The cost of events and conferences in the UK is up by almost 25%. Business is strong for now, but there are likely challenges ahead.
The latest events economy tracker report from The Business of Events (TBOE) shows that meeting and event costs were up by 22% in the second quarter, well above the UK’s June inflation figure of 7.9%.
While this report only takes data from venues and excludes exhibitions, the increase is significant. Venue revenues per attendee are up, but analysts warn that higher costs may present a barrier in the longer term.
“The Revenue Per Delegate is increasing and that is a clear indication that costs, raised by inflation, are
now being passed on by the venues to the organisers. While it is positive that this doesn’t seem to be a
barrier for now, there remains a question over how long that will last,” said Peter Heath, managing director of Venue Performance.
Rising cost across UK event suppliers is a rising concern. Gary Shapiro, CEO of the Consumer Technology Association (CTA), which puts on CES in Las Vegas, mentioned his concern about rising costs in the recent Skift Meetings Destination Experience Summit. “There’s a bit of a cliff effect that concerns me,” said Shapiro, referring to the compounding effect of rising costs across different areas.
More Events, Shorter Lead Times, and Fewer Attendees
Despite the higher costs for UK events, the second quarter was positive for venues. Confirmed events outpaced the previous quarter, and forward bookings are stable.
The average lead time for conferences and events is up to 80 days from 64 days in the first quarter. However, this is still far from the lead times before the Covid pandemic. Although the report doesn’t share a benchmark figure, it suggests no signs of returning to longer lead times.
Perhaps the most worrying sign is the decrease in the number of event attendees. This has dropped to an average of 65 this quarter from 74 in the first quarter. Even worse, the annual average is tracking 25% lower.
“This could be a major concern. If any business’s volume decreases by this amount, then operational efficiencies will be key. Flow-through and profitability are key metrics,” said Heath.
TBOE is an independent think tank for the events sector run by PR agency Davies Tanner (DT), which looks at economic data for the meetings industry in the UK. The data comes from a sample of 400 venues in the second quarter of 2023 by UK data insights company Venue Performance.