By Larry and Adam Mogelonsky
The rumors are true…groups are already starting to rebound. You may not be seeing that in the form of RFPs and spikes in search traffic. Rather, it’s happenings amongst friends and corporate executives. “Hey, we’re all vaccinated now, and the government is saying we’ll be able to gather soon, so let’s start planning something for this fall because we all haven’t seen each other in a long time,” said the CEO to the CFO during their latest fireside Zoom chat.
True, large-scale conventions with thousands of attendees intermingling will be the last segment to return, but smaller meetings and regional events may just be around the corner – think late summer and early fall. Even with an uptick in interest, you’re still going to have to hone your tech to win the business. Not only will using the old paper-and-pen methods of negotiating and contract drafting give the impression that your hotel isn’t doing its best to protect groups from viral spread, but nowadays you also need automation so as to not overload your skeleton sales teams.
As we saw with the past two recoveries after 9/11 and the 2008 recession, hotel teams learned to do more with less and this time hospitality organizations will be especially slow to ramp up hiring in the sales department even as business starts to return. The difference now is that the mandate for contactless guest experiences has also accelerated our adoption of end-to-end digital transaction platforms – no manual credit card authorizations required and no paper records.
Importantly, with the pandemic all but permanently changing many of our habits, your future group customers also won’t want to print forms to sign or even negotiate through an extended period of phone (or videoconferencing) conversations. They’ll want a frictionless bargaining process – virtual tours, detailed spec sheets, electronic contracts and web-based BEOs to fill out, all coordinated as fast as possible by your sales team.
Luckily, using a combination of customer-facing platforms and middleware, hotels can speed this process along with features that can:
- Quickly deliver electronic contract documents that can be signed, timestamped, version coded or updated on the fly
- Email or text private payment portals so that no credit card information is shared over the phone or via paper forms, thus reducing the chances of fraud and disputes
- Configure multiple deposit dates and amounts for BEOs so that groups can split the total over a longer timeframe and across different credit cards
- Layer in additional fraud prevention via payment portal closures after completion, card-not-present restrictions in the days prior to the guests’ arrival and card entry failure limits to deter brute force attacks
- Send out automated past due notifications to the group planner as a reminder as well as to the sales manager in order to keep track of trailing accounts receivable
- Connect approved online payments directly into the appropriate ledger within the PMS to decrease time requirements from the accounting team
As we’re all trying to find ways to win back groups business, I reached out to Conner Erwin at b4checkin, a company specializing in secure online payments with its product TransForm, to learn about another intricate way that modern technology will help in the recovery. “If you want to drill down, just look at the interchange rates on credit card payments, for which using PCI-compliant transaction software may help reduce this part of the overall merchant fee. So, even though we’re talking small percentage deltas, these savings become significant when you’re dealing with large group contracts, enough for hoteliers to offer a tangible price discount during negotiations.”
Indeed, in the uncertain times ahead, money will be much tighter for businesses and groups as it has been for the average leisure guest. Contracts will be won by specific properties based on arbitrages of within a couple thousand dollars. This means that the cost savings you attain through labor efficiencies, payment flexibility, better interchange rates or any other inborn advantages can then be passed through in the form of a more competitive price to the prospect.
One other behavioral change is the speed of booking; the lead-time booking metrics for leisure are getting shorter and shorter, and you can expect the same for the next wave of groups. You’ll need to react almost instantly to incoming inquiries lest the group already book somewhere else. This makes technology essential to keep pace with the rapidity of the post-Covid group bargaining process. Hence, now is the time to review your tech stack again to see how you can enable it to facilitate groups while still minimizing costs.
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Editor’s note: To discuss business challenges or speaking engagements please contact Larry or Adam directly.
