Thursday, August 11, 2011

Face to Face Still Matters

A recent survey prepared by Oxford Economics USA paints an interesting picture of the importance of business travel. While economic worries may cause many companies to slash their travel budgets, doing so may not be the smartest thing for their bottom line. In fact, the study finds that the average business in the U.S. would forfeit 17% of its profits in the first year, if they eliminated business travel. The study also showed that for every travel dollar invested, companies realize $12.50 in incremental revenue.

Face-to-face still matters. The study also showed the importance of in-person meetings to the bottom line. Both executives and business travelers estimated that 40% of their prospective customers are converted to new customers in-person and that 28% of current business would be lost without in-person meetings.

It’s clear that travel and face-to-face meetings are incredibly important to the bottom line. Great news for the meetings and events industry!

View an executive summary of the survey.

Survey points:
  • Econometric analysis and surveyed executives
    confirmed a similar magnitude of business
    travel ROI: for every dollar invested in
    business travel, companies realize $12.50 in
    incremental revenue.

  • Curbing business travel can reduce a company’s
    profits for years. The average business in the
    U.S. would forfeit 17% of its profits in the first
    year of eliminating business travel. It would
    take more than three years for profits to recover.

  • Both executives and business travelers
    estimate that 28% of current business would be
    lost without in-person meetings

  • Both executives and business travelers
    estimate that roughly 40% of their prospective
    customers are converted to new customers
    with an in-person meeting compared to 16%
    without such a meeting.

  • More than half of business travelers stated that
    5-20% of their company’s new customers were
    the result of trade show participation.

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