Please don’t go! How to retain repeat group business

We were in our third year of hosting the annual sales kickoff meeting for a consumer goods company, when my client explained on the phone: “Kat, I have been asked to look for new venue options for the year to come. We love working with you and your hotel, but we just want a new experience, something different.” There they were, the scariest words when coming from a loyal, regular customer: NEW EXPERIENCE! We agreed for my client to shop around in the market and to reconvene a week later. I immediately alerted our team and we started working on a group retention strategy. 

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We knew that finding a new group to fill this particular week in January would be hard to do. Your chances of closing a sale with a new prospect are around 13%, whereas closing a deal with a repeat guest can be as high as 65%! Also, working with your existing clientele is, in all industries, more efficient and cost-effective than constantly trying to find new business. This article in the Harvard Business Review explains that, depending on your industry, it is anywhere between 5 to 25 more expensive to find a new customer.

Another concern of ours was the revenue from total consumption. A satisfied, repeat customer is more likely to spend more overall. Based on the trustworthy relationship you have built over previous years, a repeat client is more open to suggestions from your Conference Services team and might just go for the fresh smoothie station, live cooking and a higher quality main course choice, rather than the more standard menu choices. 

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To build your “brick wall” between your client and your competitors, here are some suggestions of what you can do:

1. Understand their expectations. Really, really well. 

Exactly what part of the group program would your client like to revamp? The layout of your meeting rooms may still work perfectly for your group, but are some attendees getting a little bored of the guest room product? Maybe it’s the Gala Dinner that the group doesn’t want to repeat in the same ballroom yet again, but all other components work perfectly? Maybe it’s your contract terms that create an obstacle? Before setting your gears in motion, make sure you know what experience your client is ideally looking for. 

2. Re-invent the experience.

It’s time to show flexibility in your offering - and I don’t mean rate! Pull in all relevant department heads to discuss how you can create a new experience for your client - Front Office, Club Lounge, the Spa and Gym, as well as your culinary team can be extremely helpful resources in brainstorming how to do things differently for your group at unchanged costs to the client. Consider this:

  • Event Location: 

Are you able to move any component of the program out of the meeting floor and into a restaurant space or an outdoor venue? Showing flexibility in your food & beverage buyout minimums for your restaurants can be a winning factor. Is there an outdoor area that could be used, possibly with a tent or canopy setup to prepare for weather? Using outdoor areas is extremely popular, so put some real thought into this! 

  • Activities:

More than ever, event organizers, like hoteliers, focus on creating memorable moments for their meeting attendees. Is there an activity that your hotel could offer? Yoga stretches during meeting breaks, mini massages, cooking events in the restaurant kitchen or cheese tastings can be great fun for a group at relatively low cost to your hotel. When working with The Ritz-Carlton, my clients quite often asked for our General Manager to speak to their group about The Ritz-Carlton service culture. While our company policy didn't always allow for that, we were able to arrange other behind the scene looks. For one group program, we invited the Executives of the company to join our "line-up" a few days before their meeting. They took photos and referred to our property's service levels during their welcome speech. What a win-win! They gained fun content for their speech and we received free advertisement. 

  • Addition of a Hospitality Suite:

A hospitality Suite adds great value to a meeting. It is a perfect space for on-on-one meetings, to review upcoming presentations or invite a small group of top performers for a drink with the CEO. This could be a great draw and add a wow factor to the program! Adding a Suite does come at a serious cost to the hotel, so rather than just offering this at no charge, consider a lower rate or free addition of beverages to the Suite.

  • Contract terms and conditions

Is the decision maker of your program motivated by more loyalty program points for personal use or more benefits to the company? Would your group benefit from a different payment or cancellation schedule? Is your group risk averse and would prefer a longer cancellation window or more flexible attrition? Demonstrate to your customer exactly what value your concessions represent. Create a document that shows what your customer saves by choosing your property. Also show costs in case of full cancellation. The Executive team of your client will really appreciate seeing this!

  • Multi-year contract

The advantage of a multi-year contract to your client is a fixed rate increase, independent from market developments, and having secured the space, even if a more profitable group reaches out to the hotel. If you have not yet discussed this with your client, you should do so now!

3. Build more relationships

In my scenario above, someone in my client’s organization had asked my main contact to look for more options. This meant that we had not spent enough time getting to know the Executive Team to make sure they were positive advocates for our hotel. But not only C-level management has an influence on which hotel will be chosen for the conference. Attendees and third-party providers chosen by your customer (such as for Audio-Visual or Event decoration) also share their experiences with the organizer. A smooth execution and an amicable relationship with third-parties during set-up stage, for example, can be a huge plus!

4. Know your competition

I remember a frustrating client conversation, where the client kept on comparing The Ritz-Carlton to two small boutique hotels in Toronto. By all means these hotels were lovely properties, but the level of staff training, hotel features, culinary options and level of staffing were simply no comparison. Without meaning any harm, clients often compare hotels based on rates and space. In proposal phase customers often forget that smooth, professional planning and execution of the meeting and leaving the meeting attendees with wonderful memories is worth paying more for.   To help the client compare more than only rates and space, drawing up a comparison chart between you and your competition may be helpful. Next to meeting flow and hotel features, make sure to include differences in service. How seasoned is the team? A comparison may show your client that a move to a different hotel does not always mean a better experience. 

This is just an example - include more categories to prompt your client to consider more than only rates! 

This is just an example - include more categories to prompt your client to consider more than only rates! 

I hope this article inspires you to think about your most valuable, annual group programs and will help you to keep them for many years to come. With a good retention strategy, your client should have no reason to look for another hotel option any time soon! Here's one last fact to think about: Increasing customer retention rates by only 5% increases profits anywhere from 25-95%