are now looking at shifting their April trips to within Malaysia.
Some clients of Yento Chen, CEO of Destination Tour Indonesia, are also considering turning to destinations like Bali or Raja Ampat.
Reassurance is key
Not willing to take a hit without a fight, some Indonesian stakeholders are trying their best to dissuade clients from cancelling.
Vidya Hermanto, managing director Orange Panorama, told TTGmice that a 4,600-pax incentive group from Indonesia was on the brink of cancelling its programme in South Korea. In response, his team produced an informative video that explained the situation at attractions and public spaces, and the steps that local governments have taken, along with other positive messages.
While he managed to save that piece of business, others fell through.
Willy TM Sihombing, managing director at Sedona Holidays Tour and Travels in Indonesia, had also gone down the education track, choosing to inform clients of government efforts in dealing with the outbreak, in addition to promising them the flexibility of changing event dates and destination.
“People are panicking and their confidence in travelling is low (due to extensive coverage) of the outbreak,” he noted.
Earnings for 2020 badly hit
Stakeholders across the board agree that losses are to be expected for 1H2020, with some optimistic that business in the later half of the year will help to make up for it.
Dynasty Travel’s Seah expects losses in the first half, but “pent-up demand for 2H2020″ should turn things around. Her confidence is based on about 80 per cent of enquires for 3Q2020 that are now on hold.
Leong is hopeful of breaking even this year as long as the virus can be contained by April.
Raaj, who is bracing for a 50 per cent decline in earnings this year vis-a-vis 2019, said recovery will not come immediately. A “gestation period of two to three months” needs to be taken into account after the virus is finally under control, as “organisers will want to wait and ensure there are no more new cases of infected people being reported,” he explained.
Full refunds not guaranteed
While travel and event suppliers are understanding and supportive of clients whose event plans have been uprooted by city-wide lockdown and travel suspensions imposed by the Chinese government, and have offered full refunds, the same cannot be expected elsewhere in destinations that are still open for business.
Events specialists explained that without government-issued travel advisories against a destination, suppliers will insist that visits are still possible and safe, and therefore there are no reasons for full refunds.
FCM MICE’s Bindra shared that suppliers in destinations like Thailand and Singapore are not giving any refunds.
Nonis intends to “rely on goodwill built up with our suppliers to negotiate on behalf of our clients”.
Source : ttgmice