A lead comes in to the sales department! The group needs rooms, or rooms + meeting space, or rooms + meeting space + catering. Best to answer quickly and win the business, right? So Sales prepares a quote… and voila! Sounds simple, right? But not realistic.
Answering RFPs (Requests for Proposals) is complicated, time-consuming, and challenging; it requires coordination between Revenue Management and Sales & Catering. Meeting rooms and hotel rooms have independent fixed capacities. They also have the opportunity to sell out independently of the other. A good piece of business to sales and catering might not appear so attractive to revenue management, and vice versa. This is a classic source of friction in hotels. Moreover, this friction costs the hotel time and money.
Handling groups is not easy… but lead scoring can make it easier. Every hotel should be trying to win the right blend of business, in order to maximize its overall profit. It can be done, but first we have to understand the challenges involved in evaluating potential business.
The Sales Manager’s Dilemma
When a group business RFP arrives on a sales manager’s desk, it typically includes a set of dates, a number of rooms, and some meeting room requirements. The process of responding to this single bid already constitutes a considerable amount of work. The manager has to find out if the meeting rooms are available on those dates. Then it’s time to find out whether there are sufficient hotel rooms available to accommodate the group. But it's more complicated than just availability at a given time. Should the rooms be made available? What are the prevailing market and transient conditions?
Now imagine that there are several RFPs, and that each meeting planner is throwing out multiple date options. That escalated quickly!
Prioritize Groups or Perish
Responding to group business has been a tricky process for many years. As if making these complicated decisions quickly wasn’t hard enough before, a new level of difficulty has been added, due to the rise of the group business intermediaries. They have made it easier than ever for group planners to submit multiple group business RFPs to multiple hotels. The workload on sales managers has now multiplied. You have to prioritize or perish.
To prioritize groups, you must understand their relative attractiveness to your hotel on given dates. Profiting from your group business depends partly on the characteristics of the group itself, but mostly on what we expect to happen at the hotel over that date range.
Example: For transient business, this would mean that we have to forecast demand for rooms on the affected nights. But in the case of group business, that is not enough. Groups often book years prior to arrival, meaning we have to factor in how many group rooms we expect to have booked this far in advance of the arrival date.
Lead Scoring: Time For Automation
It’s no longer practical or effective to expect sales and revenue managers to come up with multiple quotes for multiple dates using spreadsheets. Lead scoring technology is changing the way hoteliers manage group business leads. Lead scoring tools:
- Automatically score and prioritize the group business leads in your sales funnel based on size, profit, fit and availability
- Automatically configure alternate date options for leads based on your availability
- Calculate and anticipate group business pacing compared to the previous year and your property’s historical average
Lead scoring is still a relatively new process for hotels. But its benefits extend beyond simply allowing you to prioritize leads. You want to win the business that delivers the highest revenue for your hotel. Lead scoring crunches the numbers for you, freeing up your sales managers to:
- Respond First, Respond Often: The first responder usually wins. Aim to increase the number of bids for which you submit a response.
- Convert Better: Close more deals based on accurate and attractive pricing.
- Be Thorough: High-quality responses will close better, because quality instills confidence in the mind of the meeting planner.
- Make Counter Offers: Many successful group bids are won with alternate dates that are counter-offered by the hotel.
It’s time to take advantage of sophisticated automated systems that crunch the data for you. Make your sales team more successful, and your group business more profitable.
Your team is smart, but they need help. Using tools like grouprev with integrated lead scoring can help them make informed decisions about every piece of group business. It is time for group RM to catch up to its transient counterpart. Contact us to learn more about optimizing group revenue management at your organization.
Prioritize, Automate, and Win!