Planners Target Hotel Profits on Cancellations, Attrition

Meeting Planners Target Hotel Profits on Cancellations and Attrition
Are hotels happy when your group doesn’t don’t show up? It might not be the best case scenario when a meeting group cancels or does not fulfill its group size commitment, but hotels can do very well by those planner woes. Robert Mandelbaum, director of research for PKFC Hospitality Research, found that hotel income from cancellation fees and attrition penalties increased significantly in 2009. That income resulted from outright cancellations, and from unused hotel rooms, unconsumed food and beverages and other unused services that were already paid for by meetings groups. According to Mandelbaum, attrition and cancellation income grew 4.1% in 2009, while room revenues for the year declined 19.5%. But some meeting planners are ready to fight back. “There is discussion among planners that hotels should base cancellation and attrition fees on the lost profits of the hotel, not the lost revenue,” Mendelbaum told Travel Market Report. “If a hotel collects the full revenue for rooms that are not picked up, yet does not have to spend the dollars associated with servicing the occupied rooms, they stand to make more money than if the event was actually held.”

Prove the Value of Meetings and Your Work: No Time to Let Up
“My fear is that now that we are a little removed from the combined crisis of the recession and the stigmatization of the meetings industry, the initiative to show the value of meetings might ease up. On the contrary, we need to constantly educate people within our industry to advocate for what they do. If you ask a meeting planner what they do, they will tell you about the logistics of housing and meals. But they should know the real value of what they do. We need to position professionals in the industry into understanding their strategic business role in their organizations. The old way of thinking is that meetings are all about managing hotel rooms, getting the temperature right in the meeting room and having enough coffee cups for the break. Those things are not what keep CEOs up at night. What keeps CEOs up at night is what planners are doing strategically to keep the company’s profits up.” – Roger Rickard, partner in REvent, which consults on advocating for the meeting industry

IMEX Survey: Face-to-Face Meetings Still Rule
Technology will not be replacing face-to-face meetings anytime soon, according to a recent survey by IMEX, the largest meetings exposition firm in Europe. IMEX surveyed 45 senior meetings industry and corporate professionals and found that “time out of office” was not one of the top five concerns for 60% of respondents. This suggests that technology is not preventing face-to-face meetings. In other findings, despite the recession, 42% of respondents said they are fully committed to corporate social responsibility (CSR). However, more than a quarter said that while they understand the importance of CSR, they had yet to introduce policies to embrace and support local communities and charities. The majority of survey respondents hold senior positions, including president, CEO or director; 25 of the respondents are based in Europe, 10 in the U.S. and the remainder elsewhere in the world. IMEX is mounting its first U.S. event in Las Vegas in October 2011.

Chicago CVB Populates its Board with Power Brokers
As if it’s not enough that the President Obama is a Chicago favorite son, the city’s CVB is enhancing its celebrity draw by stacking the recently restructured board of directors with local power brokers. They include: Penny Pritzker, the billionaire scion of the Pritzker family and head fundraiser for Obama’s presidential campaign; Jerry Reinsdorf, chairman of the Chicago Bulls and Chicago White Sox; and Andrew McKenna, chairman of McDonald’s. The board’s new chairman, a businessman/philanthropist named Bruce Rauner, hopes that the board will use its connections to bring business to the city as it tries to recover from the recession “It’s about connections to other trade shows and conventions, relationships with other corporations who could come here, relationships with politicians,” said Brauner.

The CVB That Ate Memphis
The Memphis CVB will take over management of the Memphis Cook Convention Center at the beginning of 2011. The move is part of a larger national trend for CVBs to expand into one-stop shops for meeting and convention planners. “The Memphis Convention and Visitors Bureau has been responsible for longterm sales and marketing for the Memphis Cook Convention Center for some time,” Kevin Kane, CVB president and CEO told Travel Market Report by email. “Being awarded management of the center will be beneficial to all of our clients as we streamline the process for meeting planning in Memphis. We are looking forward to making Memphis a one-stop shop and booking destination for those considering Memphis for their convention or meeting.”

Get Practical with Social Media for Meetings
“Before deploying social media, be certain to attach metrics or key indicators to its use and know what you need it to accomplish. If you have the resources to monitor an internal Twitter account during a meeting, you might learn right away that a bus has not arrived at a designated stop or that a hotel room is not satisfactory. Deploying social media has far-reaching opportunities; however, it can also intrude on personal privacy. Scrutinize what can be viewed and/or attached. What you think is private sometimes is not private at all.” – EJ Siwek, CMP, founder and president of FLASHpoint Technologies