Even though the Indian economy miserably slowed due to factors related to the Covid-19 pandemic-related redundancies, the resumption of overseas travelling for Indian corporates signalled resilience.
After a two-year lull, sitting all day into the virtual meetings, the Indian corporates are now finally on the go and are even more enthusiastic about returning to face-to-face events and meetings. What could’ve caused the influx in demand? Despite the travel disruptions caused by the fuel price hikes, high airfares and visa issuance delays, what is working and has worked in favour of the Indians preferring MICE (Meetings, Incentives, Conferences, Exhibitions) overseas?
Preferring business travel over soaring prices
The enthusiasm to return to in-person events echoed in a flood of events recorded 65 per cent more in 2022 in comparison to the previous year. This high demand paired with reduced hotel and venue inventory, rising fuel prices, labour shortages and inflation pressures in raw material costs further pushed up the prices but never lowered the spirits of business travellers to continue travelling for work.
According to the analysis in a recent Ministry of Tourism report, out of the major departures for Indian travellers, the business and professional category accounted for 12.3 per cent in 2021. Towards the end of 2021, huge MICE movements started to happen from India to the overseas destinations; the major one being where 1400 top-performing direct sellers of Amway India were taken to Turkey. Turkish Airlines was the official Airline Partner for Amway and the passengers were carried on 5 Charter Flights with Airbus A330 aircraft, from Mumbai and New Delhi, respectively. The group was the biggest Indian MICE group to Turkey since the outbreak of the pandemic.
2022 started with even brighter hopes and everything from corporate seminars to huge conferences, exhibitions to travel trade fairs starting as live events yet again, signalled a strong rebound of MICE. The ease of restrictions and the reopening of India’s scheduled flights further drove a positive corporate sentiment.
The international tourism destinations (Bahrain, Dubai, Abu Dhabi and Sri Lanka, to name a few) jumped on the bandwagon too and started the roadshows and various other initiatives in the major MICE business generating Indian cities like Delhi, Mumbai, Chennai, Ahmedabad and more.
Even though the pent-up demand and airfares kept rising and will continue to increase in the remaining months of 2022 and throughout 2023 (according to the 2023 Global Business Travel Forecast by CWT & GBTA), there still is a strong demand aided by higher budgets by travelling corporates in the days to come. Having held back on spending for the last two years, the growing appetite for exclusivity, safety and increased spending for business travelling has increased even more for Indian MICE travellers.
Meera Charnalia, Sr. Vice President and Head – MICE, Thomas Cook (India) Ltd said that despite the late resumption of India’s skies and significant challenges on the supply side along with visas, their company has seen a rapid rebound of our MICE business and expects to be back to pre-pandemic levels this month. “Starting May-June this year, we have witnessed brisk business from our volume driver MICE segment led by strong pent-up demand and unspent corporate budgets of the last 2 years,” she adds.
Thomas Cook India has operated group sizes ranging from 50 – 2000 with budgets over INR 4-5 lakh per person for premium groups which show a clear appetite for MICE spends, as Charnalia highlights.
SOTC Travel has also witnessed a significant uptick in demand for MICE, emphasised S D Nandakumar, President & Country Head – Corporate Tours, SOTC Travel. “With this positive travel sentiment and strong demand, we are witnessing a substantial increase in group sizes v/s pre-pandemic. To enhance loyalty and productivity, more corporates are encouraging incentive trips for their key growth contributors i.e. employees, distributors and more,” he says.
He further shares that despite demand-supply imbalance increasing airfares and on-ground costs, corporates are displaying willingness to increase spending by 10-15 per cent on MICE travel. SOTC has already operated group sizes of approximately over 8000 to Dubai-Abu Dhabi, 4000 to Thailand and 1000 to Singapore from January-August 2022, reiterating travel demand, claims Nandakumar.
A shift to visa-friendly options; selective European destinations still a preference
Despite geopolitical uncertainties like the Russia-Ukraine War and Europe reeling under the post consequences of covid causing labour shortages and lingering Schengen visa delays, business travel bookings around the globe are still picking up.
“Corporates are familiar with the current situation and are planning their trips to Europe well in advance and SOTC Travel has groups confirmed of 200 to 1000 passengers for Switzerland, Spain and Hungary starting at the end of October to mid-December,” informs Nandakumar.
Speaking on similar lines, Charnalia adds, “What is noteworthy is that despite visa challenges, given the allure for Europe, we have operated a significant number of mid to large-sized groups to France, Italy and Hungary and have several movements in the pipeline.”
Previously, as the covid restrictions were lifted in EU nations, the demand increased even more and the sudden increase found embassies unprepared and understaffed. As a result, the majority of embassies in India were unable to meet the demand, making applicants wait for weeks and leaving the Indian travel agents lamenting over delays.
Moving forward, as the experts suggest, all the corporates are now expected to have higher budgets for MICE as all they are looking at are the destinations offering the least amount of restrictions, safety, easy access and better connectivity.
“Due to the visa challenges for most countries in Europe, we have observed a shift in corporate behaviour with Australia emerging as a long haul favourite among India’s corporates,” says Nandakumar. He further adds that despite Europe and Australia still standing as long-haul favourites for Indian corporates, SOTC Travel is seeing a continuum in demand for closer-to-home/ easy-visa destinations like Singapore, Dubai, Abu Dhabi, Thailand, Malaysia, Indonesia and Vietnam.
Charnalia added that Thomas Cook (India) has seen the Indian corporates making a definitive shift to visa-friendly options like Thailand where the company has managed over 2500 delegates recently; UAE (approx 2,000); Turkey (over 1,800) followed by hosting of large groups to South Africa. With sporting events such as the cricket bonanza starting this October in Australia and the FIFA World Cup in Qatar approaching, Thomas Cook India is also preparing to host large corporate groups to both destinations.
On the other hand, SOTC Travel recently hosted groups of 3000 passengers for Abu Dhabi and 1800 passengers for Dubai and has a robust pipeline catering to the growing appetite for MICE travel. Adding to that, Nandakumar says that the company is prepping up for the upcoming festive seasons and is set to host a good mix of varied corporate engagements and events from different sectors including BFSI, FMCG, Construction, Optics, Cement and more.
Speaking further, Charnalia suggests how the cruises can represent an attractive value proposition for corporate MICE as they have recently managed a group of over 600 delegates for Rome on a cruise, citing that cruises from Europe, Singapore and UAE are also back in demand.