Keeping Up Appearances

For Jaime Bloom, director of marketing and conference planning for Atlanta, GA-based Sunbelt Business Advisors Network, planning this year's annual meeting was hardly as straightforward as simply reopening last year's file. That's because last year's meeting, like every annual meeting in the past, was a several-days-long affair at a resort property that combined networking events with educational seminars. This year, however, Bloom's directives had changed. "With the state of the economic times as they are, no one wants to pay those prices anymore," Bloom says. "The agenda was changed to shorten the length of the meeting and to focus solely on education." But be that as it may, Bloom says, "the attendees expect the resort-style venue. So I was placed into a crunch to find a middle ground."

Bloom's predicament is indicative of a trend that is affecting meetings across a wide swath of industries. Some say it all started in 2002, with the release of the PhRMA code. The voluntary guidelines outline restrictions for how pharmaceutical companies should interact with, and market to, health-care professionals. In the clause perhaps most pertinent to the meetings industry, the guidelines state that "interaction should not include entertainment . . . and should occur at a venue conducive to providing scientific or educational information." Almost immediately, planners in the pharmaceutical industry began selecting their meeting venues accordingly. And, eventually, strongly encouraged by the Enrons, WorldComs, and Adelphias of the world, this practice spread to other industries. Now, the need to avoid the slightest appearance of impropriety or imprudent spending dictates, in many cases, how—and where—meetings are held. This puts planners in the unenviable position of having to satisfy attendees who expect a resort experience while simultaneously appeasing procurement departments and ethical watchdogs. But there is good news. As resort directors of sales see their meetings business fall off, they're more willing than ever to negotiate—even in a seller's market.

In many cases, planners find that keeping up appearances is so important that it even trumps cost concerns. "We've had direction from some of our clients to avoid properties with the word 'resort' or 'spa' in their name because the implication in the name is that it is a leisure property rather than a business meeting property," says MaryAnne Kanacki, vice president of travel for Summit, NJ-based Westfield Group. "This is somewhat interesting because even though the [so-called leisure] properties are less expensive than the other, lower-end properties, we cannot use them." John Totino, project manager for Fort Lauderdale, FL-based Fanizzi Associates, Inc., concurs. "Absolutely, costs are secondary to perception," he says. "Sometimes, higher-tier properties are less expensive. Some Hyatts, for example, are more expensive than the Ritz. It's obviously not the norm, but it's not unheard of." But because it looks more prudent, Totino's clients will prefer the Hyatt over the Ritz, regardless of cost. "We've done a lot of business with Hyatt in the past two years because of this."

At Litchfield Plantation, Pawleys Island, SC, Director of Sales Sally Gomez has noticed that her property's affiliation sometimes seems more relevant than its room rate. "I often lose groups to hotels such as Radisson, Embassy Suites, and Marriott because Litchfield Plantation is a member of 'Small Luxury Hotels of the World,' a banner we wear proudly," Gomez says. "Even so, our group rate is often $10 to $30 lower per night than those other properties."

Once, meeting planners yearned to be able to afford the higher-end, status-symbol hotel brands. Now, in many cases, planners eschew these same brands, even if they can afford them. "I can say that we've won some business because we're not part of a luxury chain," says Mark Lupton, director of sales and marketing at The Houstonian Club & Spa in Houston. "It's actually an advantage to us not to have that stature." But, Lupton says, the knife cuts both ways. "We've also lost a piece of business because our name includes the word 'spa.' The client said everything looked good but that when he presented it [to his superiors], he was told that our hotel name, with the word 'spa,' indicated too much of a resort-type situation." Consequently, Lupton says, he has considered dropping "Club & Spa" from some of his sales collateral. Planners and salespeople across the board say many corporations—though they decline to name names on the record—automatically flag for review any proposals for meetings held on certain luxury brand properties, including Ritz-Carlton and The Four Seasons.

