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ASSESSMENT OF LVIV CITY’S COMPETITIVENESS AS A DESTINATION FOR INTERNATIONAL CONFERENCES AND MEETINGS RESEARCH MADE IN 2012‐2013 Executive Summary Subject Matter
The main purpose of this research is to assess the competitiveness of Lviv as a destination for international
conferences and meetings. It has been undertaken at the request of the City Council to provide a basis for
the design of a destination marketing strategy for Lviv and the decision to build a new international
conference center.
Statement of the Problem
The building of a new international conference center requires a large investment. To provide the expected
returns in terms of economic and social benefits, the new conference center must attract a substantial
number of international conventions and meetings on a regular basis. To achieve this goal, Lviv needs to
be perceived as an attractive MICE destination by international meetings planners and attendees and be
competitive compared to other destinations. The level of competitiveness and attractiveness of Lviv has
not been previously assessed and it is not clear whether the lack of a conference center is indeed a critical
competitive disadvantage of the city or that by building of a new center the competitiveness of the city
will be improved enough to become an attractive destination for international MICE events.
Methods of Analysis
The competitiveness of Lviv as an international MICE destination is measured through a number of
destination attributes identified in literature as important in the convention destination selection process
and in the decision to attend an international convention by its participants. These attributes are identified
as part of the Locational Factors in the Meeting Participation Process Model of Oppermann and Chon
(1997).
To conduct the research, a mix of quantitative and qualitative methodology is employed. The quantitative
research is conducted in form of an on-line survey using a standardized instrument based on a 5 points
Likert scale. The questions included in the instrument have been designed based on the technique of
‘Importance-Performance Analysis’ (IPA) which is considered useful to measure the competitiveness of a
destination. The qualitative part of the research has been conducted using open-ended questions and
interviews with Lviv authorities.
Key Findings and Conclusions
A number of MICE destination attributes were identified. Their importance for the competitiveness of a
destination empirically assessed. The findings in this study are concordant with previous research and
indicated that the most important attributes of a MICE destination are: good accessibility, good meeting
facilities, good level of safety and low cost of access and accommodation. This study also indicated that
destination attributes such as nightlife, climate and shopping opportunities have low importance for the
competitiveness of a MICE destination.
The Importance-Performance Analysis (IPA) approach shows that Lviv faces significant competitive
disadvantages in attributes considered very important, such as: cost and easiness of access by air,
availability of good meeting facilities and supporting infrastructure, cost of accommodation and quality of
public transportation. The IPA approach also indicates that Lviv has competitive advantages in a number
of attributes that are important for an international MICE destination. In this category the perceived high
level of safety and security of the city was indicated. Lviv is outperforming in several attributes
considered of low importance for MICE destination, e.g. variety of cultural, artistic and sportive events,
sightseeing opportunities, architecture and cultural heritage.
On the negative side, the study indicates that the perceived poor quality of public transportation in the city
has become a matter of concern for convention attendees and it could damage the image of the city as an
international MICE destination in a significant way.
Recommendations
Recommendations are presented using two parameters:
- level of importance or priority (high vs low)
- time horizon (short term versus long term)
City Council should focus its plans in the attributes that scored high in importance but in which Lviv
scored a low perceived performance and that consequently have the largest negative impact in the
competitiveness of Lviv as a MICE destination. These attributes are the following:
‐
quality of public transportation ‐
cost of flight tickets ‐
accessibility by air ‐
meeting facilities and technology A key short-term plan to be implemented by the Lviv City Council should include the organization and
funding of Lviv Convention Bureau. The international experience shows that when the marketing efforts
of a MICE destination are managed by a centralized and efficient Convention Bureau it is possible to gain
a solid position in the MICE industry in a short period of time. A marketing budget in the range of 0.5
million Euro per year is considered to be a minimum level in achieving an impact in the market and
attracting international conferences (Rainisto, 2003).
It is recommended that the Lviv City Council takes actions to increase in the short-term the availability of
meeting facilities of international standard in the city. A good starting point could be the recasting and
development of existing buildings and venues aimed to cover the fast growing segments of small
international meetings (50 to 249 participants). This segment is of high interest for hotels due to the
benefit for occupancy rate and off-season activity.
Lviv authorities should initiate financial / tax incentives for hotel projects with convention facilities. City
regulations should also introduce incentives for improvement of existing facilities or building new ones.
Forms of public private partnership (PPP) using Specific Purpose Vehicles (SPV) or Joint Ventures, in
which the city contributes public land to the equity, are options to be considered. To host international
events, the re-accommodated buildings should be able to respond to current international standards and
expectations regarding structure, layout, services and technical facilities.
In long term the city should plan to build a large international convention and exhibition center. The
objective of this project should be to provide a future-proof center that would secure the competitiveness
of Lviv as a MICE destination in a horizon of 20 years. A center with the capacity to host 3.500 delegates
and a size of approximately 27.000 square meters of gross floor area (GFA) is recommended as optimal
for Lviv because it:
‐
Provides greater incremental capability to any existing conference facilities ‐
Is competitive with the capacities and capabilities existing in other Eastern European destinations (e.g. Krakow, Warsaw, Prague) ‐
Ensures that Lviv meets the expectations of the circuits of international conferences ‐
Provides a high degree of flexibility ‐
Provides a large potential for generating maximum venue operational cash‐flows by maximizing event numbers and use The construction of international conference center of such size demands capital investments in the range
of US$ 180-200 million excluding land.
Limitations
An important limitation of this research is the relatively small number of respondents. This imposes
certain constraints to the extent to which the findings of the study can be generalized. The response ratio
of the online survey at 30% was in line with previous experiences reported in the literature. Therefore to
obtain a significant number of respondents while the number of visitors attending international
conventions in Lviv is still limited requires a much larger effort and collection time to obtain a substantial
volume of data. For the future this could be achieved by the city authorities by establishing mechanisms to
collect responses to the survey when the conferences are still taking place and the attendees are reachable
face to face. A second important limitation of this research is that it is focused solely in the perceptions of
convention attendees. A full assessment of the competitiveness of Lviv as a MICE destination requires
necessarily the research of the perceptions of meeting planners.
Overall, the limitations described above do not severely restrict either the validity or the generalizability
of the study results. However, it is clear that based on the limitations discussed, future research could be
conducted. Replication of the study with the different samples and different destinations is needed
because the survey instrument has been tested in this study for the first time.