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Mr. Fliess

Group Meetings

How Hotels Can Use Technology to be More Competitive for Group Business and Win Repeat Customers

By Kevin Fliess, Vice President Supplier Network Product Marketing, Cvent

When hotel technology is mentioned, planners often think of audio-visual and Wi-Fi coverage in meeting and guest rooms. Those things, however, comprise only the tip of the tech iceberg; as hoteliers know, the real technology accomplishments begin way before attendee arrival.

For the business of putting heads in beds - and groups in meeting rooms - the industry increasingly relies on technology that is itself evolving. In only a few short years, for example, data storage has evolved from proprietary servers (something you can spill coffee on) to virtual "cloud-based" technology, which allows for exponentially more data. So what started decades ago as a scribbled note ("Annie from XYZ Company wants 30 rooms for three days of training") has evolved into several volumes of information about every aspect of Annie's meeting. And these volumes can be read on the face of a smart phone, which has roughly the same dimensions as the original paper note.

In addition, the electronic Request for Proposal (eRFP), which made its awkward, forms-challenged debut (print-fill out-fax) around the turn of this century, is now a sophisticated tool with which hotels win lucrative group business. Through Cvent alone in 2014, planners sought to source approximately $8 billion of business through its venue sourcing sites - the Cvent Supplier Network, SpeedRFP.com, and EliteMeetings.com.

In Our Elements

At Cvent, we see successful hospitality technology as including three core elements: marketing to attract business, demand management to make sure the right leads are being pursued, and business intelligence to determine if efforts are being put against the right initiatives.

Marketing to attract business, otherwise known as lead generation, used to be way more haphazard. Getting your message in front of an audience of leisure travelers is relatively easy, as anyone can be a leisure traveler; but how to recognize meeting planners?

It's still not easy, or cheap. The hospitality industry spends millions each year trying to identify ad hoc planners, which for the most part represent persons in an organization who are charged with the function of occasional meeting planning. According to research by Frost & Sullivan, large companies spend an average of $14 million each year on offsite hotels and venues; thus, prospecting for these hotel clients is well worth the effort.

Recently, Cvent surveyed a total of 842 meeting planners for the Cvent 2015 Planner Sourcing Report, which was designed to provide venues with the insights needed to close more group business. Among these planners:

  • 71% sourced meetings on behalf of their company
  • 17% were association planners
  • 11% were third-party planners

Of the planners surveyed, among the venue decision influencers were online venue directories (90% considered influential in their decision); hotels' corporate pages (88%), and 52% felt influenced by social media and blogs. Most influential of all venue selection decision channels, however, was peer recommendation, which topped the list at 95%. ("Peer recommendation," in this case, doesn't mean turn to your right and ask your best friend; it means "go to TripAdvisor, Yelp, or other, and read the ranking comments.")

These numbers indicate the channels from which most of today's leads derive.

Leading Us On

When leads come in, demand management technology can generate reports that help your sales team focus on the best leads and pursue multiple options for each lead within the context of future inventory and demand.

In today's climate, leads from online channels are experiencing double-digit annual growth. Group revenues have significant room for expansion, with conversion rates hovering around 2%. That's a huge issue - and opportunity - for hoteliers.

Each year, hotels glean an average of $12 million in revenues from meetings and events, representing 30% of their total revenue, according to Frost & Sullivan. A nice chunk of change, to be sure; but what if that could be more? Not by putting more heads in beds (although that's certainly an option) but by adding value through customizing the meeting experience?

Demand management seeks to provide a dynamic view of group demand and resource availability, enabling hoteliers to focus on, manage and convert leads that maximize margins. "Group business can represent a third or more of the revenue for a hotel or venue, yet existing systems for managing and scoring group opportunities are complicated for the user and lack decision support," said Jeffrey Emenecker, general manager of Decision Street, Cvent's hotel sales-intelligence software solution.

First comes the eRFP, which is one of the most important lead generating tools. Completed by prospective customers, the eRFP goes directly to the hotel sales office where the meeting details can be reviewed and developed into plan of action.

At least, that's how it's supposed to work. Sometimes, however, the eRFP sits un-nurtured in a general sales account inbox, subject to other priorities, or even whims. This breakdown in engagement can make good leads go bad. In the Sourcing Report, planners' top two complaints are that suppliers lack thoroughness (as in "paying attention," 42%) and speed (32%).

