In early March, Two Roads Hospitality, the hotel management company born of the Commune Hotels and Destination Hotels & Resorts merger, hosted its annual meetings and events advisory council at The Scottsdale Resort at McCormick Ranch in Phoenix, where results from Destination Hotels’ fifth annual "State of the Meetings Industry" survey were released.
The poll’s most salient point may that the “bleisure” trend—by which business travelers extend their work travel for leisure—is becoming ubiquitous. Sixty-one percent of the more than 400 corporate, association, government and independent planners surveyed said that more than one out of 10 of their attendees include pre- or post-stays in their business-travel plans. But according to André Fournier, EVP, sales, marketing and revenue, cashing in on earned loyalty rewards isn’t necessarily the driving force behind these add-on vacations.
“Experian data shows that our groups guests and our individual guests are not that different,” he said during the event’s general sessions. “Planners know their attendees and if they’re choosing something that’s not a big brand, but off the beaten path, it’s because they know that’s what their attendees like and want. We found this also translates to bleisure travel.”
Contracts Are King
If planners’ input during breakout sessions is any indication of future trends, expect to see more meetings booked with relatively smaller, independent hotel companies. In one town hall with a group of corporate planners, the topic of master service agreements and contract terms and conditions negotiations dominated; one planner with an insurance company pointed out that negotiating the legal terms of a templated MSA with a boutique hotel company’s corporate offices can be more efficient, allowing planners to focus on commercial terms.
“This can save so much time, especially if the MSA can be used across all the brands in the portfolio, but with larger hotel chains, it doesn’t always work because some of the properties are franchised,” the planner said, adding that preapproved MSAs also give smaller hotel companies an edge when it comes to signing group business with a short booking window. Fournier agreed, adding “if we want the piece of business, we’ll make it happen.”
That same flexibility afforded by an independent hotel group also lends itself to certain aspects of the commercial terms of a group contact, including on-site technology, which more than 58 percent of planners ranked as highly important in the Destination Hotels survey. But an Atlanta-based independent planner pointed out that the costs associated with a group’s Wi-Fi often lack transparency, and without clearly defined pricing, planners can only estimate usage charges. Plus, planners don’t necessarily want the services of an in-house audio/visual team contractually prescribed to them. With 83 hotels in its portfolio, Fournier says that there’s room to negotiate Wi-Fi charges, and the use of outside A/V vendors is left to the discretion of each property’s general manager.
Demand for On-Site Teambuilding Activities
The whitepaper also found that planners have larger budgets for 2017, but the added dollars fund additional meetings, making location and rate key drivers of their venue choices. Food-and-beverage pricing is the next most vital element to their budget planning. Two Roads’ properties source much of their F&B locally and regionally, including stocking bars with small-batch spirits and beers and that can translate to teambuilding experiences for groups.
“Larger hotel companies don’t necessarily have the flexibility to work with small, local suppliers because the emphasis is on driving efficiency,” Fournier said. Two Roads’ properties can bring a vendor on-site for demonstrations or group classes as Texas’ La Cantera Resort & Spa can bring local beekeepers on property for tastings and The Cliff House in Maine offers guests the opportunity to pull lobster pots alongside local lobstermen. “Our budgets are flat so we have to do more with less and hotels that offer unique experiences really help us with that,” another independent planner said during a breakout session on incentives.
The Destination Hotels’ study found that more that 60 percent of planners want more active teambuilding experiences, while 73 percent said flexible meeting space is a priority for them. Advisory council guests took the concept a step further; on-property activities that can be incorporated into group bookings can help reduce costs for planners and make the planning process more efficient. “We design activities to be part of our facilities because we know it can reduce costs for planners,” Fournier said.
Relationships Still Count
Despite all of the talk about planners’ budget constraints, an association planner succinctly stated what many other planners were also vocalizing throughout the two-day event: “Relationships with national and local hotel sales directors are important and those relationships are disappearing with big mergers, so small hotel companies have the advantage.”
Fournier, who has been with the company for 22 years, acknowledged that the Commune Hotels merger with Destination Hotels & Resorts brought about a 0.5-percent reduction in the new hotel management group’s sales force.