guide_to_room_block_..

Transcription

At CGS, our Mission is to Help Bring People
T ogeth er to D riv e Business...Y our Business
Perfecting the Event Experience
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As the thought leader in the event marketplace, CGS continues
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which have become industry standards.
Our body of work includes the classic “Conferon Guide to Meeting Management,” the ongoing “Contracts
Corner,” our “Meet with Success®” education series, and many other time-proven planning resources
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To access the resources below, use the attached postage-paid reply card or call one of our Event
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“Conferon has long
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best practices,” said
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former president of
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and Tourism B ureau,
sponsor of the
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Perfecting the Event Experience
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2500 Enterprise Parkway East, Twinsburg, OH 44087 • 1888 North Market Street, F rederick, MD 21701
h er to drive business…your business.
e in site selection, meeting management,
ource Solution
Here is a partial list of CGS event services that can
help you perfect your event experience:
• Site Research and Recommendations
• Hotel and V enue Contract Negotiations
• Planning and On-Site Management
• Full-Service Registration and Housing Services
• Lead Retrieval
• Incentive Meetings and Promotional Products
• Group Travel Management
For more information on any
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please visit our website at
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At CGS, our mission is to help bring people togeth e
W e accomplish that by providing superior service i
registration and housing, and lead retrieval.
Your Single Sou
Tradeshow, meeting, conference, seminar…Whatever you call your
event, many of the needs are the same. Y ou need transportation and facilities for meetings and exhibits. Y ou need a convenient way for
your attendees to register and receive their credentials. Y ou need
to create networking opportunities that maximize their attendance.
CGS gives you the peace of mind that someone is taking care of the
details so that you can concentrate on your core business objectives.
A F inal T ho ug ht: C autio n and
E nco urag em ent
During the past few years, a wide variety of techniq ues have b een tried b y planners looking for ways to
avoid attrition charges.B ecause there were so few “antiattrition” success stories, experim enting was the order of
the day.S om e of these experim ents, like registration
incentives, were surprisingly successful;others, like raffling airline tickets or other prizes, were dism alfailures.
O ne thing that did work— at the tim e— was intentionally “under b locking” room s at contracted hotels.While
this strategy decreased negotiating leverage with hotels,
it did reduce the risk of attrition.(S om e groups lowered
their hotelb locks by as m uch as 50 percent.)
B ut now that the econom y has reb ounded, m any of
those sam e groups are confronting a new and very serious prob lem .C losed-out room b locks have b ecom e a
source of frustration for attendees who have to find
room s them selves at a tim e when prices are rising at
record rates.M any can’t find room s near the convention
center or headq uarters hotels;for som e, the inconvenience has led to reluctance to attend the event.Warning:
This prob lem willonly get worse as the econom y continues to reb ound.
If you haven’t already done so, now’s the tim e to
develop a policy that willwithstand the inevitab le ups
and downs of econom ic cycles.R ecent history clearly
shows that incenting attendees is the m ost powerfulway
to recapture your room b locks, increase your b uying
power, support your m em b ers and counter housing
pirates.N ow is the tim e to develop an incentive plan that
addresses the challenges of today’s b usiness world.
With Internet room prices not nearly as low as they
are in a downturn, there’s no tim e like the present to
effect change.When the next downturn occurs— as it
surely will— attendees conditioned to registration incentives willnot flee the b lock.For those who act now, b etter days are ahead.
B ruce H arris
P resid ent
C o nfero n G lo b al S ervices
continued from page 58
• Provide strong registration incentives. A ttendees
will hav e no reason to search the Internet or resp ond to
p irates if they k now that, by doing so, they will lose the
reg istration discount. T he hig her fee they p ay to g o outside the block would neg ate any sav ing s that p irates
could offer.
• C om m u nicate th e issu e. T ell attendees and ex hibitors
to be susp icious if they receiv e an unsolicited p hone call,
fax or e- mail that offers lower hotel rates than the g roup
rate. C oach them to “ p lay dumb” and obtain as much
identifying information as p ossible. C ommunicating the
name of the official housing bureau associated with your
association can help them identify the unfamiliar p irates.
A lso, communicate the p otential threat to your members
and instruct them on the benefits and imp ortance of
staying within the block .
• Protect y ou r lists. D o not p ublish the lists of attendees
and ex hibitors on the W eb or share them outside of your
ex hibitor or sp onsorship org aniz ations. If you do p ost a
list of attendees on your association’s W eb site ( a common p ractice to show the v alue of attendance to
ex hibitors) mak e sure it’s p assword- p rotected. A lso, seed
your list with some false names at addresses of emp loyees, so that you can learn firsthand if p irates hav e
obtained your list.
• Know y ou r ex h ib itors. If a susp icious firm ask s to
ex hibit, mak e sure it is leg itimate. Some p irates buy a
small booth, wait until they g et an attendee list, then cancel the booth and start attack ing the list.
• W ork w ith contracted h otels. W hen you’re work ing
out the hotel contract, include a clause that g uarantees
the g roup will hav e the lowest rate ov er the meeting dates.
T his g uarantee should ap p ly to all rates ex cep t op aq ue
channels— lik e P riceline or H otwire— where the customer cannot choose the hotel or brand. A lso mak e sure that your hotel contracts contain terms that allow for all rooms to
be credited towards the g roup p ick up , no matter what the rate or how the reserv ation was made. F ind out if your hotel has
an ag reement with its wholesalers p rev enting them from selling to meeting attendees. If not, as the meeting date
ap p roaches, ask your contracted hotel if they are aware of any inv entory outside their distribution channel. M ak e sure to
let the hotel k now to alert you of any block s being req uested that ap p ear to be In C onjunction W ith ( IC W ) your ev ent.
• C onsu lt legal cou nsel. A s soon as you find out housing p irates hav e targ eted your association, call your attorney, who
can ap p ly leg al p ressure. If p irates use the log o or the trademark ed name of the association in its mark eting p itch—
which is in v iolation of intellectual p rop erty law— or if p irates state that their solicitation was ap p rov ed or sanctioned by
the association, you could leg itimately shut them down. N ormally a g ood cease and desist letter will do. L eg al counsel
can also check to mak e sure your anti- p irate communications with attendees and ex hibitors can’t g et you into trouble.
Fo r m o re info rm atio n ab o ut p ro tecting co ntracted ro o m b lo cks,
e-m ail: ro o m b lo ckm anag em ent@ cg sco m p anies.co m ,p hone:1-8 0 0 -246-90 11
60
CONFERON GLOBAL SERVICES
IN TER N ATIO N AL D AIR Y-D ELI-BAK ER Y ASSO CIATIO N (ID D BA)
Case Study
{
Chang e Lead er:
ID D BA Executive D irecto r Caro lChristiso n
THE CHALLEN GE:
Housing pirates targeted the 2003 annual IDDBA convention. A Las Vegas event
company solicited exhibitors, offering them reduced rates at more than 6 0 hotels in Las Vegas,
including some within IDDBA’s room block. “We received many complaints because the salespeople were extremely aggressive and persistent,” Christison says.
THE SO LU TIO N :
The association took a proactive approach to battling the housing pirates. Not only did
Christison call the company that was sending faxes to her exhibitors and ask them to stop,
she also alerted members—through faxes, e-mails, articles in the IDDBA newsletter and posts
on the association Web site—to the problems that pirates can cause both to individual exhibitors and the entire association. The association motivated its exhibitors and attendees to
avoid booking with pirates by doing the following:
• P roviding the name of the official IDDBA housing bureau.
• Warning them against the common practices of housing pirates with the following
language:
– Many of these agencies do not have contracts for a block of rooms with the hotels.
– They will contact a housing wholesaler to see if anything is available that can be resold
to you.
– E ven legitimate wholesalers cannot knowingly book convention attendees in the convention room block. Only IDDBA’s housing agent can book our block of rooms. If the
hotel determines a convention attendee has been solicited or contacted by a legitimate
wholesaler, those rooms may be canceled or increased in rate to match or exceed the
group rate. A rate quote from a room broker is not a guaranteed rate.
– Rooms must be fully prepaid up front. (A one-night deposit isn’t enough; they want it
all and for every room you book, when you book.)
– Reservation confirmations and numbers are generally not available until three to seven
days before the first day of arrival. E ven then, there is no guarantee a room will be available when you arrive.
– G enerally, they cannot get a large block of rooms; only one or two at a time.
– It’s difficult to do name changes on rooms with unofficial wholesalers/room brokers.
• Incenting them to use IDDBA’s housing bureau with the following language:
– The IDDBA has negotiated reduced rates with the hotels in our block.
– The IDDBA gets a credit for the rooms booked. We are able to use this credit for speaker rooms and staff rooms. (This is one of the reasons we have not had to raise registration
fees since 19 8 8 .)
– The IDDBA provides and pays for busing from official hotels to the convention center.
You would have to arrange your own transportation from other hotels.
– Our hotel contracts include clauses that protect you. They also include clauses that require the IDDBA to pay for hotel rooms that we book on your behalf but are not filled.
U nfilled rooms could cost the IDDBA hundreds of thousands of dollars. In short, it’s
good business to stay in the association hotels.
6
THE R ESU LT:
Because the IDDBA acted as soon as they found out wholesalers were soliciting exhibitors,
they were able to prevent the pirates from booking many rooms for exhibitors and attendees. As a result, the IDDBA avoided costly attrition fees that could have caused them to
increase registration fees for future meetings.
59
• Complimentary exhibitor badges, which provide access to events like technical sessions, opening
receptions, luncheons, breakfasts and the general session. (Purchased individually, exhibitor badges
can cost as much as $ 1 0 0 each—and usually do not include access to technical sessions or meals.)
Free access to the technical sessions and other events gives exhibitors more chances to network with
attendees outside of the actual exhibit hall.
• Higher priority status in exhibit space drawings.
• O n-site rebooking service for exhibitors for the following year.
• Awarding points that can be applied to advertising or sponsorship programs.
• R efusing freight from exhibitors who aren’t staying within the contracted block.
• R equiring that two guest rooms be purchased inside the event-contracted block for every 1 0 0 net
square feet of space rented.
BATTLING THE BANDITS
B ecause most housing “pirates” operate from the platform of legal businesses, there is little planners
can do to shut down these organizations, no matter how detrimental they are to your block. Pirates are
only successful because they offer lower rates—or at least promise lower rates—than the groups they
attack; they cannot win against groups that have strong registration incentives. Here are some measures that can be implemented to curb even the peskiest pirates:
continued on page 60
P rotecting Against P oachers
THOSE W HO TARGET m eeting attendees to reserve room s outside contracted
b locks are w orse than “p irates” or “renegades.” “T hey’re p oachers,” said Steven
H acker,CAE,p resident of the International Association for Exhib ition M anagem ent
(IAEM ).“I call them p oachers b ecause they’re essentially taking som eone else’s
gam e im p rop erly.
“Everyone entitled to m ake a b uck,” he exp lained,“until you stick your hand into
som eone else’s p ocket.That’s w hat these p oachers are doing.”
According to H acker,m any of these p irates or p oachers— w hatever you w ish to
call them — are actually im p osters,p osing as an event’s b ona fide housing organization.“They try to style them selves to ap p ear as som ething they’re not,” he said.“The
look and feel and text of their W eb sites are cleverly contrived to give the effect that
they’re the official p rovider of housing services.
“They’re very clever,” he continued.“They know the line that divides legal and illegal activity,and they dance along that line adep tly.A lot of their success com es as a
result of their clever decep tion.”
H acker sp eaks from exp erience;in 20 0 3,a b old group of p irates targeted IAEM ’s
m eeting.IAEM w as ab le to escap e w idesp read dam ages only b ecause it had an
aggressive p lan in p lace to counter any p oaching.
“For op eners,” H acker said,“w e ‘seeded’our attendee list w ith som e false nam es,
addresses and fax num b ers w e could track.W hen p oachers b egan sending faxes to
attendees,several arrived in our ow n office!
“W e m ade it very clear that w e w ere p rep ared to take aggressive,direct action
against the p erp etrators,” H acker continued.“Our legal counsel com m unicated
directly w ith the renegades,citing the fact that w e had contracts w ith m eeting hotels
and m aking it clear that w e w ould go after anyone w ho contrib uted to financial losses resulting from interference w ith those contracts.”
IAEM also com m unicated freq uently and directly w ith attendees to ap p rise them
of the situation.W hile room b lock p oaching is a p rob lem ,noted H acker,it’s a m anageab le one.“They’re like m osq uitoes,” he said.“You sp ray,you drain standing w ater
and you hop e for the b est.But w hen you see one,you sw at it hard.”
58
Develop a
Protection Plan
Association and trade show
m anagers,w ho sp end countless
dollars and hours to p rom ote
attendance,should also have a
p lan in p lace for p rotecting contracted b locks This four-p oint
p lan w as shared b y Steven
H acker,CAE,p resident of the
International Association for
Exhib ition M anagem ent (IAEM ).
the use of your
1. Mlistonitor
b y seeding it w ith false
nam es.
M ake attendees aw are of
2. the
im p ortance of using the
official housing com p any and
the p otential p rob lem s of list
“hijacking.”
ake b ooking w ithin the
3. bM lock
“b ulletp roof” b y
p roviding m eaningful incentives.
Be p rep ared to “ham m er
4. hard” if anyone tries to
p oach your registrants.
APEX
Update
The Post Event Report
might be available after you book.
The CV B or your housing partner
The APEX Post Event Report (PER) lays the
can
be very helpful in letting you
g round work for future room b lock m anag em ent.It
know
if you’ve left a hotel out of
d etails a m eeting ’s room b lock pickup and arrival
the
mix.
and d eparture patterns.Thus,it provid es a vehicle
Also, remember that the size of
that hoteliers can use to b etter evaluate a piece of
the
destination and number of
b usiness.
rooms available will affect contracted pickup. If your peak night
Background: U ntil the APEX PER was ad opted as
pickup
will be 1,000 rooms, bookan accepted practice in N ovem b er 20 0 3,a consising
a
city
with 4 0,000 rooms may
tent history or post event report d id not exist in the
give
your
attendees more options
m eeting s ind u stry.Reports varied from hotel to
than
you
would
like. Booking outhotel and from city to city.N ow,all inform ation can
side
of
contracted
hotels is far
b e collected in one place to d em onstrate the total
more
likely
when
the
city has
d ollar value of a m eeting .The report is not just for
many
other
hotel
options
availcitywid e conventions;it is recom m end ed for all
able
to
attendees.
