Where we are today and how to secure our future for tomorrow
Amy Butterfield – Senior Vice President, Group Sales
Christie Pienaar – Vice President, Group Sales
Katy Gettinger – Vice President, Group Sales
Opening: Amy Butterfield
We are certainly in the midst of uncharted waters. Our goals for the next 10-12 minutes will be twofold:
To share insight on what we are seeing/hearing from our meeting planners/industry leaders across different segments
To provide you with some best practices to help navigate these turbulent waters so that your hotel and your group sales teams will be prepared when we rebound.
In other words… what can we do today to secure our future for tomorrow.
Corporate Group - Katy Gettinger
Within the Corporate Group Space, we are seeing Companies cancel and postpone at unprecedented rates as well as significant decrease in lead volume.
80% of Preferred’s Corporate group business has cancelled or postponed through April
Most US Fortune 500 Companies including, Bank of America, Nationwide, Allstate are cancelling meetings through April 30
Other large US Corporations such as Toyota, McDonalds, Home Depot do not think they will be holding meetings until sometime this Fall
We are seeing the following regarding lead volume from our offices to your hotels:
2019 YTD we sent 6400 - compared to YTD 2020 - 5800
There is some good news in these numbers. Our Lead Volume was up 27% YOY for January and 13% YOY for February - demonstrating the seat at the table our Independent hotels have with our Corporate Customers.
Yes, March lead volume is off by approximately 60% but these numbers indicate when the Pandemic passes, our hotels are well positioned with our customers
Temperature in this segment
Overall they are cautiously optimistic about the meeting business
They feel it will be a buyers’ market when we get through this situation
However, clients are concerned about the ‘pent up demand’ and how they will execute all of the meetings that need to occur July-Dec 2020 showing confidence in a relatively quick rebound of our business
Best Practices: Postpone rather than cancel their programs
20% of programs have Postponed vs 80% cancelled
the type of program usually dictates if they can do this
Incentives and client facing meetings are postponing/ while we see internal meetings cancel more frequently.
Good news space in Fall 2020 is scarce at many properties. As well, March – May 2021 space is becoming challenging to find which will help with a swift rebound and enable you to yield demand
Also, We have had success securing an additional program or two in return for a hotel’s flexibility
Our key take away… “Try to keep the customer you have today to secure your future for tomorrow, in others wards: Move VS Cancel. Understand we may be going into a buyers’ market. Better to confirm 2020 rates and terms that were contracted during a sellers’ market. You may find yourself winning the rate/occupancy game in 2021.
Third Party – Christie Pienaar
We are fortunate to have some incredible third party customers that have channeled some feedback to us.
I’ve reached out to both “mom and pop” third parties (those that do simple sourcing only and some that do full services), as well as our important incentive houses and key strategic partners of ours.
The general consensus across the Board with cancels and postponements is pretty positive:
We’re finding 80% of third party business is actually postponing vs cancelling
The GOOD News is that events are happening. And 2021 events haven’t been too affected yet.
Some important industry events are still moving forward as of today: Incentive Research Foundation’s – the IRF Invitational late May and ConferenceDirect’s APM early May.
What is the overall temperate check out there?
Big brands haven’t approached our clients to strategize as we have in the independent space so we have a leg up on them already
Remember clients in the end WANT to have these meetings they need to have these meetings they recognize the value of human interaction in person.
Here are some best practices so we win favor with the third parties.
Make the program moves seamless. Now is the time to show partnership, flexibility. For the hotels that are still trying to charge cancellation fees, groups will not bring future business there.
Third parties echoing what direct business is seeing: Fall is quickly becoming compressed so hotels are allowing movement into 2021.Key messaging: “you have a credit with us and you are welcome when it is safe.” And also “doing the right thing”
Lean on your GSOs for strategic partnerships & also tips on being flexible
How we treat our clients now in these dark times will carry through with us to the future. Be good to your clients. They will remember how they were treated.
Amy Butterfield - That is where we are, now how do we protect our future by doing the right things today for tomorrow.
Thank you Katy & Christie for painting today’s picture. Yes – this virus is taking a toll, BUT the good news here is that the overwhelming response from both our direct client and our third parties is that they are looking to still hold their events – they just need to postpone. I do want to point out that this is the same messaging that we are currently hearing from our inbound European groups.
