Thomas J. Carrier, a former senior government meeting manager, crafted five “myths and realities” of negotiating a small meeting at a typical hotel property from a planner's perspective.
We asked a hotelier, Keith Biumi, brand marketing director, Crowne Plaza Hotels and Resorts, to respond from the hotel's perspective (albeit a chain perspective, which will differ from an individual hotel property).
Myth #1: There aren't many small meetings being booked and that explains why hotels charge so much for them.
Carrier — Actually, about 80 percent of the meetings industry is composed of small meetings, when the definition of a small meeting is 100 attendees or fewer. Hotels find that large conventions bring in greater short-term profits for the energy expended in booking them. The staff has to work harder to bring in smaller meetings, which lowers the overall profit margin.
Biumi — The hospitality industry has been seeing a trend in which companies across the country are holding three or four small regional meetings per year rather than the traditional annual national conference. Companies can thus cut costs and save money, particularly on travel expenses for attendees.
With smaller, more frequent meetings, there is an opportunity for the meeting planner to leverage his negotiating power by booking all regional meetings with one hotel brand. It is possible with many hotel companies to book these multiple meetings through one point of contact — a benefit to both the meeting planner and the hotel company. For example, at Crowne Plaza, a meeting planner can work with a single contact in the Global Sales Department or a meeting specialist (see a roundup of hotel small-meeting contacts on page 7). Then, the meeting specialist can share one RFP with hotels in all cities where the meeting planner has expressed interest.
Myth #2: So, hotels would rather not have small meetings at all.
Carrier — Nonsense. Small meetings help fill holes between large conventions, called shoulder periods, and during traditional slow times. Hotels sometimes find small meetings inconvenient during traditional busy periods, but it isn't unheard of for a small meeting to be booked then. It means a meeting manager was adept enough or lucky enough to have found a hole to fill. With the right information, you can be just as adept, too.
Biumi — Crowne Plaza, along with the other hotels in its competitive set, are specifically designed to accommodate up to 200 to 250 guests on peak nights, both guest rooms and meeting space combined. Hotels in this category simply don't have the space for large annual convention meetings, and their main source of revenue is small to mid-sized meetings. Their focus remains on regional meetings held in suburban, airport, and city hotel locations.
Myth #3: You can't negotiate a small meeting.
Carrier — That depends. If it's a typical small meeting of 125 attendees or fewer reserving fewer than 10 guest rooms (my definition), and you use a lot of meeting space and little food and beverage, then you probably can't negotiate to save money. You can, however, negotiate extras such as extra wait staff for a reception, or the use of hotel flowers for the stage, or even a few free parking passes for conference staff. Use your imagination and then ask. Naturally, if you have several small meetings, then negotiate all of them all at once at one property. That's even better.
Biumi — You can always negotiate a small meeting. Hoteliers know — and expect — that planners will negotiate — and that's regardless of meeting size.
The following negotiating tips can be useful when booking a small meeting:
Guarantee multiple meetings with one brand.
Guarantee repeat business (making a commitment to hold next year's meetings with the same hotel brand is a powerful selling point).
Let the hotel company know you'll encourage employees to select their hotel brand as the brand of choice for individual business travel.
Myth #4: Even though I'm not booking many guest rooms, I'm using lots of food and beverage and audiovisual equipment. That should count for a lot.
Carrier — Hotels make most of their money selling guest rooms. Period. Having meeting space in the hotel is only an added value to get people to stay overnight. A typical full-service hotel can have a profit per room of about 60 to 85 percent. For food and beverage, the profit is about 35 to 40 percent. The meeting space rental, though, is 100 percent profit. That is why a suburban hotel would want access to its meeting space for weddings and other special events at night and on weekends, which limits the space used for small meetings and restricts the use of 24-hour holds (unless you pay for it).
If you book most of the meeting space with few or no guest rooms, then the hotel might have to turn away business that requires guest rooms and meeting space. On the other hand, if you need space within a month or so. Hotels will be glad to rent you any leftover meeting space rather cheap — and you might not even need to book any guest rooms to get it.
Biumi — Hotel business is based on guest rooms because that's what is most profitable for a hotel. But this doesn't mean that hotels will not accept meetings that do not represent a good space-to-room ratio. Hotels are often willing to accept such meetings in the short term. A short-term booking — less than 30 days' notice — provides the best opportunity for planners to book a one-day meeting at their hotel of choice.
Myth #5: If I'm priced out of hotels altogether, there are no alternatives.
Carrier — So many meeting managers are conditioned to hold meetings in inappropriately large convention hotels when they should be thinking about holding their small meeting in smaller properties or properties that are a bit out of the way, such as an airport hotels. Ideally, your guest rooms should take up about 15 percent of the entire hotel. If that's not possible, consider other sites: conference centers, universities, historic sites, and, if you are a nonprofit, community centers and public buildings. You might also consider holding a videoconference or a conference call, or even scheduling a “webinar,” a meeting held completely on the Web and accessed at an “attendees” convenience.
Biumi — The best thing to do is consider holding a meeting during a hotel's “need period,” when hotels can be more flexible because any business at that time will help the hotel's revenue. Hotels often know when these periods are six to 10 months in advance. If a meeting planner can be flexible and book during these periods, he or she will find hotels much more lenient with space-to-room proportions and pricing. Being flexible on attendee arrival and departure dates can also help the planner secure better rates. it is important to remember that there will always be hotels looking for small meetings business. Certain hotel brands will continue to make a concerted effort to attract and cater to smaller meetings. After all, not every brand or individual property can accommodate large meetings.
Myth #6: Except for alternative sites, there just isn't any real positive news for holding small meetings.
Carrier — Reality: Quite the contrary. There are a number of good things about small meetings that large conventions can't match. For example, planning a small meeting requires a shorter lead time. In six weeks, a small meeting can come together very well. Try that with a large convention. Generally a small meeting is easier to cancel, if necessary, without a large penalty, and small meetings are easier to rebook. Sites to hold a convention are fairly limited, but a small meeting can be held just about anywhere. The cost of a small meeting can be less per-person if the property used isn't in a high convention area.
Biumi — Reality: Actually, there is lots of good news today for planners organizing small meetings. First, many hotels offer meeting planning assistance from an on-site professional consultant. This is particularly beneficial to the non-professional meeting planner. Second, just because a hotel isn't located in a convention city doesn't mean it is a poor location for a meeting. Terrific locations for small meetings include properties in suburban areas, city outskirts, and near airports. Third and finally, it is important to remember that there will always be hotels looking for small meetings business. Certain hotel brands will continue to make a concerted effort to attract and cater to smaller meetings. After all, not every brand or individual property can accommodate large meetings.
Thomas J. Carrier is a former senior government meeting manager. He is currently creating the Small Meetings Network, a research service for meeting managers, and he is author of The Practical Small Meeting Planner, a step-by-step comprehensive guide due out in the fall.
Keith Biumi, a 15-year veteran of the hospitality industry, is brand-marketing director for Crowne Plaza Hotels and Resorts — The Place to Meet. He is responsible for developing, implementing, and executing marketing, advertising, and promotions for all Crowne Plaza Hotels and Resorts in North America.