If
your
group
is
g roups with 25 room s on peak nig ht or larg er.
large enough to cause compression—when you consume the
A pplication to room block management: If you
majority of the rooms available in
b uild a house on a solid found ation,it is less likely to
a
destination—then attendees are
fail.Likewise,room b locks should b e b ased on solid
more
likely to end up in your
history.The PER g ives you the vehicle to d o ju st
block
because
there will be fewer
that.W ith it,planners are m ore likely to have coopalternatives
available.
eration from attend ees and hoteliers,and to realize
During the contract phase,
lower attrition rates and hig her occupancy rates.
make sure you include a clause
that prohibits—with a few excepAm ong the accepted practices recom m end ed :(1)
tions—the hotel from offering a
that the PER should b e includ ed as an attachm ent
lower rate to the general public
to any future RF Ps;(2) that the event org anizer,in
than
the group rate. If there’s no
partnership with the event’s suppliers,com plete all
protection
in your contract,
applicab le sections of the report within 6 0 d ays of
chances
are
good
that your attenthe end of that event,and (3 ) that the prim ary
dees
will
book
outside
the block at
event org anizer should file a copy of the report with
the
lower
rate.
In
the
event that
each entity,venue or facility that was used for the
attendees
book
at
a
lower
rate but
event.The room b lock tem plate is structured to
in
the
same
hotel,
your
contract
provid e a thorou g h history of picku p,types of
should include a clause that credroom s used ,the percentag e of slippag e and the
its those rooms—even though
percentag e of room s sold in the contracted b lock
not
part of your block—towards
com pared to the final b lock.S pace is provid ed on
your
overall pickup.
the tem plate for com m ents specific to the g roup
To
preempt the dreaded call
and /or the hotel.
from a disgruntled attendee who
informs you that he or she has
found a better rate elsewhere—and to make sure the hotel honors the no-lower-rate guarantee in your
contract—you’ll need to do some price monitoring of your own. Call the hotel to find out the lowest
rate they’re offering and check the hotel’s Web site, as well as a couple of the sites of major online travel
companies. Travelaxe.com can show you side-by-side prices that you would find individually at each of
these sites.
6
M OTIVATING EX HIBITORS
The most effective way to ensure exhibitors book within your block is to provide them with incentives. Conferon G lobal Services recommends the following:
57
Protecting Your Block
Y
You will undoubtedly have to work hard and smart to motivate your attendees
and exhibitors to stay in the block. But what happens when events beyond
your control conspire to erode your block. Online price shopping, hotel reward
programs and “housing pirates” make block protection an ongoing challenge—
but one that can be overcome with astute planning and preparation.
The Culprits
Online Travel Sites: Five years ago, few people knew how to search the Internet
for lower hotel rates. Today, everyone is accustomed to checking hotel rates online
and usually on more than one site. Sites like Travelocity, Expedia, Hotels.com and
even hotel Web sites themselves sometimes offer lower rates than the ones for
which you contracted. But what many attendees don’t know is that taking advantage of lower rates cannot guarantee them a room at an overbooked hotel.
Oftentimes, the attendee will need to forego loyalty points, may need to prepay
and could be on the hook if they need to cancel or change the reservation. What’s
more, the rooms often for sale at these lower rates may be located next to an ice
machine or elevator, not the place to be the night before an intensive educational
session. Fortunately, most chains have gotten their rate integrity back and are
guaranteeing lowest pricing on their own sites. The dollar savings on rooms found
on travel Web sites diminish significantly during good economic times and
increase during bad times.
E xhibitor Sub- B locks: Exhibitors often book large blocks and are more likely
to do it on their own, rather than through your housing service. In many cases
where associations have faced attrition fees, the lack of pickup in exhibitor subblocks was the primary culprit.
H ousing Pirates: A meeting planner’s worst nightmare, housing pirates are
unauthorized, unaffiliated housing providers that offer rooms at reduced rates to
your attendees, often under the guise of an affiliation with your show. They often
target exhibitors and obtain membership lists before a show’s official housing block
opens. If successful, their efforts to siphon rooms from a block can result in tens of
thousands of dollars in attrition penalties.
STAYING VIGILANT
Protecting a housing block requires event organizers to be part sociologist, part
researcher and even part cop. Success demands the scrupulous monitoring of
many of the foundation steps in the room block management process. (See
Chapter 2 for more details on these building blocks.)
The Golden Rule
The best way to protect your block is to make sure your housing blocks accurately offer a cross section of the desired price points of your attendees and
exhibitors. To do this, you must have a thorough understanding of your attendees’
wants and needs. Remember the golden rule: If the lowest rate in your hotel mix is
too high for any segment of your audience, they will book elsewhere.
Oftentimes, the convention and visitors bureau in the city where your meeting
will be held can help you identify potential problems. Because meeting sites are
booked so far in advance, it’s possible that a new hotel (and a different price point)
56
6
Protecting
Your Block
Don’t let so-called
housing ‘pirates’ hijack
your contracted rooms.
WHAT’S INSIDE:
Staying Vigilant
M otivating Exhibitors
Battling the Bandits
6
CONFERON
55
INSURANCE ACCOUNTING AND SYSTEMS ASSOCIATION (IASA)
Case Study {
Change Leaders:
Conference Director Margaret McK eon and Conferon
Global Services Senior Account Executive John Bettag
THE CHALLENGE:
In 2002, IASA faced a $200,000 attrition damage fee after realizing that 54 percent of all exhibitors
(512 out of 9 9 5 total) booked Rooms Outside the Contracted Block (ROCH). An additional 12 percent of attendees did the same.
THE SOLU TION:
The association chose to motivate their exhibitors and attendees to stay inside the convention-contracted hotels by doing the following:
1. Educated the exhibitors and attendees on the previous year’s $200,000 attrition liability far in
advance and well before the next show’s materials were scheduled for distribution. The new policy was
explained in a letter sent to the group, and pre-show materials reinforced the registration changes and
incentives. The centerpiece of the incentives was based around the registration fee. The base registration fee was raised by $100 and only those staying in the group hotel received a $100 discount.
2. Created a separate package of incentives for exhibitors. Incentives included:
• U p to three complimentary exhibitor badges per 10' x 10' booth, up to a maximum of 12.
Badges entitled exhibitors access to the opening reception, one breakfast and one luncheon;
access to IASA’s general session; and admission to seven technical sessions.
• Each exhibiting company also received two priority points for each hotel reservation made at an
IASA contracted hotel and through the IASA housing bureau. (IASA uses a point system for
space selection for future shows.)
Exhibitors outside of the IASA housing bureau did not receive a complimentary allotment of
badges. Each badge cost them $100 and no special access tickets were attached to those badges for
meals or sessions.
THE RESU LT:
In the first year the program was introduced, 8 8 percent of exhibitors booked rooms with in the
block, nearly double the previous year’s percentage. In addition, the number of attendees staying in the
block increased to 9 2 percent.
5
IASA’S SU CCESSFU L ROCH PLAN
YEAR
SITE
EX HIBITOR ATTENDANCE
IASA HOTELS
ROCH
% OF ROOMS
OU TSIDE THE CONTRACTED BLOCK
2001
2002
2003*
San Antonio
San Francisco
Denver
595
4 33
694
392
512
93
4 0%
54 %
12%
* First year of the incentives
For additional room block incentive solutions, e-mail:
roomblockmanagement@cgscompanies.com, phone: 1-800-246-9011
53
CONDUCTING ROOM AUDITS
Ask a meeting planner who has been faced with attrition fees for advice and he or she will give you
two words: room audit. Room audits are the most effective way to find Rooms Outside the Block
(ROB), and they can help you establish history and avoid attrition fees.
SOLUTIONS
Why Audit?
Board Buy-In
For one reason or another, meeting attendees might book at
The American Industry
the contracted hotel but through a different channel, such as
Hygiene Association used a
through membership in the AARP, AAA or U.S. military. Other
registration fee incentive and
sources of miscoding can include a corporate rate plan, corporate
then gave all board members
travel policy or hotel loyalty plan. Still, if people attend your
a Q & A sheet so they could
meeting and stay in your contracted hotel, your association
answer questions about the
program.
should get credit for those rooms. Sometimes hoteliers can be
Source: CIC’s Project Attrition
reluctant to help you find these rooms.
Remember: Identifying rooms outside the block or outside the
contracted hotels is especially important for future bookings because the bigger your actual room
block pickup this year, the more bargaining power you will have for next year’s conference.
Getting Started
No matter if your association has faced attrition fees or not, performing pre-audits helps keep the
registration and housing process on track. For example, if your conference is six months out, and
you’ve only picked up 150 rooms in an 800-room block, you probably don’t want to wait until you’re
on site to perform the first room audit. Look for red flags like very light pickup or pickup that does
not match the previous year’s pace. The sooner you find ROB, the sooner you can get credit for your
rooms. The sooner you find ROCH (Rooms Outside the Contracted Hotels), the more time you’ll
have to either convince those attendees to rebook inside the block or reduce your block.
How Audits Work
Due to privacy issues, some hotels are unwilling to release a list of guests to a third party, fearing that
the third party might contact guests or sell their names and contact information. When hotels have
this concern, they might offer to conduct
the room audit itself. However, you’ll
< HILTON HELPS REDUCE ATTRITION >
generally uncover more rooms if you are
present during the audit.
he Group Rooms Identification Program (GRIP) is a software
In general the audit process involves a
program designed to interface with the Hilton reservation sysruler and a pencil, but some hotel
tem to cross-reference your group’s reservation list against
chains, like Hilton, have developed softreservations in the hotel system. It helps capture rooms your attendees
ware
that makes it easier to conduct
used but contracted outside the room block.
room
audits. (See sidebar.) In order to
“GRIP was designed as a creative solution to automate a tedious
reap
the
full benefits of a room audit, it’s
manual process,” says Joyce Inderbitzin, CMP, vice president of meeting
important to set the expectation in the
and convention services of Hilton Hotels. “GRIP has the unique ability to
contract that you will conduct an audit
identify rooms outside of the group code any time after reservation
and determine how concessions and
activity has begun, giving the customer the opportunity to reach out to
attendees and encourage them to rebook reservations correctly.”
other entitlements will be handled for
Fully automated and objective, GRIP provides detailed summary
the additional rooms.
reports of rooms booked outside the block, and reduces exposure to
As long as your pickup rate matches
attrition fees by allowing customers to receive accurate credit for histowhat you expected, the best time to conry and comps. The program also tracks actual impact of Internet bookduct a room audit is the day after each of
ing channels. What’s more, GRIP is proprietary, so there are no
the conference’s peak nights. If your conthird-party fees, and it’s completely free to the customer.
ference
is a citywide with small group
Currently GRIP is available at 30 Hilton convention/resort properties,
blocks
in
several hotels, you may want to
but is expected to launch company-wide later this year.
start the room audit process even earlier.
T
52
HOW HOTELS
CAN HELP
artnering with the hotel
to maximize pickup can
help. Hotels can do the
following to add value to the
attendee’s experience:
P
• Offer an early bird room rate—
a discounted room rate until a
certain date or until a certain
number of rooms are sold,
whichever comes first.
• Give vouchers or discounts
at the hotel’s restaurants and
other amenities to those who
stay within the block. These
can include complimentary
drinks, restaurant coupons
and free use of the health club,
parking, Internet and phone
access.
• Offer double or triple hotel
points for staying within the
block.
• Offer express check-in and
check-out services for those
staying in the block.
• For citywide meetings where
transportation to and from
the center is offered to those
who book within the block,
hotels can have room keys
imprinted with the organization’s name. A member of the
bell staff could check for room
keys at the bus stop. The
bureau could provide the
same service at the convention center.
• Waive the resort fee, which
pays for amenities like
Internet, access to the workout room and complimentary
bottles of water.
• If hotel is oversold, honor the
integrity of the group’s housing service by not relocating,
or “walking,” the reservations
made through group housing.
Incenting the Exhibitor
There’s no doubt that it’s a much harder task to get exhibitors to stay in the
block. What works is to create an incentive that is worth more to the exhibitor
than the money saved by staying outside the group’s hotels.
For exhibitors who stay in the group block, these incentives work:
• Complimentary exhibitor badges, which provide access to events like technical
sessions, opening receptions, luncheons, breakfasts and the general session.
• Higher priority status in exhibit space drawings at future meetings.
• The chance to earn points toward more advertising or sponsorship exposures.
• Requiring exhibitors using 10 or more rooms to sign a hotel contract for all
rooms.
Some meeting managers even refuse freight to exhibitors who aren’t staying
within the contracted block, while others require each exhibitor to purchase two
rooms for each 100 net square feet of space rented. (For a more detailed list, see
Chapter 6 .)
Ten Commandments of Attendance Marketing
Marketing efforts are crucial to getting your room blocks filled. It’s important
to market early and market smart. Y ou can make wise choices by comparing your
marketing plan to your housing pace report, evaluating all the marketing categories and analyzing the results of each. Comparing the housing pace of
exhibitors vs. attendees can also prove to be a valuable tracking tool. It’s important
that you know what kind of results are generated by each marketing tactic so that
you can determine what’s working.
Here are 1 0 sp ecific ways to reach your attendees and exhibitors:
1 . Make your meeting or exhibition a “ must-attend” event. Prominently promote your Unique Selling Proposition (USP)—the one thing that attendees can’t
get anywhere else—on all your outbound messages.
2 . Content is king. Become intimate with the educational needs of your audi- 5
ence, provide educational solutions and promote, promote, promote.
3 . D on’t guess the best way to get your message out. Use your attendee satisfaction surveys to research preferred communications channels.
4 . D on’t overuse e-mail just because it is so af f ordable. Marketing doesn’t
work if it doesn’t get read.
5 . A void list fatigue. If using e-mail to market, coordinate outgoing messages
with others in your organization so messages are spaced apart.
6 . Craf t your marketing p lan to get as many p otential “ hits” as p ossible.
Remember, it takes at least three contacts to make an impression.
7 . D on’t forget to ask for the order. Make the “call to action” clear: Ask them to
register; give them an easy-to-use form (print, fax and online); provide the deadline and tell them exactly what you want them to do.
8 . Make it easy to collect money. Offer as many ways to register as possible,
whether online, via phone, fax, check, purchase order, credit card or cash.
9 . Track list sources on registration f orms. Calculate the return rates from
paid registrations from all acquired mailing/contact lists you use.
1 0 . U se actual registration behavior f rom p ast meetings. Calculate the
optimum drop times for direct mail, fax and e-mail messages. Carefully analyze
every aspect of your current marketing campaign to make it even more successful
next year.
51
COMBINING REGISTRATION AND HOUSING: THREE OPTIONS
One of the easiest ways to ensure meeting attendees will book inside the block is to combine the registration and housing process. By making it easy for attendees to take care of all of their needs in one
sitting, you will increase the capture rate or be able to more accurately identify those who are not staying within the block, which creates a marketing opportunity for follow-up.
There are three options to consider:
1. Require attendees to make housing arrangements in your group block before they can proceed to
the registration page. (Local attendees and one-day-only registrants are exempted.)
2. Attendees only receive registration discounts after a guest room has been reserved.
3 . After attendees register for the conference, alert them instantly via e-mail if they forgot to register
for housing. Explain why this is important and provide a link directing them to the housing registration page.
Although it’s best if the registration process is online, always provide a phone number that a registrant can call to talk to a representative.
