Among the benefits of globalizing his firm's travel program,
Deloitte senior manager of travel procurement and operations Brian Nichols found a perk: added negotiating leverage in an increasingly challenging
hotel market.
Increased demand and limited supply growth will cause hotels
to whittle their roster of accounts, Nichols in December told attendees at The
BTN Group's Travel Management 2012 conference, and buyers must make hoteliers
aware of what separates their company from others competing for a hotel's best
rates.
"Some will get the best deals, and others will get the
next-best deals," Nichols said. "We have to show what makes
Deloitte's travel demand different from other corporations looking for a volume
discount."
Much of Deloitte's leverage in negotiating hotel rates came
from globalization. Until recently, Nichols' scope was mostly U.S.-centric, and
Deloitte's member firms around the world had their own sourcing processes. Now,
the company has established a common sourcing process for 20 member firms
across 20 countries, Nichols said.
Travel technology firm TRX assisted Deloitte in the
development of that process, TRX executive vice president Kevin Austin said. Deloitte
was the first client to use TRX's automation of the Travel Analytics consulting service by combining hotel, agency and card data with information about its
hierarchy onto TRX's TravelTrax platform.
TravelTrax generated maps that clustered together Deloitte properties, enabling automated bid lists from which it could submit RFPs
through Uversa and Lanyon, Austin said.
Communicating the value that had to hoteliers was key in
negotiating this year's rates, Nichols said, with 20 new points of sale
available for each participating hotel.
"I'm not saying it's revolutionary, because we're
probably behind the curve in multicountry efforts," he said, "but
it's worked well for us and our member firms around the world. It's enabled us
to manage through an up cycle."
Globalization was not Deloitte's only selling point, Nichols
said. He also emphasized that the firm's typical length of stay is longer than
those of other companies, because Deloitte has a concentration of long-term project
business and a pattern of consistent growth during the past decade.
Additionally, data is a critical foundation, Nichols said.
Deloitte uses GDS and card data, cleaned up by a third party, to demonstrate
detailed volume information for hotel companies, broken down by cities or ZIP
codes.
The firm also has benefitted by maintaining solid
relationships with hotels over the years regardless of who had more power in
negotiations, he said.
"These cycles are fairly predictable once they start
happening," Nichols said. "The knee-jerk response is to get upset
when they raise rates, but you can be detached emotionally from it and keep a
good business relationship through it."
— With reporting by
Jay Campbell