Extreme Deals

With occupancy low and rooms to fill, hotels and conference centers are getting very creative in luring group business. Attention getters range from "name your price" promotions to discounts that dip lower if the Dow nosedives.

Following is a look at some of the boldest offers out there -- and whether they're actually translating to more business on the books.

Name your price
One of the more eye-opening recent promotions was the Chicago-based Summit Executive Centre's "Pay What You Think" program, which ran for the month of March. According to managing director Louise A. Silberman, CMM, the venue received numerous phone calls from shocked clients.

"They would say things like, 'I can't believe you're doing this, what a clever idea!" and "I wish I had a March meeting to book. Can I name my own rate for a meeting in April, May, June?' " recalls Silberman. Ultimately, the offer has been more successful in creating dialogue than actually generating business. "That kind of success is hard to measure, but it's priceless," Silberman notes.

Interestingly, not everyone who phoned in took advantage of the offer. One of the facility's repeat clients, for example, was happy with the standard group rate but enthused about the idea of naming a price. "I took it as a compliment, a tribute to the strong working relationship we have with the client," Silberman says. "I have always been fair, sometimes to the peril of good business. But in the long run, I feel it always pays off."

The venue did land some business that month thanks to the promotion, albeit at a lower profit margin. Prices named by clients ranged from $62 to $137 person, with an average price of around $75. Because the standard rate is $179, that amounted to a 58 percent discount. "We did not have to turn anyone down," she explains. "They were all respectful offers." Occupancy increased about 15 percent during the month of March, though the numbers remained rather "dismal," Silberman says. Moreover, at least five planners booked events during the months following the program. "They said they called because they remembered the creativity of the promotion. It was definitely beneficial from a PR standpoint."

Silberman is considering running the deal again, but not until next year. "I would not want to dilute the value of our normal full-day package rate," she says.

Top service, guaranteed
Worried about service levels? The Broadmoor resort in Colorado Springs, Colo., has done away with that concern. As of mid-March, the property guarantees that groups will experience "superior value in service, facilities and quality" or the entire master account will be waived.

"We're trying to highlight how we're running our business differently," says John Washko, the Broadmoor's vice president of sales and marketing. At other properties, he says, "discounts might not guarantee value, because it might mean less staff. We've actually increased our staff training, and we continue to do infrastructure and normal maintenance on the property."

The promise appears to be paying off. Several proposals have gone out after just two weeks following its launch, and The Broadmoor has been asked to bid on a few programs as a direct result of the guarantee, says Washko.

Following the Dow
A few hotels have used the precarious state of the financial world as their inspiration for creative marketing tactics. At the Hamilton Park Hotel & Conference Center in Florham Park, N.J., the team's solution was to let the ups and downs of the economy, quantified by the Dow Jones Industrial Average, determine the savings given to planners. The hotel sent out yo-yos to prospective clients as a marketing tool, calling it "Your answer to the ups and downs of planning a meeting."

"We were trying to look at some type of formula: If things get better, this happens, and if things get worse, this happens. What better barometer than the Dow?" explains Steve Migliara, the hotel's director of sales and marketing.

Here's how it works: Depending on where the Dow closes on the last day of the meeting, planners receive discounts of up to 30 percent off the master account. Given the Dow's poor performance throughout the months of February and March -- which hotel managers had not entirely anticipated -- savings to planners hovered around that mark.

Planners have been pleased with the offer, and the hotel has decided to extend it to Aug. 8. Migliara characterizes the amount of business from the promotion as "substantial" and says Hamilton Park has forged new relationships with possible future clients as a result. "We believe it will come back to us tenfold," he says.

In a similar move, the Warwick Denver Hotel devised a promotional package for meetings up until April 30 of this year, with discounts pegged to the percentage decline of the Dow the day prior to the meeting. If the Dow made positive gains, the hotel threw in complimentary morning and afternoon refreshment breaks. The promotion helped put two new groups on the books, which saved 11 percent and 13.7 percent, respectively, on their total food and beverage costs. However, what was more popular, according to hotel general manager Scott Ostrander, was a separate meeting package not linked to the Dow that gave planners a choice of various discounts in addition to a 5 percent credit towards a  booking consumed by December 2010, for every $5,000 spent.

Bureau Bonanzas

Hotels aren't alone in attempting to lure planners with freebies. Convention and visitor bureaus all over the country are attracting group business with free local entertainment, cash rewards for sales leads and even a chance to win a new car.

The Nashville Convention & Visitors Bureau is playing up its music cultural history with its "Nashville for a Song" promotion, rolled out in March. Groups that book at least 101 peak rooms for a minimum of two nights receive a complimentary performance by a songwriter from Nashville. "Offering a performance by a professional songwriter is something uniquely Nashville," says Butch Spyridon, president of the Nashville CVB. "We have had a number of leads materialize and believe we will close a few bookings in the near future."