Deposit Do’s
Just because an attendee or exhibitor is required to book housing before being able to register,
that doesn’t prevent them from canceling the reservations. A deposit policy, which is typically nonrefundable and covers the cost of at least one night of housing, can help prevent this from happening. While there will always be some cancellations, requiring a deposit will provide a disincentive to
those attendees and exhibitors who make in-block room reservations with no intentions of keeping
them. (See Chapter 3 for more best practices for room deposits.)
SOLUTIONS
CREATING INCENTIVES
Only about one-fifth of all meeting attendees are aware that their groups
could suffer attrition fees if they choose to stay in hotels outside the block,
according to a poll taken by the Convention Industry Council’s Project
Attrition. A third of attendees said they would help their groups if inducements were given, which supports the survey’s finding that cost is the main
concern for attendees when making housing decisions.
Survey respondents said that money-saving incentives would encourage
them to use the group’s hotels, but these incentives need to be substantial
enough to make a real difference in attendees’ wallets. A $25 discount on registration is not enough to make an attendee want to stay in the block, but an incentive worth $100 to
$150 will eliminate the desire to book elsewhere. Another important thing to remember about incentives is that they should be presented as encouragement for staying in the block—not as a penalty for
booking elsewhere. Incentives always work better than penalties.
Fact: No CGS group using these types of incentives has ever picked up less than 90 percent of all the
guest rooms used for the event.
Full Disclosure
The American Academy of
Orthopaedic Surgeons stipulates that their attendees
must state where they are
staying before they receive
their registration packet.
Incenting the Attendee
Here are some of the most popular and successful attendee incentives:
• Raise the registration fee by $100 or more and then offer registration discounts of that same amount
only to those who stay within the block. Not only will it keep attendees inside your block, it will protect the revenue you receive from registrations.
• Allow attendees staying within the block to earn points toward products and services provided by
your organization.
• Offer drawings for amenities, suite upgrades at the host hotel, round-trip airport transfers or free
registration at next year’s conference, open only to those staying inside the block. (These are not as
effective when used without a registration incentive.)
• Offer special incentives, such as free merchandise credits, a reduced fee pass for local attractions or
attendance at a special networking reception only for those staying in the block.
50
8. Prize drawing. Earn a chance to enter a drawing for a free registration or complimentary guest
room.
9. L ower registration fees. Smart groups offer registration discounts to discourage “Internet shopping.”
10. Hotel incentives. Announce to attendees,“By staying in the official hotel(s), you will receive the
following additional benefits...” Some hotels will offer additional incentives to groups that proactively
combat rooms outside the contracted hotels. These incentives include additional hotel points, free
high-speed Internet, free health club or other incentives that have low to no cost to the hotel, but are
valued by the attendees.
Language Matters
Below are examples of the language that some associations have used to explain to conference attendees the importance of booking in the block:
From the Medical G roup Management Association’s 2005 Annual Conference R egistration Form:
“MGMA has reserved rooms at two area hotels. Reserve your accommodations early for the best
chance of getting your first choice, as the number of rooms held at each hotel is limited. By making
housing reservations through the MGMA housing bureau, you receive a discount on your registration
fee. Staying at the official conference hotels will keep your registration fees at current rates. If MGMA
does not achieve a minimum number of overnight accommodations, the price of services will increase
registration fees for future programs. Without your support, MGMA faces huge financial penalties for
unused sleeping rooms.”
5
SOLUTIONS
From the Direct Marketing Association’s R egistration Form:
Shuttle Diplomacy
“It benefits everyone when exhibitors and delegates utilize this service. By booking
VNU Expositions issued a
your hotel rooms in the official housing block, you:
complimentary shuttle pass
• Allow the DMA to return to the cities you love. In order to hold a conference in the
only to attendees staying in
convention center of the major cities, the conference must “qualify”to use the buildthe convention block. The
ing. In many cases, this qualification translates to utilizing a minimum number of
passes were distributed by
hotel rooms in the city over the conference dates.
the contracted hotels upon
• Help us avoid costly hotel penalties. If we do not fill the rooms we have contracted,
check-in.
penalties are assessed to the association. By avoiding these penalties, the DMA is
able to keep your conference costs down.
• Take advantage of a one-stop process for registering and booking your hotel room.
• Help us provide shuttle bus service for conference attendees—saving you on taxi fares.
To recognize your cooperation in booking through the official DMA Housing Bureau, special
incentives are given that we feel will benefit your exhibiting experience.”
49
Maximizing Pickup Within Your Block
Y
You’ve selected the hotels, reserved the block and negotiated a contract. Now you
need to focus on making sure your block fills up as you had anticipated. As recently as 10 years ago, this wasn’t hard to do. But with the advent of the Internet and
the increase in popularity of hotel loyalty programs and bargain travel Web sites,
it’s a hard sell to convince some attendees and even more exhibitors that staying
inside the block will benefit them.
What’s at Stake?
While attrition fees make headlines, there are a number of other reasons why
it’s critical to maximize and accurately report room pickups.
• Attrition Fees: Perhaps the most feared consequence of low pickup is attrition,
which can result in catastrophic damages for your association. In the aftermath
of 9/11, six-figure attrition fees were not uncommon.
• Leverage: The value of your business is largely dependent on the number of
guest rooms your meeting brings to a hotel or destination. If attendees book
outside a contracted hotel, your organization will lose negotiation leverage in
future years. Plus, your group’s reputation could be damaged if you fail to fill
your block.
• Lost Concessions: Many of the concessions routinely negotiated in a contract,
including comp room ratios, upgrades, free Internet access and even complimentary coffee breaks between sessions, depend on a group’s ability to meet
SOLUTIONS
their pickup goals. Excessive slippage may limit a hotel’s willingness
to grant future concessions.
Block Discounts
Hundreds of groups, including Deloitte & Touche, offer a
$150 discount on conference
registration for all attendees
who book in the block.
BUILDING BUY-IN
Educate your attendees about the importance of staying within the block by communicating what’s in it for them. Consider
creating and marketing a list of reasons to stay inside the conSource: CIC’s Project Attrition
tracted hotel block and include this list directly in your meeting
brochure or Web site. Here are Conferon Global Services’ top 10
reasons that address attendees’ priorities:
1. N etworking. Make the most of your conference by spending more quality
time with other attendees or exhibitors.
2.Convenience.Ride the elevator to and from the sessions and events.
3. Support your association. Help it earn free or discounted meeting space,
more concessions and decrease its liability for unused rooms to keep your registration fees lower and more competitive.
4. Cost savings. Save money on rental cars, parking and taxi fares.
5. Conference shuttle. Enjoy the convenience of complimentary shuttle service
to and from the convention center.
6. Customer service. Take advantage of superior reservation procedures.
Rooms booked through Internet channels are often difficult to cancel or change
and often require prepayment. Plus, the non-chain Internet channels do not offer
frequent stay points.
7. Low-rate guarantee. Shop for competitive rates by viewing conference hotels
on their chain-branded Web sites. Many chains now offer a lowest-rate guarantee
on their branded site.
48
5
Maximizing
Pickup Within
Your Block
Experience has shown that
attendees respond to incentives
for booking within the block.
5
WHAT’S INSIDE:
Building Buy-in
Combining Registration and H ousing
Creating Incentives
Conducting Room Audits
47
ing a mutual cancellation clause that spells out liquidated damages for the hotel and group since it is
more difficult to calculate the cost to the group if
the hotel cancels.
GROUP CANCELLATION
m Create a sliding scale of day or date ranges prior to
arrival, along with percentages of room revenue
profit that the group will pay, if cancellation takes
place within that range.
m Provide a specific formula where the amount due is
the lesser of two calculations per night.
For example:
• Determine the Maximum Cancellation Charge by
multiplying the number of rooms blocked per night
by the applicable percentage in the scale.
• Determine the number of Unsold Rooms Available
for Sale in the hotel by subtracting complimentary,
out-of-order rooms and total occupancy from
hotel’s total inventory.
• For each night, the group will pay 75 percent of the
group’s single rate (representing the lost profit on
the rooms revenue) multiplied by either the
Maximum Cancellation Charge or the number of
Unsold Rooms Available for Sale for the night,
whichever is lower.
m Require documentation for resold rooms and rooms
unavailable for sale.
m State that after receipt of the cancellation charge,
the hotel will not seek additional cancellation damages.
RIGHTS OF TERMINATION FOR GROUP
m Establish that the group may terminate the contract
if it determines that construction or remodeling will
interfere with the event. Provide a time frame.
m Allow termination by group within a given time
frame if the hotel changes management company,
ownership, franchise, files for bankruptcy or is foreclosed.
m Prohibit the hotel from booking competing groups
identified to the hotel and permit termination by
group within a given time frame, if the hotel is in violation.
m Prepare for possible unavailability of the convention
center (or other required facility) by including a termination option by the group within a given time
frame.
INDEMNIFICATION
m Add a reciprocal clause in which each party indemnifies the other for the negligence of the indemnifying party.
m Require that each party “defend” the other.
m Include the hotel’s service or sale of alcohol in its
indemnification of the group.
MISCELLANEOUS
m State that both parties will carry sufficient insurance
to cover any claims.
m Require the hotel to warrant that its facility will not
deteriorate, using a benchmark such as a commercial rating system (Mobil, AAA, etc.)
m Specify how notices are to be sent, and that they are
effective upon receipt.
AMERICANS WITH DISABILITIES ACT
m Establish that the hotel warrants compliance and list
any “grandfathered” areas the hotel may have.
m Outline the limits of the group’s obligations.
m Stipulate that each party will indemnify the other for
violations caused by the indemnifying party.
CLOSING
m Include a merger clause stating that the contract
and attachments constitute the entire agreement
and contain all terms, including benefits and liabilities.
m Stipulate that the contract prevails over ancillary
terms, such as policies and procedures, and that
changes can be made only in writing.
m Establish that the rest of the contract is still valid
even if any provision is unenforceable under applicable law.
m State that the individuals signing the contract have
the authority to do so. Add signature lines and identifying information—name, title, group name and
date.
Source: The Conferon Global Services Book of Lists,
sponsored by the Chicago Convention and Tourism
Bureau.
45
4
3Checklist
HOTEL
CONTRACT
m Require the hotel to set and be prepared to serve
5 percent over each guarantee.
SALE AND SERVICE OF ALCOHOL
m Specify the bartender ratios for hosted and cash
bars.
m State there will be no bartender or service fees.
m Require the hotel to adhere to all federal and state
laws regulating the sale and service of alcoholic beverages.
m Include that the group will conduct an inventory of
all chargeable beverages before and after each
cocktail function.
FOOD AND BEVERAGE PERFORMANCE
m State whether there will be liability for canceled or
reduced food and beverage functions or reduced
F& B revenue.
m Agree to provide 80 percent (percentage is negotiable) of a minimum dollar amount of guaranteed
food and beverage revenue. If the group actualizes
less, it will pay the lost profit on the slippage, usually
30 percent of the F& B charges.
m Indicate that the amount due will be considered liquidated damages. (See “Attrition” below.)
EXHIBIT SPACE
m List the type, size, number of booths and other
requirements.
m Specify the days, dates and start/end times of the
show—setup and move-in, tear-down and move-out.
m State if rental charges will be waived or, if charged,
include the amount charged per net (not gross)
square feet.
m Itemize what is included in the rental, such as setup
and dismantle days, general lighting, climate control,
and daily maintenance and vacuuming of aisles.
m Itemize what is not included in the rental, such as
drayage, decoration, labor, security service and
cleaning in individual booths.
m Include an exhibitor responsibility clause that
absolves both the hotel and group of liability.
ROOM BLOCK MANAGEMENT
m State clearly whether there will be liability for room
block performance.
m Prevent multiple charges for the same room block
slippage by allowing only one room block performance term—usually attrition or a meeting room
rental scale.
44
ATTRITION
m Set a specific date or time frame for determination
of the final adjusted room block, which is the figure
that will be used to calculate attrition. Indicate there
will be no charge for room block adjustments up to
that date or time frame.
m Include a formula for calculating the amount due if
the group fails to pick up a specified minimum percentage of the final adjusted room block. This
amount is considered “liquidated damages” and
should be labeled as such.
m Determine the Minimum Commitment by multiplying the number of rooms blocked per night by the
negotiated percentage. Then subtract the actual
group pickup, including miscoded and relocated
rooms.
m Determine the number of Unsold Rooms Available
for Sale in the hotel by subtracting complimentary,
out-of-order rooms and total occupancy from the
hotel’s total inventory.
m For each night, the group will pay 75 percent of the
group’s single rate (representing the lost profit on
the rooms revenue) multiplied by either the
Minimum Commitment or the number of Unsold
Rooms Available for Sale for the night, whichever is
lower.
m State that after receipt of the attrition charge, the
hotel will not seek additional performance damages.
CONTRACT MANAGEMENT ISSUES
m Include a force majeure clause that is mutual, incorporates at least one broad standard for excuse of
performance (like “inadvisable”), allows for attrition,
establishes a benchmark of percentage of attendees
affected (25 percent, for example) and provides a
catch-all phrase such as “any other emergency.”
m Stipulate that if the hotel is overbooked, the hotel
will pay for a room at another comparable property
and daily transportation until a room in the hotel is
available. State that the hotel also will pay for two
five-minute phone calls and attempt to upgrade the
guest upon return. Require that relocated rooms
and room revenue will be credited to the group’s
overall pickup.
m Do not allow charges added after the contract is
executed unless the group agrees to such charges in
writing or unless the charges are an additional tax or
otherwise required by law.
m State that the hotel may not cancel except for the
causes specified in the contract. Refrain from includ-
group will maintain confidentiality of the list.)
m Stipulate that miscoded rooms will be credited to
the group’s pickup.
m State that the group will receive credit for all rooms
booked by attendees, regardless of the room rate or
reservation method, including Internet distribution
channels.
PAYMENT
m Indicate whether individuals or the group are
responsible for each category of charges—guest
rooms, incidentals, etc.
m Spell out the policies for individual deposits, including acceptable forms of deposit and the hotel’s
refund/ cancellation policy. Stipulate that name
changes to reservations will be allowed and made at
no charge.
m List any deposit amount(s) due to the master
account and terms of payment.
m Describe the terms of application for the master
account. (If credit is not approved, prepayment of
50 percent of the estimated master account will be
required prior to arrival, with the balance due at
departure.)
m State that if credit is approved, payment of all undisputed charges will be due 30 days after receipt of
the final invoice, after which finance charges not
exceeding 1.5 percent per month will be applied to
the unpaid, undisputed portion, beginning 30 days
after receipt of the final invoice.
CONCESSIONS
m Itemize all concessions with specific detail, such as
two complimentary, one-bedroom suites for up to
four nights each, four complimentary, round-trip airport transfers, three complimentary, welcome VIP
amenities, etc.
m For the “one-per-50 complimentary rooms” concession, ensure that it will be calculated for revenue-producing rooms on a cumulative basis, not
per night. Specify whether comp rooms will be
assigned and/or credited to the master account at
the group rate.
m If concessions are tied to picking up 80 percent of
the room block, specify exactly how they will change
if the group fails to meet the minimum pickup.
m Consider requesting complimentary concessions
unique to your meeting, such as a house phone with
outside call capability; pencils, pads and pens in
function rooms not set theater style; easels for sig-
nage placement; microphone and hotel sound system for each day requested in function rooms set
for 60 or more people.
