Mr. Boult

Group Meetings

Small Meetings = Big Opportunity

By Michael Boult, President & CEO, StarCite, Inc.

A recent report on the groups and meetings industry published by PhoCusWright, "Groups and Meetings: Market Opportunity Redefined," estimates the current size of the meetings industry in the U.S. at $164.1 billion and projects it to grow to $175 billion by 2008. PhoCusWright estimates that nearly one quarter of all online travel in the U.S. will be groups and meetings related by 2008.

What the hotel community should recognize is that a key factor in this growth is the anticipated increase in small meetings. While the total market for corporate meetings will be relatively flat, PhoCusWright reports that corporate meetings with fewer than 25 attendees are projected to grow a 13% in 2007. Obviously, this shows that to grow your business in this market you have to focus on increasing your market share and attracting more small meetings.

There's an overall perception in the industry that the large hassles of small meetings don't match the potential pay-off. It is difficult for individual hotels to stand out. There is no way to really influence the customer unless you get him or her on the phone. Hotels that realize the potential and the opportunity, struggle with just how to reach these consumers - who exactly within a company do you target? Without a set group of buyers, occasional small meeting planners are a moving target.

On the hotel side you also have missed opportunity. Your hotel in a particular city may not be as well known as some of your competitors, so you don't get the first call. Smaller meetings tend to have shorter lead times and planners need a response right away. You lose business if you get a call or fax for meeting request from a different time zone, and no one is available to respond. Many times, small meeting requests get forwarded to another department such as catering, causing further delays. The bottom line is that you need a way to manage these requests and ensure that they are routed to the right sales person or decision-maker so they can be analyzed and responded to as fast as possible.

The PhoCusWright report confirms what we know already at StarCite working with our corporate clients who have implemented strategic meetings management programs. According to our own research at StarCite, and studies conducted by others in the industry, it is estimated that 70 percent of corporate meetings include 50 people or less. These small meetings represent a potentially massive opportunity for hotels to win more corporate business and increase their market share. Unfortunately, the potential of small meetings is still largely untapped by hotel marketing organizations.

Using on demand meeting solutions, corporations have realized significant savings through process efficiencies and leveraging their data to negotiate preferred supplier agreements. In addition to streamlining the RFP process, online solutions have made it easy for planners to quickly search and compare a diverse array of suppliers.

Planning managers realize that these same benefits, if not more, can be realized for their small meetings programs. Many have come to us and asked for a solution. That's because on the corporate side, the planning of small meetings is mostly decentralized process. Smaller meetings are not usually handled by the meeting department. Various staff though-out the organization use a time-consuming process of finding hotels in a particular destination, looking up contact information, calling, emailing or faxing individually, and waiting for a response. They're more inclined to call whatever brand is top of mind and, because it is such as hassle, they book the first response they get based on availability.

Often, these one-time "planners" are not familiar with the logistics such as basic room layouts, food and beverage options or standard terms in hotel contracts, making the process time-consuming for both sides. This may be part of the reason why until recently, smaller meetings have not been a major focus of automation for hotel sales departments. The sales focus tends to be on the larger and more lucrative meetings business, even though the small meetings are typically the lifeblood of many hotels. Furthermore, smaller meetings tend to have much shorter lead-times which further constricts the sales process.

There is another factor to consider in this equation that will push more of the booking of small meetings to online managed solutions. Procurement departments continue to have a greater role in meeting planning purchases. Thirty percent of corporate and government planners report procurement plays a major part in their purchasing decisions and another 34% report some participation, according to this year's FutureWatch survey. Another 27% expect purchasing departments to become more involved. Sarbanes-Oxley and regulatory requirements other industries are forcing more companies to track and document all of their meeting purchases. They are increasingly looking for online tools that help them manage their purchasing processes.

Slowly, hotels and others are recognizing the significance of how technology can help to book small meetings online. Hilton, Starwood and Hyatt have launched online efforts, and even the Las Vegas Convention and Visitors Bureau has dedicated a section of its website to small meetings. However, despite this progress, the demands of the small meetings market still drastically outweigh the information provided by the supplier community.

Millions of dollars in potential revenue are potentially being missed as hotels wrestle with the implications of creating their own online efforts to corral this demand. Their concerns, while understandable, may be costing the hotel industry significant potential profit. A cooperative effort amongst the hotel industry, and third party sourcing services, could streamline the process of booking small meetings, resulting in increased business.

We often speak about the productivity gains that can be made on the corporate side that benefit from having full meeting visibility. There are also significant gains to be made on the hotel side. With an online system that forwards all small meetings leads to one place, with status completely visible, your sales team can be more strategically focused. You can identify patterns and areas of opportunity to increase your marketing efforts. You can make better yield decisions by having visibility into demand centrally. You also put your property on a level playing field with others. This is especially critical for newer properties which may not have the brand recognition and are not top of meeting with the occasional meeting planner.

Small meetings represent a huge area of opportunity for the hotel community. Online solutions will help them realize it.

Michael Boult is President & Chief Executive Officer of StarCite, Inc. Mr. Boult, joined StarCite in May 2005 with more than 20 years of experience in travel and business strategy. Prior to joining StarCite, Mr. Boult founded eCLIPSE ADVISORS travel procurement solutions, and led the growth of this technology and consulting enterprise as chief operating officer. A frequent speaker at industry events, he has published a variety of White Papers on travel industry issues. He was named on of the top 25 travel executives of 2006 by Business Travel News. Mr. Boult can be contacted at 267-330-0502 or Extended Bio... retains the copyright to the articles published in the Hotel Business Review. Articles cannot be republished without prior written consent by

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