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Enabling the

Online Marketplace for Groups and Meetings: A Toolkit

A Guide for Bringing Groups and Small Meetings Online

HEDNA Group Online Committee

Hotel Electronic Distribution Network Association

1156 15th Street, NW, Suite 900

Washington, DC 20005

+1 202-204-8400

www.hedna.org

2 Prepared for HEDNA by PhoCusWright Inc.

© 2008 Hotel Electronic Distribution Network Association

Table of Contents

How to Use This Toolkit .....................................................................................3

Executive Summary............................................................................................3

Part I: Evaluating the Opportunity.....................................................................3

1. The Size of the Meetings Market .............................................................3 2. The Market: Customer/Planner Expectations ..........................................6 3. How All the Pieces Fit: The Group and Meetings Ecosystem................11 4. Current Technology: Capabilities Matrix ................................................12 5. Readiness Assessment: 10 Questions to Ask .......................................15

Part II: Participating in the Online Group Marketplace ..................................17

1. Technology: Connecting the Parts.........................................................17 2. Operational Considerations: Customer Support ....................................21 a. Support ..................................................................................................21 b. Costs......................................................................................................21 3. Revenue Management: Parameters and Policies..................................22 4. Marketing: Channels & Content .............................................................23 5. Sales: Automating Transactions and Forming Relationships.................24 a. Sales Policies ........................................................................................24 b. Incentive Programs for Hotel Sales Managers.......................................25

Conclusion: .......................................................................................................26



How to Use This Toolkit This toolkit has been developed as a reference to promote a general understanding of the current opportunities and challenges relating to the use of an online procurement service for real-time booking of meeting facilities and/or group guest room blocks, The materials are organized to introduce the issues and the current state of technology available for enabling further electronic network distribution of group- and meeting-related content. It is also a goal of this document to foster the open exchange of ideas among members to optimize the use of available technology. HEDNA does not recommend or endorse any particular product or solution. The report provides both strategic and tactical advice to the reader. Often, tactical realities must be addressed before strategic goals can be achieved. This is particularly true when a hotel looks to automate the groups and small meetings distribution process. HEDNA offers this publication for use at the discretion of the individual or company. Please note that because the laws and regulations that apply to each user will vary and may render certain information incorrect or unusable, each company or individual that uses this material does so at its own risk and with the acknowledge-ment that the company is solely and fully responsible for its use of this material.

Executive Summary The 2006 HEDNA white paper report entitled “Online Group and Meeting Planning” set the stage for this toolkit. The report describes the online group travel market opportunity, outlines key drivers from the perspective of customers, attendees, distributors and suppliers and identifies key challenges and success factors. This toolkit aims to provide information for practical application in assessing readiness, planning and deploying an online strategy for groups. The kit focuses on groups of fewer than 75 participants, as procurement of these kinds of meetings is generally most suitable to full automation. In Part I, the report offers a candid look at how customers and planners want to buy online, an illustration of the group online value chain and an up-to-date report on the current technical capabilities in the marketplace. Part II takes the reader through the practical considerations for offering groups online, including technology, operations, revenue management, content delivery and sales team management.

Part I: Evaluating the Opportunity 1. The Size of the Meetings Market PhoCusWright projects the total U.S. groups and meetings market will reach $175 billion by the end of this year (2008). This figure includes leisure and corporate



meetings and travel and non-travel expenses. The total groups and meetings market includes air, hotel, car rental and other ground transportation, tour, cruise, meeting rooms, food and beverage (F&B) and audio/visual (A/V) equipment rentals (See Figure 1).

Figure 2 illustrates the breakdown of the U.S. Groups and Meetings market into the corporate, leisure and association categories highlighting the travel and non-travel components. The ability to book the travel components (air, hotel, car and other ground transportation) has been available for many years through corporate or leisure booking systems. The focus of this Toolkit is on the non-travel components, particularly the online booking of meeting rooms, food and audio visual equipment.

Source: PhoCusWright Groups and Meetings: Market Opportunity Redefined

U.S Groups & Meetings Market, 2005-2008 (Total Market in US$B)

Figure 1



Figure 3 describes the mix for corporate meetings. The majority of these meetings are less than 200 people, and 67% have less than 50 attendees.