AGENDA
m Include the preliminary agenda in the contract or
attach it to the document (even if you may have
future changes), and state that the hotel is holding
space according to the agenda.
m Define the meeting space requirements using a
table format with day, date, time, type of function,
room setup, estimated attendance, rental fee and
minimum square feet required/ceiling height
required (or room name) across the top. List the
days and dates along the left side and fill in the
spaces with the applicable information.
m Stipulate start/end days, dates and times for 24hour hold on space.
m Include terms for the release of meeting space.
FUNCTION SPACE
4
m Provide due dates for the tentative and final agendas (12 months and six months, respectively).
m Spell out charges for meeting room rental and/or
setup, and state that there will be no meeting room
rental, setup or labor charges other than those, if
any, specified in the contract.
m Stipulate that changes to function space assignments or requirements are not allowed without written consent of the group.
m Indicate that the hotel’s agreement to provide the
specific function space assignments and/or minimum square footage and ceiling height requirements specified in the contract is a condition of the
group booking the property.
m Ensure that the group may use outside contractors
of its choosing without a surcharge from the hotel
or its in-house supplier. Itemize all areas where this is
permissible—audiovisual, exhibitor decorating, security, meeting room Internet service, etc.
MEALS
m Specify the banquet staff ratios, and state that there
will be no extra service or labor charges for these
ratios.
m State that menu prices will be guaranteed six
months out.
m Note that guarantees for all food and beverage functions will be due 48 or 72 hours prior to each function.
43
3Checklist
HOTEL
CONTRACT
Ideally, your hotel contract should be a balanced document that is fair to both parties. The basic terms
listed below w ill help you achieve that goal for your largest meetings that are planned years ahead.
F or smaller meetings that are more short-term, delete the items that don’t apply. K eep in mind, how ever, that this information is not intended to be legal advice. A q ualified attorney, familiar w ith
the meetings industry, should be consulted to review all contract issues. F inally, remember that
everything is negotiable.
IDENTIFYING INFORMATION
m Call the document a “Group Sales Contract.”
m Include the date of contract initiation.
m Provide accurate and complete legal names of both
parties (from letterhead or business cards) as well
as contact information.
m State the name of the meeting and dates.
m Identify how the parties are referred to and state
that they agree to the following terms. (“Group and
Hotel agree as follows...”)
m Include the date the signed contract is due back to
the hotel.
HEADQUARTERS HOTEL STATUS
m Affirm that the hotel will be designated the headquarters hotel in all meeting-related publications
and that, based on the hotel’s capacity, most food
and beverage functions will take place there.
m Establish that if the hotel is not the headquarters
hotel, it may reduce the room block and meeting
space but only with the group’s approval.
GUEST ROOM BLOCK
m Specify that the hotel is “holding” rooms for the
meeting, using language that does not lock the
group into payment.
m Define the block using a table format, with the year,
days and dates across the top, types of rooms down
the side and numbers of rooms in the spaces.
GUEST ROOM RATES
m Specify definite rates that cannot be changed, as
well as the year to which the rates apply.
m If future rates are quoted, require that they be calculated with a formula that uses the lowest of at least
two of the following three factors—percent off the
lowest, single rack rate, percent increase per year or
rate growth tied to the Consumer Price Index. Final
rates should be determined 12 months out.
m Include a breakdown by type of room/suite,
single/double, deluxe, government rate, etc., with
the percentage blocked in each rate category.
m Specify applicable taxes (sales, occupancy), service
charges, gratuities, etc.
42
m Include the charge for an additional person in the
room.
m Stipulate that group rates will apply three days
before and after the room block dates.
m Specify that the rates will be at least as low as any
comparable group in-house at the same time,
and/or that if the hotel offers lower individual transient rates, those rates will also apply to attendees
who meet the booking restrictions of the lower rate.
RESERVATIONS
m Indicate whether reservations will be made by rooming list or individual call-ins. If the latter, note that
reservations may be made directly with the hotel via
call-ins, reservation card or form, the Internet or
other channels available to groups.
m If a housing bureau will be used, state the name of
the bureau, and that reservations will be handled at
no extra charge to the group. Stipulate that if attendees make reservations on their own, outside the
bureau or other group-approved methods, those
rooms will not be taken out of the group block.
m Specify check-in/check-out times.
m State that confirmations will be sent by the hotel
within seven days of receipt of reservations or reservation changes.
m Require the hotel to load the room block/reservation
procedures into the hotel’s central reservations system when the contract is executed or when final
rates are determined, whichever is later.
CUTOFF DATE
m Stipulate the cutoff date—typically between 21 and
30 days prior to arrival, which is the day attendees
fill 50 percent or more of the greatest number of
rooms blocked.
m State whether reservations made after the cutoff
date will be based on room availability and given the
group rate or the best available rate.
ROOMS OUTSIDE THE BLOCK
m Arrange to compare the hotel’s in-house guest list
with the group’s registration list, either independently or alongside a hotel representative. (State that the
CONTRACTS CORNER:
Ensuring Low Rates
Many hotels look to wholesale and online distribution
channels to help sell their available inventory. At
some hotels, rooms available through these channels
are often offered at rates lower than the contracted
group rates. You can take measures prior to contract
signature to help prevent this situation.
Make sure that rate protection clauses are negotiated into the contract. If
future rates are not yet confirmed, specify a formula that spells out how
the rates will be determined. It should use at least two of these three factors: percent off rack rate, percentage increase per year or Consumer Price
Index increase per year. The final rate should be the lowest of the benchmarks used. There should be a clause protecting rates from deals being
offered to the general public, as well as one ensuring that rates are not
higher than those offered to similar groups.
If your group is occupying more than 50 percent of the hotel’s rooms,
consider the following clause:
4
Lowest Rate: If Group’s pickup is not a cause for Hotel to offer a rate
lower than the contracted group rate (Group must pick up 80 percent of
its room block), Hotel agrees that the Group will be guaranteed the lowest rate in-house over the meeting dates. E xceptions include negotiated
volume corporate business and/or government accounts, airline crew
rooms and other similar agreements. This guarantee applies to rates
made available to the general public, either through the hotel reservation
department, 800-reservation service or any online distribution channel.
Should a lower rate be discovered, the Hotel agrees to either offer the
lower rate to all of the Group’s attendees or to have the lower rate
removed from all distribution channels.
After the contract is signed, what strategies can be used to ensure that
the rate protection clauses are being honored? Call the hotel reservations
department anonymously prior to sending out marketing materials for the
meeting. Ask to make a reservation over the dates of the meeting and
request the lowest available single/double rate and availability of any special rates like those offered for AAA. Calls should be made every three or
four weeks thereafter or upon notification of lower rates by one of the
group’s attendees. If it is discovered that a lower rate is being offered,
address the situation with the hotel salesperson. If lower rates are available,
the hotel should be asked to either close out the rate over your dates or
offer it to the entire group.
* Note: This information is not intended to be “legal advice.” A qualified
attorney should be consulted to review all contract issues.
For more information about hotel contracts, e-mail:
roomblockmanag ement@ cg scomp anies.com, p hone: 1-8 0 0 -24 6 -9 0 11
41
AP EX
U p d ate
Req uests fo r P ro p o sals
An accurate request for proposal (RFP) to a housing facility
or m eeting site is an im portant part of m anaging room b locks.
U nless the RFP contains all the inform ation necessary for a
property to d esign a thorough and accurate proposal,a m eeting m ay b e d oom ed to failure.
Background: The RFPs Panel is d eveloping b est practices that
w ill ensure the b est possib le partnership b etw een planners,
their organizations and various suppliers.The report w ill contain
RFP tem plates for single facilities (a form should b e com pleted
for each facility if m ore than one is used ),A/V services,service
contractors,show m anagem ent,transportation m anagem ent
and d estination m anagem ent.E ach contains an event profile,
as w ell as event requirem ents and specifications,and required
content that should b e part of each proposal.The RFP accepted practices can b e used for any gathering— from a b oard
m eeting to a cityw id e convention.
A pplication to room block management: B est practices state
that the m ost recent APE X Post E vent Report for a m eeting
should accom pany an RFP.In ad d ition,planners should includ e
as m any d etails as possib le,so that suppliers m ay respond w ith
a m ore targeted and com plete proposal for the m eeting.This
w ill also cut d ow n on tim e-consum ing,b ack-and -forth com m unications that have taken place in the past.The housing facility
tem plate contains inform ation on d em ographics,anticipated
num b er of attend ees,the event history,guest room b lock
requirem ents and d ecision factors.
G ro up Cancellatio n
The cancellation clause is not considered part of room block management, but
it deserv es mention because it falls under the broader umbrella of room rev enue
management. The cancellation and attrition terms hold potentially the most liability for y our group and are thus most likely to be the prime focus of negotiations
w ith the hotel. M any of the same principles apply to cancellation as to attrition, so
y ou need to check the cancellation clause carefully .
A s w ith attrition, the model cancellation clause w ill show charges based on a
percentage of room rev enue or profit, not the full room rate. F or cancellation,
there w ill be a sliding scale of day or date ranges prior to arriv al, along w ith percentages of room rev enue or profit that the group w ill pay if cancellation takes
place w ithin that range. A s w ith attrition, there should be a specific formula w here
the amount due is the lesser of tw o calculations per night. S imilarly , the hotel
should be req uired to prov ide documentation for resold rooms and rooms
unav ailable for sale, the terms should be defined as liq uidated damages, and the
hotel should agree that the cancellation fee, due according to the terms of the
clause, is the hotel’s sole remedy for cancellation.
40
Attrition Liab ility Calculator
M INIM UM COM M ITM ENT (I.E.80% )
26 -Jun
27-Jun 28-Jun 29-Jun 30-Jun
1-Jul
2-Jul
3-Jul
4-Jul
5-Jul
Total
Contracted B lock
20
40
80
120
80
40
20
-
-
-
400
80% com m itm ent
Your g roup’s actual pickup
16
10
32
20
64
40
96
60
64
40
32
20
16
10
0
5
0
0
0
0
320
205
A.Per nig ht liab ility
6
12
24
36
24
12
6
-5
0
0
115
B . Room s availab le for sale in hotel*
0
10
25
40
10
6
10
10
0
0
Liab ility (lesser of A or B )
0
10
24
36
10
6
6
-5
0
0
87
TOTAL LIAB ILITY
Sing le Room Rate $200.00 x 87
Room nig hts X 75% = $13,050
* Total hotel room s m inus com p room s,unavailab le room s and all room s sold that day.
Room Profit Percentag e (100% ,unless neg otiated to b e low er)
75%
There are other important terms that should be a part of any attrition clause or formula. A provision for adjustments to the room block should be made without charge up to a specific date or time
frame. At that time, the final adjusted room block will be determined, and attrition based on that. The
terms should be defined as liquidated damages, agreed not to constitute a penalty. O fficial documentation should be required from the hotel showing resold rooms and rooms not available for sale.
Attrition damages should never be due until after the documentation is provided. The hotel should
also agree that any attrition fee due in the clause is the hotel’s sole remedy for lowered performance.
4
M EETING ROOM RENTAL SLID ING SCALE
An alternative to attrition for room block performance is a graduated charge for meeting room
rental. It’s important to note that this is an alternative choice. B e mindful of the need to prevent multiple charges for the same room block slippage. Allow only one room block performance clause— usually attrition o r a meeting room rental scale.
AD D ITIONAL CLAUSES
O ther contract clauses can help you properly manage your room block in a more general sense:
Room B lock Review D ates
H otels sometimes include a schedule of room block review dates where adjustments can be made
without charge. The date closest to the meeting is the date when the final room block is determined,
and attrition will be based on that. O f course, the further out the time frame, the more difficult it is to
anticipate pickup. That’s why this kind of clause is most useful if the final date is reasonably close to the
meeting dates ( say, six months) , and if unlimited adjustments can be made on each of the scheduled
room block review dates without charge.
Room s Outside the B lock Clause
This clause is certain to boost your pickup count after the meeting is over, so it is an important one
to include.Y our group should receive credit towards its pickup for rooms that were booked outside the
contracted room block. A comparison of the group’s registration list and the hotel’s guest list will
accomplish this. The names of attendees occupying rooms who are listed on both the registration list
and the hotel’s guest list but not coded to the group in the hotel’s system should be credited to your
group.
39
APEX
Update
Contracts Panel
Contracts form the legal basis for any
agreements and subsequent actions
between suppliers and planners. S uch
important documents often take significant time to promulgate—to ensure that
all appropriate clauses are included and
that both parties are equally protected.
Background: The goal of the APEX
Contracts Panel is to provide guidance
about common types of meeting industry contracts. W hen completed, the final
report will detail best practices for contract development and review,
approaches to consider, and guidance
for preparing clauses for the top 10 sections of contracts as they apply to meeting management.
Panel members recognize that no one
contract will work for every event. Too
many variables exist. H owever, the panel
is striving to provide a template, so that
all applicable clauses are in the same
place from contract to contract. A common template will speed the time for
review, and hopefully, lead to a better
understanding between contracting parties.
The contracts panel report will not be a
panacea that will answer all questions or
solve all legal problems. N or should it be
a substitute for legal advice. But it will
provide a basis to begin discussion—
especially for the estimated 50 percent of
meeting planners who do not seek legal
advice before signing meeting contracts.
Application to room block management: M any contract clauses that require
the most attention deal with room block
management—attrition, cancellation,
guest room accommodations, termination and excuse of performance (including force majeure), damages, conflict
avoidance, concessions, mitigation, audit
and pickup reports. Each of these issues
will be considered by the panel and
included in the final report.
38
CALCULATING ATTRITION DAMAGES
Depending on how your attrition clause is written, a hotel
could actually charge a higher attrition fee than you really need to
pay. That’s one reason why it’s crucial to be aware that unfair practices can enter into attrition calculations and to understand how to
prevent such problems. Once you have decided that the terms are
fair, make sure the clause is written clearly enough, so that you and
the hotel can independently perform the calculations and arrive at
the same amount due.
A sample attrition liability calculator appears on the facing
page. Here are the instructions:
Build a spreadsheet that lists each day of your “ C ontracted
1 Block”
across the top from left to right.
Below each day show the minimum number of rooms you
were required to fill. (If your attrition guarantee number
2
was 8 0 percent, then multiply each day’s block by “ 8 0 percent
C ommitment.” ) L ist this minimum guarantee under each day.
Next list “ Your G roup’s Actual P ickup.” Be sure to include
3
comps, any walked rooms and any rooms outside your
block that you found by comparing your list to the hotel’s inhouse list.
Subtract your actual pickup from the minimum required
pickup and list it for each day. This is your “ P er Night
4
L iability,” shown as R ow A. Highlight this row since you will be
comparing it to another row.