Bharet Malhotra, Cvent's senior vice president of sales, recommends that hoteliers first accelerate their lead response time by setting up their account for maximum efficiency. "Define the role of venue administrators, lead catchers and users," says Malhotra. "Assign assets to review eRFPs in a timely way and charge them to develop an understanding of the planner perspective."

Last year, more than 27 million hotel room nights were submitted through Cvent's venue channels, which include the Cvent Supplier Network, EliteMeetings.com and SpeedRFP. "If professionals better understand the RFP process from a planner's perspective," says Malhotra, "it will ultimately lead to a more effective use of time and create opportunity for their property to win more group business."

Once engagement is initiated, negotiations begin. But if hoteliers are expecting tough tactics, then this insight from our Sourcing Report may come as a shock: Over 40% of planners said that a 10% discount would convince them to switch from their first choice venue to their second.

I am not kidding. OK, climb back in your seat and we'll look at this dispassionately.

Today's millennial planners, which comprise 41% of the planners surveyed in the Sourcing Report, are tech natives - they might not have been born with a smart phone in their hands but they certainly teethed on one. Gen X planners (incidentally the largest group at 43%) are first generation tech, the ones who drove the tech innovations we see today.

With all this tech handiness, however, come some downsides; namely, a disinclination to negotiate face-to-face. Josh Davis of Cvent's Marketing Department examined the data and teased out these nuggets of insight about millennials:

  • 50% are more likely to be influenced by social media
  • 37% are less likely to source directly through a hotel
  • 29% think negotiating is the hardest part of venue selection
  • 22% said they wouldn't use a venue again if they were dissatisfied with the service
  • 14% think that response time should be improved

Get the idea? They want to find you online. They want to see positive comments about you online. They want to hear from you online. More and more, they prefer to negotiate online. But when they get to the property, everything better be perfect, because either way, they and their attendees are going be chatting with their BFF TripAdvisor. Online.

Obviously, meaningful, transactional engagement is now taking place in the cloud and will be doing so for the foreseeable future. As the next generation of meeting planners rises in the workplace, hotels and event venues need to better understand their behaviors to close more group business. It is clear that both the influx of millennial planners and advances in event planning processes and technologies are changing how hotels compete for lucrative group business.

The Change Up

In order to get in front of this somewhat bashful generation of meeting professionals, here's what you need to do:

  • In social media, press your transactional advantage rather than your experiential benefits.
    (Example: "We have a great promotion for small meetings!" instead of "See us first, the meeting experts.")
  • Answer eRFPs promptly and deliver proposals that meet the planner's specified requirements.
  • Use scoring systems to review leads to be sure if this meeting meets your requirements.
  • Most planners do not have time for an exploratory site visit, so send them a video showing them what to expect when they bring business to your property. Take them into the kitchen to talk with the chef, walk the lobby, jump in the pool. Use your imagination to give them a taste of your venue. (Make sure it's something you won't mind having shared, because it will be.)
  • Negotiating? Start by taking 5% off the top.
  • Execute flawlessly.

Today's planners talk less about ROI and more about ROE, or "return on event." It would not be a bad idea for hoteliers to do the same.

Only you know your bottom line - the absolute value of a head in your property's bed. But everyone knows what's to be gained from group business. Firstly, more group business, as happy planners rebook and tell their colleagues what a successful event they had. Secondly, the conversion of attendees into leisure customers.

May you be rewarded with both.

Kevin Fliess has spent the past two decades in leadership positions across B2B and B2C technology companies. He’s led marketing, product management, and general management functions across a spectrum of ventures – from early stage start-ups, to growth companies, as well as established world-class brands. Mr. Fliess is currently VP of marketing at Cvent, where he leads product marketing, demand generation, and customer marketing for the Hospitality Cloud division. This includes Cvent’s Group Marketing Solutions which span three online marketplaces that support a variety of meeting planners – the Cvent Supplier Network, EliteMeetings.com, and SpeedRFP.com – that expose hoteliers to hundreds of thousands of planners. Mr. Fliess can be contacted at 866-318-4358 or kfliess@cvent.com Extended Bio...

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