Corporate Meetings Business Mix by Group Size, 2006


Figure 3

Figure 2




It is this segment that presents the biggest opportunity and the greatest challenges for the hospitality industry. The traditional booking and management processes for smaller groups and meetings are hampered by numerous manual steps requiring access to multiple systems for the various group reservation elements. From a hotel’s perspective, defining what constitutes a small group is more than just a simple size parameter. For example, a meeting with 50 attendees may only be associated with 10 sleeping rooms (if most of the attendees commute to the meeting). Does it represent a group? Yes, but the hotelier sees a lower value from this type of group than a group with 40 attendees and 30 sleeping rooms. Another way to view smaller meetings is based on their underlying complexity. Small, simple meetings where options have become commoditized are more appropriate for online bookings than are smaller groups with needs beyond a meeting room, break-out room, simple catering and limited audio visual requirements. A common challenge across groups of fewer than 75 attendees is the cost and complexity involved in managing the reservation process. With these groups, significant time savings can be achieved for the planner and for the hotel staff if automation of the buying process can be achieved. Such automation would have to include not only the request for proposal (RFP) process, but also room reservations, event space bookings, attendee management, administration functions and event content. Another practical consideration that needs to be addressed is the current inability for almost all hotel CRS to accept multiple rooms per booking beyond the current limitations that vary between 4-9 rooms per booking. Hotel chains will need to invest and upgrade functionality to set rooms per booking limitations down to the property (and preferably) the rate plan level. This limitation is not helped by the inability of GDS and Switch companies to also differentiate availability requests by channel. Ideally a “flagged” group rate or availability request will allow the hotels to differentiate sources of booking and provide an automated response without compromising rate integrity for the transient/corporate market. 2. The Market: Customer/Planner Expectations The traditional processes in place for handling meetings through RFP, quote preparation and negotiation have been applied equally to meetings of all sizes. However, simple, small meetings have characteristics that are well suited to an automated buying process. Figure 4 contrasts planner side and hotel side expectations with respect to booking and managing meetings online.



Essentially, the planner wants complete content with the flexibility to manage all aspects of the group: planning, booking, payment, analytics and tracking. Hoteliers want inventory and revenue control with complete visibility into the buying and management process for the group. Achieving completeness of inventory and control over the booking process are not necessarily mutually exclusive goals, keeping in mind that the current, fragmented process for small, simple groups of 75 attendees are costly to the hotelier and inefficient to the planner. Small meetings also have some common characteristics that make the process easier to automate (See Figure 5).

1) Ability to plan 2) Ability to see availability 3) Ability to determine if product fits budget 4) Seamless booking, transaction and

confirmation process 5) Ability to arrange logistics 6) Once hotel is chosen, ability to manage all

aspects of booking online: rooming list, air, car 7) Current media content 8) Rich media content 9) Trust in process and in hotel supplier 10) Control in purchasing – procurement chain,

corporate laws and rules 11) Payments submitted easily 12) Accurate analytics and tracking

1) Control over inventory and rates 2) Seamless automation 3) Systems that run off central database 4) Revenue/rate management of guest

rooms 5) Revenue management of all product

offerings 6) Ability for each individual hotel to define

“small meeting” 7) Detailed, accurate reporting 8) Visibility in buying process 9) Ability to fine-tune process 10) Content control

Figure 4

Planner Side Expectations Hotel Side Expectations



Customer requirements for smaller meetings also have some common characteristics (See Figure 6).

• Regular or recurring meetings with meeting planners who are comfortable with online processes

• Standard catering: Breakfast, breaks, lunch • Drive-to-fly-to mix means manageable room blocks • Short lead time: 38 days or less means less time to negotiate

• Save time by being able to research, compare and book group rooms, meeting facilities, equipment and catering online.

• Benefit from any pre-negotiated rates, terms and conditions, whether a la carte or with packages priced per attendee.

• Access accurate content: pricing and promotions that reflect who they are, inventory availability, photos (including each meeting facility), menus, maps, directions and relevant customer reviews.

• Centrally apply expense management policy for compliance reporting and cost analysis, so they can consolidate data about actual spend.

• Manage the attendee invitation, registration, rooming and payment processes and options.

• Have trusted, personalized support at the property that reflects the nature of their meeting, including the expectation that what you see online is what you will get.