In R ow B list the hotel’s total number of “ R ooms Available
For Sale.” C alculate this by taking the hotel’s total number
5
of rooms (minus rooms under repair and rooms comped to
others) and then subtracting the total number of rooms that the
hotel sold to individuals and groups (including your sold rooms
and your comps). This shows how many rooms did not get sold
each night of your meeting.
In the next row—“ L iability (lesser of A or B)” —select from
row A and B the number for each day that reflects the least
6
amount of attrition. This is the row that shows the liability for
each day.
Now, add the numbers across this final row to determine
7
how many room nights you may owe—8 7 in this example.
If the number is negative, you owe no attrition. If the number
is positive, multiply that number times the room rate ($ 2 0 0 )
and then multiply that result times the room profit percentage.
The result will be your obligation to the hotel. (In this example,
the planner below negotiated a room profit of 7 5 percent.
R emember that if you don’t specify it in your contract, the room
profit will be 1 0 0 percent.)
Before coming to
closure with a
hotel, check out
room rates on the
Internet or find out
what other groups
are paying at similar
times. A competitive
rate will encourage
booking within
the block.
4
W hat should you look for?
Many hotels expect groups to agree to guarantee to occupy or pay for 80 percent of the rooms
clocked, but don’t feel like you automatically have to give in to that request. Many groups have asked
for and received concessions when it comes to attrition terms. W hen determining what to ask for in
your attrition agreement, consider the following:
• Include room block review dates that enable you to adjust the block without paying damages.
Oftentimes, this needs to be done six to 12 months before arrival.
• Try to negotiate for a lower minimum commitment than the standard 80 percent.
• If your meeting includes a headquarters hotel and secondary hotels, consider refusing to agree to
pay attrition in an overflow hotel.
• Try to negotiate to pay attrition for the lost profit on a room.
• Try to get attrition damages to only apply on the peak nights of the room block.
• Make sure the contract explicitly states how attrition damages will be calculated. (For more information on the correct way to calculate damages, see page 3 8.)
W hen is it okay not to have an attrition clause?
In some cases, especially involving smaller meetings or short lead times, hotels are willing to sign
contracts without any attrition clauses. For instance, some convention and visitor bureaus offer to
eliminate attrition charges for groups that meet certain conditions, such as offering incentives to attendees for booking contracted hotels. If you’re able to negotiate a hotel to sign a contract with no attrition clause, you should still take some precautions.
Most importantly, make sure the contract clearly states there will be no damages for not picking up
the contracted block. Just because there’s no attrition clause in the contract doesn’t mean the hotel
won’t try to charge attrition fees. If left unmentioned, they could arguably have a claim for your group
to use and pay for the entire block. It’s much better to include a no-attrition clause than neglect to
address the issue at all. W hen you and the hotel have agreed on no attrition, here is a suggested clause
to use:
The parties agree that the Hotel will not assess any fees against Group should Group hold the meeting
b ut fail to utiliz e the total room b loc k as outlined in this C ontrac t.
Note:
This information is
not intended to be
“legal advice.” A
qualified attorney
should be consulted
to review all legal
issues.
37
Formalizing Hotel Agreements
H
H ere’s an Rx for the anxiety that inevitab ly accom p anies hotelnegotiations.Close
your eyes and rem ind yourself that b oth p arties have the sam e goal,which is to
live up to their contractualcom m itm ent and ultim ately to p ut head s in b ed s.No
m atter how com p licated the finished d ocum ent b ecom es,the contract itself is
sim p ly a m eans to ensure that each sid e will p erform everything that has b een
agreed up on.It’s a road m ap .
NEGOTIATION
ATTRITION
HOTLINE
Need help developing
an attrition strategy?
E-MAIL:
room b lockm anag em ent@ cgscom
OR CALL:
Jeff Fug ate at (330 ) 4 25-8333
Knowledge is power, especially when it comes to negotiations. Know everything there is to know about your group and learn everything you can about the
properties you’re considering. Ask the right questions to make certain the hotel
accurately evaluates your piece of business. Here are other tips to help your
negotiation process go more smoothly:
Be specific in your RFP. You can streamline the negotiation process by being
as specific as possible and including everything from meeting space and F& B
requirements to staff room rates and V IP amenities in your initial request.
Priorit iz e. You can ask for the moon, but make sure you separate
“needs” from “wants.” Space, dates and rates will always top the list.
C onsid er m ore t h a n one h ot el or cit y, b ut not t oo m a ny. It’s never a
good idea to limit your negotiation clout out of the gate by considering
only one alternative. Hotels are on RFP overload, so it is best to limit your
options to four or five good prospects to drive a competitive process.
However, let each hotel know that it is not the only property under conp anies.com
sideration. Don’t announce a city as the destination until you have worked
through some of the key negotiations at the major hotels.
Be rea list ic a b out t h e v a lue of your b usiness. “If the baby’s ugly,” CE IR
president Doug Ducate once explained, “the hotel will let you know.”
Flexibility in arrival/ departure pattern, seasonality and meeting space
requirements can turn an ugly baby into a handsome prince.
D o your h om ew ork . Before coming to closure with a hotel, check out room
rates on the Internet or find out what other groups are paying at similar times. A
competitive rate will encourage booking within the block.
CONTRACT CLAUSES
The end product of your negotiations has finally arrived: the contract. You
will have already discussed many of the terms with the hotel, but the written
version with boilerplate language may contain surprises and differ from your
understanding. U ntil the contract is dually signed, the terms are still negotiable,
so examine the language very carefully and prioritiz e your requests for changes.
In order to properly manage the room block, several clauses deserve special
attention.
ATTRITION CLAUSES
Attrition is a hot issue for both meeting planners and hoteliers. Guest rooms
are a perishable commodity. When your group does not fill the rooms you have
blocked for your meeting, the hotel loses money (if they are not able to resell the
rooms) and will usually insist upon an attrition fee. Attrition terms should be
decided during the contract negotiation phase, but as a planner, be informed
about the issues and pitfalls involved and see to it that your rights to a fair and
balanced contract are represented.
36
4
Formalizing
Hotel
Agreements
The shared goal of both
parties is to put heads in
contracted beds.
4
W HAT ’S INSID E:
Negotiation
Attrition Clauses
Calculating Attrition D amages
Additional Clauses
Hotel Contract Checklist
35
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Conveniently located from airports to city centers to resort destinations, every Hilton property
offers a wide range of products and services so guests will find just what they’re looking for.
Business travelers will appreciate the private lounges and helpful concierges offered on
executive-level floors at select Hilton hotels.
Executives planning corporate retreats will
appreciate that conveniently located Hilton hotels and resorts provide access to culture, sports,
scuba and snow – even gaming and safari. Other business features include hotel business centers,
videoconference facilities, plus generous in-room workspaces and high speed Internet access.
T ravelers in every country and time zone can benefit from the award-winning Hilton website at
www.hilton.com. Guests can easily make reservations and access other important information
instantly.
Perhaps one of the strongest loyalty incentives offered to guests by the Hilton Family is the
acclaimed Hilton HHonors® rewards program. Hilton HHonors is the only program that
rewards guest with both hotel points and airline miles for the same qualifying stay at more than
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Hilton HHonors membership, earning of P oints & Miles® and redemption of points are subject to HHonors T erms and Conditions.
Need to Minimize Walks? Take These Five Steps
Prior to your arrival and at the pre-convention meeting, ask hoteliers
whether they anticipate a walk situation on any night of your convention. If at
any point hoteliers believe there is a possibility that some guests may have to be
walked, there are several steps you can take to prepare for the situation and minimize any possible damages, including:
1. Ask for advance notice. Always encourage a “pre-walk,” which means the
hotel will notify guests in advance and set up arrangements for them to
stay in another hotel. It’s always better for guests to be prepared in
advance and to be taken to the new hotel directly from the airport, than
for them to arrive at the first hotel at midnight and find out they’re being
sent to another property across town.
2. S tudy arrival reports. Ask to see a report of every guest who will be arriving on the night in question. After reviewing the list, give hotel staff the
names of any VIPs or other guests who absolutely cannot be walked.
These may be your board members, attendees with disabilities, speakers
or other individuals you would not want to subject to a walk situation.
3. Recruit volunteers. If you know early in the day that some attendees will
have to be walked, ask for volunteers among your attendees. Explain that
the hotel is in a tough situation, and it invites willing attendees to stay in
another hotel down the road at no expense. Include a dinner coupon or
other incentive to encourage people to volunteer. It’s always a better situation if people are able to make the choice to move.
4. Consider other solutions. If it looks as if some of your attendees will be
walked, look at other possible solutions. For instance, ask staff members
or student attendees to share rooms or consider moving vendors or your
own staff out of the hotel rather than your attendees.
5. Protect your block. Even if members of your group have to be walked,
make sure you get credit for the rooms they would have used in order to
protect your organization from facing attrition damages.
3
The Benefits of Combining Housing and Registration
Combining housing and registration is one method that helps many associations fill their room
blocks.Among the reasons:
• You can track information about w here attendees are staying as soon as they register for your
meeting,w hich allow s you to gather valuable information about your room block.
• It’s advantageous for attendees to seamlessly register for your meeting and reserve their hotel
rooms at the same time.
• If your combined system notices that an attendee has registered but has not reserved a room,
then an instant message from your chief executive can be sent to remind the attendee how
staying inside the group block avoids attrition charges.
• If you force participants to register in order to reserve a hotel room,pre-registration numbers
increase,your group receives more registration money sooner and lines at on-site registration
get shorter.
(M ore details on how to implement this method appear in Chapter 5.)
For more information about housing and registration, e-mail
roomblockmanagement@cgscompanies.com, phone: 1-800-246-9011
31
It’s a good practice to send out reminders about six weeks out to encourage
attendees planning to cancel to do so in advance, in order to make room for
others who may need reservations.
DEALING WITH WALK
SITUATIONS
Associations Fight Attrition With
Pointed Language
Because it is the nature of the hotel business to
oversell rooms in anticipation of last-minute cancellations, the possibility always exists that your
hotel could be oversold during your meeting. In
Thousands of associations have taken proactive
that case, a hotel is forced to walk some of its guests.
stances to fight attrition. O ne such association,
Nobody wants to be shuffled around among hotels,
CO MMO N , a users group providing IT education,
and no meeting planner wants his or her attendees
included pointed language on its W eb site to
to be walked, but the reality is that the situation
encourage attendees to stay in its housing block.
could occur. Knowing that, it’s essential that meetCO MMO N posted the following when the organiing planners ask for a “walk clause” in their hotel
zation chose to charge a higher fee for registrants
contracts.
who don’t book within the block:
Having a walk clause doesn’t guarantee that your
attendees won’t be walked, but it does discourage
Q : Why is the registration rate higher for attendees
the hotel from choosing members of your group if
who aren’t staying in an official conference hotel?
a walk situation occurs. It also protects you in the
A: Staying in rooms at our conference hotels helps
event that your attendees do have to be relocated.
CO MMO N offset the costs of meeting space,
The walk clause should outline exactly what will
exhibit hall rental and many other costs associated
happen in case of a walk situation—who will pay
with our meetings, from tables and chairs to
for what, and what other responsibilities the hotel
power, air/heat and lighting. These are sizeable
will assume.
costs to the organization that must be covered.
The ideal walk clause will include specific stipuAttendees who stay in other non-official CO MMO N
lations such as:
conference hotels do not help offset these expens• The hotel will pay for the walked attendees’
es. Additionally, low sleeping room usage at our
rooms at another property.
contracted hotels increases CO MMO N’s exposure
• The hotel will pay for attendees’ transportation
to financial penalties. We hope that a $100
to the other property.
savings for attendees who stay in a conference
• The hotel will pay for two five-minute phone
hotel will provide added incentive to stay in one of
calls for each walked attendee.
the official conference hotels.
• If the attendee chooses to stay at the new property for additional nights (rather than returning
S ee the rest of CO MMO N ’s FAQ at:
to the original hotel when rooms become availwww.common.org/conferences/20 0 5/spring
able), he or she is responsible for paying for the
/registration/faq .html
additional nights.
• The hotel will send a letter to any walked attendees admitting fault so that your association
isn’t blamed for the situation.
Keep in mind that if you ask the hotel to oversell, you may have to release
them from their obligations under the walk clause. Knowing your group and
your history can help you avoid such a situation.
Even if you have a walk clause in your contract—and even if you’ve educated the hotel about why your group shouldn’t be walked—you should continually stay informed about the possibility of a walk situation. As a meeting
planner, you should never be caught by surprise by such an occurrence. Start
checking the pickup of the hotel at least a week in advance, if not several
weeks ahead, to ensure that you’ll have advance warning about a possible walk
situation.
30
APEX
Update
Housing and Registration Accepted Practice
The APEX housing and registration accepted practice deals directly with all
issues inherent in managing room blocks. It should be an everyday tool for all
meeting managers.
Background: The housing and registration panel made a conscious decision
to consider the two meeting planning processes, recognizing that they are
inherently linked. The members also examined and included recommendations and conclusions of two CIC Project Attrition reports. The final Project
Attrition report included tools to assist planners and suppliers alike;the Phase
II report examined event attendee behavior and perceptions when reserving
hotel rooms, compiled from a survey of event attendees.
3
Housing and registration accepted practices are organized into two parts—
recommended forms for registration and housing, and accepted practices to
be followed. The forms are templates that can be customized to suit the character of the meeting. As with the other accepted practices, the housing and
registration report can be adapted to any size meeting.
Application to room block management: This accepted practice is the one
to use when managing room blocks. Even the registration form section on
“On-site Emergency Information,” asks “Where are you staying during the
event?” (e.g., name of hotel, with a family member or at home). Event organizers can link housing and registration so that information keyed in for one
can be used on the succeeding form. Indeed, a recommended accepted practice is that “an event’s housing and registration forms should be combined if
the processes are not too complicated.”
The report provides new definitions that will be included in the APEX
G lossary, such as “event contracted block” (ECB), “sub-block” and “peripheral block.” It contains detailed information on managing room blocks in 11 separate areas, including contracting, education and marketing to attendees and
exhibitors. An especially helpful section details incentives to book within the
block. Clear communication—with attendees, exhibitors, hoteliers and CVBs—
is a key aspect for effectively managing room blocks. The report also recommends using the APEX Post-Event Report as a first step in successful registration and housing management.
unrealistic in today’s world of Internet reservations, multiple conferences to choose from and lastminute decisions.
When working with your hotel to establish the cutoff date, it’s a good idea to show pace reports
detailing your weekly pickup starting 12 to 16 weeks out. With well-documented history, you’ll be
able to show the hotel what to expect regardless of your cutoff date. But even if you and the hotel
agree on a standard three-week-out cutoff date, you may want to publish a 30-day cutoff to your
membership. This will allow you extra time to work in last-minute reservations without jeopardizing your block.
29
If you decide to oversell, let the hotels know by how much, maybe 5 percent or
10 percent, and have both parties sign a contract addendum agreeing to that
amount. By communicating openly, you can help each other achieve the best
results for both your organization and the hotel.