Based on the info that Katy & Christie just shared… we need to act NOW to be ready for tomorrow. We are hearing that this Coronavirus will most likely catapult us into a recession.. We will come out of this – but it will be a New Normal. A Normal where the Buyer once again has the upper hand and supply outpaces demand. When we dust off our old game plans for a down economy –we should remember that Group is CRITICAL to our future success. Now is the time to once again look to build a group base that will allow you to yield demand. In addition, I would encourage you all to really look at your Sales Teams
Have they lived thru a down economy or will this all be new to them?
Do they know how to ask for the business and HOW to stand out from the crowd OR are they order takers—waiting for the phone to ring?
Now is the time to set your team up for success…Look at your processes for quoting rates/dates, look at your proposals and ensure that they are truly targeted responses that are catering to our client’s needs.
Corporate Group – Katy Gettinger
So how do you “Group Up” and “Build your Base” with Corporate Group Business during the expected downturn?
Consider focusing on Industries & Segments that you previously may not have invested time & resources
Pharma - Typically short term, known to be space intensive and unfortunately challenging one sided contracts
Medical Device companies - Medtronic, BD, GE, Siemens, Stryker
IT - Cloud Companies, Video Conferencing - SAP, Cisco, Microsoft
Some Retail - Grocery, Drugstores and of course retailers such as Amazon
I&F companies will still host incentives and client facing programs but these may be smaller and closer to home which could help some of our domestic, boutique properties
We encourage you to revisit your hotels relationship with Associations. You may not have accepted some of this business in the past due to F&B spend and space requirements. However, they meet even in the worst of economies due to their bylaws
A few additional suggestions to quickly rebound from our current situation?
MSA’s - Strongly encourage you to consider these when you can.
But please Note there is little flexibility in their FM, Resell and Cancellation Clauses
Aggressive rate strategy. Build your base with group
Third Party Group – Christie Pienaar
Which Third Parties should we focus on?
Our Strategic Partners - ConferenceDirect, AMEX, CWT, BCDME, MCI – these third parties have been in business for a long long time – they’ve weathered many economic storms in the past several years. Kellen Meetings (Association Management Comp) and other Association focused third parties will also be key relationships to leverage.
There IS business to be had – We are still getting some RFPs for 2021 and beyond. Your strategy and approach to responding to these RFPS is of the utmost importance. We need to be the first to respond and we need to show that we want the business!
How do you succeed and elevate your hotel?
We tend to find that strong third parties can often thrive in a down economy. Many companies will opt to shrink up their meeting departments to save dollars and will turn to the 3rd parties to further augment or to take over completely. It is important that we remember that the 3rd party planners are influencers and can really drive business our way.
What can you do to be sure that the 3rd party is pushing us?
We already have a competitive advantage as independents that have not cut commissions nor made them feel unnecessary. We need to keep this up and show them how much we value their expertise.
Some items that we know are important to our 3rd parties are:
Enhanced Commissions – this will set you apart to take care of these customers when they need it the most – makes you memorable
Making them “Shine” and be all around more flexible when you can
The diversified third parties that are handling soup to nuts sourcing to logistics will survive. And also those who have a diversified group of industries as customers will survive.
Several of the hard brands have systematically devalued the 3rd parties. This in combination with their lack of flexibility with regard to cancellations could be their downfall – and our windfall.
Amy Butterfield – Closing Comments
As I was preparing for this Town Hall, I was thinking back to January 2020. We kicked off this new decade with a Joint Sales Meeting where the theme and focus was “Better+ Together”. We had NO IDEA what would happen to our world just a few short months after the meeting – BUT certainly our Better Together messaging continues to apply. We are an amazing and seasoned Group Sales Force with decades of experience under our belts. We successfully navigated the turbulent waters after 9/11 and 2008 AND we are here with you now! HERE to meet with your teams, to strategize, share best practices and help you to spend your travel & event dollars wisely. We are talking to our clients each and every day and will be meeting with them in person as soon as we have the green light to be back on the road
We are here today, Better Together, - and we are READY to help secure our future for tomorrow.
