Each year, public and private organizations send thousands of employees to meetings held at hotels, motels, convention centres, conference centres, and resorts.
These meetings represent a multimillion-dollar business in Canada and the United States. Airport hotels such as the Marriott Houston Hobby, introduced at the beginning of this chapter, are a good example of the venues typically selected for these meetings The Marriott Houston Hobby is conveniently located only one mile from the Hobby Airport in Houston, Texas. It has a competitive edge over its competition because it lies outside of the flight path. In addition to convenience and tranquility, the goal of the hotel is to provide guests with outstanding meeting and conference services. The hotel offers 235 deluxe guest rooms, 52 suites, 13 soundproof meeting rooms with state-of-the-art audiovisual technology, and continuous break service that can accommodate any agenda. Lavish customized meal events from a wide variety of international cuisines are a specialty of the Marriott Houston Hobby.
In an ideal situation, Heather Ramsey, corporate catering manager at the hotel, tries to get prospects out for an inspection of the property. Prospects might also sample hors d’oeuvres or lunch during a site tour. This tour, in some ways, fulfills the function of a sales demonstration.
Throughout the tour, Heather describes special amenities and services offered by the hotel. She also uses this time to get better acquainted with the needs of the prospect. Once the tour is complete, she escorts the prospect back to her office and completes the needs assessment. Next, she prepares a detailed sales proposal or, in some cases, a contract. The proposal needs to contain accurate and complete facts because when signed, it becomes a legally enforceable sales contract.
For big events, the sales proposal is rarely accepted without modification. Professional meeting planners are experienced negotiators and press hard for concessions.
Some have completed training programs developed for professional buyers. The concessions requested may include a lower guest room rate, lower meal costs, complimentary suites, or a complimentary event such as a wine and cheese reception. It might take as long as two months to reach an agreement with sophisticated buyers.
Of course, some buyer resistance is not easily identified.
Heather Ramsey says that she follows four steps in dealing with buyer concerns:
1. Identify the actual needs of the prospects. To achieve win-win deals, Heather spends time asking specific questions about the customer’s needs, such as the audience for the event, the size and timing of the event, and the customer’s budget. The prospects normally focus on negotiating details of the food menu, group rates for room rental, and audiovisual facilities.
2. Locate the resistance. Some prospects are reluctant to accept the offer, but the reason may be unclear.
Heather has discovered that asking open-ended questions goes a long way in understanding the actual resistance. Once the reason for resistance is uncovered, Heather knows how to deal with it.
3. Clarify the resistance. If a prospect says, “I like your facilities, but your prices are a little high,” then the salesperson must clarify the meaning of this objection.
Is the prospect seeking a major price concession or a small price concession?
4. Overcome the objection. Heather says, “You must be prepared for negotiations by understanding both your flexibility and the customer’s needs.” The hotel must earn a profit or publicity, so concessions can be made only after careful consideration of the bottom line and other intangible benefits.
Heather has discovered that the best way to negotiate buyer concerns is to make sure both the prospect and the resort feel like winners once the negotiations are finalized.
If either party feels like a loser, a long-term relationship will not be possible. During peak seasons, Heather might also need to negotiate the schedule of events with prospects to minimize opportunity costs for the hotel while keeping the customers happy by offering off-season concessions.
Questions
1. If you were selling convention services for a hotel located in a large city, what types of buyer concerns would you expect from a new prospect?
2. Let us assume that you are representing the Marriott Houston Hobby and you are meeting with a new prospect at the hotel for a site tour. This prospect is planning to host an important event for 200 guests at your hotel. List the questions that you might ask the prospect to identify her actual needs. In doing so, be specific about the alternatives (e.g., high-end, medium, or regular packages) you can offer and the order you present them.
3. If you meet with a professional buyer who is trained in negotiation, what tactics can you expect the person to use? How would you respond to each of these tactics?
4. What subtle questions will you ask to ascertain that the negotiator is the decision maker without hurting her feelings? What actions will you take if you find out she is not the decision maker?