Mr. Escoffier

Food & Beverage

F&B Insight: Getting Your Economy Moving: Spurring the Meeting Market

By Marcel Escoffier, Associate Professor, FIU School of Hospitality Management

Lessons from the Car Industry:

By now the "Cash for Clunkers" program is a well documented business story. It moved a lot of cars off the lot, but there are lingering concerns about the long term effects. Some pundits believe that the program simply concentrated sales into one brief period. Others believe that it got people off their duff to commit to a purchase that may or may not have happened at all.

What you need to concentrate on concerning "Cash for Clunkers" is how it worked, not its long term effect. We will handle the long term later, let's get business into the hotel now.

What can you learn from "Cash for Clunkers"? (Let's get over the name; your hotel is not a "clunker"!) The main lesson is that you need to offer something significant and desirable, available only on a short term basis, and at a significant savings. You can do all that with everything your hotel offers, but let's concentrate on the business meeting market.

What Do You Sell?

The main service you sell to businesses across the country is a convenient, dedicated, and full service place to hold a meeting and get things accomplished. The business market knows how to make things, how to distribute goods, and how to sell those goods. But they probably don't have much of their physical business space devoted to meeting space, catering, or places where they can sit and meet for a half day or more without being interrupted.

You offer those services. And you can make it so that the business meeting planner (in most cases, the boss's secretary) doesn't have to spend a whole lot of time worrying about the logistical issues of setting the meeting up. But first, you need to analyze what, exactly you are selling.

Of course, you are selling a meeting space. Like the guest rooms, meeting spaces are rented. Unlike guest rooms, many times hoteliers give away the space in exchange for the sale of guest rooms, or for large banquet orders, etc. Nothing wrong with this, but the meeting planners should understand that a "rebate" has been applied.

Also, often, we make parking available for free, or at a greatly reduced price. Again, a "rebate" that should be noted in the proposal. Of course, the F+B Director's "bread and butter" are the various catering opportunities. No need for rebates here, but a simplified menu plan might reduce the decision making time and effort to a simple "yes" or "no".

Audio / visual in this day and age is less specialized than before. By that I mean, that it seems that nearly every computer now has video capabilities. Projection technology is almost common place. I can see a time, shortly, when A/V becomes about as profitable as the hotel phone system. But, again, any discounts, or reduction in traditional charges for A/V should be noted as a "rebate".

What a "Buy Back" Deal Would Look Like:

Let's look at an example of how your proposal might look under a "Cash for Clunkers" style marketing effort.

OK, a little sales hype is going on here (remember; you really were not going to charge for the room rental or the full parking fee). But isn't this what those car dealers do with their window stickers? Who pays the full sticker price? Certainly not you!

Looking at it from the position of the purchaser, we see that if I buy the meeting now, I can save 35%. Sounds like a strong incentive to buy now!

You can put a time limit on the proposal ("Beginning of the Year Event" or some such hyperbole.) But the essence is, I think clear. "Buy now and save a significant amount of money."

Getting the Word Out:

We know what to sell, now let's look at how to sell it. It is time for your banquet / meeting people to go out and knock on doors. "Contacts" are the name of the game in selling. The more people you can communicate with ("meet, greet" or via TV or radio ads, or whatever means,) the more contacts you develop. Then the task it to convert at least some of those contacts into sales.

Other media techniques, like direct mailing are great; but to whom will you address the mailing? Who is the decision maker? Probably, "the Boss" will decide if to hold a meeting, but his secretary will decide where to hold it. You need to make an in-person office call and talk to everyone. Research has shown beyond a doubt that direct contact works best.

Go into the place of business, plant the idea that it is time to spend a morning or afternoon away from the office and get some ideas floating on how to address the economic recovery issues relevant to that particular business. Get them thinking about the idea of a meeting... at you hotel. Leave a brochure, and promise to get back with a proposal.

Good personal selling is an art, only a few are good at it. But two or three good sales people can bring in a whole lot of contacts which can be converted into sales by your other meeting and banquet planning staff. This is known as "passing the baton" or having detail-oriented people follow up and take that initial contact and convert it into a sale. This frees up those couple of sales people to go out and make more initial contacts.

An alternative to the direct sales technique is to meet people at other business or social events. The Chamber of Commerce, high school sports events, church socials, wherever they congregate in your community all are great places to make an initial contact. This is not quite as effective; you don't know if your are talking with a soccer mom or the woman who manages the local bank, but it is an alternative to traveling around town visiting offices. Here, again, the name of the game is contacts - actually "contact management".

It isn't good enough to simply meet people. You have to follow up that meeting with other contacts with the prospective decision maker. No matter how you do it, direct sales are laborious, not at all predictable, nor, frankly, much fun, but it can be highly effective.

A Few Nice Touches:

A few months back the Chief Executive Officer of a major hotel chain said that they had initiated a program of surprising guests with unexpected extras during their stay. This is a very important concept. As I've said, the executive secretary, or whatever she may be called, has great influence on the decision to hold meetings at your hotel. Additionally, she has the ability to suggest more meeting business in the future - not just from the place where she works, but the businesses that work with her employer. My experience has been that you really hit the marketing jackpot when you can get one of those "super secretaries" working with you!

Let's face it, if the meeting includes a breakfast, or if the meeting looks like it may drag on into late afternoon or evening, that meeting planner will be very appreciative if you give her a room at the hotel to freshen up in. While my hotel had a year around 92% occupancy rate (two years in a row), we still always seemed to have a room or at least a day room available to comp this overworked decision maker. It is very cost effective in the long run, and is a small consideration for the help she will provide you in securing future business.

Another nice touch are amenity baskets or other displays in the meeting rooms. I can take $20 in fruit and make a very nice presentation. Remember, this isn't in lieu of breaks, or other refreshments. But it is a nice touch.

What not to do? One hotel I scheduled a meeting in charged us for the water and glasses set up in the meeting room itself. That was after we agreed to spend nearly $40,000 on food and beverage! Please; if you can't squeeze a profit off of $40,000 in banquet sales and still provide ice water to the meeting room, may I suggest that your food and beverage pricing structure needs to be reviewed?

Do It Now

The economy is about to change. Most businesses re-think their strategies and plans at the beginning of a new year. It is time for you to do the same. You need to figure out what you are selling, give the businesses a reason to buy what you are selling - now, and go out and sell! Personally, and in order to facilitate the ease of decision making, I use a sort of "Table d'H^ote" menu scheme. I created a "quick and easy" meeting plan, with a light breakfast, mid-morning snack, and A/V. For the slightly more affluent businesses I had a light breakfast, mid-morning snack, A/V and lunch proposal. And finally a bang-up all day event. Three choices, with ways to elaborate on each. That way we could get directly down to closing a deal with no days wasted dickering about the details.

We converted about one contact in ten to a meeting sale. A very good average. Getting the contacts was fairly easy, we knocked on a lot of doors of newly established businesses in town (a list of new businesses is usually available through the local licensing apparatus.) We fully booked out meeting rooms for January through March in about three weeks of our sales campaign. You can do it as well.

Marcel R. Escoffier was an Associate Professor at the School of Hospitality Management Florida International University. He had over thirty years experience in hotels and restaurants throughout the U.S. Unfortunately, Mr. Escoffier passed away in September, 2009. We at HotelExecutive.com would like to continue publishing Marcel's articles on our website as a tribute to this brilliant man. The one thing we loved most about him most was his sense of humor. He would always make light of any serious situation, and this was reflected often in the articles he wrote for the Hotel Business Review. Mr. Escoffier can be contacted at editor@hotelexecutive.com Extended Bio...

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