MAKING THE E-RFP WORK FOR EVERYONE
Just think of how time-intensive and inefficient sending out a paper request-for-proposal used to be, let alone comparing the competitive bids that were returned. No one is unhappy about leaving that torturous process behind. Just a click of the mouse and off the e-RFP goes to multiple hotels in multiple cities.
The upside: The convenience and speed of the e-RFP clearly expedites the decision-making process.
The downside: The e-RFP is prime for abuse exactly because it is so easy to distribute.
The resulting “lead spray” helps neither the meeting professional nor the hotelier, and instead threatens to overwhelm both sides of the impending transaction.
“Depending on their size, hotels can get thousands of leads in a week or month. We understand that for them to respond to every RFP is very time consuming and costly,” said Dan Herbers, ConferenceDirect vice president. So he and his ConferenceDirect colleagues focus on truly clarifying the specifications for meetings they source. That way, they’ll send perhaps 10 e-RFPs — rather than 50 — for a specific meeting.
“Hotels want to feel that they have a real opportunity to convert the business,” said ConferenceDirect vice president/team director Mike Taylor. “Revenue management teams are much more selective on which proposals they’ll give.”
Market issues. Still, it’s hard to limit e-RFPs when high demand turns top-tier cities into sellers’ markets. For a meeting in New York City on fixed dates in October — “the busiest time of the year,” said Taylor — he may have to send an e-RFP to 20 hotels just to get a single proposal back. “I try to be sensitive to the hotels, but my customer’s short-term meeting needs quick response.” In cities like San Francisco, Chicago and Washington, D.C., too, “we’re somewhat forced into sourcing dozens of hotels,” said Herbers, thanks to soaring occupancy levels. Hotels, meanwhile, face the competitive pressure to turn e-RFPs around in days, if not within 24 hours.
Unfortunately, when hotels see that a meeting RFP is sent to 50 other properties, the lead is likely to “fall to the bottom of the stack,” Herbers said. It’s a lot different “if they see only four hotels in their city vying for this business.”
What’s so efficient about the e-RFP is that every potential hotelier gets detailed and consistent information at the very same time. If it’s a piece of business that isn’t flexible on dates and a hotel clearly doesn’t have availability, it’s a quick process to turn down. Otherwise, it will require a considerable amount of time and effort for hotel sales professionals to adequately respond.
Hotel issues. “The number of leads has expanded, not necessarily because there is more business, but because the automated process is easier than in the past,” said Jim Bennett, New York metro market sales leader, Starwood Hotels & Resorts. Do the math: a hotel sales professional can take 30 minutes to an hour to complete just a basic RFP, then that is multiplied if the lead goes to 20 hotels.
“We use our knowledge and skills to qualify the business, so have to allocate our time wisely to maximize productivity,” he explained. “We consistently look at lead sources and numbers, their closing percentage, and how far out we’re booking to determine how to deploy our team. The clearer the expectations and the more qualified the lead is around requirements for the meeting, the more considerate our response can be.”
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