Room for Savings: Optimizing Hotel Spend - Carlson

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SUMMARY Tracking performance: Companies should monitor hoteliers’ performance systematically to ensure rates are loaded correctly into GDSs and negotiated rates are available to travelers. Regular tracking is essential for ensuring the hotel program meets travelers’ needs and improving compliance. Key performance indicators and reporting dashboards help travel managers to optimize their programs.
Conclusion Hotel spend will be increasingly managed by companies as they seek further savings from their travel program. Best performers will build on a keen understanding of the hotel market and traveler behavior, bringing improvements in key areas such as data consolidation, travel policy, the preferred hotel program, negotiations, traveler compliance and performance tracking. Realizing they can spend nearly as much on hotels as on air transportation may encourage companies to allocate greater resources to hotel sourcing and expect a higher return on their hotel program. They will be helped by a buyer’s market in many major cities, as a weak economy lowers occupancy and encourages hoteliers to bargain hard for corporate business. Going forward, companies can expect significantly better conditions in terms of rates and complementary amenities. Moreover, travel managers will find it easier to secure sufficient room availability for their travelers in some high-demand markets. At the same time, companies should continue to ask hoteliers to help make travel more sustainable, and work with security experts to ensure the hotels they choose provide the right level of security for travelers. Corporate buyers can take full advantage of these opportunities to create more value by working with specialists in hotel sourcing and program optimization. As this report has shown, optimizing hotel spend offers many companies plenty of room for savings. 133
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Room for Savings: Optimizing Hotel
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Contents Introduction Overview ....
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Research objectives This CWT resear
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Figure 1: Breakdown of surveyed com
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Key findings in brief The research
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changes. In addition to providing t
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A complex market The complexity of
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A lack of global standards to defin
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Complex pricing Hoteliers use diffe
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Figure 10: Rates remain fairly cons
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Figure 12: Most corporate hotel boo
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Data on hotel spend is however, not
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How to calculate your company’s t
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2. Twenty-one percent savings throu
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Many organizations have yet to opti
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GDS auditing It is important to ens
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1. Consolidate data Travel managers
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Figure 27: Combined TMC and credit
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Figure 28: Recommended data fields
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Hotel category: not the most import
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“No-frills” booking When it com
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In fact, travelers often draw on th
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A number of differences between the
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SUMMARY Understanding traveler need
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2. Ask travelers to use serviced ap
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Figure 41: Recommended rules for bo
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Figure 43: Rates are on average 18-
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Figure 46: In a rate benchmarking e
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5. Mandate booking at least two wee
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6. Address extra charges Travelers
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SUMMARY An optimal hotel policy cov
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4. Optimize the preferred hotel pro
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Identifying properties and location
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Considering local market conditions
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Figure 59: One company could save 6
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Figure 61(continued): The share of
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Figure 63: Hotel stays of at least
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Deciding between existing preferred
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Figure 69: Companies that retain at
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SUMMARY Key points for optimizing a
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5. Negotiate effectively Negotiatio
Page 84 and 85: Chain-wide agreements, as the name
Page 86 and 87: Chain-wide deals tend to offer smal
Page 88 and 89: There is, however, a risk associate
Page 90 and 91: Despite this reticence, 40 percent
Page 92 and 93: Figure 83: Another company’s ARR
Page 94 and 95: Last-room availability A last-room
Page 96 and 97: LRA is common in corporate contract
Page 98 and 99: Benchmark rates. Companies commonly
Page 100 and 101: Companies can consolidate volumes i
Page 102 and 103: Leverage city caps. Experience sugg
Page 104 and 105: Consider renegotiating flat rates d
Page 106 and 107: Buyers should use the full range of
Page 108 and 109: Hoteliers’ performance. A hotelie
Page 110 and 111: Ensure your travel management team
Page 112 and 113: 6. Improve traveler compliance The
Page 114 and 115: Understanding why travelers book ou
Page 116 and 117: The survey also indicates that trav
Page 118 and 119: Explain the stakes. Price-conscious
Page 120 and 121: Figure 112 shows how an OBT can be
Page 122 and 123: Require travelers to book their hot
Page 124 and 125: Investigate the reasons for noncomp
Page 126 and 127: To ensure that the agreed condition
Page 128 and 129: GDS rate squatting. Regular GDS aud
Page 130 and 131: Rate audits pay A rate audit conduc
Page 132 and 133: Tracking traveler compliance Compan
Page 136 and 137: Appendices Glossary The following i
Page 138: For more information about how CWT
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