Figure 5

Simple meetings for up to 75 participants often include:

Customers want to:

Figure 6



For corporate meetings, large travel management companies (TMCs) have dedicated personnel to manage the entire group reservation and management process, but these TMCs also recognize the need to automate the small, simple groups that have become a commodity. Hoteliers can work with the major TMCs and third-party vendors to identify an online meeting process that benefits both the supplier and end corporate customer. The traditional reservation flow for groups and meetings of this size is highly dependent on manual processes that often act independently of each other (See Figure 7). First, an RFP is received by a central group reservation desk or group sales department. Group reservations agents from the hotel then query the hotel central reservation system (CRS). The group sales department of the hotel will query the hotel property management system (PMS) for meeting space and the hotel’s catering offerings, unless a dedicated sales and catering system (SCS) is used. This means the meeting planner must wait for the Central Group Reservation response based on a quote from the Hotel’s group sales department, which is in turn waiting for relay of information from the revenue manager and catering department staff. Of course for a complex meeting these are necessary steps, but for simple meetings, many of these steps can now be automated.

Figure 7



An evolving group/meetings reservation process has emerged that automates much of this activity into centralized systems (See Figure 8).The same varied types of customers (travel agents, meeting specialists, corporate planners, self-managed, S.M.E.R.F. (social, military, educational, religious, and fraternal organization meeting planners) and tour operators request a quote electronically through branded Web sites, group booking sites, online travel agencies and corporate online booking systems (who offer their product as a “software as a service” or SaaS). In this evolving world, an additional application layer is needed that acts as an aggregator for central group reservation and property-based systems. Rather than Group Sales or the Catering Department responding to individual group quote requests, these departments feed their available inventory and food services into their property-based systems, which in turn populate the booking engines. The booking engine automatically queries these systems for availability and presents the results to the online software product. With the legacy group/meetings reservation process a significant number of RFPs may go unanswered due to the traditional manually intensive process.

This evolving online process allows the hotelier to replace the manual group-by-group negotiation and quoting process with an automated system that reduces proposal generation time and puts the online capability in the hands of the meeting planner. The system does bring a level of pricing transparency to the process. The primary business practice that will to change in the future is a

Figure 8



movement toward negotiating a unique discount for each group of 75 people or below. Hotel group sales and catering departments should be able to load rates within the PMS and catering system for groups of set characteristics with multiple parameters, such as number of attendees, guest rooms, standard meals, refreshments and premium offerings. The goal is to create standard offerings that can be booked electronically based on these set parameters. Increasingly, Meeting Planners are looking for annually negotiated, seasonal small group rates. Online booking will give hotels the ability to expose those preferred rates to their preferred clients. A true end-to-end solution would also include putting yield/revenue management intelligence into the electronic process. This is one of the next steps in the evolutionary process of online group meetings and a worthy goal. Including revenue management guidance on which inventory should be available for booking at what price is an essential step toward bringing small meetings into the broader hotel revenue measurements. 3. How All the Pieces Fit: The Group and Meetings Ecosystem

Figure 9 provides a high-level view of the group and meetings marketplace.

• End-Users: End-users may be corporate meeting planners, administrative assistants, corporate stakeholders who are sponsoring the meetings,

Figure 9



travel agents or group leaders. In fact, the effort to standardize small, simple meetings allows assistants to manage meetings online without the need of a professional meeting planner. The most fundamental need of end users is the ability to be able to seamlessly “shop” across brand on a first look basis.

• Distribution: Inventory may be distributed through corporate self-booking tools (CBTs), TMCs or online travel agents. They may also be distributed via corporate or supplier white label sites, where the engine powering the transaction may be provided by a third-party, but is branded by the supplier or corporation.

• R & M: The guest room and meeting room inventories are at the heart of the booking and management processes. While the guest room inventory availability can be accessed seamlessly (albeit with rooms per booking limitations mentioned above), there is currently no capability to aggregate meeting room data at the CRS level. One solution is to enable the “push of this data to external inventory sources in much the same way that hotels are now feeling the need to push guest room inventory in a seamless fashion to external sources such as Tour Operators.

