Many hotels have a ready source of revenue at their fingertips, many times not efficiently exploited nor fully understood: meeting rooms used for 40 people or less.
The need for meeting rooms has seen a strong increase over the past few years, driven in part by the changing structure of the workforce. A recent IDC report said the mobile worker population in the US is already over 90 million and growing fast. It is expected to reach over 70% of the entire US workforce by 2020.
Cvent estimates the global market for all types of meetings and events to be worth around $565 billion annually. Revenue generated by meeting rooms for up to 40 people may represent as much as $50-60 billion of this amount.
Capitalizing on meeting room space is an opportunity hotels cannot afford to miss.
Booking should be easy
Despite the demand, reports suggest that booking a meeting room through a hotel is not always easy. Many meeting room bookings in the US are still handled manually. This results in cumbersome booking procedures due to negotiating rates and awkward contracts. Some customers complain of a slow process, taking as long as three or four days to complete.
One meeting broker said 46% of their clients had tried to contact hotels but got either a late response or none at all. For most hotels, overnight room bookings are more lucrative and take priority.
A study from the UK showed that roughly 10,000 medium-sized meeting rooms are available on any given day. The report suggests that only 30% of these rooms are in use at any one time, representing a staggering loss of potential revenue.
The growth in demand for meeting rooms has been met by a rise in competitive businesses. The new entrants have embraced technology and developed apps to make booking easy.
Rather than trawl the Internet or spend hours on the telephone searching for the right venue, companies in need of a meeting room can use these apps to find what they need. They are able to search by date and time, comparing services offered and related charges. The better apps also give information on location and facilities, making a company’s search not only faster but more productive.
The booking itself is a simple process that can be completed in seconds. It is clear that to compete in this evolving marketplace, hotels must adopt new strategies.
Let apps do the work
The good news is that similar apps designed expressly for hotels are now available. Besides providing the information needed for a company to decide on its preferred venue, these apps include other benefits such online payment and automated confirmation.
It is difficult for a hotel relying solely on its sales force or website to sell unused meeting space at short notice. This problem exists despite a growing trend for rooms that need to be booked within days of a meeting. These apps allow unused time slots to be easily viewed and booked by potential clients with minimal or no intervention from the hotel.
Bizly, a mobile and web booking platform is a great example of how hotels can profit from this technology. Working closely with the hospitality industry, Bizly’s app has been designed so a company can select the appropriate venue for its needs and check its availability within seconds.
The app shows the facilities in terms of layout and equipment, including information about F&B and other hotel amenities. Among its features is a link to Uber, and an automated calendar for inviting delegates. By enabling hotels to sell their meeting rooms by the hour, Bizly allows hotels to maximize revenue.
Time for a change?
Even if a hotel has been selling larger meeting and event rooms for years, this could be the time to review the space they have and how they use it. By adjusting their current meeting room policies, hotels can take advantage of the quiet revolution happening in the workplace and the growing demand for meeting rooms.
There is excellent income potential in offering rooms by the hour that are suitable for meetings of up to 50 people. There is already substantial growth in this market segment. By making their rooms appealing to companies who need high-quality venues, hotels can attract new clients and open up associated revenue streams, such as F&B.
Companies like Bizly now provide the apps needed to market and sell effectively into this niche area. The secret to success is the visibility that comes from working with the right technology partner. Change is in the air, and with this change comes opportunity!
Sources: Idc /BizBash / Tnooz / Chicago Tribune / Her – Consulting / CNBC / Tourism Insights / Ehotelier
About the author
Arianna O’Dell is the founder of Airlink Marketing, a digital agency that helps hotels, restaurants and travel destinations attract and retain clientele.