Making hay with the oversupply of hotel rooms and corporate America's penchant for cost cutting, Eventsource, a major player in the online RFP arena, has been renamed and rebranded to focus on saving companies time and money on group hotel and meeting room purchases through an online open-bid process.

ProcurePoint Travel Solutions Inc., based in Sausalito, Calif., the new name of EventSource, has introduced a new suite of products called ProcurePoint Enterprise. Ed Sarraille, president and CEO, says the first and core product, Enterprise Meetings, is an “open market negotiation” or online auction process that distinguishes it from its competitors. It includes an online, customized RFP development process.

Here's how the online negotiation works: A corporate meeting or travel manager or procurement executive licenses the Enterprise Meetings product. After narrowing the destination or city through ProcurePoint's sourcing database of 12,500 hotels worldwide, up to 10 hotels in that venue are invited to participate in the open-bid process, which takes place over a period of four hours (the optimum amount of time, says Sarraille).

He calls it a “transparent marketplace” because the procurer sees the name of each hotel bidding with its “paddle number” — just like a real auction — but the bidding hotels only see each other by paddle number. One meeting put up for auction in mid-February, for example, showed the winning hotel starting the bidding process with a $129 room rate, and reducing it to $105; reducing the meeting room costs from $5,600 to zero; and climbing from no fringes to three (comp shuttle, comp parking, comp 24-hour fitness center).

It is up to the client sourcing the meeting whether it pays a fee per transaction or per room night, or if the hotel pays a commission. Sarraille says ProcurePoint charges the “standard 10 percent commission” to hotels.

There is no fee for hotels to participate in the bid process, but they are able to bid more intelligently when they see what their competition is offering. “It's a level playing field,” he says. “We have no preferred hotel arrangements.”

And, surprisingly, in 87 percent of the online auctions that ProcurePoint has run, the low bid has not been the winning hotel. “It's based more on location, brand, and quality,” says Sarraille.

That said, the average meeting customer saves from 5 percent to 35 percent on overall costs by using the online auction.