• Content: Content includes price, availability, multimedia content such as photos & maps, visualization of group rooms and meeting space, user generated content such as reviews, and information about food, beverage and A/V equipment. Again the challenge in this respect is aggregation and inventorying of content at CRS level that will allow a combined R&M “first look” shopping request. Any aggregation of data will need to meet the needs of properties and chains to allocate (and ideally revenue manage) these non-room items

• Suppliers: Suppliers of space may include the hotels, conference/congress centers, business centers, airport club lounges, special venues or other types of inventory. For example, in Europe many cities have large congress halls designed for major conventions and meetings, lessening the need for these types of large facilities at business hotels.

4. Current Technology: Capabilities Matrix The following matrix (See Figure 10) outlines current technology readiness for group room bookings, event space booking, attendee management and content management and distribution.



Function Today Tomorrow

Group Room Booking

Search/compare/book up to 25 rooms in real time

Manage payment method by attendee

Access rates availability via GDS

Access rates availability via direct CRS connects

Confirm and/or cancel booking online

Hotel branded solutions

Third-party distribution solutions

Rules-based buying

User-specific preferred content

Supplier reporting and Web analytics

Event Space Booking

Search/compare/book meeting space in real time (including simple catering and A/V)

Meeting packages and a la carte

Multi-day meeting search

Preferred content

Access rates and availability via SCS connect

Revenue management limits: Live booking window

Supplier reporting and Web analytics

Corporate reporting and content management

Figure 10



Confirm and/or cancel booking online

Hotel branded solutions

Third-party distribution solutions

Attendee Management

Create custom event registration URL

Create custom attendee invitations

Create manage rooming lists

Manage attendee preferences

Event reporting

Manifest matching

Corporate administration

Hierarchy-driven enrollment

Centralized reporting

Rules-based buying

Preferred content restrictions

Content and Distribution

Feeds (photos, descriptions, language)

Intranets

Peer reviews

Ancillary content: Dining, event tickets, ground

Clearly, a majority of functions listed in this matrix are now available from various application providers. Despite this fact, adoption of truly automated small groups and meetings capabilities is still very low. One problem is that much of this functionality is provided by different niche application vendors who each have a limited focus. In addition, PMSs or catering systems need to be Web-enabled



and allow hotel management to create key parameters that designate certain inventory as bookable. Though the hotel industry is still at this early stage of development with respect to automating groups and meetings under 75 attendees, the available technology and ultimate cost savings opportunity will likely accelerate adoption of these tools. 5. Readiness Assessment: 10 Questions to Ask To better prepare for automating the small group process, HEDNA has compiled a series of questions designed to test a hotel’s readiness. Some of these questions are tactical in nature, relating to systems functionality. Other questions are more strategic in nature, involving hotel service strategy, pricing and the related costs of implementing new technology. Tactical Questions:

1) Can your system handle group rooms? a. RFP into availability request b. Booking of 9+ rooms in a single request c. Delivery of reservations via rooming list d. Payment e. Changes and cancellations f. Group rooms with meeting space

i. Linked together ii. Linked to the catering system

Strategic Questions: 1) Does online group booking meet my company’s revenue management

plan? For example, what’s my return on investment (ROI)? Can I recast sales reps by doing this? What other efficiencies do I gain at my hotel?

2) People versus automated booking – what’s the balance and value? 3) Can my hotel adapt to a new way of doing business and maintain

excellent customer service? 4) Could owners accept the possibility of paying higher booking fees? 5) Is my organization ready to expand systems, and if so, at what cost? 6) Are there resources allocated for training? 7) Will my legal privacy policies be compromised?



8) Will the lack of hotel participation affect negotiated terms? How does this affect my hotel’s ability to negotiate?

9) Can I quantify incremental revenue opportunities that would justify moving in this direction?



Part II: Participating in the Online Group Marketplace 1. Technology: Connecting the Parts The following describes how external technology and internal hotel platforms need to be modified in order to accommodate automated bookings for small groups of less than 75 attendees.

Hotel CRS needs to allow group bookings access. Depending on the capabilities of the CRS, additional programming to enable group bookings beyond nine rooms may be needed.

The PMS vendor needs to expose a Web-enabled layer to allow access to group inventory. Revenue management should control what inventory is accessible and when, based on parameters created by hotel management.