Some bureaus have looked to hometown residents for leads -- and are willing to pay for those that convert to real bookings. Hometown Hosts, a 6-year-old program from the Lexington Convention and Visitors Bureau in Kentucky, was recently pumped up with an offer of $100 in cash to the first 100 residents within 100 days to contact the bureau with a legitimate meeting contact.

The program generally targets professors at the nearby University of Kentucky, as they typically belong to associations. Since it began in early April, the referrals have been pouring in. "The money has definitely gotten their attention," says Dennis Johnston, vice president of sales for the CVB. "I've received 16 leads in five days. I've been here for four years and have never gotten so many at once. Some are bogus, but we probably have five or six that we're working on now."

Other CVBs, including the Las Vegas Convention and Visitors Authority, are embracing sweepstakes promotions to woo group business. Planners who book a meeting held between June 1 and Aug. 31 using the bureau's eRFP system will be entered into a drawing for a new 2009 hybrid vehicle, to be awarded in September. Though interest in the promotion was just getting started at press time, the bureau hopes it will lure planners in favor of environmental responsibility within the meetings industry. -- K.H. 

Planner perspective
What seems to be the most useful for planners are offers giving them freedom to choose where to cut costs. The Temecula Creek Inn in Temecula, Calif., for example, introduced a "Three for Free" promotion in February, which lets planners choose three services at no cost, such as free Internet in guest rooms, a complimentary morning breakout session and a 50 percent discount on attrition fees, for meetings throughout 2009 with a minimum of ten guest rooms on peak nights.

Laura Hontas, meeting and event planner for Agoura Hills, Calif.-based Pinnacle Solutions, who held an event at Temecula Creek this past January, found the number of options helpful when it came down to making a decision. "Some hotels will throw out concessions that aren't relevant, like spa discounts," she says. "That might not be valuable for an all-male group, for instance, but a choice between a comped reception and a morning coffee break would be."

In other cases, the attendees could use the savings, Hontas explains. "The overall goal of the company is to get full attendance, so I'd rather pass along the savings to attendees. They are more likely to register if they have incentives."

Surprisingly, the 50 percent discount on attrition fees was not one of the more attractive options for Hontas's groups. "If I took the 50 percent attrition, that would mean I was expecting the meeting to be a flop," she says. "I'd rather look at overall cost savings."

Others have been enticed by the half-off attrition offer, says Shawn Jackson, the property's director of sales. In fact, she suspects it was a decision factor for five groups that have been added to the books since the promotion began. "We've talked about cutting off the program but decided against it," she notes. "The economy is not going to be fixed anytime soon."

The Renaissance Las Vegas also has had success by easing attrition fees. Out of all the options made available to meeting planners, including Best Buy gift cards, complimentary Internet in meeting rooms and extra loyalty points, reduced attrition is by far the most popular, according to Fred DeSota, director of sales. "The promotion has been in place for two weeks," he said in late March, "and half of the new business on the books has because of it. Business is still down from last year, but we're having a great month."

Brandwide discounts
In addition to attractive offers by individual properties, new group business is being rewarded at the chain level. The Orlando-based Kessler Collection, which has 13 hotels throughout the United States, is waiving cancellation fees at most of its properties. For new meetings booked in 2009 with at least 400 room nights, Orlando-based Rosen Hotels & Resorts has ventured to reduce or waive attrition fees entirely at its three Orlando convention hotels, Rosen Plaza, Rosen Centre and Rosen Shingle Creek, depending on the group's history with the hotel company.

As early as February, Omni Hotels agreed to waive attrition fees for new meetings with up to 150 peak room nights, booked by June 30 and held in 2009. Additionally, at 90, 60 and 30 days prior to the event, the hotel will review the room block to make necessary changes.

Beyond attrition, most every major hotel brand is offering concessions, such as discounts on room rates, food and beverage, and double reward points.

La Quinta, Calif.-based KSL Resorts, an upscale group of seven properties popular with financial groups, has attempted to ease the burden of planning by educating staff on the federal guidelines for meetings held by TARP fund recipients. According to director of sales Michael Erickson, "In talking with different groups who canceled their meetings, we realized we had to address their specific needs. We're making sure that we educate our managers about the proper protocol for meeting and incentive groups who must abide by those guidelines."

Even in lieu of special promotional offers, planners should feel free to ask for whatever concessions would influence their site-selection decisions. "This is the year to ask for a better deal," says Erickson. "We're more flexible than ever with discounts. Take advantage of them."