“Show organizers call us pirates and bandits. That's OK,” says Bruce Peterson, president of Las Vegas-based Events Plus Travel. His destination management company has come under fire recently for allegedly “poaching” attendees and exhibitors from several meetings' official room blocks byto them directly with offers of cheaper room rates, plus ancillary services like transportation and off-site cocktail parties. “They can call us whatever they want. Our clients don't see us that way, and that's all we care about.”
But show organizers just see red.
“It's insidious,” says Steven Hacker, president of the International Association of Exhibition Management, explaining that Events Plus Travel and other similar companies use the meeting's name on their Web sites and in their e-mail, fax, and telemarketing efforts. “If you receive an invitation/solicitation from what appears to be someone affiliated with the event, and it offers you a decent rate, you go for it.” While these companies “aren't outright lying, they are skating the thin line between criminal activity and business ethics,” he says.
One such company, Beverly Hills Premiere Tour Operator, based in Beverly Hills, Calif., specifically targets attendees and exhibitors of. “We contact groups who are going to the meeting — agencies, laboratories, pharmaceutical companies — to provide them hotel rooms and services,” says a spokeswoman for the company. “We contact people going to the conference directly by e-mail and by fax.”
In an e-mail solicitation received in late October by Medical Meetings, a sister publication to AM, the company offered housing deals for the American Society of Hematology conference in San Diego, the American College of Cardiology in New Orleans, and the American Academy of Orthopedic Surgeons in San Francisco. When printed out, the entire list of meetings for which housing was offered was more than four pages long.
Further, PITTCON, the 25,000-attendee annual conference and exposition hosted by the Society for Analytical Chemists of Pittsburgh and the Spectroscopy Society of Pittsburgh scheduled for March 2004 in Chicago, is listed on the Events Plus Travel Web site. But PITTCON negotiations chairman Richard Danchik, PhD, isn't too worried: “I talked with [official housing company] Travel Planners. They were aware of it. But we're a full-city show, so they won't have much room to maneuver.” In addition, his housingall state that the hotel has to give the best rate to the show organizers' block, “So if another outfit comes in and gets a better rate, we can go back to the hotel and they have to drop our rates to match,” he says. “The trickier part is finding out that this is happening so you're able to do something about it.”
The Blame Game
Bruce Harris, president of Twinsburg, Ohio-based Conferon, states, “To attack the base of attendees and exhibitors for personal gain or profit, knowing full well that there's a high likelihood that it's going to damage the association, is terrible. It's like a bloodsucker living off a host. There are associations who've had such hugebills that they are just struggling to survive. In the meantime, these people laugh all the way to the bank.”
Peterson says that show organizers have no one but themselves to blame if their attendees or exhibitors defect from the official housing block. “Our clients just don't want to go through show management because they get such poor customer service. Show management thinks they own exhibitors. Well, they don't. Exhibiting companies can pick and choose where they spend their money — this is still America. Show organizers used to be able to get away with treating their exhibitors as second-class citizens. Now they can't, and they're blaming me because I can give exhibitors the level of service they need.” His company gets the low rates by buying blocks from wholesalers, “and negotiating very hard. We have a very aggressive sales force out there negotiating for our clients,” he says.
Planners' outrage comes, in part, from the tactics used by these types of companies. Planners say they either join an organization to get the membership directory, or purchase an exhibit booth to receive the pre-reg or exhibitor list. Then they cancel their booth after they're done soliciting, or don't show up.
So far, it appears that most of these companies are targeting the major convention cities, but when one company was contacted about providing low-cost rooms for the annual meeting of the Professional Convention Management Association in January in Indianapolis, the company said “no problem. We have signed contracts allowing us to beat Expedia in 75 percent of all markets!”
“It's one thing to lose room block because people are afraid to travel, or the cost is too high, or any of the other factors that come into play,” Hacker says. “It's something else again to have some poacher come along and suck the lifeblood out of your event. That's hard to deal with.”
“I know I'm portrayed as the bad guy, but we're just one small company,” says Peterson. “They should look at Expedia and the other major room wholesalers — that's where they're really losing their business.”
From Pirate to Partner? Your Choice
While he admits that the alleged poachers are a relatively small issue now, David Radcliffe, who headed the Convention Industry Council's Project Attrition, says, “If they're successful at building revenue and generating attendee attention, they can grow exponentially, not unlike the way the other online entities have.”
“From the beginning, I said that given the growth of intermediaries on the Internet, technology is going to have to be part of the solution to this and other attrition problems,” says Radcliffe. “Recently I spoke with an executive from hotels.com, who told me that their strategy is to allow the planner to go through the block-contracting process with their headquarters hotel, then allow the intermediary — hotels.com, in this case — to, on their behalf,for the balance of the inventory required to meet their needs.” In other words, the Internet site would become the back-end booking engine to the meeting planning site. “Attrition then would become the intermediary's problem, but if they don't sell the rooms to meeting attendees, they'll sell them to someone else.”
The only downside that he sees? “Getting in bed with these guys, and maybe losing some of the perks,” like free room nights for staff.
Peterson's all over this idea. “We've grown a lot over the past several years, and now we're going to change our business model a bit. We've partnered with one of the largest housing reservation companies in the world, and we're finalizing software that will allow us to become the official housing agent for shows of fewer than 15,000 people,” says Peterson, who hopes to roll out the new model by January.
“We'll be the official housing agent for the show organizer, but we'll also be the pirates and bandits.” He explained that his company would give people four or five ways to find housing for the show — some of which won't look like they're going through the show organizer at all — but they will get credit for the room block. “Our whole point will be to help them stop attrition penalties. And we'll be able to give the customer service our clients — their exhibitors — want.”