Hotel Contracts The Value Proposition

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Hotel Contracts The Value Proposition

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Scott Allison. Vice President, Sales & Marketing - Marriott Hotels of Canada. Peter Maltby ... Director of Travel Partner Relations, The Americas, Hilton ... – PowerPoint PPT presentation

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Title: Hotel Contracts The Value Proposition


1
Hotel Contracts The Value Proposition
  • Scott Allison
  • Vice President, Sales Marketing - Marriott
    Hotels of Canada
  • Peter Maltby
  • Director of Travel Partner Relations, The
    Americas, Hilton International
  • Tanya Pratt
  • Director, Electronic Distribution Marketing -
    Delta Hotels
  • Moderator - Onita Dey
  • Business Development Manager, TQ3

2
Hotel Contracts The Value Proposition
  • PhoCusWright Inc. recently suggested that while
    corporations will relax travel and budget
    restrictions, corporate travel will retain a far
    more disciplined ROI approach. This means that
    hotels will continue to be pressured for rate
    concessions or value-adds, while corporations
    will be asked to improve compliance. With
    transient business travel recovering more slowly
    than anticipated, fierce competition for share of
    wallet from key accounts will continue. At the
    same time, both the supplier and the customer
    will continue to carefully manage the ROI of the
    relationship against the expectations outlined in
    the contract.

3
Do hotel contracts still work for the corporate
travel program?
  • Contracts are a valuable part of the agreement
    but it is only the start of a relationship.
    Compliance, however, demonstrates the ability of
    the programme to move market share, fulfil the
    contracted volumes and add value to the
    partnership. Conditions of booking lower,
    promotional rates are often not appropriate for a
    business traveller even though the rate is
    appealing.

4
What new technology trends are emerging and how
are they affecting how your organization buys
travel?
  • Booking channels are becoming quicker and more
    common place. Consistency of rates and
    availability are even more important, especially
    where there are multiple parties involved in the
    booking process. Hotels are starting to take
    control of their pricing and how they are
    represented on 3rd party websites

5
Where is the integrity of contracts vs web
pricing?
  • Hotels are increasingly managing their own rate
    structures through the 3rd party sites and
    limiting access only to those merchants who offer
    transparent rates (IE the actual rate paid to the
    hotel is shared with the traveller). The largest
    chains are also now offering price guarantees, to
    protect the traveller, the website and the chain
    themselves from lost revenues and inconsistent
    pricing.

6
What are some of the trends for a non-managed
corporate program?
  • The use of a TMC (Travel Management Company) or
    consortia agent can be one solution where volume
    rates have been negotiated with Global players at
    Parity. This can also be adopted in secondary
    markets where volumes are too low to warrant
    discounted corporate rates. Credit card and
    Agency data can offer the potential for control
    eventhough the programme is unmanaged

7
What are the trends towards incorporating
meetings groups into the corporate
negotiation?
  • This is a growing trend in the local or domestic
    market place although international conference
    and incentive destinations tend to be outside the
    usual travel pattern and do not form part of the
    annual programme due to the nature of the event
    and destination
  • Typically, smaller groups will be a consideration
    when negotiating an annual negotiated rate as
    larger groups will, be nature, demand lower price
    points due to volume

8
With the diversity of hotel product ranging from
limited to full service, how can a travel buyer
use all levels of hotels within a program?
  • Each hotel satisfies a different need, from long
    term suite products and focused service to the
    traditional International full service and
    boutique hotel. Depending on budget, location or
    even image every corporation is using multi
    levels of product for incentive, board meetings,
    road warriors, engineers etc. Loyalty programmes
    across products keep the guest loyal, when he is
    on business or leisure.

9
Hotel Contracts The Value Proposition
  • Further Discussions?
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