[Case Study] Hotel at Auburn University Increases Group Business Profits

The Hotel at Auburn University Profile

  • Established – 1989
  • Headquarters – Auburn, Alabama
  • Property Location – 241 South College Street
  • Rooms – 236 guest rooms, including 11 suites
  • Amenities – Three dining spaces, 22,000 square feet of meeting space
  • Rainmaker Products Used – guestrev and grouprev

lobby of the Auburn hotel

Executive Summary

The Hotel at Auburn University & Dixon Conference Center has priced its rooms based on total guest value using The Rainmaker Group’s guestrev product for more than one year, but with group business claiming a high percentage of its overall mix, the hotel also needed a solution to optimally price group bids. After weighing options in a wide range of price points and capabilities, the hotel chose Rainmaker’s grouprev solution, and has thus far experienced seamless integration; substantial growth in occupancy, rate and RevPAR; and a quicker-than-ever response to RFPs.

Based on the February 2016 STAR report, following three months of implementation, The Hotel at Auburn University saw:

  • 101 percent increase of rate
  • 170.8 percent increase in Group RevPAR
  • 4 percent growth in year-over-year occupancy

Challenges

An integral part of Auburn University, with 45 percent of its business hailing from groups, the hotel prioritized finding a group pricing tool that hit the sweet spot of capabilities versus cost, something Director of Sales and Marketing Todd Scholl calls “the Goldilocks syndrome.” “As a smaller hotel without the huge financial backing of a national flag, we need a great product with a value quotient that provides strong ROI without being considered ‘economy’ in terms of capability,” he said.

Scholl also recognizes that with the market growing, The Hotel at Auburn University needs to look at an entire booking instead of just room contribution. The hotel provides more than 22,000 square feet of meeting space and extensive dining options, making the potential total revenue contribution from a group critical in determining which ones to pursue.

For much of the year, the hotel’s university location attracts walk-in group business consisting of sports teams, associations, and local organizations and corporations. Its challenge, then, is to stay competitive and maximize efficiencies to capture as much business as possible when school is out of session. Explained Scholl, “The previous product we used proved to be very complicated, resulting in a lot of role playing and onsite handholding from the provider. It wasted a lot of time.”

Effective Implementation and Instruction

“After a hiccup-free implementation process, we found grouprev to be extremely user-friendly, and saw immediate results,” said Kyle Yarbrough, The Hotel at Auburn University’s revenue manager. The team was particularly pleased with the simple, intuitive interface that hooked up perfectly with the existing Delphi systems.

The instruction from Rainmaker at the early stages of implementation was imperative, especially for Yarbrough. “The guidance from the Rainmaker team has been phenomenal from the beginning. They taught me how grouprev gives a range between floor, optimal and ceiling rates, and how I can effectively communicate those numbers to the sales team.”

Yarbrough has observed that rates provided by grouprev can sometimes differ greatly from what the sales team would instinctively recommend. “Sometimes the sales manager has the correct rate in mind, and sometimes grouprev puts out a higher rate,” said Yarbrough. “The discussion isn’t focused on why the number is wrong. It’s about what we can do to meet in the middle. Using grouprev keeps us all on the same page.”

events hall at the Hotel at Auburn

Results, Return on Investment and Future Plans

A year-over-year comparison of three key indicators—rate, occupancy and RevPAR—for February 2016 vs. February 2015 underscores grouprev’s immediate impact. In 2015, The Hotel at Auburn University reaped the benefits of a single conference event that lasted for 10 days, yielding revenue in the six figures. One year later, with school out on break and no conferences scheduled, the hotel still managed to increase its occupancy by 34 percent, with a group RevPAR Index of 170.8.

In the same period, The Hotel at Auburn University drove higher room occupancy while also winning the rate war. Despite competition from nearby full-service resorts, the hotel hit a rate percentage of 101.

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Photo credit: Auburn University