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    Attrition not pressing now, but2008 could be a concern

    PSG INST OF MANAGEMENT

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    Title:

    Attrition not pressing now, but 2008 could be a concern. By: Carey, Robert, Meeting

    News, 0145630X, 10/22/2007, Vol. 31, Issue 14

    Database:

    Business Source Premier

    HTML Full Text

    Attrition notpressing now, but2008 could be aconcern

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    Contents

    1. Tackling the Block

    2. Willing to Go Over Board

    List

    en

    Paus

    e

    Load

    ing

    Help

    Section: MN Exclusive Research

    In the latest MeetingNews survey of more than

    340 corporate and association meeting

    planners, one theme was clear: In 2007,

    planners are not too concerned about their

    ability to pick up the minimum percentage of

    guest rooms they contracted for, and are on a

    good track to avoid attrition penalties.

    The survey results show that 70 percent of all

    planners--and more than 79 percent of

    association planners, who are more vulnerable

    to attrition--have taken action in the past two

    years to reduce their exposure to attrition.

    "There's no doubt that organizations learned

    from the grief they encountered in the early

    2000s, when too many of them didn't monitor

    room bookings until 30 days out and then fell

    way short of filling the minimum 80 to 90

    percent of the rooms they blocked,' said Fred

    Shea, VP of sales for Hyatt Hotels. "Since then,

    planners have reduced their block sizes, used

    technology like Passkey to monitor bookings

    early and often, established rules for how

    http://web.ebscohost.com/ehost/detail?vid=15&hid=104&sid=def768d2-1ee4-4046-9e9c-6895c57b0ba8@sessionmgr113&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3D%3D#AN0027580667-3%23AN0027580667-3http://web.ebscohost.com/ehost/detail?vid=15&hid=104&sid=def768d2-1ee4-4046-9e9c-6895c57b0ba8@sessionmgr113&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3D%3D#AN0027580667-5%23AN0027580667-5http://web.ebscohost.com/ehost/detail?vid=15&hid=104&sid=def768d2-1ee4-4046-9e9c-6895c57b0ba8@sessionmgr113&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3D%3D#AN0027580667-3%23AN0027580667-3http://web.ebscohost.com/ehost/detail?vid=15&hid=104&sid=def768d2-1ee4-4046-9e9c-6895c57b0ba8@sessionmgr113&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3D%3D#AN0027580667-5%23AN0027580667-5
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    attendees book rooms, linked the housing

    function to registration so people book inside

    the room block, come earlier to us to release

    rooms for transient resale, and so on. The

    bottom line is that most planners today would

    rather look for overflow inventory for some

    attendees than risk triggering attrition

    charges."

    One convention manager who created a solid

    plan to avoid attrition is Lisa Fall of the Texas

    Association of Health, Physical Education,

    Recreation, and Dance. She keeps detailed

    meeting histories of the prior three meetings

    she's held in every city in her group's rotation.

    "I can show the hotels not just our overall

    booking trend, but also our performance rates

    over the years in particular cities," she said.

    "This makes iteasy for me to secure the room

    block I want at the headquarters hotel, and

    secure a block at an overflow hotel."

    In fact, Fall often books in excess of 100

    percent of the room block--something that 41

    percent of survey respondents have done with

    at least half of their meetings. In these cases,

    groups can extract from hotels a "bonus" of

    some type beyond simply extending the group

    rate to rooms booked above the block, said a

    sales executive at a large Northeast meetings

    hotel who asked not to be identified.

    "Some planners try to negotiate rebates into

    the contract if they book over their block, but

    properties are much more amenable to giving

    softdollar items," he said. "Of course, you'll get

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    your additional comp rooms, but you can also

    land suite upgrades, airport transfers, spa

    treatments--the items that hotels already have

    access to and which will not cost them out of

    pocket"

    While planners have been diligent with their

    room blocks since 2004, the shaky economic

    outlook could jar the meetings market in the

    coming year. A dramatic downturn could

    ravage not just meeting attendance, but also

    transient business that often saves planners

    from attrition.

    At the moment, Shea says there is simply no

    evidence of that. "Despite what we're all

    hearing about the implosion of the housing

    market and how itshould slow down the

    economy, we are seeing no downward trend in

    bookings in either individual or group travel"

    he said. "In fact, our pace as of Sept. 1 is

    stronger for 2008 than 2007, with no indicationthat itis about to change--even our 2009

    bookings are healthy. So, we expect that

    occupancy levels for 2008 will, at the least,

    stay flat and that the attrition situation will

    remain the same. If groups miss their room

    targets, transient business will be there to fill

    rooms."

    Still, planners have been creative in defending

    their organizations from financial loss: A 2004

    MN survey found that one-third of planners

    were able to reduce their attrition penalties,

    usually by purchasing another F&B event for a

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    meeting or by booking another meeting at the

    host hotel in the same year.

    Shea noted all that could be moot. "If planners

    monitor their booking pace right from the start,

    they leave themselves with many options to

    avoid attrition."

    Tackling the Block

    How often do you consume more rooms that

    the number set in your original room block?

    Corporate

    Association

    Planners

    Planners

    100% of the time 4.0%

    6.1%

    75 to 99% of the time 13.7%

    25.2%

    50 to 74% of the time 11.1%

    21.7%

    25 to 49% of the time 11.5%

    8.7%

    1 to 24% of the time 39.8%

    29.6%

    0 of the time 19.9%

    8.7%

    Source: MeetingNews survey of 341

    meeting planners

    Willing to Go Over Board

    http://web.ebscohost.com/ehost/detail?vid=15&hid=104&sid=def768d2-1ee4-4046-9e9c-6895c57b0ba8@sessionmgr113&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3D%3D#toc%23tochttp://web.ebscohost.com/ehost/detail?vid=15&hid=104&sid=def768d2-1ee4-4046-9e9c-6895c57b0ba8@sessionmgr113&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3D%3D#toc%23tochttp://web.ebscohost.com/ehost/detail?vid=15&hid=104&sid=def768d2-1ee4-4046-9e9c-6895c57b0ba8@sessionmgr113&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3D%3D#toc%23tochttp://web.ebscohost.com/ehost/detail?vid=15&hid=104&sid=def768d2-1ee4-4046-9e9c-6895c57b0ba8@sessionmgr113&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3D%3D#toc%23toc
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    In general, how willing have hotels been lately

    to enlarge your room block at your negotiated

    rate when the need arises?

    Corporate Planners

    Very willing 53.8%

    Somewhat willing,

    if 1 push the issue 43.0%

    Not at all willing 3.2%

    Association Planners

    Very willing 45.1%

    Somewhat willing,

    if 1 push the issue 46.9%

    Not at all willing 8.0%

    Source: MeetingNews survey of 341

    meeting planners

    ~~~~~~~~

    By Robert Carey

    Copyright of Meeting News is the property of

    Northstar Travel Group LLC and its content

    may not be copied or emailed to multiple sites

    or posted to a listserv without the copyright

    holder's express written permission. However,

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