CWT Solutions Group - Carlson Wagonlit Travel

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4 Copyright © 2012 CWT GLOBAL PERSPECTIVE Looking to leverage transient and M&E? Start with hotels The goal should be to look at those properties in the program that can meet the needs of both types of travel, and focus there. Another opportunity is to take a chain-wide approach, negotiating for both transient and M&E volume with one or several large national or global hotel chains. In this case, it is likely that within the chain’s portfolio are properties that are ideal for meetings only and transient only, as well as some properties that could work for both, which enables buyers to leverage more of their total volume. As organizations have embarked on combining transient and M&E hotel volume, their expectations for working with suppliers have changed, and hotels have had to respond accordingly. Buyers increasingly expect to work with a single hotel As more and more organizations have brought their meetings and events (M&E) under tighter management in the past 5-10 years, many have also begun seeking opportunities to leverage combined M&E and transient travel volume in negotiations with suppliers when applicable. The Global Business Travel Association (GBTA) has helped to further this practice by adding a groups and meetings section to its widelyused hotel request for proposals (RFP) template about six years ago, in response to increasing desire by travel buyers to combine this spend in negotiations when possible. CWT Meetings & Events and its clients have had particular success accomplishing this with hotels, which can be a natural starting point given the signifi cant portion of spend that hotel represents for both transient travel and M&E. The key for travel buyers to understand when combining these two areas in negotiations is that not all volume can be leveraged with a common set of suppliers. The number of properties that could meet the needs of both types of travel will vary based on the organization’s existing preferred suppliers, the types of properties it prefers to use for transient travel and M&E, etc., but there will never be 100% overlap. For instance, many hotels are appropriate for transient travel but cannot accommodate meetings because they lack meetings space, food and beverage capability, etc. Transient hotels M&E hotels Hotels appropriate for both transient and M&E contact, rather than separate contacts for transient and M&E, prompting the hotels most serious about pursuing this business to adjust how they staff . Contracting is another area that has evolved to support the combination of both types of travel: organizations are now negotiating a shared set of terms and conditions for the upcoming year to cover all of the volume. In some cases, M&E pricing will then be set for the year, just as it is for transient travel. This represents a signifi cant shift for hotels, because in the past every meeting was a separate sale with specifi c pricing and terms based on location, seasonality, and more. This too impacts how they staff , as well as how they project revenue for the year.
| Q2 2012 CWT Meetings & Events off ers the following recommendations to organizations interested in pursuing some combination of hotel spend across transient travel and M&E: Establish a meetings and events policy. The success of combining volumes is dependent on the organization’s ability to drive travelers to preferred properties. This cannot be accomplished without a meetings policy, which few organizations have in place, in addition to the more common transient travel policy. Gather data. Collect and review as much data as possible on the organization’s current hotel volume for both transient and M&E. Look for commonalities and patterns in terms of chains or individual properties used, locations most frequently visited, etc. � Capture small meetings. Be vigilant about identifying hotel costs that appear larger than a transient trip but smaller than a large meeting – these may represent small meetings, which are diffi cult to track but represent the majority of M&E spend for many organizations. Small meetings also off er the best opportunity for combined transient and M&E volume because, based on the group size, they are often fl exible enough to be held at more traditional transient hotels when needed, or at smaller facilities within larger M&E-focused properties. Dedicate resources. While there are substantial savings and other benefi ts to be gained by combining transient and M&E hotel volume, it defi nitely requires an upfront investment by organizations. Be sure to dedicate suffi cient internal resources, the time of external consultants like CWT Meetings & Events, or both, to give this eff ort the attention it deserves for maximum impact. Sell the business to suppliers. As discussed above, this approach can require signifi cant eff ort and adaptability on the part of hoteliers in terms of staffi ng, contracting, and more. Buyers must be able to articulate the benefi t to suppliers of partnering with them on this. Examples include guaranteed M&E business for the hotelier for the entire year, the ability for hotel salespeople to focus elsewhere once the deal is done rather than having to sell every meeting, increased penetration throughout the organization, etc. Be a true partner. Buyers who take a partnership approach with their suppliers will likely experience greater success overall, including when combining M&E and transient hotel spend. Meet with suppliers outside the typical negotiation environment to outline the organization’s strategy, hear about their goals and objectives, and discuss how each party can support the other. Ask open-ended questions like, “What makes it hard to do business with me?” and “How can I become a more valuable partner to you?” and expect to receive those types of questions in return. These dynamics will impact the partnership whether addressed directly or not, so it is best to discuss them. v CWT Meetings & Events recently worked with a global pharmaceutical client to achieve signifi cant success implementing a combined hotel program for transient travel and M&E. Following are some quick facts on the achievement: 2 number of chain-wide partnerships negotiated to support the program (consolidated from many supplier partners in the past) 18 number of countries with contracted properties to cover transient and M&E 68 number of cities with contracted properties to cover transient and M&E 1,050 number of RFPs issued to source combined program $2.9M amount of forecasted savings this new approach will deliver in its fi rst year of operation alone 5
Page 1 and 2: Looking to leverage transient and M
Page 3: New ways of thinking Christophe Ren
Page 7 and 8: | Q2 2012 Anyone who has done busin
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Page 11 and 12: REGIONAL SPOTLIGHT: Asia Pacifi c T
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CWT Solutions Group - Carlson Wagonlit Travel

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