12 Creative Ways to Cut Hotel Meeting Costs
by Dawn M. Barclay
January 28, 2010
When asked when what travel sellers could do to prove their value to
corporations and in doing so, increase their share of the estimated $100
billion-plus meetings and incentive business, corporations, agents and
consultants interviewed by Travel
Market Report had one overwhelmingly consistent reply: achieve and
convey significant cost savings, while of course, maintaining quality.
�The bottom line is money,� said Beth Harin, who works in Marketing
Communications at the Movius Interactive Corporation in Johns Creek, GA.
Harin said she books two meetings of 100 persons each annually, plus trade
shows throughout the year. �We usually work with the hotels directly.
If a travel agent had the pull to secure better discounts and booking incentives
than we�d get by calling the hotel direct, we might consider it,� she said.
Vickey Woodley, the manager of meeting services at Medtronic in Jacksonville,
FL, admitted that while her company mandates that meeting accommodations
be arranged directly, she sometimes �cheats� and uses an outside company,
Experient, to handle the meeting RFPs (requests for proposal) for her annual
300-person sales meeting, citing a strong six-year relationship with the
third-party provider.
�They negotiate everything for me, catching things I wouldn�t ordinarily
catch. I trust their commitment to me, their consistency, the fact that
they�ll always be there when I need them,� she said. However, if the savings
were large enough Woodley said she�d be tempted to switch camps. �I can�t
imagine it but if [an planner] could save me another $100,000 off a $500,000
already well-negotiated program, I�d consider it,� she said.
So are such savings achievable? And if so, how can it be done?
One way is through strong contract negotiations, according to Shaun
N. Balani of Travel Time Travel Agency in Lancaster, PA.
1. Negotiate attrition clauses: �There�s big savings
just in the attrition clauses we can negotiate out for them. Sometimes,
if they�re a company that does only one meeting a year, they don�t even
realize that attrition can be a negotiable item,� Balani said.
2. Watch for Special Deals: Keeping abreast on hotel specials
can help in this regard. For example, the Omni Hotel chain (www.omni.com)
is offering zero attrition on their meeting packages booked and consumed
by December 31, 2010, which means planners won�t be penalized with fees
if actual attendance falls below anticipated levels. Some restrictions
apply.
3. Ask about alternative dates: Sometimes a slight shift in dates
can yield sizeable savings, noted Lou Lemos of BTI The Travel Consultants
in Syracuse, NY. �We recently saved one client hundreds of thousands of
dollars at a Hyatt in the southeast by convincing them to slightly alter
the dates of their meeting to coincide with one of the hotel�s slower periods.
We improved the rate by 40% on the rooms alone, not even counting the savings
on food, beverage and audio-visual rentals,� he said.
4. Tap into hidden inventory deals: Hotels are often most negotiable
on space left empty because of attrition or cancelled programs.
Acclaim Meetings� AcclaimCite, a robust meetings technology
platform, allows members to bid on meeting space cancelled due to attrition
or change in plans. AcclaimCite also provides an outlet for their clients
if the need arises. (www.acclaimmeetings.com)
MeetingTrader (www.meetingtrader.com),
a new online marketplace for the resale of cancelled meeting contracts
and reallocation of prepaid hotel credits, is essentially a clearinghouse
which CEO Tim Brooks, likens to an eBay for the MICE market. While planners
or corporations posting cancelled space will soon have to pay for the privilege
to the tune of $1,950 per posting plus a transaction fee equal to 6 percent
of the �replacement value,� it costs agents nothing to go onto the site,
register, search for remnant hotel space and make an offer.
Planners also can find listings of cancelled space on the MeCo (or Meetings
Community) Web site at www.meetingscommunity.com.
5. Find Efficiencies for the Property: Stephen Light, a Connecticut-based
independent meeting planner, has also discovered some novel and creative
ways to carve out savings for his clients. �Through discussions with a
venue, you can request menus that other groups are using and lower costs
by piggybacking. This can also be applied to security services by just
adding to an existing order from another group,� he said.
6. Think about transportation: Light also said he determines
alternatives to costly bus service as a means to transport his groups.
�I�m working on a conference in Las Vegas and one client is able to use
the underground walkway and free monorail to transport their guests to
another hotel�s nightclub,� he said.
7. Be creative: Light sometimes purchases edible centerpieces
at meal functions so as to not pay double for an appetizer or dessert and
a separate centerpiece. He also takes advantage of the free services offered
by state CVBs (convention and visitors bureaus) to do the legwork for hotel
availability, after-hours venues and ground transportation. This allows
him to use his time more profitably, he said.
8. Drill down on details: Steve Auer, CEO of Wheeling, Illinois-based
Cadence, Inc., a 20 year veteran of the live event and meeting production
industry, offered several suggestions of where meeting program savings
can be achieved. First, he said, �Get accurate. Employ a more detailed
registration system and get more detail on meals. Reducing headcount on
breakfasts for people who only want coffee, and skipping meals for walk-in
attendees translates to big savings. He pointed to one recent 300 person
program he did for Pepsi, where by eliminating 50 walk-ins from the local
office as breakfast candidate, along with another 30 who opted out of breakfast
when asked, he was able to achieve a $3,500 savings for the client.
9. Work directly with a property: Auer also suggested going to
properties locally, rather than booking with national sales offices. �Local
sales representatives for a hotel or venue will work harder and can provide
significant savings over a national rep or broker. They have a pulse on
the local market and can offer incentives unique to their property�they
wheel and deal just a little bit more,� he said. Price savings for a recent
two-night program where the hotel, when called directly, came in $20 per
night cheaper than was quoted by the national sales rep. The savings: $16,000.
10. Ask your hotel about airport transfers: �Be creative,� said
Auer. �Find something that doesn't really cost the hotel or vendor and
leverage it. For example, airport transfers can sometimes be provided
at no charge if a hotel has its own vehicles. It's a relatively low
cost item to the hotel, but can save tens of thousands in transfers or
cabs. In Chicago, Auer found a hotel that was willing to provide
roundtrip transfers for his group for $15 roundtrip when local ground transportation
firms were charging as much as $60 for the same service.
11. Do your printing on site: Along those same lines, think about
asking for free printing from the hotel's business center for agendas,
anything you need on site, Auer suggested. He estimated that at $1 per
page for a two-page program for 400 attendees, when adding in shipping
costs and hotel receiving fees, he saved a client $1,240.
12. Buy in bulk: Auer noted that you can negotiate better rates
by planning to be a repeat customer. �It's amazing how simple this concept
is, but how seldom it's applied. Hotels and vendors want repeat business
and they're willing to discount to get it. Use that to your advantage.
Can't sign a three year contract? Don't worry. Negotiate rebates
that kick in retroactively once you reach a certain level. There's
no need for a commitment because if you don't deliver the business, they
don't have to deliver the discount,� he said.
Overall the main key to savings is to not be afraid to ask current
suppliers to move outside their comfort zone,� Auer said.
Dawn M. Barclay, meetings and incentive travel editor, grew up in
the travel business and has worked in many facets of the industry. An award-winning
writer, Dawn spent twenty years at Barclay Travel Ltd. and Barclay International
Group. She followed this with editor positions at Travel Agent magazine
and Travel Life magazine as well as stints at HelmsBriscoe and Carey International
Chauffeured Services. She has visited all the continents of the world except
Antarctica (it's on her to-do list). [email protected]
