In preparation for the day they won't be able to book short-term meetings at reasonable contractual terms, buyers are instituting new internal mechanisms prompting meeting sponsors to deliver event specifications to meeting planners and managers faster, whenever possible. The means used vary, from specific policies enacted to compel sponsors to receive executive approval a specific amount of time before the event, to the introduction of technology designed to give sponsors and attendees a quick and direct avenue to meetings departments, as well as more unofficial communications between planner and sponsor, in which the potential financial ramifications of short lead times are analyzed.
While all of these moves can offer immediate cost- and time-saving efficiencies, the real benefit will be realized when the current buyer's market eases, as history has proven is inevitable. With some analysts forecasting increased overall demand for hotel rooms
(BTN, Sept. 22), and construction of new hotels at its lowest pace in years
(BTN, Aug. 25), it is clear meeting buyers, at some point in the future, will find it much more difficult to dictate contractual terms of short-term meetings. Therefore, many buyers agree that taking steps now—when the financial stakes are decidedly lower—to streamline their internal operations is key.
"We're trying to have them give us some more time to source things out," said Terry Sullo, manager of travel and meeting services at Cambridge, Mass.-based Akamai Technologies Inc. "We'll show them what might have been, had we had the meeting earlier."
Sullo said Akamai meeting sponsors, following a short-term meeting, sometimes will be shown the difference between the event's actual hotel cost and the probable cost if the sponsor offered a few weeks more lead time. Typically, the demonstration produces the desired effect. "It only takes doing that once," she said. "What we want them to do is think about their scheduled dates and tell me as soon as they can so we can work with hotels for dates that are good for both of us." Sullo, whose company recently became the first midmarket corporation to publicly move its transient air volume to Expedia Corporate Travel
(BTN, Sept. 22), added that the prospective introduction of unrelated meetings management technology also could prove worthwhile in speeding and smoothing the internal process of meeting request and registration.
Other buyers have taken to making sponsors aware of the potential benefits of flexibility in meeting site locations. "There's an increasing awareness on the part of our organization that we need to have face to face meetings, but we're very focused on pricing and cost," said Barbara Stark of St. Paul, Minn.-based AgriBank, a wholesale lender and provider of business services to farm credit associations that holds meetings primarily in the Midwest.
AgriBank meeting sponsors have been asked to consider "strategic locations" for the sites of their short-term events, Stark said, to keep costs controlled. "We want more consideration of location and the amount of attendee travel minimized so that costs will be impacted," she said. "We now have meeting requests two weeks out, which, for us, is incredible. We rarely have more than 60 days anymore."
For the moment, Stark has developed enough of a history with a handful of local properties to ease the potential ramifications of short-term booking.
"For local meetings, we have resources in place," Stark said. "We've made arrangements with three hotels in St. Paul that are always available for us to go to. When we have needs outside of Minnesota, we'll typically contact HelmsBriscoe or a convention and visitors bureau, which are usually able to help.
"All it means for us is that we have to move faster, but our hotels and venues have been great to work with," she continued. "Our need to have events follows our course of business, and that course has started to move faster. We don't have a lot of time to think or do extensive planning, but there is enough hotel availability, and we're not usually closed out of places that we've requested."
Buyers, though, agreed that situation will not last forever. "We are seeing a bit of pickup at hotels, particularly in New England in the fall," Sullo said, "but there's always opportunity if you're flexible with them. You can come to an agreeable amount if the dates are flexible. There's been no change in that."
"The pendulum will turn back sometime," said Jan Hennessey, manager of meeting and conference services at Oakland, Calif.-based Kaiser Permanente. "In New York or Chicago, there are still places with high occupancy and rate, but in San Francisco and in southern California, there's a lot more product and we're finding what we need."
In some cases, little can be done to lengthen the amount of lead time planners receive, as some meeting-spurring business developments cannot be timed. "Our lead time has been shorter because we're having new meetings," Hennessey said. "There's a lot of changes, regardless of the economy, that are causing that. Our annual meetings are still going on rather standard cycles, including incentives, but even those are being booked with maybe 10 months of lead time instead of 12 months. I'm working one now that's 300 people, four days, that's three months out."
Though buyers are aware of and preparing for the future, they still are able to capitalize on the present market. "We have a long list of things to ask for," Hennessey said. "We know that if we ask for 20 things, we might get 15. Hotels vary on what they're willing to give us. They still want attrition, and they want some rate integrity, but we have been successful in negotiating that cancellation fees will be based on lost hotel profit, not revenue."