Should Planners Be Pumped About Cheap Gas Prices?

By Matt Swenson, January 29, 2015

Like most drivers, Dianne Davis, owner of TulNet Marketing and Events, loves paying less for gas. And right now, Americans have to squeeze their wallets far less forcefully to fill up than they used to. The average price of gas is down to about $2 per gallon, roughly one dollar less than it was last year. But because Davis is based in Oklahoma, an oil-bearing state, she sees the gas tank as half-full when it comes to cheap oil. Among the meeting planner’s clients is a Fortune 100 oil company that is being forced to cut its work force by up to 20 percent to trim costs after its profits were halved. Davis discussed both the positive and negative effects plunging gas prices are having on the meetings industry with Senior Editor Matt Swenson.

What does gas cost in your neck of the woods?

We’re $1.74 right now—it was down to $1.69. That’s such a mixed thing.

Why do you see cheap gas as a double-edged sword?

I think we tend to get excited about these great gas prices from a consumer standpoint but don’t realize that there is a larger picture. If a guy in Oklahoma or Texas works for an oil company, he spends his dollars at the local QuikTrip, tanning bed or the movies. Those dollars get spent throughout the community. Whenever oil companies go from $100 per barrel to $50 to barrel, people start losing their jobs. This will affect everyone eventually.

How does this impact your business?

In the short term, this has created the need for more meetings, because my clients are having to circle the wagons to figure out a strategy about what they are going to do.

What options are being discussed?

One of the things I know they discussed is keeping travel to an absolute minimum and only doing conference calls and webcasts. Right there, you see the impact on our industry.

How about keeping meetings closer to home?

That’s already happening. They are doing things on a smaller scale, even having meetings at their own facilities or bringing an entire event in-house, whereas in the past, they would go to a hotel to get everyone off-site.

Sounds like echoes of what happened after the AIG and General Services Administration scandals.

I’m always concerned companies are going to go: “The last time we did that meeting, we did it on a conference call or webcast. Why don’t we just do it that way?” I have to remind them about the need to meet face-to-face and the impact of getting everyone in the same room.

Are there any surprises?

My clients keep wanting to know why airfares aren’t going down. It seems like a no-brainer, but the airlines haven’t done themselves any favors in the industry. That’s a whole other story.

Are there some positives to take out of the cheap gas?

I predict some really good deals coming out of the oil patch in the not so distant future. People will be able to book meetings at great prices in oil bearing centers like Dallas, Houston and New Orleans.

 

Photo credit: Julio Cortez/AP

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