Seoul as an Emerging International Convention Destination

Introduction to the International Conference Industry

International conferences are emerging as a major global industry. Despite their growing size, they have been largely ignored in terms of academic research. While the western world has historically been the locus of the conference industry — with major locations in the United States and the United Kingdom — Asian cities are now emerging as compelling alternatives for hosting international conferences. Furthermore, the international conference industry is growing in parallel with the international trade show industry. Where South Korea is becoming a new hub of international trade shows, its capital city Seoul is transforming into an ideal location for international conferences, with many promising events scheduled for upcoming years.

International conferences are becoming a substantial peripheral element of the trade industry, which is why tourism regulation authorities worldwide are paying increasing attention to this area of revenue generation. In order to understand the dynamics of this industry, the factors governing its demand and supply forces need to be elaborated and clearly understood. There are numerous corporate events conducted every month globally, involving substantial payments, and the success of a conference mainly depends on how well it has been planned and executed (Rogers, 2012).

In order to evaluate the impacts of the conference industry at an international level, information from various sources — such as ICCA, MPI, and the Convention Industry Council (CIC), as well as from tourism bodies such as the UNWTO — can be drawn upon. While such reports help in determining shifts in trends over recent years, they do not provide a comprehensive view because local attendees remain largely unidentified in tourism reports. Trends of the conference industry have been the focus of only limited research. However, the available literature suggests that it is the growth of the knowledge economy that most significantly affects the development of the conference industry (Weber and Ladkin, 2004). The continuous need for knowledge updating requires professionals to convene and disseminate information. This growth in conference organizing has pushed convention associations to invest effort in determining the scope of the industry. Unfortunately, due to isolated studies, concrete aggregate data remains scarce.

Demand and Supply Dynamics of the Conference Sector

The conference industry can be segmented into two broad divisions: demand and supply. The demand side consists of consumers — usually termed delegates or participants — who are the main customers in this industry. The supply side consists of organizers. The term "organizer" itself carries a broad meaning, encompassing not only event planners and managers but also venue owners and private managers. It is important to recognize that suppliers of products and services outside the main event management function do not form the supply part of this industry, despite their substantial role during events. Additionally, the definition of "organizer" can refer to either the host or the venue owner, depending on the nature of the event (Weber & Chon, 2002).

The demand side of this industry is represented by the number of delegates attending conferences annually, their countries of origin, and their expenditure on registration and other products and services. The data of the supply side, meanwhile, relates to expenditures incurred and revenue generated while hosting an event, along with statistics related to participants. The international conference industry can be divided into various segments in different ways — by size, type of delegates, type of conference, and so on. It is the initiator of the conference who decides its nature and the kind of supplier it will require. When segmenting by initiator type, corporate and non-corporate segments emerge. Non-corporate initiators may include governments, associations, and non-profit organizations. Where events are initiated by associations, involvement of a local counterpart, scheduling at regular intervals, and longer lead times are among the visible trends.

Global Trends: Attendance, Venues, and Delegate Expenditure

Since concrete data for evaluating the conference industry alone is not always available, data from the broader meetings industry — which partially includes conference statistics — is used for representational purposes. According to ICCA statistics, events that previously had a rotating nature are now appearing to stabilize in the Asian part of the world. Evaluating the number of meetings conducted in the region, the allocation of meetings has been found reasonably stable, including conference numbers. While Europe holds the major share, Asia and the Pacific are emerging as significant markets that provide reasonable competition to established destinations. Several major Asian cities have shown significant growth by entering the top 20 rankings for meetings hosted per city, and Seoul joined that top 20 grouping in 2005.

According to ICCA statistics, despite a large number of international conferences attracting many delegates, smaller meetings — involving 50 to 150 attendees — are becoming the preference of event organizers. This is why, despite a rise in the number of events, the overall density of participants has decreased substantially. The average headcount, which had been at least 662 persons per event, fell to an average of 535 persons per event. The decrease in overall participant numbers during 2006–2008 initiated a trend of conducting frequent yet smaller meetings, leading to overall lower participation density. However, approximate growth between 2002 and 2011 was 11.1% (ICCA, 2011).

