During this past year of economic recession and attacks on the value of business-related travel, the symbiotic relationship that exists between associations and the cities that host their meetings, conventions and trade shows has only become clearer. Both association and convention bureau executives can find new ammunition to defend the value of business travel in a first-of-its-kind study released last month by the United States Travel Association and Destination & Travel Foundation. (Disclosure: I serve on the executive committee of the Destination & Travel Foundation.)

Titled “The Return on Investment of U.S. Business Travel,” the study was completed by Oxford Economics and found that for every dollar invested in business travel, businesses experience an average $12.50 in increased revenue and $3.80 in new profits. The study also concluded that reducing business travel has a negative impact on corporate profits: The average U.S. business would forfeit 15 percent of its profits in the first year of eliminating business travel.

The study covered 14 economic sectors and its findings were verified through a combination of three separate surveys of corporate executives and business travelers and a broad review of related research. For the purposes of the study, business travel included sales trips, meetings, conventions, trade shows and incentive trips. Other key findings of the study include:

• Business executives estimated a four- to six-time return on every dollar invested in conference and trade show participation.
• Business executives and business travelers estimated that 28 percent of their current business would be lost without in-person meetings.
• Business executives and business travelers estimated that roughly 40 percent of their prospective customers are converted to new customers through in-person meetings compared with only 16 percent without such meetings.
• More than half of business travelers stated that as many as 20 percent of their company’s new customers were the direct result of trade-show participation.
• Eighty-five percent of corporate executives perceive web meetings and teleconferences to be less effective than in-person meetings with prospective customers, and 63 percent believe virtual meetings are less effective with current customers.

According to the study, U.S. business travel is responsible for $246 billion in spending and 2.3 million American jobs; $100 billion of this spending and nearly 1 million American jobs are linked directly to meetings and events. In the first six months of 2009, total business travel spending was down 11.9 percent. The study estimated that a 10 percent increase in business travel spending would increase the Gross Domestic Product of the U.S. by between 1.5 and 2.8 percent.

There is no question that business-related travel is critical to the economic well-being of the United States and encouraging your members to travel more may well be the best “stimulus package” for getting the economy back on track. For the complete version of the study and a tool kit with suggestions for using its findings, please visit the U.S. Travel Association website at ustravel.org.

Tim Schneider
Schneider Publishing Company

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