The Potential of Using Meeting Space Booking Platform in Egyptian Five-star Hotels
Dr. Ashraf Tag-Eldeen
Faculty of Tourism & Hotels, Alexandria University, Egypt
Abstract
The objective of this research paper is to investigate the potential of using meeting space online booking in Egyptian five-star hotels. As online-room booking is booming and has proved to be effective and profitable, the tactic has extended to other hotel facilities, inter alia, meeting spaces. The methodology of the research employed an online survey with a purposeful sample of 15 event management managers/sales executives from five-star Egyptian hotel operations. The outcome of the research has provided evidence for the necessity of introducing Meeting Space Portals access to customers of Egyptian hotel operations as a strategy to boost the sales of meeting facilities. It also explored the challenges facing the marketing mix of this particular service channel in the Egyptian meeting space/event management market.
Key Words: meeting spaces, online booking, event management, Egyptian hotels.
- INTRODUCTION
During the last two decades, there has been a growing rise of online platforms for various products/services. This booming demand was very much encouraged by a variety of reasons. These reasons include, inter alia, changing customer behavior and purchasing patterns, technology development and better efficiency and promptness (Zhu and Zhang, 2010).
The hospitality industry is not an exception to the rule. The service has started with online booking of rooms via authorized agents or own hospitality websites. This approach proved to be successful and profitable enhancing the yield of room sales and providing flexibility and on-the-spot sales transaction (Gavilan, Avello and Martinez-Navarro, 2018).
During the last few years, business pioneers initiated online platforms to book small meeting spaces. Good examples of such venues include LiquidSpace, Breather, PivotDesk, WeWork, Bizly, SpaceBase and Seats2meet. The ultimate goal of such venues was designed primarily to avoid the hassle of manual request-for-proposal (RFP) by providing instant direct boking capability with non-negotiable lowest quote guarantee (Skift Report, 2017a and 2017b).
Recently, many customers are not any more interested in using RFP for many reasons. It is very time-consuming to get the quote, negotiate the price and further documenting the deal. However, business clients are demanding added customization i.e. instant messaging and feedback for specific/particular services (Getz and Page, 2016).
According to Dickinger and Mazanec (2008), the process of booking a private dining room or hotel meeting space for a small corporate group can sometimes require almost as many back-and-forth emails and lengthy negotiations between the venue and customer as a larger conference. The process might begin with searching multiple hotel and event venue websites, followed by emails to determine rate and availability, and then there’s the whole request-for-proposal (RFP) process to consider different bids. All of that requires an excessive amount of time, waiting, delays, stress, and expense to organize a 90-minute meal (Spencer, 2002).
- LITERATURE REVIEW
There is no doubt that the changing landscape for meeting/events business has become crucial. Appealing to multiple generations of meeting attendees and millennials is a key for success. Adhering to the needs of these segments is a must. Hotel operations are facing intense competition for customers, intensified by oversupply, an increasingly fragmented market and consumer demand for services to be provided across every channel (Getz, 2008; Shone and Parry, 2004; Wood, 2009).
Initiatives have been made by some governmental bodies in some European countries to encourage and support the hospitality industry to take a real step toward the use of meeting space portals, i.e. The German Convention Bureau catalogue of criteria (German Convention Bureau, 2016). However, there are some aspects that need to be investigated within the course of offering the meeting space booking platform for instance, technology in place and customization of the product/service. While these issues look like traditional aspects within the marketing and sales context. These aspects still need to be looked at sensibly (Göll and Evers-Wölk, 2014).
While advances in technology specifically designed for meetings and events continues to evolve. The role of technology has dramatically changed the overall competitive business environment (Eraqi, 2006). The technology has also provided the opportunity to upload floor plans, brochures, menus, and anything else to provide as much detail as possible about its listing. For those customers who want additional information before booking, or to negotiate rates and add-ons, they can chat with the venue host in the message center, just like an Airbnb guest can chat with a prospective host (CWT, 2016; Law, Leung and Buhalis, 2009; Wong and Law, 2005).
Another important issue with the course of meeting platform system is customization of the meeting/event offer to suit the potential buyer. It remains a challenge to know how to craft a meeting that will appeal to an age-diverse audience and in the meantime to be able to adapt to the specific needs of the potential buyer and make a meeting experience better and more personalized for attendees (Singh and Kasavana, 2005; Raj, Rashid and Walters, 2017).