Complicated issues such as whether to oversell offer another reason for
working with a third-party housing vendor: After working with you for a couple of years, your vendor will have a good handle on the patterns and trends of
your group and will be able to make informed decisions.
Often, groups like to segregate their block to limit the number of exhibitors
allowed to stay at certain hotels. For instance, the meeting planner may split her
block at the headquarter hotel to be 50 percent exhibitors and 50 percent attendees. Such specifics can help improve the buying opportunities and networking
at your meetings and conventions.
SETTING DEPOSITS AND CUTOFF DATES
In most cases, any deposits required when attendees make housing reservations are determined by hotels and their policies. You may want to negotiate the
standard policy as deposits often tend to deter early registrations. However, you
also don’t want registrants making reservations carelessly, because that can
jeopardize your room block. If this
concerns you, requiring a deposit can
help ensure that registrants are comCREDIT CARD GUARANTEE V S.
mitted to the meeting. A typical
ACTUAL CHARGING OF CARD
deposit is one night of housing; asking more of attendees can deter them
If you’re having trouble deciding on a deposit strategy,
from booking within the block.
the general rule is to look at how the size of your meeting
The most conventional way to
relates to the size of your destination. If your meeting is a
guarantee a reservation is by taking a
cityw ide that takes up a good number of hotels, and other
credit card number to reserve a room.
hotel options are less viable, then charging the credit card
Make sure you know if the hotel is
in advance is a good idea. The same goes for a meeting at
going to charge the card before the
a resort or one that takes up an entire hotel w here everyguest arrives or just keep the inforone w ill w ant to stay in one place. A lso, meetings that have
mation as a guarantee, only charging
a fair amount of international attendance usually try to
the card if the guest is a no-show.
adopt a charge-in-advance policy, due to the high number
Upfront deposits are generally
of invalid credit card numbers.
used in citywide meetings where
If your meeting is smaller, domestic and the concern is
hotel rooms are at a premium. The
that reservations w ill be made outside of your block, then a
expectation is that with an upfront
credit card guarantee may be the correct path. In this case,
deposit, or a deposit being charged as
w here there are many other viable hotel options, charging
soon as the room is reserved, large
an advance deposit may deter someone from making a
groups, such as exhibitors, will be
reservation in the contracted hotel block.
more cautious when reserving large
blocks of rooms. Oftentimes, deposit
amounts are higher for exhibitors
than attendees, and early non-refundable policies can be initiated to facilitate
earlier and fewer cancellations. When using any deposit option, make sure there
is plenty of discussion with all parties involved so the policies are understood
and approved.
Cutoff dates vary, but the industry standard is 30 days before a meeting.
(Some groups prefer three weeks, while resort hotels may require greater lead
time.) Less than three weeks seems unfair to the hotel, as it doesn’t allow them
much time to fill any rooms left empty in your block. More than 30 days is
28
communicate your attendees’ loyalty points data to the hotel. Many guests want to be able to
use their frequency programs for major chains.
• Ensure efficient housing confirmations. Many attendees need to have something in their hands
in order to have confidence in the housing process.
OVERSELLING
Meeting planners often oversell their room blocks, anticipating that some registrants will cancel
at the last minute or not show up. Overselling can help you avoid attrition damages if you end up
with a significant number of no-shows. But if everyone does show up, an oversold block will cause
the hotel to have to walk some of your attendees.
For that reason, overselling is good policy only if you have at least two to three years’ worth of
history for your meeting, and if you understand the pacing of your pickup. If your history, for
example, shows that slippage is 10 percent during the 30 days prior to the meeting, overselling may
be a good idea. Do not oversell if you have employed a strong incentive to keep your attendees and
exhibitors inside your block. The strong incentive should almost totally avoid any room slippage.
If you feel confident enough to oversell rooms, work closely with the hotel throughout the
process. Keep in mind that the hotel will be overselling its rooms regardless of whether you oversell
your block or not; it’s simply normal business practice for most hotels to ensure that they maintain
high occupancy rates.
The best way to work closely with the hotel is to communicate openly throughout the registration process. Don’t be afraid to ask questions to stay informed about the hotel’s situation. Ask hoteliers whether they believe the hotel will sell out over your dates, and regularly question them about
how full the hotel looks on your peak nights. Find out what percentage they normally oversell during the time that you’ll be in house and stay posted on whether they’ve reached their oversell goals.
3
Event Specifications Guide
The event specifications guide (ESG) is the most important document meeting
professionals must have in order to produce an effective meeting on site. Yet,
until the APEX guide was adopted as an accepted practice in September 2004 ,
there was no consistent format from planners or suppliers. The APEX ESG helps
planners focus requirements around the information that hotels and convention
centers need to deliver a zero-defect meeting.
.
Background: The APEX ESG is formatted into three sections:(1) a narrative that details general information about the event; (2) a timetable of
all functions that comprise the overall event; and (3) function set-up
order forms—specifications for each function that is part of the overall
event. Each function of the event has its own form. The ESG was
designed for use by meetings and expositions of all sizes, and it can be
adapted to reflect the special culture of each event.
APEX
Update
Application to room block management: The narrative section is most relevant to room block management. It contains a profile of the event, a summary
of the room block in each contracted hotel, reservation method(s) used, any
special needs required and billing instructions (including room charges).
Recommended practices cite that the ESG should be shared in such a way that,
when changes are made, they can be tracked properly and identified. Thus,
planners and suppliers alike can use it as a reference going into the event.
27
!
CHOOSING A PARTNER
When choosing your housing partner,
consider the following tips:
• Cost isn’t always the most important
consideration. Above all else, make certain that you’re working with a vendor
who is capable of meeting your needs,
however complex they may be.
• Cutting-edge technology, without
adeq uate support, is ineffective. If a
housing vendor seems to be high-tech
and low-cost, be cautious. S uch a company may lack the personnel to know
how to manage the technology— to
analyze your data, correlate information
and customize your reports. M any housing and registration companies use the
same basic technologies, but not all have
informed, skilled personnel who can help
you make the most of it.
• Consistency is crucial. U sing the same
housing vendor year after year can make
your job easier as a planner because
your vendor will be intimately familiar
with your needs and able to make judgment calls without your constant supervision. C onsistency in housing can also
create a comfort zone for your attendees
and help ensure hassle-free registration
for them each year. The easier it is to
make reservations, the more likely it is
that attendees will come to your conference and stay in your block.
• P ersonal service is still important. S ome
housing and registration vendors are
Internet-only:N ot only do they req uire
that all reservations be submitted via the
Internet, but all service req uests must be
made by e-mail. M ake sure your provider
has a call center that makes it possible
for customers to contact them by phone
or fax. S et up processes that enable your
attendees to participate in whatever
manner they choose:mail, phone, fax
or Internet.
26
ENCOURAGING BOOKING
WITHIN THE BLOCK
Once you’ve decided which vendor will handle
your housing arrangements, the next step is to make
sure that your meeting attendees stay within your
contracted housing block. First, during contract discussions with your hotel, make sure you negotiate to
receive credit for all rooms that are part of your
group, even if the guests booked the rooms through
channels other than your housing vendor. Next,
work with your housing vendor to put a system in
place that will encourage attendees to book rooms
within your contracted block.
Encourage attendees to book within the block by
offering incentives for doing so—and by creating
barriers to booking outside the block. Conferon
Global Services’ recommendations include the following:
• Promote in your preview book the importance
of staying inside the block; explain why and how
an attendee’s choice of hotel affects your organization.
• Offer registration discounts for booking hotel
rooms within the contracted block.
• Offer hotel giveaways for attendees who book
within the block.
• Conduct drawings for prizes that are only open
to attendees staying in the block.
• Offer special incentives to those who stay in the
block, such as free merchandise credit, a
reduced fee pass for local attractions, or attendance at a special networking reception only for
those staying in the block.
• Don’t allow an individual to register for the
meeting without booking a guest room within
the block.
• Refuse freight to exhibitors who aren’t staying
within the contracted block.
• Charge a higher registration fee for attendees
who don’t stay in the block.
• Work with your hotel partners to provide additional incentives such as discounted dining, spa
treatments or high-speed Internet access.
If you realize an attendee is not reserving a room,
collect data on where they are staying or why they
are not staying inside the block. This should help
you block more accurately next year.
Other best practices for serving the attendee in
the housing process include:
• Establish a solution that enables attendees to change
their reservation online after initial submission.
• Ask your housing vendor to help collect and
when you develop a relationship
with a housing provider, its representatives become familiar with your
meeting (exhibitors and attendees)
and your history and eventually
become an extension of your own
staff. Because they intimately know
you, your meeting and your needs,
you rarely have to personally deal
with housing details.
Using the same housing vendor
doesn’t just make the process easier
for you; it can also make it easier for
your attendees. A consistent system
for housing each year can create a level of comfort for attendees that can be very important. For
attendees who travel infrequently, familiarity with the Web site and the individuals handling housing can make the entire meeting experience less stressful and more enjoyable. In addition, some
housing companies will negotiate hotel contracts for your group and possibly work in extra rebates
for you, if you work with them on an annual basis.
Finally, when you use a third-party housing vendor, you sometimes have the option to use the
same vendor for registration. If housing and registration are handled by the same company, you’ll
be in a better position to manage your room block. Some groups like to make rooms available within their block only to those who have registered and paid to attend the conference, and combining
registration and housing enables this. Also, a combined system enables meeting organizers to
deploy effective anti-attrition and anti-piracy policies.
3
Rooming Lists
A final option is to handle housing on your own by using a rooming list. Rooming lists are primarily used for corporate meetings, at which all registrants arrive and depart on similar dates. Using
a rooming list can be advantageous because:
• Many hotel chains can download the information directly into their reservation systems.
• It’s convenient for very small blocks that generally have one point of contact.
• One list can be sent on the hotel cut-off date, minimizing the number of changes the hotel handles throughout the process.
However, the rooming list option also has its disadvantages. For instance:
• It can be difficult for the hotel to determine booking pace and current room pickup if all the
information is being handled through one rooming list.
• The simple act of compiling a list can lead to human error due to the fact that someone other
than the attendee must handle the reservation. Allowing an attendee to confirm the reservation
via a Web site or another online booking tool puts the responsibility for the reservation’s accuracy back on the attendee.
• The rooming list must be continuously updated and managed. Depending on the number of
changes, this can be a cumbersome process, especially if handled manually.
25
Housing and Registration
O
Once registration is open for your meeting, your room block situation changes
day by day, hour by hour. To keep a close, continual watch on the numbers,
you’ll need a functional, reliable system in place.
Several different options are available to help you handle housing and
registration, and a number of decisions need to be made along the way.
CHOOSING A HOUSING OPTION
Housing is usually managed in one of four ways: by the hotel itself; by the
convention and visitor bureau in the city where the meeting will be held; by an
outside or third-party provider; or by the group via rooming list. Each option
has its advantages, and the size of a group and complexity of the meeting are
often major factors in determining which route to take. You may choose to use
different options for different types of meetings or events.
Hotel-Managed Housing
Using a hotel’s in-house system for managing housing reservations can be a
viable option if your meeting is self-contained in one property. Some hotel
companies offer a linking option, which involves placing a link to their reservation system on your Web site. Some hotel companies utilize Web-based systems
for electronic reservation processing. A Web-based option can make it easy for
attendees to make housing reservations with your contracted hotel. However, if
you have a number of sub-blocks or if you’re using more than one contracted
hotel, you’ll need a housing reservation system that is more robust than what a
single hotel offers.
CVB-Managed Housing
A number of CVBs offer housing services to groups and, if the CVB in your
destination does so, it may be an option worth considering. In some cases,
meeting planners can negotiate for the CVB to handle housing at no cost to the
association. If that is an option, it could result in great savings for your group.
The main benefit of using a CVB for housing is that your main housing contact
usually has a strong working relationship with the hotels in your meeting city.
In most cases, it’s best to trust housing to the CVB when your housing and
registration processes can be separated and when you do not have substantial
sub-blocking for exhibitors or attendees. If you need a housing and registration
partner that can collect payments and complex information, such as attendee
demographics or event and workshop preferences, you will probably get better
results with a third-party provider.
Third-Party Housing
A third-party provider can be especially beneficial when your needs are more
complex. For instance, if you need to collect more than simple demographic
information from registrants, a third-party vendor will usually have technology
necessary to do so easily and efficiently. Because third-party vendors are solely
in the business of housing and/or registration, they often have the most streamlined systems in place for making the process smooth and successful.
In addition, working with the same housing company year after year can
bring continuity to the process and even provide extra benefits. Oftentimes,
they will customize their system to your unique, specific needs. For instance,
24
3
Housing and
Registration
3
Once registration opens, your
room block situation changes
every day.
WHAT’S INSIDE:
Choosing a Housing Option
Encouraging Booking Within
the Block
Overbooking
Setting Deposits and Cutoff Dates
Dealing With Walk Situations
23
ACCOMMODATING VIPS
It can be helpful to determine how many VIPs you’ll need to accommodate at your meeting before contracting for
your room block. Estimate how many VIPs will need suites and how many will need regular guest rooms, as well as any
additional services that they’ll need during the meeting. Knowing this information in advance can help you settle on 2
how many rooms to block and how many complimentary rooms you may want to request.
When making plans to accommodate VIPs, consider these guidelines:
• Find out each VIP’s amenity preferences. (For instance, don’t have alcohol sent to someone who doesn’t drink.)
• Arrange for you or someone on your meetings staff to personally check each VIP’s guest room before he or she
arrives and checks in.
• Regularly check each VIP’s arrival and departure dates and ground transportation plans, since he or she may change
plans frequently and may not remember to alert your staff.
• Find out if any VIPs are bringing anyone with them.
• Make sure billing is set up correctly so that no VIPs receive bills for their stay. Make sure this information is
communicated to the hotel.
• Consider blocking your top VIP room one day earlier to be absolutely sure it is available.
USING THE BELL CURVE
Your meeting’s bell curve can be one of your most effective tools for determining how many rooms to block. The
bell-curve formula looks at the room block per night, expressed as a percentage of the peak night. Most effective when
portrayed graphically, the bell curve shows arrival numbers for each day of the meeting, building up over the first few
days and cascading downward following peak nights. You can figure the percentage of peak for each night by dividing
the number of rooms used by the number of rooms on peak night. Here’s an example of the bell curve for a typical
meeting:
Day
Friday
Saturday
Sunday
M onday
Tuesday
Wednesday Thursday
Number of Rooms
50
125
9 50
1,650
1,650
1300
75
Percentage of Peak
3%
8%
58%
100%
100%
79 %
5%
Use your history to determine the meeting’s average bell curve, which can help you anticipate how many rooms to
block on any given night of your meeting. When booking citywide events, or events that will use multiple hotels, you
can also use the bell curve to compute the number of rooms needed at each hotel on each night.
