Since the advent of online housing nearly five years ago, e-mail forms that dumped reservationsinto a manual data entry system have been replaced by real-time databases that access live hotel inventory. The technology suppliers promise this can cut costs, increase revenues and improve customer service for all parties involved. 

How? When attendees and exhibitors get the rooms they want, there are fewer changes and last-minute cancellations, resulting in better block management, less attrition and more accurate histories for future negotiations. 

And because attendees enter their own data, and that data is transferred directly to hotels, data re-entry is eliminated. 

For hotels, the potential savings is enormous. Passkey.com, Quincy, MA, provider of Internet-based group housing, registration and travel services, estimates annual attrition costs can be in the six figures for a single property with 1,000 rooms. For show managers, moving housing to a real-time system could mean operational savings of up to 500 percent, according to b-there.com, the Westport, CT-based provider of online event management solutions. 

According to EXPO’s 2000 Show Management Web Survey, about 55 percent of show Web sites offer online hotel reservations to attendees. As more shows take housing online, the challenge will be to set realistic expectations. “Sometimes vendors lead you to believe things are possible that aren’t here yet,” says Cindy Stark, SIGGRAPH Convention Manager for Smith Bucklin Associates, Chicago. “It’s honest excitement on their part. But if you’re someone like me, who’s chomping at the bit for a better way to do things, you may think you can do everything they’re talking about. But, unfortunately, that’s not always the case.”

What’s possible today

SIGGRAPH went with Passkey.com in 1998, when 25 percent of the 7,900 attendee and exhibitor hotel reservations were made online, thanks to the technology-savvy computer graphics crowd. “There were a lot of things to be worked out, but we knew that going in,” Stark says. The next year, SIGGRAPH signed a three-year contract with Travel Technology Group, Chicago. For 
SIGGRAPH 2000, July 23–28, 2000, in New Orleans, 34 percent of reservations were made online. 

Now that the system has matured, Stark says the benefits are real. “From an attendee standpoint, they get instant notification about their housing. They don’t have to wait for the hotel to contact them,” Stark says. “From show management’s standpoint, the more people who use the online system, the quicker you have a better feel for where your housing numbers stand. From the hotel’s standpoint, they have access to this information, so they can go online and see on a day-by-day basis, how their hotel is picking up.”

Stark actively uses real-time reports to project housing needs before the cut-off date. Now, instead of “running scared” and adding a hotel prematurely, she can tweak the block. “What we’ve found is that hotels tend to work with us much more closely on adjusting individual days. It’s made our relationship with hotels much smoother.”

This is the scenario advocates envisioned would squeeze costs out of the system. RogerParadis, President and CEO of Passkey.com, cites statistics based on more than 500 events averaging 2,000 attendees each. Passkey charges $4 per online reservation, or $9 per reservation with the call center option, plus a $25 fee for cancellations made prior to the cut-off date. 

“Without Passkey, attrition is traditionally 12.5 percent,” he says. “With Passkey, and without the cancellation fee, we’ve driven that to zero, because some people drop off and others come on. The hotel can take control of the Web site and 800 number and keep the distribution channel open. With the cancellation fee, if you have 100 names at cut-off, you have 111 when the meeting opens.”

With all parties accessing a real-time database, accuracy also improves. “When hotels have to re-input rooming lists into their property management systems (PMS), they have a 15 percent error rate,” Paradis says. “We have a 99 percent accuracy factor.” 

As a self-serve system, online housing reduces menial and repetitive tasks that run up costs. “There is no doubt that an Internet-based reservation system is dramatically cheaper from a service point of view than a traditional reservation system,” says Peggy Lee, CEO and Founder ofb-there.com, which charges a $2,500 setup fee and $5.75 per transaction — the base price before volume discounts. 

In an offline system, Lee says it takes multiple phone, fax and e-mail contacts to finalize a reservation, because 40 percent of all reservations are changed. The savings for a citywide program come when attendees who make their own reservations online are satisfied with their room assignment and require no further contact. 

What’s coming tomorrow

Compelling facts and figures aside, there are a few kinks in the system. Cleveland, OH-basedConferon, a Passkey.com customer, has found the economies of scale for online housing don’t kick in for groups less than 1,000. “Because of the fixed startup costs of setting up the database, policies and procedures, and enabling transactions on the Web, it’s a major obstacle for small meetings,” says David Lutz, Executive Vice President. 

And despite vendor claims of more accurate histories, show managers still depend upon the hotels for their post-show reports. “Passkey or any other system can only give you rooms that were reserved, not occupied. The rest has to come from the hotel,” Lutz says.

Integration with hotels seems to be the greatest hurdle ahead. Vendors are working with select properties to integrate their systems, but it’s not here yet. For example, only about 40 percent of all Passkey reservations are input directly into hotel systems. “We’re moving the Passkey shut-off date closer and closer to the attendee arrival time. As soon as shut-off happens at the same time, reconciliation of the housing records will be done in the Passkey system,” Paradis says. 

Privacy issues make reconciling records problematic, but b-there. com’s Lee says that’s her ultimate goal. “Our plan is to have a registration/in-house reconciliation report. Once we have full integration with the hotels, we can get feedback on the actual pick-up and see whowent outside the block.” When 
will that time come? Expect progress by midyear.

Cathy Chatfield-Taylor writes about technology solutions for the meeting, convention and exposition industry. She can be reached via e-mail atcathy@cc-tunlimited.com