Hotel Technology External Technology

Catering management needs the ability to establish standard configurations to be used with the event/space booking engine and the ability to expose a Web-enabled layer to the booking engine. The system needs to be able to push non room inventory to an external source

The group room booking engine needs to accept an electronic feed from the hotel’s CRS or PMS allowing the real-time booking of group room inventory.

The event/space booking engine needs to accept an electronic feed from the PMS and catering system, allowing access to meeting space, F&B and A/V equipment.

Figure 11

CateringSystem

PMS



In order to make the system work efficiently, the type of inventory exposed to the booking engines must be controlled by a set of parameters that limits the inventory to specific types of bookings. For example, most hotels will book larger conventions or meetings many months in advance, locking up specific breakout meeting rooms. The breakout rooms that aren’t part of these large groups can accommodate smaller meetings of 75 and less, provided that their availability is tied to the booking engine. Additional parameters provided by the catering staff should designate a specific standard configuration that can be used for the small meetings. Often, the corporations who are planning smaller meetings already have a negotiated business travel room rate directly through the hotel or through their TMC. The PMS or CRS must be able to access these rates, if offered by the hotel, based on corporate discount codes and utilize the rate as part of the booking process. In addition, preferred small group rates will become more prevalent and will need to be able to be accessed in an electronic manner. Hotels need to work with their PMS and sales and catering vendors to:

• Enable connectivity to a system or systems that have access to both guest room and meeting space availability.

• Once the connectivity systems are in place, synchronized real-time capability on booking both guest rooms and meeting space must be designed and achieved.

• Establish business rules within those applications as to what meeting rooms can return availability in real time and with pre-established lead times for booking.

• Enable the creation of meeting “packages” that provide price quotes based on per-person pricing, including guest rooms, meeting space, meeting room essentials and standard F&B, or a price per guest room and a one-time package price for meeting space, meeting room essentials and F&B (one-time price could be for “up to” a certain number of people or per person).

• Given the number of immediate and long-range opportunities to reduce processing costs for small groups, the hotel industry may need to develop some form of industry “switch” for meeting space (similar to the Pegasus UltraSwitch for guestrooms). This would enable more hotels and hotel brands to take advantage of this emerging trend.

Technology readiness varies by market. In Europe, the Middle East and Africa (EMEA), due to the large number of boutique hotels and established congress centers for large meetings, the opportunity to automate the small meetings process is not encumbered by the need to allocate inventory for large, convention-style meetings. In North America, many chain hotels have built extensive conference facilities that reserve many smaller breakout rooms as part of the large group movement. For the North American market, online meeting room availability must reflect available space not included in the large convention



block, and combine it with transient sleeping room rates and availability through a single online meeting request. Figure 12 shows how various types of planners in the market may converge upon a group bookings capability.

Inquiries and online booking requests may come from amateurs (generalists like administrative assistants or leisure group leaders) who use the Web to search for available meeting room content or from customers of the hotel. Alternatively hotel customers may work through internal or external meetings professionals. These professionals may use the Web for searching, comparing quotes and booking group rooms through an online Group Travel Agency (OGTA). They may also rely on a GDS for groups up to 9, which may, in turn, connect to specific OGTA or connect directly into the hotel’s portal. Regardless of the source of the inquiry, hotel systems are queried on rates, availability and content. This query may then

Figure 12



access a static set of information exported by the PMS or CRS or create a dynamic query of these systems through group room and event space booking engines. To be successful, the hotelier must create strategies that control the flow of information based on overall property revenue goals and type of customer. Connectivity should be based on standards (such as Web Services or XML schemas based on the Open Travel Alliance) so communication can be received and integrated from a variety of sources. The ultimate solution should reflect an efficient workflow that combines the search for the meeting space, catering requirements and room availability through an integrated process. In the future, hotel meetings content will be enhanced with:

• Better, real-time feeds from property and centralized systems

• Peer reviews from planners providing expert user-generated content

• Ancillary content connected with the meeting, such as transfers Figure 13 describes the ideal electronic workflow for bringing simple small meetings online.

