<B>End Of The RFP?</B>
<I>GetThere Tool Aims High, Assures Rates</I>
By Chris Davis
In a development that GetThere executives claim will lead to the end of the traditional request for proposal process, the company's DirectMeetings subsidiary has created a tool that allows corporate meeting buyers to reserve meeting space and food and beverage service online--and guarantees that buyers will receive the lowest rates offered by the selected hotel.
The system is set to launch this month, and currently includes 313 hotels in 16 cities.
Under the terms of the program, buyers would submit basic details of a proposed meeting, including date, city, number of attendees, and meetings space and F&B requirements through the DirectMeetings Web site or a corporate intranet. DirectMeetings staffers then would conduct a real-time search of availability at participating hotels and, if there is space, receive the hotel's best possible quote and report back to the buyer. The necessary guest rooms and meeting space would be blocked until an answer from the buyer is received.
"We have negotiated most-favored nation status with participating hotels, allowing buyers to book instantly," DirectMeetings director of meeting solutions Brian Ashton said. "The corporation will not get a better rate than we will for the exact same meeting through any other channel, including their own negotiating."
Corporate buyers would not be required to accept any of the proposed contracts offered through the service. If a buyer chooses to accept, DirectMeetings would charge its standard per-meeting fee of $50 to $100, depending on meeting size and location. Buyers would have the opportunity to negotiate specific details with hotels.
"This takes the RFP time down significantly, as well as the booking work," Ashton said. "Meeting customers have complained that they have to rush to get whatever space comes first for small, short-term meetings, and end up paying a higher rate." The process is made possible by hotels paying DirectMeetings a negotiated per-transaction fee allowing it access to a dedicated subset of their guest room and meeting space inventory to book these meetings.
While the system is designed to handle meetings of less than 100 attendees with about 90 to 120 days of lead time, each participating hotel has a specific set of requirements, including ratio of meeting space to room nights and F&B service, that precludes DirectMeetings from booking any proposed meeting.
"They can say that they need 100 room nights and a level of F&B for five meeting rooms, or that they need 30 days advance notice or seven days," Ashton said. "Each hotel will do it differently and each will only make inventory available at certain times. But since 80 percent of corporate meetings are planned by administrative assistants or secretaries, and a hotel sales staff doesn't sell much to them directly, this gives the hotel exposure and visibility to corporations. It's qualified, profitable short-term business."
A key factor in the program is DirectMeetings' directive to forward every possible lead to all participating hotels that have availability in the buyer-selected city. If a hotel will not accept the corporate meeting, its staff will tell DirectMeetings why, and the reasons will be passed on to the buyer for possible adjustment of meeting requirements.
The reaction from several corporate clients was a mixture of interest in the program, with reservations about the pricing plans. "Who wouldn't be interested in it?" said Judy Weber, corporate travel manager for Parker Hannifin Corp. of Cleveland, Ohio, and a GetThere client. "I'd be happy to look at it, but we would test it thoroughly; I don't have much faith in that guarantee."
Weber uses GetThere and parent company Sabre as part of an innovative transient air management program that allows Parker Hannifin a larger negotiated discount for tickets booked through Sabre BTS than through its own agency (BTN, Jan. 15). The company also is centralizing meetings through its in-house meetings department and, given her previous success with GetThere, Weber expressed interest in DirectMeetings' program as a conduit for further savings.
"We enjoy the GetThere system, and its success is validated in our air ticket prices," Weber said. "Whether this can prove valuable in further cost savings is something I don't know, but it sounds pretty aggressive."
Other corporate meeting managers, who requested anonymity, also expressed interest at the concept but questioned the lowest-rate-possible setup, pointing out the unlikelihood of a hotel director of sales offering the lowest rate for anything but the shortest-term space or distressed inventory. There also could be concerns that the participating hotels would be offering rates through DirectMeetings that they wouldn't offer if negotiating directly with the corporate buyer.
One hotel chain that is involved in the program is MeriStar Hotels and Resorts, which has several properties included in the current total of 313 and eventually hopes to have many more, said Pam Streeter, vice president of electronic distribution.
"We developed this relationship with GetThere because their client base was asking for a product like this," Streeter said. "This will be a great source of small corporate meetings business, which is exactly the type of meetings business we want. GetThere has an established corporate client base that wants this service, and we can provide the resources for the business that will fill our hotels."
Streeter said MeriStar properties included in the program can offer the lowest rate available because their sales execs know the rate cannot be used by the buyer to negotiate with another hotel.
"We will put into the system the best available rate for that specific inventory, at that time," Streeter said. "We will confirm availability and place holds because we know the deal is locked down, so we can offer them better rates than if they were going to shop that rate around. If we know for certain the business is there, we can walk the rate down. This is qualified business at the specifications that we set, and since they pick the hotel, we know they will be satisfied."
Other hotel sales executives, also questioned the concept of offering guaranteed lowest rates through DirectMeetings. "When I learned of GetThere's purchase of AllMeetings, we met with their executives about this and felt it was not in Hyatt's best interests to participate," said Joan Lowell, vice president of electronic distribution for Hyatt Hotels Corp. "I don't know if any Hyatt properties are participating, but we would be very careful about any arrangement with an outside party that would have a hand in deciding what our rates should be. Rate integrity is very important with our customer base, and it seems to be an impossible commitment to deliver."
DirectMeetings has spent the past year developing the program, Ashton said, predating GetThere's July purchase of AllMeetings, DirectMeetings' original incarnation.