People and Processes


by Dave Lutz

Getting a Quality Response for Your RFP

Technology has made it easy for planners to blast out RFPs … too easy. Hotels get an overabundance of unqualified leads, or leads that they don’t have the resources to provide with quality responses.

 

Many hotels and industry suppliers are on RFP overload. One major chain reports that its RFP volume has nearly tripled in the past three years while its conversion rate has been cut in half from 17 percent to 9 percent. Combine this trend with the realities of the current seller's market, the expectation of an immediate RFP response, increased utilization of Web search engines, and the growing trend of procurement in the meeting space, and you get an industry on a crash course for commoditization.

You can be sure your RFP gets the hotel's attention and triggers its most aggressive initial response by using these 10 tactics:

1. Limit the playing field. Make an A list of your top three or four hotel options and send to them first. Let each hotel know that it is one among a few under consideration versus the normal one of 10. Don't allow your hotel national sales or CVB representative to add hotel options without discussing it with you first.

2. Pick up the phone. Build a relationship with a hotel salesperson and s/he will push your RFP to the top of the pile and try harder to find a workable option for you.

3. Help them help you. Share your history of guest room pick up and food & beverage spend for previous meetings. Especially in a seller's market, hotel sales personnel must justify to their leadership (i.e., revenue manager) why your business is better for the hotel than another group's piece of business.

4. Put all your cards on the table. If there are certain concessions, room rate parameters, or contractual requirements that will be deal breakers for you, be sure to communicate them from the get go.

5. Be flexible. Offering the hotel some alternative dates to place your program where its inventory needs it most will put you in a much better negotiating position.

6. Give them adequate time. For longer-term bookings, give the hotel three to five business days to get back to you with an aggressive and high-quality response. For meetings occurring in the near term, a 24-hour response is a reasonable request. The key is to align your response request deadline with the decision-making timeline.

7. Ask the hotel to sell you. Our business is becoming more transactional with decisions often being made off of a grid (price, location, and availability). Let the hotel know your critical meeting objectives and ask them to communicate how and why you will have a better meeting at their property versus hotel B and C. Many hotels are investing heavily to differentiate and improve their product and service and train their sales folks to communicate their value proposition.

8. Be empowered. Smart hotel sales people are anxious to deal with folks who have decision-making authority or significant influence on the buying decision. Be sure that you have that power and communicate it.

9. Be timely. Say when a decision will be made and stick to it. A quick decision timeline will help drive the urgency needed to get the best deal.

10. Be loyal. Be sure to strengthen the relationships you develop by doing more business together. The long-term value of a customer can be influential in a seller's market.

Remember that hotels within the same chain are often owned and managed by companies other than the parent chain. Hotel chains will do a great job of communicating the value that you bring to the chain, but decisions on individual pieces of business will often be made at the individual hotel level.

Dave Lutz is managing director of Velvet Chainsaw Consulting, www.velvetchainsaw.com, a business improvement consultant specializing in the meeting and event industry. His company assists organizations in realizing top- and bottom-line growth by delivering customer-focused solutions in business development, best practice and process improvement, strategic planning, and training.