"That has sometimes been the case due to increased scrutiny of these companies' corporate governance practices," admits Vivian Deuschl, vice president of corporate relations for Chevy Chase, MD-headquartered Ritz-Carlton. "However, we are seeing, as demand grows for meeting space across the board, less reluctance to choose Ritz-Carlton because of our increased inventory, our reputation for service, and the positive impact on meetings attendance when the location is a Ritz-Carlton." Still, like The Houstonian, some properties are considering dropping the words "resort" or "spa" from the collateral they give to certain meeting groups. "We were encouraged to do that by the resort who referred a Johnson & Johnson program to us," says Lindsay D. Curry, group sales manager at the CopperWynd Resort & Club in Fountain Hills, AZ. "The sales staff at that property said they were getting some negative feedback about having 'resort' in their name."

But for some properties, this increased scrutiny on site selection has actually improved business. "We're getting a lot of meetings, particularly from the pharmaceutical market," says Lauri Baker, director of sales and marketing at the Hotel Andalucia in Santa Barbara, CA. Although the property just opened recently, Baker says up to 60 percent of her business is from meetings that bring groups to the resort town. "Whereas certain high-end brands are flagged as unsuitable for meetings, the Andalucia is perfect. We have resort amenities, but we're not part of a chain." Similarly, The Houstonian's Lupton says his property has been hosting more groups lately because the independent property "doesn't raise flags on a balance sheet or proposal." Lupton says his property has the added benefit of being located within the city center, so "groups can have the resort feel without necessarily going somewhere known as a resort destination." This also works in Orlando, where the Grande Lakes Orlando combines two hotels, the Ritz-Carlton Orlando and the JW Marriott Orlando. "Guests can come have a meeting at the JW Marriott and at the same time they can use the Ritz-Carlton spa and golf course," says Vice President and Managing Director Marc Hoffman. "It's a great advantage for us, especially as industries are trying to be careful of their message."

Booking high-end independent properties in less obviously glamorous locations is just one of many strategies planners have developed to accomplish their seemingly contradictory dual objectives. Some planners opt for properties that have access to luxury amenities but don't necessarily advertise them. "We know [planners] have to be very careful about where they stay, and we don't have 'resort' in our name, but we're a luxury property," says Shannon Short, public relations manager for the Grand America in Salt Lake City, UT. "We also have a lot of resort-like amenities, but not necessarily on property." Fanizzi's Totino, who recently brought a group to the Grand America, agrees. "Indepen-dent hotels definitely have a niche right now. Who knows where it'll be in five years, but right now they definitely have [an advantage], especially when you have to go to non-resort-type properties."

Some planners also report that resorts that have seen their group business wane are now eager to grant concessions to seal the deal, even in what's fast becoming a seller's market. If a planner can sell the resort concept to his or her higher-ups, there are good deals to be had. Vicki Juntti, event manager for Minneapolis, MN-based Sagebrush Corporation, says, "I find the resorts more than willing to work in this fashion. They will either give me a CMP package or give me a lower room rate."

Sunbelt's Bloom agrees. By moving around the dates of her annual meeting, she was able to wrangle a slew of concessions from the resort she booked. "The property offered enough compensation packages to bring registration costs down and appeal to my business group," she says. "I was able to get free Internet access for all attendees, discounts on AV, enough upgrades for all our VIPs, and free airport transportation for all speakers." And that's just a few of the items on her long list of concessions. In the end, Bloom says, persistence pays off. "Of all the venues I looked at, this one offered the best package deal, and I am still able to offer my attendees the resort atmosphere that they are used to seeing."


Ask Away
Jaime Bloom, director of marketing and conference planning for Atlanta, GA-based Sunbelt Business Advisors Network, asked for, and received, all of the following concessions from the resort where she booked her annual meeting:

• Free Internet access for all attendees

• Discounted AV

• Upgrades to accommodate all VIPs

• Discounted rates for all corporate staff

• Free transportation to and from the airport for all speakers

• Complimentary shuttle service to an off-site location (25 miles away)

• Complimentary shuttle to the top local mall

• Discounted rate on golf for attendees who chose to stay over the weekend