Figure 13



An ideal shopping and reservation flow incorporates meetings space/catering/AV bookings, group room-night bookings, attendee management and reporting into a single integrated process. The boxes with the dashes represent flow steps that require technology enhancements. The blue boxes reflect the ideal flow where a standard template is created and a consolidated shopping cart integrates all the elements into a single electronic procurement process. 2. Operational Considerations: Customer Support

a. Support By distributing availability and rates of meeting rooms electronically, hotels also open the door to the reality of support. What happens when a problem is encountered in the interaction between the customer touchpoint and the system that keeps the availability and rates? Who does the customer contact? Who is responsible for the sales? As is the case with electronic distribution of guest rooms, there is generally some central source that handles problems the customer may encounter. Many times customers want the technical problem resolved – so they need to be able to reach the group responsible for configuration (generally not the sales department). To this end, it’s important to establish who will be responsible for configuration and support. b. Costs When meeting space and guest rooms that are part of a block are sold in the traditional manner, there are costs associated with getting that business – the sales manager, the incentive program, the sales coordinator, the cost of office space and printed materials. In the world of electronic distribution, traditional costs are gone, but there are new costs:

• Software enhancements that enable electronic distribution

• Participation costs in the customer touchpoint

• Updating of content in electronic channels

• Customer support

• Knowledge and training of configuration to enable electronic distribution

As is the case when nontraditional means of any aspect of business are explored, the question gets asked, “Who’s going to pay for this?” In going through the ROI process, some things to think about include:



• What’s the cost of not participating? If the customer is predisposed to buying in this manner and we’re not on the menu, then we won’t get purchased.

• Do the “new costs” offset or equal the costs of the traditional method of distribution? In the short term, generally not, in the longer term, yes, as many of the initial costs are not annual payments.

• From a central or brand perspective, it will be necessary to establish fees associated with the transactions generated through the applications – similar to charges for brand Web bookings or GDS bookings. These become costs of doing business.

3. Revenue Management: Parameters and Policies Parameters: The following parameters need to be considered: lead time, guest room minimum, total revenue, and ratio of attendees to room nights. Issues: What inventory to expose: Hotels want to expose availability to the marketplace, but also need to optimize revenue. Customers want to have access to book rooms and meeting space at any time. The balance between hoteliers’ goals and consumers’ needs is governed by a comparison of the value of inventory access versus the cost of an alternative booking process. One question to consider is, “Are there group bookings that a hotel would ‘always’ allow online? If so, what are their attributes?” Short Lead Time: Hotels have little capacity for outbound marketing of meetings and groups with short lead time. In other words, hotel sales teams and group sales desks are experienced professionals, a resource that is matched against big revenue opportunities. Big revenue opportunities are generally complex, with lead times of months or years. In these cases, hotels have time to review each opportunity before responding to an RFP with a detailed proposal. Shorter lead time presents its own challenges:

• Within 30 days: Generally, any revenue inside 30 days is good revenue, because the ability to market for short lead time meetings is limited and empty meeting rooms go stale each day. Beyond 30 days, hotels generally want more room-night or total revenue to boost the revenue per available room (RevPAR) above the possible short lead time group they could otherwise accommodate.

• Beyond 45 days: Hotels generally want a minimum of 10 room nights and full meeting space requirements. Hoteliers want an ability to “accept the booking” before confirming availability.

Small/Simple: Meetings for fewer than 75 participants tend to require meeting and event space that is readily available. With meeting room occupancy



generally 50% or below for most large hotels, making a single training room or board room available is not a difficult decision. Total Revenue Minimum: Some hoteliers consider minimum revenue threshold for the event including catering, equipment, room rental and guest rooms. The longer the lead time, the higher the revenue target. Guest Room Revenue Minimum: Some hotels consider establishing a minimum guest room to meeting attendee ratio in order to avoid filling meeting space that might otherwise be needed by groups requiring more room nights. Suggested minimums might be five room nights or 10 room nights. Of course, rates for groups will eventually be yielded too – with automation comes data and an ability to set booking rules. Once these parameters can be formalized into rules, algorithms can be created to indicate under what conditions a hotel will allow live booking of group rooms when queried by a third-party system. 4. Marketing: Channels & Content Whenever the decision is made to distribute and sell products electronically, the opportunity to engage the customer must also happen in an electronic manner. Without a knowledgeable colleague selling the features and benefits of your goods and services, your ability to realize gains becomes dependent on the effectiveness of your electronic information. While the hotel industry has used the value of printed material to supplement or enhance the traditional selling experience, electronic distribution and selling is totally dependent on updated, effective electronic content. To be effective in this arena, the hotel industry needs to ensure that content distribution holds the same weight as availability and rate distribution. With so many customer touchpoints already in existence and with even more to come, there are a number of factors to consider:

• Make a commitment within your hotel/organization to the ongoing maintenance of product content in all customer touchpoints – not just your branded Web site.

