Most Planners Can't Combine Meetings, Transient Volume

<FONT SIZE="+3"><B>Most Planners Can't Combine Meetings, Transient Volume</B>

By Lauren Bielski

Leveraging transient and meeting volume to drive down room rates is a tactic they aspire to, but relatively few companies are actually in a position-lacking sheer size, a sophistication of T&E and meeting budgeting systems, and compliance-to put their good intentions into action, according to a recent survey of corporate meetings buyers.

Furthermore, with climbing occupancies in hotels and on airplanes it is unlikely that combining both types of business will bring significant savings unless there are specific vacancies to fill.

When it comes to booking meetings, hotels and airlines may be part of a mutually beneficial transaction, but their patterns of availability will often put them at cross purposes with the agendas of their corporate clients.

To wit: Corporate planners want their volume over a period of time to bear weight on the level of discounting obtained for each trip, while hotel and air vendors need to "fill slots with bodies" on a particular day and will be often hard pressed to charge less than the market will bear. Combining both transient and meeting business even further complicates the issue.

This month's Meetings Monitor shows that, of the 219 planners polled, only 34.3 percent combine both transient and meeting volume for negotiating purposes with air carriers, while 39.5 percent do so with hotel vendors in the development of preferred vendor programs.

In most cases, air carriers view meetings business as separate and aren't necessarily willing to determine rates on the basis of total spending. Monitor participants interviewed for this article agreed.

"Typically, it's kind of hard to combine transient and meeting volumes to present the total value of the business to air carriers," said Dawn Levesque, a meeting planner with an American Express on-site office for tractor and equipment manufacturer John Deere in Moline, Ill. "With most of the carriers that I've worked with, they are more interested in whether I will fulfill a particular contract than in my total volume."

She did manage to leverage her transient and meetings business with one carrier-obtaining discounts of 35 percent off full coach and up to 12 percent off the lowest fare for non-refundables-but only in that case does her company drum up enough transient business to warrant a break on group movement.

Levesque said her regional office generates air volume of $3 to $3.5 million annually and a lot of meetings-small sessions, typically with 5 or 10 employees, occur 20 or 30 times monthly and three large meetings for dealers and customers with groups of up to 1,000 occur annually.

Karen Levitan, air program manager at BTI Americas in Rutherford, N.J., works with several clients on air negotiations and meeting planning-and has also had luck combining transient and meeting volumes for her largest account, a pharmaceutical company.

"We tend to rely on zone fares for most of our clients but in the case of the pharmaceutical company, we were able to obtain an annual corporate contract of 30 to 40 percent off from United based on the total volume of business-we even switched our CRS system to Apollo to support reservations for that client," she said.

What hope is there for smaller companies with less illustrious travel schedules? "I think you don't have to be a giant to gain some discounting from airlines; I think you could get some percentage off if you could demonstrate that you've mostly flown on a particular carrier," Levitan said.

In fact, a fragmented transient travel booking pattern keeps Mauna Hatchett, a meeting planner with Indianapolis Life, from being able to attract deeper discounts with the airlines, even though she books $400,000 in group and some transient business out of the company's headquarters alone.

"It's always been the case that everyone books their own travel. We've recommended that they use the agency, but we aren't in a position to mandate it." Hatchett plans four meetings requiring group travel annually and uses Maritz for incentive travel, which represents an additional piece of business.

For a smaller company, Vensys, a software developer that specializes in solutions in the legal market, the quick wits and maneuvering of planner Nancy Wilke's travel agent take the place of a discounted corporate rate on the transient side. "She's so good, I wouldn't put an automated booking system in if you paid me to-we really rely on her," Wilke said.

The company has six technical employees regularly flying to locations throughout the United States, Canada and Jamaica to support a client base of about 130 companies. The agent also handles booking for the one larger meeting that Vensys hosts annually-a user's group that is meeting this month at the Sheraton Palace Hotel.

Still, the going will be tough for most, particularly when it comes to negotiating for meetings properties, as the hotel industry is even more inclined now to drive a hard bargain. Bjorn Hansen, national hospitality industry chairman at Coopers & Lybrand, has stated repeatedly that rates-which will be 20 percent more for high-season, highly traveled cities-won't change in the near future and the hotel industry is at the highest capacity it has enjoyed in 15 years (<I>BTN</I>, July 29).

John Deere's Levesque agrees that, with respect to properties that she's negotiated with, many hotels aren't giving an inch on discounts. "It's kind of frustrating, because Amex has great rates negotiated with many hotel properties, and yet those hotels are reluctant to offer those rates for meetings. They've tended to charge more for booking a block. Of course, in the past year, meeting space itself has commanded a premium price in many properties," she said.

When booking room nights for a sales meeting recently in Chicago, Levesque had to reserve each of the 10 attendees' four-night stays separately on the CRS, because of the significant difference between the negotiated transient and meeting rate.

Courtney Hill, meeting and travel planner with Birkenstock in Novato, Calif., plans to push a bit harder with both air and hotel negotiations despite her company's small size.

She plans 8 to 10 meetings for 25 field sales reps and their brand managers annually-two of which are national meetings-and has about 40 or 50 regular travelers, with some international travel from the Birkenstock Germany company. Because her transient travelers stay in many different cities, she hasn't had the opportunity to forge cost-saving relationships with most of the properties the company stays in. "We have definitely done better with a local hotel-we funnel our one national meeting, and a fair amount of transient business," Hill said.