Conference Centers

Conference centers aren't on many planners' radars, either because they don't know about conference centers, harbor confusion about them, or think they're too expensive to actually book.

Nationwide, conference center managers and sellers have acknowledged these misperceptions and they're moving to change them. Among the strategies to do so: offer more flexibility on complete meeting package (CMP) pricing to attract new customers and work on improving brand definition.


The CMP Advantage

Conference center managers and sellers maintain that while they welcome some individual business guests and even leisure guests over weekends, their core weekday business is meetings. That service focus, plus quality meetings-equipped facilities (see sidebar, page 16) for events give conference centers an edge over most hotels in providing groups and planners everything they need to capture meetings objectives. Coverage of this one-stop shopping is best achieved, they say, with CMP pricing. Most packages include guest room, three meals, meeting space, continuous breaks during the meeting schedule, and standard audiovisual services, all for one generally lower price per person compared with services and facilities in a hotel.

CMP pricing is a win-win for groups and conference centers, contends the conference center industry's standard bearer, the St. Louis-based International Association of Conference Centers (IACC). Package pricing keeps groups and revenues on-site, and it provides significant advantages for groups beyond favorable apples-to-apples cost comparisons with hotels, says IACC Executive Vice President Tom Bolman, CAE.

"Packaging eliminates a myriad of decisions and details meeting professionals—and especially harried part-time planners whose expertise is often limited—would otherwise have to take care of," he says. "It eliminates the need for the customer to deal with various departments on the property, bouncing back and forth among several to lock in all the necessary details. This streamlines advance planning and billing reconciliation. Billing is based on a complete, pre-negotiated package price per attendee that yields no unpleasant surprises at the conclusion of the meeting.

"Hotels can bundle a package, too," he continues, "but very few hotels really have the quality facilities and meetings-focused services that conference centers offer. They just don't have the physical amenities, like ergonomic chairs and upgraded tech. A hotel must gear its resources toward a variety of markets—transient guests, restaurants, meetings, incentives, and leisure guests."

Philadelphia-based David Arnold, PKF Consulting's eastern regional chief executive, agrees with Bolman.

"Hotels simply can't do what conference centers do—give superior services to the midsize group market," he says. "They have to serve many different traveler markets, not just meetings groups. Conference centers provide 24-hour meeting space, continuous breakout stations, buffet dining—all those things hotels don't usually have. To have the full conference center experience, you get guest rooms with the meetings services, so it's appropriate to do the package approach."


CMP Modified

But what if the group doesn't want to eat every meal on site for a three- or four-day meeting? Can't the contracting center give credit if attendees prefer to go off-site for dinner on the third night? These are two examples of the pushback questions from buyers that led Dolce International to announce early in 2005 that it would "unbundle" its CMP. Others in the industry are now following that lead, especially for first-time customers and for planners that select weekends and shoulder dates.

"We found that a lot of customers don't use conference centers because they don't like the CMP pricing," says Andy Dolce, chairman and CEO of Montvale, N.J.-based Dolce International. "The pricing issue sometimes comes from procurement people who have become major players in looking at net bottom pricing, so we came up with some flexibility for our salespeople to introduce new customers to our concept."

Dolce and others at times quote EP (European Plan)—room rate—and then add what the customer wants in a meetings package, all priced out. For regular customers who request to do special dining off-site or to bring in elaborate audiovisual equipment, Dolce will often sell items a la carte. Dolce offers anyone an interactive calculator on its site (www.dolce .com) to do comparison shopping between venues they are considering.

Brian Stevens, president and founder of Conference Direct, an independent planning company in Los Angeles, has also seen customer pushback on CMP pricing.

"Some clients don't like being forced to pay for a meal they don't use, even if it's a bargain," he says. "Some conference centers say the CMP is all they offer, while others will bust it up. Because many are in isolated areas, attendees can't just walk around the corner to a selection of restaurants. They are a bit like cruise ships in that the food is 'free' because there's no place else to go. At resorts like The Greenbrier you can't not have dinner included. It's the same idea."

At Lansdowne Resort in Northern Virginia, where groups can purchase golf, swimming and spa components on top of the meetings package, Scott Flexman, director of sales and marketing, says 85 percent of his group business still utilizes a standard CMP. But a modified approach is sometimes appropriate, he adds.

"We are becoming more flexible in off-season and weekends, especially with associations," he says. "We try to put them on a modified CMP so it doesn't include all the components if they don't need them. We still believe, however, that the CMP is best for most groups because it includes everything they need, yet it requires so little logistics planning for the client. For example, the continuous breaks we include for the duration of the meetings are so convenient—staff manages them all day, and there's no set time for them to begin and end. With hotels, this usually costs extra."

When groups request dining options that would take them off-site or to a different venue other than the conference center dining facility, some conference centers offer meal service at another on-site venue, such as a golf clubhouse, or by the pool.

Sherry Awbrey, associate director of sales for Wyndham Peachtree Conference Center near Atlanta's international airport, says her groups can choose carousel dining.

"We work with three restaurants in Peachtree City, and we give attendees a gift card to go off-site," she explains.

Apparently, flexibility with dining and other components in the property's CMP package is helping attract more business, Awbrey says, because an early 2005 drop-off has been replaced by an upswing in demand for the CMP pricing, especially from associations and SMERF groups.


Brand Confusion

While some conference centers are encouraged by new flexibility on CMP pricing, others see a larger problem—that of brand education. Some say tinkering with the standard CMP frustrates buyers who aren't familiar with the conference center product. They become confused in the hands of some salespeople and walk away during negotiations.

"Competing against hotels is complicated for us," says Michael Swyney, director of sales and marketing at Pacific Palms Conference Resort in Industry Hills, Calif. "There's always a struggle with CMP—many people don't understand it and don't want to understand it, so conference center salespeople must be very creative to keep the group on-site, which is always our objective. Many centers are struggling because they don't have educated and seasoned salespeople who know how to negotiate CMP flexibility. Most salespeople at conference centers have hotel sales experience, but we hire sales consultants who will understand that offering more services—such as an awesome themed evening event—will keep groups on-property."

In Michigan, Rick Schmitt, vice president of sales for Crystal Mountain resort in Thompsonville, agrees with Swyney and also feels the lack of brand understanding among buyers.

"Our biggest competitors are northern Michigan resorts that don't have true conference centers," he says. "The pricing issue is a struggle, and we always ask the buyer if they understand the conference center commitment to superior meeting facilities, like soundproof rooms. When we can go head-to-head with a competing venue, the package pricing compares favorably."

Buyers like planner and industry educator Bonnie Walsh of Bonnie Walsh Associates Ltd., in Charlotte, N.C., who do understand and use conference centers, are often enthusiastic about them and eager to educate their peers.

"Conference centers are fabulous places to have meetings, especially if learning is the objective," she says. "When I teach planners I always talk about how conference centers differ from hotels and why they are valuable. A major component of my business is education, and conference centers are designed to be a learning environment—usually in a pretty area with some isolation. You have everything you need and all the costs are included up front. Food is healthier at conference centers, with more options than you get in hotels, and they cost less.

"Also, centers are totally focused on meetings," she continues. "I think confusion about pricing is ignorance, and conference centers need to do a better job of educating their customers. Sure, I negotiate some flexibility sometimes—like one night out of four off-site, and they will credit me. Or maybe I'll add some AV or flip charts I need that aren't package standards."

Walsh is the kind of loyal conference center customer the industry would like to cultivate, but it appears more than CMP pricing flexibility is needed to accomplish the goal.