For example, if one hotel can commit 500 of your needed 1,650 rooms on peak night, you would multiply 500 by
the percentage required each night. That calculation will determine how many rooms you need that hotel to provide
each night throughout the meeting’s duration. Here’s how it works:
Day
Friday
Saturday
Sunday
M onday
Tuesday
Wednesday Thursday
Number of Rooms
15
40
29 0
500
500
39 5
25
Percentage of Peak
3%
8%
58%
100%
100%
79 %
5%
For more information about calculating the value of your meeting, e-mail:
roomblockmanagement@cgscompanies.com, phone: 800-246-9011
21
APEX
Update
Meeting and Site Profiles
An accurate meeting and site profile is a key “building block” to identifying destinations and/or properties for any meeting or convention. Hotels that
can meet the group’s goals and objectives can be
identified long before a site inspection takes place.
Accurate meeting and site profiles allow meeting
planners to “buy smart.”
Background: The meeting and site profiles panel is
developing accepted practices for site profiles for
five primary location and facility types—hotels,
resorts, convention centers, conference centers
and cities. Additional profiles may be developed for
such locations as colleges and universities, arenas
and coliseums or performing arts centers, based
on feedback from the industry and a yearly review
of the adopted accepted practices. In addition, the
panel worked with the RFP panel to identify a recommended event profile.
Application to room block management: If a hotel
or locality does not meet attendees’ expectations
and needs, they will not register for a conference or
stay in the hotel. A first step for planners to effectively manage their room blocks is to book properties that suit the meeting and the attendees. In the
report, recommended practices indicate a property’s current service and quality ratings by AAA,
Mobile and Z agat travel guides, types of rooms and
rates offered, and guest services such as health
facilities. The report also recommends that site
information be reviewed and updated at least two
times each calendar year. K nowing their individual
groups and using this data will enable planners to
make intelligent choices.
CONTRACTING AT THE
RIGHT TIME
It’s the question every meeting planner
wants answered: How far in advance should
you contract for hotel rooms at your meeting?
Q uite simply, the answer depends on your
meeting and on your preferences, as well as the
hotel(s) you plan to use. As a general rule,
Conferon Global Services recommends contracting three to five years out for groups of less
than 1,000 and five to seven years out for
groups of 1,200 or more. (Groups meeting in
off-season or in second- or third-tier destinations may successfully find space in shorter
windows.) Groups requiring numerous hotels
may choose to lock in their primary hotels as
described above, but lock in overflow hotels
two or so years out. However, if the organization will be undergoing major changes (such as
a CEO resignation or relocation), it’s a good
idea to wait and contract for rooms closer to
the meeting, when you know how the changes
might affect attendance.
No agreed-upon standard exists for when to
contract rooms because every group is different
and a number of variables can affect their
needs. For instance, it may be important to
book further out if:
• The group is not flexible with its meeting
pattern. (For instance, the group must always
meet from Sunday to Wednesday, with no
exceptions, or during the first week in a month.)
• The group is booking only premium, firsttier destinations.
However, if the group is flexible when it
comes to dates, pattern or destination, booking
closer to the meeting is not only acceptable, but
may be preferable. And if major changes are
foreseen, it’s a good idea to book closer in.
CREATING THE PROPER MIX OF HOTELS
If your group’s meeting can be self-contained in one hotel, that’s preferable and much easier to manage. However,
if your meeting is too large to be housed in one hotel or if you need to offer attendees more options, it’s important
to carefully develop the right combination of hotels within your contracted room block. When creating a mix of
hotels, include:
• A mixture of rates, including government-rated rooms if needed.
• A mixture of name brands.
• A variety of locations. (Some attendees would rather walk five blocks and pay less for their rooms than to be
right across the street from the convention center.)
If saving money is important to your group, offering a range of contracted hotels will help encourage attendees
to stay within your block.
20
SELECTING THE SITE
Because site selection takes place long before attendees begin making hotel reservations, the two
processes may seem relatively unrelated. But site selection plays an important role in managing your
room block. If you know how your group reacts to various types of destinations, you’ll be better
prepared to block the appropriate number of rooms. In fact, the site of your meeting is often a
major factor in determining attendance numbers, which directly correlate to the number of rooms
you will need in the block.
2
Geographical Area
The area of the country where you hold your meeting can greatly influence whether attendees
will need extra room nights before or after the meeting. The timing of the first and last events also
has a huge impact on room blocks for those dates. Whenever an early arrival or extra late night is
needed, do not assume that 100 percent of attendees impacted will actually stay the extra night. The
following guide can help you determine how various sites may affect your guest-room needs.
Geographical Area
Effects on Rooming Needs
East
• Because of the time change, West Coast attendees
can depart late on the last day of the event, affecting
booking patterns.
Central
• Central destinations may be accessible to a large
number of members via automobile.
• Flights from either East or West Coast destinations
are more available for later arrival to or earlier departure from centrally located cities.
• With a midmorning or noon meeting start, attendees
must arrive one day earlier.
West
• With a midmorning or noon meeting start, guests
from the East, Central and West regions must arrive
the night before an event begins.
• With the exception of red-eye flights, a 2 p.m. departure is typically the last flight out on any given day.
For meetings that end in the late afternoon, guests
from the East and Central require an extra night.
• Some West Coast destinations popular with tourists
may require an increase in rooms over pre- and
post-meeting dates.
Other Factors
When selecting a site, also consider these factors and how they might influence attendance numbers and room needs:
• Air access
• Distance from the airport
• Affordability
• Proximity to dining and entertainment
• Destination appeal
19
?
How far back should the
history go?
Three years’ worth of history
used to be standard, but times
have changed. For many groups, a
current three-year history is
skewed because the meetings
industry has just come through a
slump preceded by a few aboveaverage years. If your current history reveals the ups and downs of a
recently changing economy, don’t
trust a three-year history. Instead,
go back as far as you can and
come up with averages based on
all the years for which you have
documented history. As the economy and the meetings industry
slowly level off and get back to
normal, three years of history
should once again become effective for planning.
If you don’t have documented
history for your meeting, start documenting now. H istory has to start
somewhere, and the sooner you
begin documenting your group’s
activity, the sooner you’ll be able to
use that information to simplify
room block management.
• Final pickup numbers. Along with the week-by-week
pace report, keep documentation of the final pickup numbers from previous meetings. Together, these two documents can help you and the hotel decide whether you’re
tracking the right number of rooms.
• Slippage. Your group’s slippage shows how much the
numbers fall between the cutoff date and the meeting date.
Usually expressed as a percentage, this number represents
the difference in the number of reservations at their peak
point and the amount actually picked up. You can usually
pull this figure from your pace report.
• Suite usage. Documentation of the number of suites
your group uses can help you in negotiations, especially if
your group uses numerous suites.
DETERMINING THE NUMBER
OF ROOMS
Once you have assembled historical numbers for your
group, that documentation can help you determine how many
rooms to block. You can generally use the pace report to determine how many rooms you’ll need, but keep in mind that a
number of variables can affect changes in your numbers. These
variables include meeting destination, time of year and program format.
Meeting Destination
A resort or city known for family attractions may increase the
number of attendees who bring their families to the meeting
with them. Meeting in such a destination may also increase the
number of those who stay for extra nights before or after the
meeting.
Meeting Dates
Consider how specific meeting dates might affect arrival and
departure patterns. For example, if your meeting is during spring break or over a holiday weekend, some attendees
may choose to bring their families and stay longer.
Program Format
The most important predictor of room-night needs is the format of your meeting. Changing your program format can change the whole pattern of attendance and the number of rooms needed. Keep in mind that meeting
space and guest rooms go hand in hand; on the days that you need more meeting space, you’ll most likely need
more guest rooms, except on departure days. Use your workshop schedule to determine how many guest rooms
might be needed: Start with the number of sessions offered on a given day and estimate how many people will
attend each session.
Shoulder Nights
When determining how many rooms to block, pay attention to more than peak nights; spend time considering
your shoulder nights as well as the nights before and after the meeting. These nights will fluctuate more from year
to year, so you must watch them closely. For instance, if you notice that you aren’t filling enough nights on the front
end of the meeting, you may not be able to fill your rooms on peak nights. If your shoulder nights are not booked
properly, it can dramatically impact your ability to pick up your peak night commitment.
18
2
• Single/double mix. A large number of double/double rooms can
increase the value to the hotel, since it signals that there will be more people to use the hotel outlets.
• Potential incremental revenue. Ultimately, the value of a group is
measured by its “total revenue” contribution. Make sure you have history
that demonstrates the total “spending” of your group.
• Affiliate revenue. Document any revenue the hotel gains from other
groups meeting in conjunction with your group, exhibitor meetings or hospitality events. You may document this revenue as a percentage of pickup
or a percentage of extra room nights booked by affiliate groups.
• Value of account to hotel or chain. It is surprising how many
groups do not track this critical negotiation tool. The value of annual or
multiyear revenue can drive significant discounts/concessions with a hotel
or within a chain.
• Risk. Contractual terms, history, cancellation, attrition clauses– – the
assumption of risk has become a preeminent consideration for all associations. Contract language should seek to mitigate the risk assumed by both
the meeting sponsor and the host hotel.
Which tracking devices are best?
A number of different tracking devices exist to help you keep up with the
variables listed above. Conferon Global Services recommends maintaining the
following:
• Pace reports. A pace report is a document that keeps track of the pickup of your group on a regular (usually weekly) basis. Week-by-week historical information helps you and your hotels know your group’s pattern of
booking. For instance, if the majority of your group waits until the last four
weeks to book rooms, knowing that history will prevent your hotelier from
being alarmed when the meeting is six weeks out, and the block is only 50
percent filled. A pace report is also extremely helpful in monitoring bellcurve percentages because many times the shoulder nights can become
problematic if not monitored frequently. For most groups, tracking of pace
reports should start at least 16 weeks prior to arrival or whenever marketing information is sent.
17
The Building Blocks
S
Successful room block management begins long before the actual meeting
takes place. The foundation includes several critical “building blocks.” From
compiling group history and selecting a site to determining the room count and
creating the proper mix of hotels, a meeting planner’s to-do list is a long one.
To cut down on the inevitable complications— and to help make your meeting
even more successful— Conferon Global Services recommends adding the following points to your planning process.
COMPILING GROUP HISTORY
Maintaining a documented history can help you not only negotiate competitive room rates, but also make tough decisions, such as how many rooms to
block and which types of hotels to choose.
What kind of historical information is needed?
With each group, hotels are interested in a number of variables that can help
them determine the value of the group’s business. It’s a good idea to keep track
of these various characteristics of your group, including:
• Lead time. Booking patterns, which vary from hotel to hotel and destination to destination, have shortened in recent years. Determine the typical
booking cycle of the hotels you’re considering and how your meeting
matches up. One rule of thumb: Short-term business is always welcome.
• Seasonality. A basic element of site research is ascertaining which times
of the year are considered off-season and shoulder/value seasons. Ask about
specific “need” dates when group rate discounts can be maximized.
• Transient demand. Negotiation flexibility is inversely proportional to
transient demand. Groups that have confirmed future rates will benefit as
the current rebound in transient demand continues to drive rates higher.
• Arrival/departure pattern. Find out what group patterns are standard
at a particular hotel. A Tuesday-to-Thursday meeting, for example, is problematic for a hotel seeking to pair one group arriving Sunday and departing
Wednesday with another checking in Wednesday and departing Sunday.
Moving your arrival one day can result in substantial savings.
• Rooms-to-space ratio. Space-intensive meetings have a tough time
getting all their needs met, especially during peak season. Site research
should include a calculation of your rooms-to-space ratio compared to the
overall ratio of properties you’re considering. “Double using” some rooms
for meetings and meals, using non-conventional spaces like restaurants and
suites and avoiding 24-hour room sets can make your meeting more attractive to hoteliers.
• Food and beverage history. Maintain records of how much money
your group spends on F&B in the hotels where your meeting is held. This
figure can be a strong negotiating tool. Most hotels have a per-room-night
revenue target for group business. Make sure you know what the hotel
desires––and how your meeting matches up.
• Local catering potential. Hotels with major function space derive significant F&B revenue from hosting local events. Determining the volume of
local catering demand helps assess the availability of meeting space, especially during peak function times such as evenings and weekends.
• Outlet usage. Keep track of how much money your group spends on
shopping, entertainment or other businesses located inside the hotel. Some
hotels can track outlet revenue, which can be helpful in future negotiations.
16
2
The
Building
Blocks
2
The foundation of successful
room block management
begins long before the actual
meeting takes place.
WHAT’S INSIDE:
Compiling Group History
Determining the Number of Rooms
Selecting the Site
Contracting at the Right Time
Creating the Proper Mix of Hotels
Accommodating VIPs
Using the Bell Curve
15
1
Despite the availability of Internet rates, the lure of hotel loyalty points
and a host of other factors, a variety of practices have enabled groups to maximize guest room pickup. Many of the “solutions” cited in this chapter were
identified in the research phase of Project Attrition. There’s also a case study
of how the proactive policies of the Insurance Accounting and Systems
Association (IASA) increased exhibitor blocks by more than 60 percent—in
one year!
While maximizing pickup is the ultimate goal, Chapter 6 offers an epilogue
about protecting the block, notably from notorious housing pirates. Pirates
(or “poachers,” as IAEM president Steve Hacker refers to them) utilize member and attendee lists in an effort to promote sale of guest room rooms
outside the contracted block. Left unchecked, the exodus can cost an organization tens of thousands of dollars.
The entire CGS Guide to Room Block Management can be accessed at
www.cgscompanies.com. Additional references sourced in the development of
this project can be obtained by calling 1-800-246-9011 or visiting the
Convention Industry Council’s Web site at www.conventionindustry.org.
Glossary
APEX
Update
Planners and suppliers should be using the same terms to manage room blocks.
Now those industry-wide accepted definitions can be found in the APEX
Glossary.
Background: The glossary contains more than 3,8 00 terms, acronyms and
abbreviations that are common across the industry. First adopted in November
2003, it is a work in progress, updated annually by the APEX Terminology Panel.
Even today, industry professionals can access the CIC Web site to suggest new
terms to be considered by the panel. As reports of each of the other panels
become accepted practices, their specific new terminology will be added to the
glossary.
Application to room block management: Suppliers and planners need to be
speaking the same language. Before the glossary was adopted, the definition of
“slippage” could vary from hotel to hotel. Now, there also are common definitions for “attrition,” “block” and “audit”—all terms used in room block management. New terms, such as “event contracted block” (ECB), “peripheral block”
and “sub-block” will be added from the panel’s housing and registration report.
At least two major hotel chains have incorporated the glossary into their training
programs.
13
While group history has always been an essential tool,
knowledge of hotel partners’ needs and goals is equally
important. All successful negotiations begin with an
understanding of how a hotel evaluates your piece of
business. The chapter also offers guidelines for assembling a block to maximize attendance, as well as a timeline and tools for tracking pickup.
The next step in the process is housing and registration, the focus of Chapter 3. One rule of thumb: Once
you open registration, your room block situation
changes every day. The chapter begins by detailing the
various methods for managing citywide housing (See
Figure 3.) It also kicks off discussion of the Guide’s
essential theme: how to encourage attendees and
exhibitors to book within the block. Included in this
chapter are samples of communications that organizations have used to educate members about the financial conse‘Reserving rooms
quences of attrition.
