Rosenbluth Reacts To Econ.

By BTN / June 10, 2001

Rosenbluth Reacts To Econ.

Tech. Will Play A Larger Role

Ron DiLeo, senior vice president of North American operations at Rosenbluth International, last month spoke with Meetings Today editor Chris Davis about the mega agency's plans for meetings management solutions and the economy's impact on corporate group travel.

Meetings Today: How have your clients fared with economy-related meetings cutbacks?

Ron DiLeo: There's been no impact in the pharmaceutical vertical. Their meeting activity is driven completely by new drug releases. But manufacturing, technology, petroleum and chemical companies are cutting back. It's not a good time to spend when your stock's in the toilet. You wait until it's more appropriate or need to drive top-line growth. We suspect meetings will come back with a vengeance by the end of the year and level themselves out. Right now, everyone is taking a hard look at travel, period, and though meetings is a completely separate universe, it's perceived as travel-related and is cut accordingly.

MT: A year-end bounceback is one of the optimistic predictions we've heard.

DiLeo: Meetings are different than transient travel, and I'm not suggesting that transient will bounce back by the year-end. But a lot of the meetings we serve are client/customer meetings, and you can only focus on the bottom line and cut costs to a certain point there. At some point, someone will wake up and want to drive top-line growth. That's why we expect meetings to bounce back within nine to 12 months.

MT: Have your clients tried to reduce meeting costs through methods besides cancellations?

DiLeo: There has been a huge accelerated demand for videoconferencing and teleconferencing services. We launched a venture three years ago with TeleSuites (BTN, Aug. 3, 1998) and have installed five or six times as many facilities in the past six months than in the preceding two years combined. People are viewing that as an alternative to traveling for internal meetings.

MT: What other products are you offering to the meetings industry?

DiLeo: We have an offering we've branded Meetings@Rosenbluth. We're going after components of meetings and incentive business that most of the big meeting houses and our competitors don't go after: the basic blocking and tackling that goes on behind the scenes that can truly make or break the meeting's effectiveness. If you're an in-house corporate meetings department, and you need that support, we're a great alternative to what's out there. We're not trying to do anything other than what we're asked to do.

We've also started a venture with PlanSoft that enables you to truly manage a series of meeting functions in a very collective way. It connects to virtually every type of supplier involved in the process and lets you communicate changes to everyone along the line. This creates a database of not only our customers, but others that we can use as best practices to ensure we give clients the best deals and best packaging, all of which relates to setting and delivering expectations. Within our corporate client base, it is not uncommon to have pockets of small meeting desks within any given Rosenbluth business unit that provide group air and logistical support. We manage that on a day-to-day basis as an extension of our relationship. However, there are peaks and valleys in the meetings business. If you're a pharmaceutical client, your cycles may be huge in the spring and fall, or when the drugs are introduced, which may be different than other clients. When clients hit extraordinary surges of activity, there's a place they can go to get meeting planners or onsite support help. They can use it as needed, rather than paying for resources that will be very busy some times and not busy other times.

MT: Are most of your offerings designed for meeting-by-meeting usage?

DiLeo: In the business units, yes. We have very formal contracts with clients to manage all of their meeting functions.

MT: Lately, some of your competitors have tried to develop procurement-based meetings solutions. Does Rosenbluth have any interest in that?

DiLeo: We have Dacoda, a yield management system that manages both transient and meetings activity. The system enables us to take those two separate functions and manage them in a very consolidated way to completely optimize the yield you can get from any supplier in either of those functions. On the air side, we've been in that business since 1994. The hotel procurement component is managed through the PlanSoft software. We do have a Dacoda offering forthcoming that is focused on hotel yield management strategies, as the hotel industry gets more sophisticated in that area.

MT: Are your transient clients looking for some of those integrated, program-wide solutions?

DiLeo: Meetings are a black hole in many corporate travel programs and represent that last province of spend that hasn't been completely taken advantage of. During the past few years, transient clients are going after it more aggressively than they have in the past decade. We have a diagnostic process, as part of the business planning process we do with all clients, that assesses opportunity and service needs, looks at behavioral and cultural profiles within the corporation and enables us to make very statistically grounded recommendations in every component of a travel program and estimate the size of the prize associated with that. Meetings bubble up very frequently in that diagnostic process as an opportunity well worth pursuing. We can go into this in a non-threatening way and have them look at it not as something we try to take away, but as an asset. Often we operate not as Rosenbluth, but as the corporate meetings desk.

MT: E-travel, Rosenbluth's online booking partner, has a relationship with StarCite. How does that affect the PlanSoft relationship?

DiLeo: StarCite has a great product, too, and we never limit our options. The only thing we're doing with StarCite that we're not doing with PlanSoft is product development and a more advanced level of systems integration. We use StarCite for some of our pharmaceutical clients and their software is as good as anything gets in that marketplace.

MT: What products will Rosenbluth develop with PlanSoft?

DiLeo: We'll develop Dacoda in a more integrated fashion behind the scenes, having their networking hang off our global distribution system. It's not interesting reading, and it's not as product-centric as it is function-centric. The meeting buyer will not directly use it.

MT: Has there been any discussion to broaden your relationship with PlanSoft or acquire it outright?

DiLeo: We are always in the market for acquisitions or equity stakes with the right companies, and that's all I can say.

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