Hoteliers are just one piece of the pie when it comes to group business, and a varied set of needs and desires between hoteliers, destination marketing organizations, meeting planners and third parties also have to be considered.
NASHVILLE, Tennessee—It’s not hard to find hoteliers who will bemoan the relative lack of rate growth in the group segment, but that perspective might not be shared by others involved with group business.
During the “Divergent perspectives on group meeting pricing” panel at the recent Hotel Data Conference, the tone was set quickly when moderator Chris Klauda, senior director of market insights, at STR, asked audience members what drew them to the panel, and several meeting planners responded saying they believe hotel rates are currently too high. (STR is the parent company of Hotel News Now.)
Panelists repeatedly stressed throughout the session that the various parties involved in getting group bookings at a hotel are often not on the same page and can do more to make each other’s jobs easier.
Heather Dameron, manager of event strategy and recruiting for The Journeys Group, said she’s always looking for value when booking events, but the definition of value can vary based on different factors.
For some events, there might be value derived from sending people to an all-inclusive resort, where all the odds and ends are already accounted for, she said, but events with more local attendees might derive value from free parking.
“It depends on what kind of meeting you’re planning to know what’s valuable,” she said. “So you have to uncover that value (from the planner).”
Laurie Czyz, senior director of sales Americas, meetings and events for Radisson Hotel Group, said the same could be said on the hotel side, as some groups hold differing levels of value for hotels at different points in the year.
“One group that’s valuable to us in January might not be value to us in August,” she said.
Hoteliers are also put in the position of having to weigh the short-term value of group business with the long-term value of the relationship, Czyz said. She noted the example of a government group that regularly booked 30 rooms each weekend at a hotel with poor weekend demand. She said that group happened to coincide with “two huge citywides” one year, which limited the hotels revenue potential on the strongest weekends of the year. But the overall value over the full year made it worthwhile, she said.
“It all depends on the demand in the city, the events happening and what your pattern (for demand) is,” she said.
Importance of collaboration
Adam DePiro, director of convention sales for Visit Tampa Bay and a former hotelier with Hyatt Hotels & Resorts and Hilton properties, said destination marketing organizations like his are often the meeting points for all the varied stakeholders in the group sales process, and he believes hoteliers broadly could be making better use of them.
“Destinations are the one entity that has the complete picture of what’s happening,” he said, noting that working with a DMO can help hotels connect with planners that deliver the specific types of business or demand they’re looking for.
But Czyz also noted that some DMOs might be overly fixated on portions of the total hotel supply in their markets.
“Not all CVBs or DMOs actively engage hoteliers, and some may focus just on the big boxes,” she said. “And those cities that do engage may not go a step further to engage the global sales reps for those brands in that city.”
She said it’s important for DMOs and planners to not just deal with property-level sales reps because they can eventually see dividends from establishing relationships with brandwide salespeople.
DePiro agreed that the process works better if everyone is committed to engaging.
“It really is a collective effort,” he said. “In recent years, we’ve worked on a better definition of the services we offer. I think in the past, there was some confusion about the role we all play, but we’ve done a better job working collaboratively.”
He said it’s important to not only focus on large events.
“It’s easy to get caught up on those home runs, but in the case of Tampa, we have 120-plus hotel partners and they all have different needs,” he said. “One thing we’re conscious of is how we deploy sales efforts to satisfy all those needs.”
The value of third parties
The panel touched on the subject of some large hotel companies cutting commission rates for third-party booking platforms in the meetings space, and panelists largely said the industry needs to understand the value those platforms bring.
Dameron said they are key in tackling issues that planners might not be able to on their own.
“I was trying to source something on my own that my boss asked me about, and we ran into a wall for six weeks” trying to find something that satisfied desired rate and space needs, she said.
She noted she was finally able to break through those issues by working with a third-party platform.
“We’re going to have a great program, and that wouldn’t have happened without the help of the third party,” she said.
DePiro agreed that strategic relationships with third parties are “critical for our success.”
Czyz said Radisson consciously opted to preserve its existing commission structure because it sees the value of those groups.
“We see our intermediary partners as an extension of our sales force,” she said.