• While “easy-to-use extranets” sound convenient, if you’re distributing through eight touchpoints then that’s eight places you need to maintain – with details and imagery.

• Commit to rich content. Most individual, hotels participate in existing industry content-keepers like Lanyon PropertyVault, Leonardo or Pegasus’ Online Distribution Database (ODD). All of these content warehouses have the ability to push your content details to any location prepared to accept it.



• The hotel industry should be vocal in suggesting that both the content warehouses and the customer touchpoints work together on content updates.

Don’t forget that key components to content in the electronic world are digital assets (e.g., imagery, 360-degree photos, video walk-throughs). Just as channels show different levels of guest room product, it’s important to show meeting rooms in various set-up options – not just a picture of the open space. 5. Sales: Automating Transactions and Forming Relationships For sales, policies and incentive programs, it’s key to remember that the customer is using an electronic means to seek your offers out. The customer is electing to do business in this manner and expects the hotel community to respond to his or her choice of forum. The ability to transact group business online does not mean long-term success will come from using this as a lead generator and then forcing the customer into a traditional business exchange. Since the customer has come to you electronically and potentially will complete the entire transaction without human interaction, your existing policies and the approach to selling the meeting space and guest rooms together need to be examined.

a. Sales Policies A review of current sales policies will need to be conducted in areas such as: • Selection of Meeting Space to Offer Electronically: Which meeting

rooms will be made available for electronic distribution (availability and booking). For example, you probably don’t want your grand ballroom or all breakout rooms put into this space.

• Lead Time: What will be the lead time established for a meeting room’s availability to be displayed? The vast majority of bookings in the small meetings market tend to book within 90 days. Profitable repeat small group training business may want to book further out. Thought must be put into the strategy of exposing online inventory for multiple buying scenarios.

• Total Revenue: Traditionally, meeting space is almost “given away” as part of larger meetings that include guest rooms and where contracts cover attrition and risk. If a customer wants meeting space only, don’t give the space away – there aren’t other revenue areas involved.

o Meeting space needs to be realistically priced. o Today, meeting room rental rates may be unrealistic in order to

establish “value quotes” when you need to discount meeting room rental rates.

• The Business Model is Pre-Paid: Contracts may need to be adjusted to reflect the pre-payment and how and when it will be done. What are the options and costs associated with cancellation? Ensuring that accounting



practices are in place to handle pre-payment is important in order to effectively manage customer expectations.

b. Incentive Programs for Hotel Sales Managers You’ve made a decision to place your meeting space into an electronic availability and booking channel. A small company decides to book the space electronically and pay in advance. No human interaction has taken place. What does your sales manager responsible for the corporate meetings segment think about this situation? • It is imperative that you manage not only your customers’ expectations,

but also your employees’. • The sales manager needs to know that the decision has been made to

electronically distribute meeting space and that existing market segments will be booking into that space.

• The decision to distribute in this manner is not taking away from existing efforts, because if the customer is predisposed to doing business electronically and your hotel isn’t represented in that space, a different venue would have received the business.

• It’s a two-pronged approach: o Position this form of distribution as a method of finding new

customers. While the electronically distributed business may not count towards the incentive plan, the sales manager responsible for the market segment may have a new customer to “sell” larger meeting plans to in the future. It also saves the salesperson time and effort so he or she can spend more time on larger pieces of business.

o Use electronic distribution as a way of adding value to existing customers. Sign them up for contracted space/packages when they book electronically. Then the sales manager is working with existing customers and finding new customers who use electronic means to check availability and book. Consequently, productivity goes up and costs associated with booking that piece of business go down.

Look at electronic distribution and existing customer usage of it as a component to be added to existing sales incentive programs. It’s more cost effective, so drive whatever business you can into this means of distribution.