And while careful room block
outside a block raises
management
reduces the potendaunting issues for
tial for overbooked situations,
hoteliers and their
there are no absolute guarantees.
customers …
The chapter concludes with
detailed recommendations for the
Ultimately, when
care and comfort of walked
attendees reserve a
guests.
guest room outside
A complete discussion of hotel
the contracted guest contracts would require a volume
of its own, plus addenda updated
room block, all
on an almost daily basis. Chapter 4
parties involved can
focuses on clauses specific to room
block management, primarily
suffer substantial
attrition.
Special attention should
financial losses.’
be paid to the formulas for calculating attrition damages. The
chapter concludes with Conferon Global Services’ extensive “Checklist for Negotiating Hotel Contracts.”
Chapter 5 was the inspiration for this entire project.
As noted in the final report of CIC’s “Project Attrition”:
“Reserving rooms outside a block raises daunting
issues for hoteliers and their customers … Ultimately,
when attendees reserve a guest room outside the contracted guest room block, all parties involved can suffer
substantial financial losses.”
12
10
Reasons to Book
Within The Block
Repeated studies have
shown that cost is the primary reason attendees
choose to stay outside the
block. B ut there are numerous advantages that result
from booking within the
block.
Ed Harris, the president of
ITS, which developed many
of the best practices in room
block management, detailed
the benefits in an article that
appears on CIC’s W eb site,
www.conventionindustry.org.
Among them:
1 . O ne-stop shopping
2. Convenient customer
service
3. No full prepayment
required
4. Easy-to-change
reservations
5. Reservations backed
by meeting sponsor
6. Convenient shuttle
bus service
7. O n-site service desk
8. Full frequent traveler
benefits
9. Increased networking
opportunities
10. Support of sponsoring organization’s
financial commitments
1
F igure 3 :
Method of Handling Citywide Housing
Convention
Bureau
In-House
18%
33%
Housing Company
49%
for the Convention Industry
Council (see Figure 1), nearly
30 percent of organizations
were assessed attrition damages in 2002-2003.
As of this writing in mid2005, hotel demand, occupancy and room pickup were
enjoying a sustained rebound.
(See Figure 2.) While economic recovery has been the driver,
the improvement in pickup
rates has been due, in large
part, to the innovative solutions described in this Guide.
To be certain, there is no
magic elixir for the inevitable
swings in the economic pendulum. But there is a blueprint
for effective management of
contracted room blocks.
Chapter 2 focuses on the
critical “Building Blocks.”
How APEX Will Aid Room Block Management
APEX—the Accepted Practices Exchange initiative of the Convention Industry Council
(CIC)—is changing the way meeting professionals do business. Already, APEX is streamlining many of the business processes on which the meetings, convention and exhibitions
industry spends an inordinate amount of time. This includes room block management.
The official charge for APEX is to spearhead an industry-wide initiative that brings
together all stakeholders in developing and implementing accepted practices to
create and enhance efficiencies.
As suppliers and planners increasingly use accepted practices, meeting planning processes will take less time and will be more easily communicated. Meeting
professionals will be able to focus their energies on more productive and profitable
activities.
Accepted practices have been adopted in four areas: terminology, post-event reports,
event specifications and housing and registration. Templates can be downloaded from the
CIC Web site for use in everyday work. The reports on meeting and site profiles, requests
for proposals (RFPs) and contracts are still being developed by industry-wide panels and
will be available later in 2005.
To access accepted practices and updates on work in process, go to CIC’s Web site at
www.conventionindustry.org. Analysis of various APEX initiatives appear throughout the G uide.
APEX
Update
11
Introduction
I
In the beginning,
RFPs were scratched on napkins.
Agreements were sealed with a handshake.
Groups routinely inflated their guest room requirements,
And hotels countered by overbooking to ensure that no rooms went empty.
Room block management is neither science nor
art. It is instead a process, a logical progression of
best practices designed to cushion the upticks and
downturns inherent in economic cycles. There’s
only one problem: The rules change all the time.
A generation ago, group histories were no better than “educated guesses” and collection of
damages was virtually nonexistent. There followed an extended period of selective enforcement when attrition became a deterrent but one
that was rarely enforced, especially with longtime
clients. The sea change came during the perfect
storm of the 1990s lodging boom; with demand
from all market segments overwhelming supply,
hotels required guarantees that their entire room
inventory would be occupied and that anticipated food and beverage goals would also be met.
What had once been a gentleman’s agreement
was now a ticking time bomb. Organizations that
were locked into long-term commitments could
not manage to withstand a severe economic
downturn, which is exactly what occurred in
2001. The result? According to a survey conducted
Figure 1 :
Percentage of Organizations Assessed
Attrition-Related Fees
30
25
20
15
10
5
0
1998
1999
2000
2001
2002/2003
Figure 2 :
U.S. Lodging Industry Forecast
Year
Hotel Occupancy
Percentage Change
In Average Rate
2000
2001
2002
2003
63.3
59.7
59.0
59.2
61.3
63.4
64.5
64.9
5.6
(1.4)
(1.5)
0.1
4.0
4.3
4.2
4.1
Source: PricewaterhouseCoopers; Smith Travel Research
10
2004 2005* 2006* 2007*
*Estimated
11
1
Tracing
the
History
The mid ’90s compression of
supply and demand created
a ‘perfect storm’ in room block
management.
WHAT’S INSIDE:
CIC’s APEX Initiative
U.S. Lodging Industry Forecast
10 Reasons to Book Inside the Block
9
guests every day. From the Hilton Hawaiian V illage ® to The
W aldorf=Astoria®, from our web sites to our Kiosks,our technology is
all about supporting the customer and guest experience and that means
you. Here are some tools available to you at select Hilton properties.*
POG
Pr iv at e Online Gr oup Pag e
Pr ov id es Or g aniz at ions w it h a c us t om iz ed b ook ing s pag e c ont aining a c us t om
Or g aniz at ion’ s log o, t ex t on pr og r am and link ab le f r om c us t om er s w eb s it e.
U R L ,
• Available at any Hilton Hotel
• Attendees make reservations direct from their PC
• Page design is q uick and easy for the event planner
• NO CHARGE - IT’S FREE
THE HILTON C OMMITMENT
Our ability to achieve success depends on your success. And that is why Hilton is committed to
be your best resource in meeting planning. As your partner we commit to providing you with
the tools, resources and service standards to help you be your best and complete your job in the
most efficient manner possible. There are many effective ways to develop these skills and
sustain a successful partnership. Hilton is committed to continue our development in
technology and service standards to meet your goals. Our service commitments to you:
• Master Account Delivered in 5 Business Days:
Hilton will deliver your final statement within 5 working days - so you can keep your business moving forward.
• Post Event Report Delivered in 1 4 Business Days:
A timely report of post-analysis will help you plan your next meeting more effectively.
*T echnology tools and service commitments availab le at select Hilton properties. F or full details and information visit www.hiltondirect.com.
Delivering a personal customized experience to every guest, business
traveler or meeting attendee everyday is critical to our mutual
success. We are proud of our unique proprietary OnQ™ technology
platform because it is built to last for the long run, enabling our hotel
team members to deliver a personalized, customer experience to our
RAPID
Reservations Automated Processing Input and Delivery System
Ideal for customers with their own reservation tool to interface with
The Hilton Reservation system.
• Keeps Housing Open Longer - no hotel input time required
• Ensures accurate reservations - no data entry errors
• Provides faster confirmation numbers to attendees for better customer service
GRIP
Group Reservations Identification Program
Provides meeting professional access to automated cross reference group
registration lists against hotel rooming lists.
• Reduces exposure to attrition damages
• Quickly identifies reservations made outside of the room block
• Ability to monitor daily attendee booking pace activity
• Ability to measure effects of Internet reservations on groups pick-up
• Ability for you to make more accurate guest room projections
Resource Guide
Committed to be y our best
resource in meeting planning.
c o n tin ued fro m p a g e 2
This resource guide is the answer.
A ttrition turned out to b e a p ainful sy m p tom of a recurring ep idem ic: inefficient room b lock m anagem ent. With the eb b and flow of econom ic cy cles as certain as death and taxes, event organiz ers m ust b e flexib le enough to withstand
any unforeseen shift in the sup p ly /dem and p endulum . This Guide details the
b est p ractices of C G S and the collective wisdom of 3 5 y ears of exp erience.
D ave L utz , D avid P eck inp augh and B rad Weab er were our corp orate cham p ions. B ut the “C G S exp erience” was recounted b y N ancy Wise, L aurie Trautner
B lack , B ill M acD onald, Jerry M urp hy , M arianna G allo, A ida C am p b ell, D eb b ie
B eldon, D eirdre B ourk e, D awn S coville, Erin H ay es, Jo A nn M atousek and John
B ettag. A lso, K aren Watson, Teri Tonioli, G ary S chirm acher, D avid B eck ett and
M arian C alvin.
R ob in R oth rates a p aragrap h all her own. H er ab ility to translate com p lex
contract issues into sim p le English b ecam e the p latform on which this entire
p ub lication is b ased.
M any of the registration/housing sy stem s
and p rocedures detailed throughout are the
handiwork of industry leader I TS . S p ecial
thank s to Ed H arris and B ill M artin for their
careful review.
We did go “outside the fam ily ” to round
off the edges on a coup le of critical issues.
The analy sis of how C IC ’s A ccep ted P ractices
Exchange ( A P EX ) is im p acting room b lock
m anagem ent was contrib uted b y longtim e
governm ent p lanner S ara Torrence. A nd
attorney B arb ara D unn, of H owe & H utton,
reviewed the “evidence” from an attorney ’s p ersp ective.
The decision to retain H am m ock C ustom P ub lishing was m ade easy b y the
fact that its senior editor, Jam ie R ob erts, was the architect of a num b er of sp ecial
p rojects develop ed for P C M A ’s C o n v en e m agaz ine. K udos to Jam ie and C reative
D irector S usie G arland.
When the concep t of a R o o m B lo c k M a n a g em en t Guide took shap e m ore than
a y ear ago, only one q uestion rem ained unanswered: H ow could C G S dissem inate the content to the widest industry audience? Though the entire Guide is
housed at www.cgscom p anies.com , the goal from the outset was to p rovide hard
cop y distrib ution to 2 0 ,0 0 0 association and trade show organiz ers.
H ilton H otels recogniz ed the enorm ity of the room b lock m anagem ent challenge and a uniq ue op p ortunity to address it. S p ecial thank s to B ob D irk s, L arry
L uteran and the entire H ilton organiz ation. C G S is p roud to share cover b illing
with a valued industry p artner.
T his ‘vanishing act’
b ro ug ht the
hig h-stakes g am e
o f attritio n o ut
o f the clo set.
Peter Shure
D irec to r o f Stra teg ic M a rk etin g
C o n fero n G lo b a l Serv ic es
4
C O N F E R O N G L O B A L S E R V IC E S
Acknowledgments
The w hole is
greater than
the sum of
its p artners.
Peop le w ere vanishing.
In the aftermath of 9 /1 1 , the group market proved
to be the strongest link in the hotel supply chain.
While there was a predictable softening in convention
attendance, it paled in comparison to the virtual halt
in business travel. By the end of 2003, in fact, attendance at many events not dependent on international
visitors began approaching pre-2001 levels.
The only problem was that the rebound in convention attendance occurred during a period of
extremely soft hotel demand and rampant Internet
discounting. Attendees and exhibitors came, but they
increasingly booked outside contracted blocks. This
“vanishing act” brought the high-stakes game of
attrition out of the closet.
A high-level industry dialogue began in January
2003 when Conferon Global Services’ (CGS) president Bruce Harris led the Convention Industry
Council (CIC) to launch its yearlong “Project
Attrition” initiative. (See Chapter 1 for details.)
When it was completed, one question remained:
“What’s next?”
continued on page 4
2
CO N F E R O N G LO B A L S E RV I C E S
C O N TEN TS
A cknowledgments..................................................................2
1
Tracing the History....................................................................8
CIC’s APEX Initiative
U .S .Lo d ging Ind ustry F o recast
10 R easo ns to B o o k Insid e the B lo ck
2 Building Blocks..........................................................................14
Co m p iling G ro up H isto ry
D eterm ining the N um b er of R o o m s
S electing the S ite
Co ntracting at the R ight Tim e
Creating the Pro p er M ix o f H o tels
Acco m m o d ating V IPs
U sing the B ell Curve
3 Housing and Registration....................................................22
Cho o sing a H o using Op tio n
Enco uraging B o o king W ithin the B lo ck
Overb o o king
S etting D ep o sits and Cuto ff D ates
D ealing W ith W alk S ituatio ns
4 Formalizing Hotel A greements........................................34
N ego tiatio n
Attrition Clauses
Calculating Attrition D am ages
Ad d itional Clauses
H otel Contract Checklist
5 Maximizing Pickup Within Your Block.........................46
B uild ing B uy-in
Com b ining R egistration and H ousing
Creating Incentives
Cond ucting R oom Aud its
6 Protecting Your Block...........................................................54
S taying V igilant
M o tivating Exhib ito rs
B attling the B and its
7 C onferon Global Services.....................................................61
CO N F E R O N G LO B A L S E RV I C E S
1
Conferon Global Services
Guid e to Ro o m Blo ck M anag em ent
A Shared Goal
Room block management is a partnership.
AT THE END OF THE DAY — or, more precisely, late into the night — the goal of
both event organizers and host properties is to maximize the number of heads in
contracted beds. It’s the engine that drives hotel profits and allows organizations to
reach revenue targets and/or meeting objectives; it’s also why groups receive public
space, special services and a variety of amenities at little or no additional cost.
The events of 2001 shattered the ability for both parties to just sign a contract and
perform. Though group meeting attendance held up relatively well, soft transient
demand and Internet price shopping converged to wreak havoc on rates and contracted blocks. As a result, according to a survey conducted by the Convention
Industry Council (CIC), an estimated 30 percent of associations incurred attrition
damages in 2002-2003.
Conferon Global Services, which manages events for nearly 1,000 organizations,
recognized the extent of the industry-wide challenge. Its efforts led to CIC’s “Project
Attrition,” a yearlong initiative that identified solutions to maximize pickup on contracted room blocks.
An active participant in that high-level task force, Hilton Hotels Corporation
recognized that room block management was not a onetime task but rather a continuous process requiring ongoing industry education and engagement. That shared
concern compelled Hilton to sponsor the compendium of best practices that anchor
this CGS Guide to Room Block Management.
An alliance is truly strategic when the whole is greater than the sum of its partners.
We are pleased to share this celebration of partnership with the entire industry.
BOB DIRK S
Senior Vice P resid ent Sales Strateg y
and D evelop m ent
Hilto n Ho tels Co rp o ratio n
ED SHARTAR
C EO
Co nfero n Glo b alServices
Guide to
Room Block Management
SPONSORED B Y

guide_to_room_block_..

Transcription

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