BLIND COMMISSIONS EXPOSED: PANEL TO EXPLORE PRACTICE Do you pay your incentive house or outside meeting planner a flat fee for a meeting? Is that fee negotiated based on the assumption that you are getting the best possible hotel rate and that the third party you are paying is not also getting a commission from your meeting hotel?
That might not be the case. Some third parties, such as incentive houses or other independent meeting planners, are receiving so-called "blind commissions" from hotels, which do not appear in the hoteland, therefore, may be hidden from the corporation holding the meeting. These commissions are built into the room rate.
Concern about blind commissions surfaced at the Marriott Meeting andManagement Conference in Bermuda last fall, prompting Marriott Hotels & Resorts to form a committee to investigate the practice. Kitty DeBusk, the Los Angeles-based Marriott national account executive who is heading the committee, says that its members-five Marriott hotel executives and five meeting planners-will hold several conference calls on the issue this year and report their recommendations at next fall's Marriott incentive conference.
"We're trying to come up with an agreement that everyone will be comfortable with on how business is done with intermediaries," DeBusk says. "We also want to be completely honest with the end-user, the corporate client."
Currently, hotels and third parties use several types offor meetings, incentive trips, or other events. Some identify the commission paid to the intermediary (in the U.S. the standard hotel commission is ten percent).
Sometimes, however, a contract which specifies a commission payment is also drawn up between an intermediary and the hotel. The intermediary then writes its own contract-which may or may not contain the commission-with its corporate client. Or, a contract which doesn't mention the commission payment is entered between the hotel and the corporate client, and an addendum, which does specify the commission, is later agreed to by the intermediary and the hotel.
According to Tom Ernsting, Marriott's director of incentive, there is no consistency in how the hotel industry deals with blind, or "non-contracted," commissions. "There are a lot of gray areas when you work this market," he says. "We're partners with everyone and we don't want to formulate a policy on this until we've had a chance to get the different perspectives on the issue. We're not questioning the ethics of having or not having the commission in contracts; we are questioning the procedures involved."
The ethical aspect of the issue is murky. For example, The Meeting Encore Group, a Toronto-based meeting planning company, has in the past had its commissions omitted from hotel contracts, according to Linda Genest, its president and a member of the new Marriott committee. But, says Genest, she did so only because she was asked to by her corporate clients.
"I had a situation where the vice president of sales for one of our clients said 'I don't want to see your company's name on the hotel contract because it must go before my president, and I don't want the president to know we're bringing in third parties for meeting planning,' " Genest explains. "It makes no difference to us whatsoever whether the commission is contained in the hotel contract or not; our brochure says we are paid a commission by hotels, so our clients know that," she adds. "I want my client to be happy, and if that means putting the commission in an addendum, instead of in the contract, I want to be able to do that."
Genest says her company always receives hotel commissions but some planners may choose instead to seek a net rate and bill the commission, or an analogous amount, to the client.
Harith Wickrema, president of Harith Productions Ltd. of Fort Washington, PA, says his company doesn't always ask the hotel for a commission. "If we're not receiving a commission from the hotel our fee would be a little higher," he says. "If we do get a commission, though, we've never made any attempt to hide it."
Wickrema, who is also a member of the Marriott committee, says one aspect of the non-contracted commissions issue involves what should be assumed by clients and the industry in general.
"When you buy an airline ticket from a travel agent, the agent gets a commission from the airline but the agent doesn't announce that. And the airline contract, which is in effect the ticket, doesn't specify the commission," he notes. "So meeting planners say why make a big deal about commissions? Planners should be compensated for the business they do."
The Team That Plays Together Stays ]Together Business is all fun and games for Seattle-based ENTROS. Since its founding four years ago, the entertainment company has been creating high-tech games and activities for a variety of corporate clients and events.
ENTROS believes in the "power of fun" as a means of encouraging social interaction and stimulating creative thinking, according to Nasreen Wills, marketing and sales director. "The idea is to make the event memorable," Wills says. "When people play together at an event they remember it. And they often form lasting relationships."
The company also has turned the tables on technology by using it to enhance social interaction rather than isolate people, which some believe it has the potential to do.
ENTROS offers off-the-shelf games or can custom-design a game for meetings. Some samples: Time Portal, a time-travel game that uses virtual reality glasses, 3-D animation, and stereoscopic live-action video; and Global Secrets, a "globe-trotting adventure" in which teams of players solve brain-teasing riddles, decode secret messages, and compete in daring feats.
"Companies come to us to fulfill distinct needs, such as launching or promoting a product, or purely for entertainment at a convention, meeting, or," Wills says. ENTROS games are also effective as tools, she adds.
ENTROS can create games for groups as small as 50 or as large as 3,000. Corporations meeting in Seattle should consider a theme party at the ENTROS "Intelligent Amusement Park," a nightclub with an open bar and grill surrounded by an array of ENTROS games. The Park also serves as a laboratory where ENTROS gamemakers test out their latest creations. For more information, call (206) 624-0057.
Incentive Possibilities Traveling Afoot in Europe Incentives take the road less traveled with The Wayfarers' walking tours of the British Isles, France, Italy, and Switzerland. The British company's 21 walking tours are available for small incentive groups of ten to 16 as well as for individual incentive winners.
With a range of itineraries that include Cezanne's Provence and the Loire Valley in France, the Gardens of Tuscany in Italy, the Border Castles and Rivers of Wales, and the Swiss Alps, Wayfarer's programs focus on the history and culture, food and wine, and spectacular natural beauty of each destination.
"The American market is looking for more individual incentives and incentive movements are splitting off into smaller groups," says Judy Allpress, The Wayfarers' U.S. representative. "We're also seeing a growing interest in walking programs. People want to be outside, and walking is a great stress releaser."
The Wayfarers' standard tours are six nights, but the company can tailor programs to fit specific group needs. Wayfarers describes its tours as "gentle exercise" suited to any fit person. Participants' baggage is transported between every stage of the trip. Accommodations are in charming country inns. For more information, call (800) 249-4620.
Try This Keep These Characters Out of the Limelight Don't let the following "meeting characters" take over at your next conference table. Here's how to handle them, from the editors of Communications Briefings newsletter:
* Mutterers mumble among themselves, perhaps because they feel trapped in what they view as a meaningless meeting. Constant muttering may demonstrate that the meeting does needs mending. Then again, it may be simple rudeness. In that case, meeting leaders should suddenly stop talking. All eyes will turn to the mutterers and that's usually enough to muzzle them.
* Monarchs mandate a meeting to announce an absolutely final decision and ask the group to approve it. Suggest that simply announcing the decision will allow everyone to use the meeting time on other tasks, thus boosting productivity.
* Millers mill around and muddle a meeting by repeatedly leaving to take or make phone calls or get something they forgot. Meeting leaders may need to note on the agenda or announce at the start of a meeting what should be-but isn't always-common courtesy: "Please give your full attention to this meeting; everyone's time is valuable."
* Malcontents march into meetings with a surplus of attitude, ready to shoot down every idea. Meeting leaders should explain calmly, firmly, and in private, that their input is valued but only if it is polite and constructive.