Conclusion: HEDNA’s 2006 white paper Online Group and Meeting Planning referenced a “dearth of information available on the topic of a fully online group booking process.” In that paper, most hoteliers were at a research and development phase of the group automation process. This toolkit demonstrates that the market has become increasingly more sophisticated. As the online group market continues to evolve, significant progress will continue to be made...and fast. Many solutions remain niche markets by nature, automating pieces of the process without a fully integrated solution. The fact remains that the hotel industry has a unique opportunity to reduce costs and improve efficiency by automating the small, simple meetings market of 75 attendees and below. This is supported by a number of factors:

o Size of small meeting opportunity Overall, the growth of the total groups and meetings market is slow. PhoCusWright sees the major growth in meetings for both corporate and leisure in the 50-and-below attendee mark. The same opportunities also exist for the segment of 50-75 attendees.

o Inefficiencies and costs of current manual process Current manual processes for small group meetings are highly inefficient and costly. Automating this segment benefits the needs of both the meeting planner and the hotel operator.

o Technology enablers Currently there are a number of technology vendors who offer solutions to automate various parts of the meeting booking and management process. Most central and property systems have become Web-enabled, allowing the booking of inventory online.

o Policy components Which inventory is exposed online to which channel is more of a policy consideration than a technical limitation. By automating the right inventory to the right audience, hoteliers can benefit from the cost savings associated with the electronic process and ensure that perishable inventory is sold.

o Operational considerations There are number of operational considerations that need to be considered prior to embarking on an automated solution, such as what support will be offered and how the sales force will interact with the electronic process.



o Revenue management perspective Best practice automation needs to incorporate revenue management logic and techniques into the selection and management of inventory chosen for the electronic process. Feeding this logic into the systems that control online inventory can ensure that online booking activity contributes positively to the hotel’s bottom line.

o Defining sales and channel relationships Attention needs to be given to designing the online meetings process to work with current and desired channels and to integrating the process with current sales strategy. Though we are at the beginning of small-meeting automation, the continued advance of booking engine technology, the ongoing push to electronic processes spurred by the Web and the clear cost benefits to the hotel industry in automating small, simple meetings will likely accelerate the movement of these automation capabilities online.



HEDNA would like to acknowledge the work of the Groups Meeting On line committee for their work on this publication: Co-Chairs: John Arenas of Worktopia and Scott Harness of Group Travel Planet offer special acknowledgment to the work of key contributors: Quentin Moores, Pegasus; Douglas Carr, Fairmont Raffles; David O’Donohoe, Starcite Committee Members:

Alexandria Bell Technology for Events

Andrea Carrillo Bianchi Micros Fidelio

Angela Ybarra WPS

Christian Urbat IHG

Christine Davaine Accor

Claudia Marulanda Amadeus

Courtney Bolton Denihan Hospitality Group

Craig Rogers IHG

David O'Donohoe StarCite

Doug Carr Fairmont Raffles Intl.

Duncan Kennedy Starwood Hotels

Edward Perry WORLDHOTELS

Frauke Stahmer Mövenpick Hotels & Resorts

Jean-Luc Adalian Accor

Jennifer Ginty Hyatt Hotels

John Arenas Worktopia

Julie Mezmur Carlson Hotels Worldwide

Lara Hernandez IHG

LeeAnn Lewis Worldspan

Lisa Muret IHG

Mark Bell Hotel Reservation Services



Mark Lowery Adam's Mark Hotels

Marty Denning NewMarket Intl.

Michael Stacy Groople

Nancy Little IHG

Patu Patel Travelport

Pauline Le Travelport

Quentin Moores Pegasus Solutions

Rajesh Vohra Sarova Hotels

Rebecca Kim Groople

Roberta Barry Shangri-la Hotels & Resorts

Scott Harness Group Travel Planet

Sean Gray Fairmont Raffles Intl.

Shannon Hyland Groople

Tony Evangalista Priceline.com

HEDNA would also like to acknowledge the financial support by Worktopia, Inc. and Group Travel Planet which helped to make the publication of this report, in partnership with PhoCusWright, possible.

Documents

Enabling the Online Marketplace for Groups and Meetings: A ...eoplugin.commpartners.com/HSMAI/2008_HEDNA_GOTK_Final.pdfsales department. Group reservations agents from the hotel then