Republicans, Democrats and Inaugurations, Oh My!

Operating Tips for hoteliers during major, international city-wide events

Three cities will be the setting of major, international events this and next year.  Tampa, FL, Charlotte, NC and Washington, DC will have a microscope on their respective cities for the political conventions and inaugurations.

Tampa will host the Republican National Convention August 27-30, 2012.

Charlotte will host the Democratic National Convention September 3-6, 2012.

Washington D.C. will host the Inauguration in January 2013. 

Can’t the Presidential Inauguration be treated like any other major event?

Just ask seasoned hotelier Dan Jasinski, who is the General Manager of two DC area hotels in Silver Spring, MD, the Homewood Suites and Hampton Inn.  I did, and he says, if left unrestricted, his 239 guestrooms will be fully booked for the inauguration within two weeks of the election in November, with many having already been reserved just after the system opens for booking in late January 2012.  He’s quick to say the rate strategy must change throughout the year as they get closer to the big date.  In offering advice to hoteliers, Jasinski states, “A couple more revenue and rate strategy-related items to consider are the extended-stay occupancy percentage, group “pick up” and your regular, corporate clients.”

Expect and Plan for Cancellations

Both Republicans and Democrats will book early for the inauguration in 2013.  But what if their respective party doesn’t take the White House?  Most cancel their trip, including large groups.  Therefore, prepare for cancellations and write your contracts accordingly.  A well written group room’s contract will inform and prepare the guests and also protect the hotel.

In November 2008, when President Obama was elected, the hotels located in the city center of DC filled first.  They filled immediately with large groups, at a lower rate, then transient/leisure at a higher rate – a good plan.  The suburban DC hotels first accepted the higher rated transient/leisure rooms with expectations to fill the rest of their rooms with smaller groups, also a good plan.  All was fine until the economy continued its sharp decline in November, December and January of 2009.  Many of those big groups cancelled inside DC and moved their rooms to the lower rated suburban hotels, as far out as Dover, DE.  This opened up a huge void of guestrooms in downtown DC, and by the end of December, the guests profile had changed – the guests previously willing to pay high rates because they were location sensitive, were now cost sensitive and location didn’t matter as much.  It was a fun, chaotic time for DC area hoteliers. 

*Note – January 20^th lies on a Sunday in 2013, which means the actual Inauguration of the President for public view will be held on Monday, January 21^st, extending the weekend one extra night.  In the past, when January 20^th falls on a Sunday, U.S. Presidents have been officially sworn in during a private ceremony on the 20^th.  Plan accordingly.

 According to a Charlotte Observer article from February, 2011, (http://www.charlotteobserver.com/2011/02/01/2027540/charlotte-wins-2012-dem-convention.html) the “DNC” that starts on Labor Day 2012 is expected to generate more than $150 million in economic benefits. It will bring in more than 35,000 delegates and visitors as well as international attention to Charlotte.

 With the DNC and RND cities being selected 18-24 months in advance of the event, it allows the city’s political and business leaders to prepare and plan for this major event.  Also, it allows travelers the chance to plan.  Hotels and hospitality leaders start preparing from the day it’s announced.  With all this time to prepare, it would be a failed strategy to simply sell-out all the guest rooms at the highest rate possible for the dates of the event.

 Native Charlottean Clarke Allen, Founder and CEO of Charlotte Arrangements (http://www.charlottearrangements.com), a destination management company, says "You're leaving money on the table if you are just selling rates, dates, and spaces." Clarke continues, “An international event like the DNC offers you a chance to make incremental income by packaging your product with the local resources.  Whether you package by adding valuable shuttle transportation to area events or you bundle tickets to attractions, you can provide your guests with a great "Experience" while increasing your bottom line.”  Allen suggests contacting your local DMC (Destination Management Company) which can be found here, http://www.adme.org/dmc/directory.asp.  The local DMC can assist in putting together packages that include a host of amenities and options that will differentiate your property from the competition.

Of course, as with any large city-wide event, there is the question of how to manage the revenue.    As for rate strategy, David Love, General Manager of Uptown Chartlotte’s Residence Inn, is holding inventory for group opportunities 2-3 weeks before and 1-2 weeks after the main event as there will many contractors for the pre-convention services as well as post-convention services.

 I also spoke to Bob Morgan, President and CEO of the Charlotte Chamber of Commerce, who said, “Delivering customer satisfaction is not complicated.  You need to know your customer’s expectations are and then be intentional in exceeding them.  I would think that having staff on hand during the DNC who can answer basic questions – What’s happening when & where, directions on how to best to get there, the places not to miss, where to eat, etc. – will be critical.”  Meeting this request may be a regular scheduling task for a full service property, though may take some planning for hotels in the select service sector.

 I brought up this topic during a phone conversation with Bob Morrison, executive director of the Tampa-Hillsborough County Hotel Motel Association, whose city is expecting over 15,000 media and support members to visit for the August RNC.  He said it’s all about the guests.  He sees huge value in creating a “Welcome” package for first time visitors to the city.  He also suggested getting to know the food and beverage schedule of the convention center, or event venue.  If there is limited food available on one of the dates, then you can expect your restaurant to be busy.  Mr. Morrison said that the select service hotels will be used to house contractors and IT support people, which rarely get a chance to eat at the venue, so be prepared for them to frequent the complimentary breakfast buffet before heading to the event.

 The secret sauce is in the preparation.  London will be hosting the 2012 Summer Olympics in August.  If its perspective you desire, give some hoteliers a call overseas and they will offer up advice three years in the making.  If you’re thinking “big picture” and want to get involved in the selection process of these major events, I suggest contacting your local Chamber of Commerce or Convention and Visitors Bureau, which have “Host” committees dedicated to attracting major events such as the RND and DNC. 

 Good luck and have fun!