Recent reports, studies and articles have all come out from Smith Travel Research (STR), PwC, American Express and Carlson Wagonlit — as well as industry associations like MPI, GBTA and PCMA — consistently saying that not only are hotel occupancy percentages up (in some cities by double digits), but the Average Daily Rate (ADR) has significantly increased as well.
So if you’re a travel procurement buyer, category manager, hotel program administrator, meetings/events manager, etc.: Listen up! All of these combined increases are going to rock your budget and space availability world in 2015 and 2016.
Basically, these indicators substantiate the supply and demand dynamics that exist in our industry whether you work on the corporate and/or meetings/events side of the fence. In layman’s terms, your company is going to be fighting for room and facility space — and paying higher deposits and rates for it as well.
The only way you’re going to be able to have any kind of leverage in your annual (and ongoing) negotiations is by leveraging and combining your transient hotel volume data along with your meetings/events data. It also would help your negotiations if you have supplier market share breakdowns, top and tertiary city information, volume forecasts, and — last but not least — your ability to move market share in exchange for sustaining discounts and amenities for 2015 and 2016.
You may also have to revisit your existing travel policies and GDS-OBT booking engine rules to demonstrate your credibility and seriousness in moving supplier market share; the hotel suppliers you’re talking to are providing discounts and amenities to corporations that can demonstrate market share movement.
Using powerful technology systems will not only make these strategies a reality, it will greatly shorten your efforts to put together the metrics and analytics you’ll need to show your suppliers during negotiations.
Now — more than ever — you need data, analytics and a commitment to move business in order to receive corporate discounts. There’s no more room for procrastination.
Here’s a great article from Meetings and Conventions magazine about this current situation: Read More.
Do you have any best practices to share? If so, share them with us!