OnVantage Tests Room Block Booking Tool: Debuts Tool To Book Small Events Without meeting Space, Using StandarD Hotel Contract

Taking aim at ad hoc, small corporate events, meetings technology provider OnVantage Inc. on June 26 announced a new online booking tool tied to a mandatory standard contract pre-approved by both hoteliers and corporate meeting buyers. Currently testing in eight metropolitan markets and available to book only room blocks, the company said EasyBook would allow buyers to save both time and money.

The EasyBook tool has a user interface similar to such online booking tools already on the market as Expedia Corporate Travel and Travelocity Business, but instead of booking individual rooms, users will be able to book blocks of up to 100 rooms, OnVantage CEO John Chang said. Meeting buyers can book and pay for room blocks in real time using the pre-negotiated terms. The tool also links users to their preferred air booking providers.

"EasyBook will allow our customers to go online, search for group hotel inventory and be able to book it online," Chang said.

EasyBook is testing in eight metropolitan areas—San Francisco, Los Angeles, Chicago, Dallas/Fort Worth, Portland, Nashville, Atlanta and Phoenix—and OnVantage aims to expand the tool to 36 cities by the end of the year.

Small meetings, which the Santa Clara, Calif.-based company defines as those with fewer than 50 attendees, account for 80 percent to 90 percent of all corporate meetings, according to OnVantage's Chang, and small corporate groups make up 60 percent of group room blocks for hotels.

This week at the annual National Business Travel Association International Convention and Exposition, the company plans to launch a new version of MarketView, its online tool for suppliers. The new platform better integrates with the MeetingView system for buyers, he said.

Cheryl Hoffard, manager of meeting services for Marshall, Minn.-based Schwan Food Co., said she has followed development of the tool for months but is hesitant to adopt it until she sees how effective it is. Some online booking tools available directly from hoteliers require deposits up front.

"I looked at it earlier this spring when they were first talking about it, and my first thought was that even though they do the contracting for you, it's no different than the hotels today when you have to pay upfront," Hoffard said. "Maybe I just have to use it. I'm not comfortable with that process."

Chang said users have multiple payment options through the tool.

"It's simple. Buyers pay a 10 percent deposit with a credit card, either a master billing account or an individual card, or they can be invoiced for it. After they have the meeting, then they pay the hotel, sometimes that's through master billing, sometimes through individual travelers," he said.

In the second phase of the project, buyers commit to volume and then attendees can pay for their rooms as they register, Chang said.

One potential problem with using the tool is that sponsors sometimes cancel meetings at the last minute, Hoffard said.

"We don't make the final decisions in our office. We give our people three or four hotels to choose from and do the requests for proposals. There's been times where sponsors are about to sign a contract and then they say to wait for a couple days," she said.

The standard contract uses industry accepted terms for attrition, cancellation, force majeure and other clauses, Chang said, and includes a rebooking option.

"Maybe, down the road, I'll find out this is something we can really use for small quick meetings," Schwan's Hoffard said, adding that she is unsure how many hotels will agree to standard contracts. "I'm sure it's going to be a slow process. If it works, it's going to be wonderful."

Cupertino, Calif-based Symantec Corp., a content and network security provider that adopted OnVantage in 2005, plans this year to roll out EasyBook for use by the company's meeting planners and a select group of administrative assistants, said Laurie Yaksick, the company's project manager of corporate meeting solutions.

Symantec has umbrella meeting agreements with a few properties close to company headquarters, but EasyBook would act as a supplement to the transient program. The pre-negotiated contract is "fantastic," she said.

"I can see that Symantec will be able to leverage the spend better, we won't be leaving dollars on the table and contracts with inappropriate language won't be signed," Yaksick said.

Preferred transient hotels would be given top priority in the tool, she said, so more volume can be driven to those properties.

However, Symantec needs meeting space in addition to room blocks. If only a room block is needed, then the company would use its travel management company, Yaksick said. Until EasyBook offers online meeting space booking and such services as catering, those arrangements would be made offline—as would payment, she said, due to internal policy and thresholds for requisitions. Despite the limitations, she expects benefits from the tool.

"Right now the RFP process is a little laborious. There's a lot of back and forth. EasyBook will definitely be able to leverage my time and leverage the dollars," she said.

The incentive for hotels lies in the size of the groups in the program. While large events present a problem in yield management and rate flexibility, small groups yield higher revenues than transient, Chang said. In the end, neither side has an overwhelming advantage, he said.

"Is it the absolute best contract that a corporate meeting planner could negotiate? No, but is it the best contract that the hotels would like to see? No, it's a very reasonable contract," Chang said.

Diane Reardon, senior director of regions and groups for Minneapolis-based Carlson Hotels Worldwide, said a pre-approved contract is acceptable for small meetings and the use of standard clauses drafted by industry associations in the OnVantage contract will benefit both sides.

"More hotels are going to this anyway. We as a company are having our legal team look at it. When you know that it has been looked at from both sides of the fence and it seems to be standard, I think we're going to be finding it commonly used no matter where," Reardon said.

Large meeting contracts are complicated and entail more risk for companies, but a standard contract can help speed approval for small events.

"The small ones are pretty straightforward. I've been amazed in my career, moving from brand to brand our contracts are pretty much the same. Everyone is just trying to protect themselves," Reardon said.

Rather than leveraging transient volume in group negotiations, buyers may find it easier to leverage their small group volume in transient negotiations, Chang said. Corporations can ensure their preferred properties are given priority in search results, and volume data can be used in annual transient hotel negotiations.

Search results sort by best match and property star ratings. Users cannot book meeting space through the tool, but Chang said participating vendors rarely are unable to accommodate small events, unless the space required is disproportionately larger than the room block. In addition, only 40 percent to 60 percent of these groups require meeting space, he said, as many events are held on company property.