As the headcount of international conferences decreased and events took on the character of corporate meetings, the period from 2002 to 2011 also showed a shift in venue preference — from dedicated convention conference centers to meeting facilities in major hotels, rising from approximately 35% to 45%. Many hotels also offer large facilities that can accommodate major conferences. The most favored venues for conferences are, in order: meeting facilities in major hotels, convention centers, and universities (ICCA, 2011).

Despite changes in the demographics of the conference industry, the subject matter most commonly addressed at these conferences has remained consistent: medical science continues to top the list. Although the number of events in the past decade increased, the headcount attending these medical conferences decreased substantially, reaching its lowest point in 2009. The second most popular subject area is technology, which has shown a reasonable increase over recent years. Regarding registration fees, the average fee per delegate per meeting in 2011 was USD 561.34. Over the first few years of the decade, the average registration fee per delegate increased until 2005, followed by a short-lived rise in 2006 and a decrease lasting until 2009, with a slight increase in the final two years. The average total expenditure across all meetings included in the ICCA Association Database was USD 13,747,787,985 in 2011 (ICCA, 2011).

Studies have provided evidence that the conference industry is cyclic in nature. This is reflected in the ICCA report on the five-year performance of the meetings industry, which showed substantial growth from 2000 to 2005 followed by a notable downturn in 2008. Like any other industry, the conference sector is subject to economic, social, and political factors. Events such as the September 11 attacks, the Iraq–U.S. war, and the global recession imposed restrictions on many enterprises, which obviously affected the conference industry as well. Although enterprises began to recover from economic distress, budgetary controls remained in place — explaining both the decrease in major participant headcounts and the shift from large conferences to smaller knowledge-sharing sessions (ICCA, 2005).

Two visible factors have therefore been identified that characterize change in the international conference industry: a decrease in headcount and a shortening of meeting or conference duration. The trend has been toward shorter meetings; in 2004, the average duration for international meetings was 4.2 days, the lowest average in the preceding ten years (ICCA, 2004). These statistics are corroborated by other studies, including the Australian study by Deery et al. (2005), research on Israeli conference tourism (Sultan, Ditzian, and Darsa, 2002), and the Korean Meetings Industry study by Kim et al. (2003). On the supply side, five distinct regions act as supply zones for this industry: Africa, America, Asia Pacific, Europe, and the Middle East (UNWTO, 2005).

Conclusion

The international conference industry is growing substantially with every passing year. However, there remains a need for substantial further growth and research in this area. In order to understand the dynamics of the conference industry, the demand and supply forces governing it must be clearly understood. On the demand side, consumers are mainly delegates and visitors; on the supply side, event managers are the principal actors. Research has shown that this industry possesses a cyclic nature, exhibiting patterns of slow growth, rapid expansion, and periodic depression over time.

The available literature elaborates that, while America, Germany, and the United Kingdom have historically been the major centers of international events, Asian markets are now claiming their share by attracting major event initiators. ICCA statistics — providing rankings at both global and regional levels — illustrate this shift clearly. South Korea is growing by leaps and bounds in terms of international events, and a similar pattern of growth is evident in Korea's trade show industry, where it is competing with established international event destinations such as Germany and Hong Kong. Alongside the trade show industry, the conference industry is also becoming a major source of revenue for South Korea.

Seoul, as South Korea's capital, is becoming a major attraction for international visitors. Backed by government support through bodies such as the Seoul Convention Bureau, the city is demonstrating tremendous growth in both overall infrastructure and the number of international events it hosts. Landmark achievements such as the G20 Seoul Summit, the International Dragon Awards, and numerous other conferences have established Seoul's credibility on the world stage. With improved transportation and accommodation facilities, massive convention infrastructure, and other major attractions, Seoul is well positioned to lead the international conference industry in the years ahead.

References

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