MICE without a home

A congress for 12,000 dentists in Poznań in September, another for 10,000 doctors in Kraków in two years’ time and one for more than 4,000 jugglers and street performers in Lublin next year – this is just a sample of the international meetings set to take place in Poland in the near future. Over the next five years there are expected to be app. 150 events of this kind. According the International Congress and Conference Association (ICCA), the number of international meetings held in Poland has doubled in less than fifteen years. “Poland is also becoming more and more recognisable throughout the world. We have proved that successful congresses and corporate events can be held here,” claims Krzysztof Celuch, the manager of the Poland Convention Bureau – a governmental agency that deals with the promotion of Poland among international meetings organisers. According to the latest annual report by PCB, the sector’s contribution to the country’s hotel accommodation revenue now exceeds PLN 3.1 bln. On top of that, there is the income from banqueting and restaurant events, which is estimated at over PLN 1 bln, as well as the revenue from cultural and recreational services, estimated at PLN 1.2 bln. And this is a very low estimation since PCB has so far only managed to analyse a relatively small part of the business. “The money goes to airlines, hoteliers, restaurants, taxis, souvenir shops, congress rooms, simultaneous translation agencies and technical event service companies as well as to local and central budgets in the form of taxes,” says Sławomir J. Wróblewski, the general secretary of the Conferences and Congresses in Poland association. However, this is not the end of the benefits. At the core of the meetings is the transfer of knowledge, the acquisition of information and developing contacts abroad. And then there are the marketing advantages on top of that. “You could say that each person who visits Poland for an event goes back home and becomes an ambassador for our country. So we receive free marketing. In this way the cities holding the congresses benefit from that. The NATO summit and Euro 2012 were a source of free advertising for Warsaw in media published across the world, including the press, TV, glossy magazines and social media. This could be the most important advantage of these kinds of events,” believes Alex Kloszewski, the managing partner of Hotel Professionals.

Infrastructure gets better

In 2014 in Kraków the construction of three modern venues suitable for holding such events was completed. These were ICE Kraków, Expo Kraków and Tauron Arena. “The construction of these buildings virtually created the conference segment in the city, which was non-existent as little as five years ago,” explains Alex Kloszewski. Most conferences and congresses in Poland are now held in Kraków – 3,529 according to the 2015 data. Warsaw comes second with 3,258. “Kraków’s hoteliers have no complaints when it comes to occupancy. For them the so-called low season is virtually non-existent and rooms, particularly for groups, have to be booked well in advance,” says Katarzyna Gądek, the deputy director of Kraków’s department of promotion and tourism.

What are the most effective methods of city promotion? According to the representative of Kraków’s promotion bureau, there is no universal method. “The approach should be chosen according to the image that city wants to create or strengthen. There is no single effective method of city promotion, so Kraków approaches promotion in a different way than Shanghai – and this is the case not only because of the size of the city, but also stems from its character and uniqueness,” says Katarzyna Gądek. The most important methods for the historic city include the involvement of the authorities in film productions and the organisation of large cultural and sports events. “The hosting of such events is indicative of the status of the city. It portrays us as an affluent, developed city that can offer a good time,” she points out.

The ICE Kraków congress centre itself attracted over 200 events in its first year. These were attended by app. 230,000 people and included such international meetings as the World Seed Congress, the European Conference for Aero-nautics and Space Sciences (EUCAS), the European Biomaterial Conference and the European Society of Veterinary Dermatology (ESVD). “The revenue for the municipal budget from the business tourism sector was estimated at app. PLN 90 mln in 2014,” reveals Katarzyna Gądek. The city’s representative emphasises that the events held in the newly-built complex do not only have a monetary impact on the budget but are also an advertisement for the city. “The continuing extension of the airport and the development of companies hosting conferences (PCO and DMC) are not without importance for tourist traffic,” says Katarzyna Gądek.

Lack in the capital city

What seems to be a success from the national perspective does not look so impressive when compared to the stronger competition from abroad. Warsaw comes 40th and Kraków 49th in ICCA’s 2015 ranking of cities across the world in terms of the number of international meetings hosted. This fact is not itself a cause for concern, but it should be added that Warsaw is behind not only rich western cities such as Berlin (first place in the ranking), Paris (2nd) and Barcelona (3rd), but also local competitors such as Prague (11th), andBudapest (19th). “Let’s take into consideration Germany, for example, which has app. 250 modern congress and exhibition centres. In Poland we have seven or eight such facilities. This reflects more or less how to approach the business of meetings and the strategy we should take,” believes Alex Kloszewski. Poland as a whole has been in the twenties on the same ICCA ranking over the years, and in spite of a clear improvement in terms of infrastructure it still remains stuck between 21st and 25th position. “This is due to the fact that our competition is not resting either. Other countries and cities are also continuing to develop their events sectors,” explains Krzysztof Celuch. When the UN Climate Change Conference came to Poland in 2013, which was attended by 10,000 delegates, they had to build a makeshift hall on the lawn of the National Stadium at a cost of PLN 4.5 mln, only to dismantle it after the meeting finished. “This was a costly and temporary measure. The lack of infrastructure makes it more difficult for Warsaw to compete against other capital cities in Europe,” claims Alex Kloszewski. A genuine conference centre would be a significant asset. And the appetite of the sector is strong. Poland is, allegedly, trying to acquire not only medium-sized but also large events, such as the Rotary International Convention in 2027, which could be attended by as many as 35,000 people.

To increase funds for promotion

The prevailing view among representatives of the MICE sector is that the expenditure on the promotion of Poland as a destination for the international meeting industry is still too low. “We have never spent enough funds to make Poland a brand that would sell well. I believe that in order to compete against countries and cities scrapping it out to secure international meetings, such as France, England, Germany, Italy, Portugal and the CEE countries, we have to allocate more funds for this,” believes Alex Kloszewski. Krzysztof Celuch shares this opinion and believes that the events sector should be treated as an investment that will certainly pay off. “The meeting industry in Poland is an undervalued sector, which is mostly down to a lack of knowledge,” says Krzysztof Celuch. The Poland Convention Bureau is planning to raise awareness of the economic benefits that result from the hosting of meetings, both for the organiser and the economy, through a new research project under the name of Poland Meetings Impact. “This will be the first project of its kind in Poland and the seventh in the world aimed at estimating the economic value of the MICE sector,” reveals Krzysztof Celuch. The team for the project will include scientists representing Warsaw universities and colleges, who plan to publish the report in Q1 2017. So how should the improved promotion of Poland to increase the number of international MICE events be financed? One frequently mooted proposal is a local tax. “Such a tax is not something unique. It exists in 27 countries and app. 55–57 cities across Europe. However, it is vital that this does not affect room prices too much. The additional tax levied on them should range from PLN 1 to PLN 2 per night, which frankly speaking is not a great expense for anyone who travels,” believes Alex Kloszewski. Such a tax could generate PLN 70–80 mln per year for the country for tourist promotion. A similar fee, or ‘tourist tax’, for over a decade was being charged in Kraków to help cover some of the costs of the city’s tourist services. Since the beginning of the year the law has become more restrictive in specifying the conditions (such as low air pollution) uder which boroughs (gminas) were allowed to charge the fee. This led some localities (including Kraków) to drop the fee. “The experience of European countries justifies the introduction of a tourist fee, which would of course require changing the regulations on taxes and local fees as well as the law on the raising of revenue for local authorities,” says Katarzyna Gądek.