By Kemp Gallineau, Chief Executive Officer, Groups360
This week, we continue to tackle commonly held misconceptions in the group meetings industry. We previously addressed the myth that the lowest price always wins the day. To continue the myth-busting series of blog posts, we’ll take on the idea that a seller’s market means you will pay more, and we’ll discuss need dates.
Let’s break the cycle of these self-perpetuating myths so they can’t drive a wedge between meeting planners and hoteliers. Stick with us through the series if you want to be amazed! The truth and the data are sitting in plain view.
A seller’s market?
How many articles have you read that describe the current environment as a “seller’s market”? All these articles describe the difficult circumstances event planners find when trying to book a meeting and find value for the dollar. To be sure, these are very good times for hotels. That said, there are many ways to still deliver a meeting that meets your budget and is a good value.
The hospitality industry uses the phrase “need dates” to describe a specific pattern of days in which a meeting planner has the potential to find better value than what the market typically demands.
There are two types of need dates.
First, there are need dates we know about, those patterns of days mostly focused around holidays, weather, e.g., January in Minnesota or hurricane season in South Florida, and unique destination situations.
Second, specific hotel-related circumstances may cause the hotel to want to attract groups at very attractive prices.
When hotels talk about their need dates or special offers, they frequently happen during holidays or seasonally affected periods. To know when these periods exist, one needs two things:
- A calendar with major holidays
- An understanding of when seasonal group and transient travel are slow.
The former is simple. Everyone knows there isn’t much business travel the week of Thanksgiving or around Memorial Day. Business travelers are simply less interested in being on the road during these periods. If your group is flexible enough to move your meeting to one of the 50 or so low-demand days that fit into this category, you are in for a treat. Hotels will typically roll out the red carpet for you.
To discover unique destination situations, you’ll need better market intelligence. Frankly, you need a crystal ball. Each market changes significantly week to week, month to month, and season to season. If you are flexible and have the right market intelligence, you have the opportunity to go to the market your heart is set on for a very attractive price.
For instance, in Miami, the price difference between February and September is $150. If you absolutely must be in Miami, use our market intelligence to find the best options for you.
Other ways to find value with set dates
In the examples above, the meeting planner can find tremendous value by being flexible with event dates. But what if you can’t move the dates of your company meeting?
There’s still hope. New intelligence in the marketplace allows corporate event planners to make direct market comparisons before enduring the labor intensive task of contacting hotels for pricing. GroupSync helps event planners identify where to place their meeting that would fill a natural gap in demand — where hotels need business and are likely to be competitive.
For instance, assume you are an event planner who wants to be in Dallas the third week of September, and you want to pay $170 per room. With the right information at your fingertips, you would know that Dallas that week typically runs very high occupancy and at a rate above your desired rates.
You could go through the laborious task of contacting the 10 to 20 hotels in Dallas that could hold your program in hopes of finding a needle in the haystack. By you don’t want to do that, do you? That would be a tremendous waste of your time, as well as the hotels’. Hotels in Dallas are unlikely to bend over backward for your group.
Instead, you could look in Orlando, which is similar in weather and airlift to Dallas but is less expensive that week of the year. Or you could look at San Antonio, which runs a much lower occupancy at that time of year and may have more hotels competitive for your business.
In either scenario, you, the meeting planner, have a much better chance of delivering an event on your $170 budget than trying to force your way into a very tight market. In either alternative, the hotels will likely roll out the red carpet for you, welcoming you and your business, making you look like a hero.
Don’t fall for the hype. According to STR, in 2015 luxury and upper-upscale hotels ran approximately 76% occupancy. That means on any given night, a quarter of the available rooms in the U.S. were vacant. That is almost 40 million room nights annually. If you have the right tools, you can find the opportunities to help a hotel fill some of these rooms at a good value for you.