Sluggish recovery for Middle East groups sector

From page 2. Adjustment Having rerouted groups during the height of the conflict, incentive travel planners say new bookings still largely avoid Middle Eastern airlines. “There wasn’t a loss of business; there was a movement of business. Prices have gone up, airfares have gone up and that’s affecting budgets. We’re finding a lot more travel to Indian Ocean islands for this particular year,” said Raoul Canetti, MD/Owner of U-Cannect. Nkwe said the shift towards local, high-value incentives for South African clients had largely been driven by cost. “Rising airfares have prompted corporates to rethink their approach to incentive travel, especially on the long-haul side. What we are seeing is an appetite for value-based incentives – keeping the programme local with added benefits.” Smaller groups Canetti said, with travel costs expected to remain high, corporates would likely consider smaller groups. “I don’t see airfares coming down and if anything will change, it might be corporates reducing numbers. I think our incentives might get a little smaller, or corporates might consolidate, and rather than having two or three tours, they might just have one.” The 2027 Rugby World Cup in Australia is a welcome alternative for incentive travel next year. “A lot of the incentives are going to Australia and luckily that doesn’t have to go via the Middle East. The Middle East conflict doesn’t slow business down as much as we would expect because I believe it will all go to Australia next year. I think a lot of companies are pushing that,” said Canetti. Risk planning The conflict has changed how corporates assess and manage travel risk with safety considerations now playing a greater role in planning incentive trips. “Before, the Gulf was regarded as a safe transit point. Now, people are looking at risk much more closely because the situation changed so quickly,” said Aldworth. She said it was important to have more detailed discussions with clients before bookings were confirmed. “As an operator of incentives and groups, you carry a lot of responsibility for these people. You must have the conversation with them: ‘This is the reality and this is what I can and can’t do for you’.” Where clients still choose to travel through the region, she said Voyager Travel required them to formally acknowledge the potential risks and release them from any of the responsibility. Many corporates have also tightened their own travel policies. “A corporate makes a decision on behalf of their top achievers and they have to make sure that safety comes first. A lot of big corporates have their own safety and risk management departments and they’ll set out a corporate policy. Clients are then dictated to by what their corporate policies stipulate,” said Napoli. According to Nkwe, companies now assess the risks of transiting through a region separately from travelling to it. “Transit risk is now assessed separately from destination risk and programmes are also being designed with much more flexibility built in, including changeable tickets. That flexibility costs more but clients now consider it well worth it.”