Here’s how hoteliers can maximize business travel to hotels as the industry approaches a likely downturn.
NASHVILLE, Tennessee—Successful hotels get their fair share of business travel, and that is increasingly important as the industry likely nears a downturn, experts said.
Speaking during the “Opportunities to boost your share in the competitive business travel segment” panel at the 2019 Hotel Data Conference, Karen McWilliams, VP of revenue strategy for Concord Hospitality Enterprises, said there are long-term advantages to maintaining relationships with companies that frequent your hotel. That can sometimes mean sacrificing on rate in high-demand windows to keep those relationships strong.
“One of the largest challenges comes when there are specific opportunities to grow (average daily rate),” she said. “When you can’t lose those accounts, what does that mean for the rest of your revenue strategy?”
Heather Larison, corporate director of revenue optimization for Hostmark Hospitality Group, said it comes down to collaboration between sales teams and revenue management.
“Analyzing and knowing the business we have helps determine what business we need,” she said.
Be quick to respond
When businesses go through request-for-proposal processes with hotels, they want prompt responses, panelists said, so hoteliers need to be quick to respond even if that initial response is just confirming receipt.
“You have to build a structure to respond quickly,” McWilliams said. “We’ve asked all responses within four hours, but that’s really, really hard to do. From a customer perspective, (after that window) they possibly start looking elsewhere.”
“There’s often a three to four (hour) window to acknowledge (a request), but I think within 24 hours is a minimum expectation for formal proposals,” said Janine Alsalam, senior director of sales for Cvent. “From a buyer’s perspective, they want answers back.”
It becomes a matter of being prompt, but not necessarily racing to be first, she said.
“Sometimes that first response is very quick and doesn’t acknowledge all of (the buyer’s) questions,” she said. “I’d say to put as much detail as possible into an RFP.”
Partner with travel managers
When companies cut on business travel, it’s often from a cold, dollars-and-cents perspective, driven by accounting departments who have little to no knowledge or concern about how it impacts the travel experience for companies’ employees, panelists said.
But travelers always care about the experience on property, and hoteliers should do their best to work with travel managers at companies who can advocate for the value and importance of sending employees to good hotels that offer a comfortable and safe environment, even if it costs a little bit more.
Procurement departments “are a big decision maker (in a downturn),” said Jennifer Schneider, VP of revenue for Commonwealth Hotels.
Hoteliers are best positioned if travel managers are given a seat at the table within those departments, sources said.
“If the travel manager is in procurement, that’s good, because they understand the end user’s needs, while a lot of procurement officers don’t,” McWilliams said.
Even business travelers want unique experiences
With that in mind, winning business travel is not just about offering the cheapest rate, it’s about offering the best experience. That includes comfort, safety and security, along with something new and unique for those travelers.
“Experience matters to a really high degree,” McWilliams said. “Look at all the investments brands are making in experience. … Whatever a hotel can do above and beyond the standards, even in a downturn, that really matters.”
Panelists said this is essential for independent hotels, which aren’t armed with the benefits of wide-reaching loyalty platforms like the brands.
Alternative accommodations still not big players in business travel
Despite some companies such as Airbnb trying to push into the business travel segment, travel managers at many companies still aren’t comfortable with alternative accommodations from a safety standpoint, panelists said.
“There are still many companies that are nervous to give the thumbs up and go ahead,” Schneider said.
The predictability of hotel accommodations also comes in as a positive, she noted, with travelers having consistent check-in and check-out times and services such as luggage storage.
“I don’t think (alternative accommodations) are a big player now, other than on compression dates,” she said.