There are several good reasons for maximizing spending volumes with suppliers, and they’re not all financial. In lodging, buyers have long sought to combine transient travel and meetings procurement but internal and external hurdles have stymied efforts. However, with diligence and patience, there are ways to derive value.

That was the message from three travel management professionals speaking on the February edition of the Business Travel Executive Town Hall conducted live on LinkedIn. The three – Megin Dressel, travel manager at Keller North America, DRW global head of travel Kara Brayton, and Sean Parham, a longtime travel manager and currently a consultant – agreed that by bringing together transient and meetings, and maybe other types of travel, companies may improve the traveler experience, close the loop on billing, payments and risk management, and strengthen supplier relationships.

There are opportunities to wring out hard-dollar savings. According to HRS, a big advocate of convergence buying, an undisclosed number of its clients engaging in this approach during the last 18 months extracted an additional three percentage points of savings on group rates and two points on transient. Beyond the savings, astute negotiating can secure better terms, such as flexible cancellation policies, upgraded rooms or club access for meeting attendees.

“We’d love to see better rates, but that’s not my primary objective,” Dressel said. The main goal is strong supplier partnerships that allow for “flexibility when flexibility is needed,” a trouble-free traveler experience and successful events.

Convergence also brings expertise and consistency to contracting.

Dozens of contracts between lots of hotels and different parts of an organization “is just not manageable in today’s business environment,” said Dressel. “Business holders, EAs and sometimes vice presidents were signing their own contracts. They know nothing about what goes into a meeting contract. It was time for the travel department to step in and try to solidify that relationship.”

Parham referenced poor performance against transient hotel contract goals at a previous employer due to COVID. But thanks to the many meetings the employer was still conducting, “we were able to work with the hotels to keep these transient contracts in place,” he said.

For Brayton, the objective is a “seamless” and consistent employee experience, whether booking for transient travel or a meeting. That means making existing tech capable of handling multiple use cases. “Sometimes it can feel like tool overload and our travelers don’t need another tool,” she said. “We want to try to solve for things within the products that they’re already using.”

Roadblocks & Detours

That’s easier said than done. There’s resistance from travelers who don’t understand why the group rate may be higher than a transient rate (if they can even access the group rate through the designated tool), why cancellation policies are different and why it’s difficult to make changes.

“When they see that rate disparity, they start booking outside of the group block, we start losing control, and it snowballs,” Parham said. He pointed out that some TMC transaction fees for meeting bookings are higher than those travelers incur for transient travel.

Then there are loyalty programs. When group bookings don’t reward individual travelers with points, those travelers might rebel.

Dressel said employees’ loyalty points accrual shouldn’t depend on the form of payment. Whether with individual corporate cards or direct billing, the company is paying. Furthermore, direct billing is easier for the hotel than charging each room separately, but in those cases, hotels withhold points from individual travelers. “Why are they disincentivizing my travelers?” Dressel asked. “It makes no sense. It’s our job to make this easy for them to do the right thing, and when the hotels don’t step up and help us with that, it just causes problems everywhere,” she said.

“My people are geotechnical engineers,” she explained. “They are highly trained people, but it’s not their job to know what an attrition clause means, or any of those finite details in a meeting contract. Those are entirely outside their skill set. The challenge for us is, No. 1, helping them understand why they need to trust travel.”

Everyone needs to buy in. Executive admins, those in marketing and others in an organization may, despite a lack of proficiency, view meetings as their own fiefdoms. The C-suite needs to back a central approach. “It’s not about control,” said Brayton. “For us, it’s more about alignment, becoming more strategic and adding more value.”

A house in order doesn’t mean much if the supplier’s ability or willingness to address convergence is limited. Hotel brands, properties and ownership groups usually have separate departments for meetings and transient. With that structural separation, customers are put in silos and coordination is often lacking.

Some hotel brands “do this moderately well,” recognizing the overall worth of Keller’s meetings, transient and crew travel volumes, according to Dressel. “Others are still struggling with it,” she said. “We could have many years of a relationship with a property on the transient side, and we come to a meeting, and it’s like they’ve never met us before.”

Steering Toward Solutions

The panel had several suggestions for the path foward.

For Keller North America, a first step was mandating that meeting sourcing use designated procedures and centralized payment. “It was the only way we could really get our arms around what was happening in the business,” Dressel said. “We were surprised by what the total spend was; probably most companies are. It was almost 75 percent bigger than what we thought when I was brought in to start this program. We were able to take that spend back to the brand level and have those discussions.”

To make the case to senior management, explain the value and the expected return. Play up the risk angle. Describe contractual situations that went south and could have been avoided. Talk about the internal efficiencies.

“You’re selling to the stakeholders – legal, procurement, the accounts payable team, maybe an events team, the administrative assistants who book and plan all the meetings,” Parham said. “If you don’t have somebody at the C-suite level saying ‘you need to do this because X, Y and Z,’ then you’re going to have to make up that narrative. Show them you can save the company money, but also provide a lot of time savings because you’re going to take care of this, this and this.”

Travelers don’t need to know about contract nuances, but they want a good reason why they’re seeing higher room rates for a meeting than for other business trips, and why they’re not getting their loyalty points. Education is important. The same goes for those planning meetings on their own. Instead of hundreds of thousands of points accrued from meeting purchases going to those individuals, companies can explain the better uses for those rewards, including future company travel or charitable donations.

On the supplier side, individual properties and independent hotels may be more willing and able than brands to orchestrate. But buyers want brands to find solutions, too.

According to Brayton, DRW tries to insist that hotels write into meeting contracts that points can be allocated back to attendees. “Some of our partners have been more flexible because they have the relationship on the transient side and we’ve built up that proven trust and history,” she said. “I’m seeing it become more of an accepted practice, but there’s definitely room for improvement.”

Buyers also want brands to better train their less-seasoned people on sales mechanics and relationship selling. Unified supplier tech platforms to ease data aggregation would help, as would emphasizing coordination between brands’ transient and meetings teams.

“If we already have centralized billing with a specific property or even just contacts that we know that we can work with really well on the transient side, if we have trusted partners that we know can execute, we see that as a win-win to leverage it on the events or meeting side,” Brayton said.

Visit businesstravelexecutive.com to listen to this complete LinkedIn Audio session and find details about the next BTE Town Hall.