Further, an important challenge facing meeting booking sites is to segment/classify those meeting businesses for the purpose of tracking, measuring, and reporting appropriately and further, the provision of competitive venue pricing. The segmentation of the potential customers "younger participants", alternatively named "millennials". While they are the largest generation in size right now, nothing is being done for the generation that follows them. The fact that they do share some traits with the millennials generation they're not exactly alike. Their characteristics include digital natives, more pragmatic, more cautious, more money-conscious, and more globally minded than the millennials (Hernandez-Maskivker and Rauch, 2017; Ozturk, Bilgihan, Nusair and Okumus, 2016).
Additionally, real time messaging has become an important feature that would make a significant stimulus to attract this particular segment. A more advanced feature is to provide more information about the surrounding environment and guest experience feedback as well for each property. Some of the supplements that enhance prethe instant booking capability include special demands, for instance, menu preferences, special equipment or the most common questions option (Wong and Law, 2005).
Ultimately, online booking platform websites go beyond simply promoting services. Such websites could help as interactive marketing and direct marketing channels, distribution channels, web advertising medium, supporting relationships with customers, and generate additional revenue by reaching new markets inaccessible by using the traditional systems (Tarek, 2009).
3. RESEARCH OBJECTIVES
The objectives of this research paper attempted:
- to investigate the potential of using meeting space online booking platform by Egyptian five-star hotels and;
- to explore the challenges facing the marketing mix of this particular service in the Egyptian meeting space/event management market.
Therefore, the research question could be phrased as "how would online booking platform contribute to the booming of event management market in Egypt in five-star hotels? In line with the research objectives and the research question, the investigation will look at the potential by exploring the pros and cons of the online tool under investigation as expressed by industry practitioners.
Further, the inquiry examines the challenges facing the industry professionals and the implications of such a tool in particular as regards marketing mix as it relates to the meeting space online platform channel.
- METHODOLOGY
The methodology for this research used an online survey to answer the research questions and attain the research objectives as stated earlier. The survey was communicated via the e-mail to a purposeful sample (Miles and Huberman, 1994) of marketing managers of a 15 different hotel brands in 3 different destinations. Those destinations are Cairo, Alexandria and Sharm-El Sheikh. These destinations were selected as they feature the most popular places for meeting/event planners. The selected brands represent, inter alia, the top five-star hotel brands operating in Egypt.
The survey was addressed to either Directors of Marketing and Sales or the person in charge for meeting/event sales. The survey consisted of 13 questions. The types of questions varied between closed questions and open-ended questions. No demographic questions were included as this information deemed to be irrelevant to the topic. The survey was piloted for clarity and coherence with three experts from the hospitality industry before communicating the survey. Invaluable comments were received and adjustments were made appropriately.
A cover letter was attached to the survey explaining the objectives of the survey and confirming the confidentiality of the data and anonymity of the respondents. Finally the survey took place during the months of August-September 2017.
The analytical strategy for this research was primarily qualitative due to the nature of the investigation. The objective was to identify the perceptions of the management of top leading brands of the advantages, disadvantages and obstacles of the implementation/use of online booking platform for meeting spaces. Moreover, it intended to investigate the impact of using such a tool on the marketing mix of that particular channel.
- ANALYSIS AND RESULTS
The results of the survey are more likely to be described as qualitative. The survey describes and investigates the effects and requisites of the phenomena rather than the objective of reaching a statistical product about the phenomenon.
Coding for themes was primarily developed from the extensive literature review conducted earlier by the researcher and consequently inherent in the survey questions. However, further themes were brought forward as a result of participants' response. Some quantitative conclusion was also made with reference to closed questions as demonstrated in Table 1. The table provides a summary of frequency of the survey probes of the 15 participating brands.
Table 1. Summary of Frequency of the Survey Probes of the 15 Participating Brands
|
Probes |
Frequency Yes No |
|||
|
2 13
7 8
2 13
2 13
2 13
5 10
5 10
|
The findings revealed that only two of the respondents (brands) of the selected sample are using the meeting online booking platform since 2016. The service is provided within the context of chain policy worldwide. The rest of the participating brands in the survey did not introduce the meeting space online booking service in their hotel operation yet. The main tool that is in use is Request for Proposal (RFP) in an attempt to enhance the communication with the customers and increase the efficiency of dealing with potential request as expressed by the respondents. However, 7 out of the 15 participating brands acknowledged the use of the online booking by some sister hotel units within their chain.
As regards the sources/channels of meeting space bookings, the direct booking represented 75% of the business volume, 20% from meeting/event management agencies and the remaining 5% from meeting space portals for those offering this service. For those brands not offering the service, the average ratio was 80% and 20% respectively for the first two channels.
As for the brands not offering the service, there has been no effort to classify and/or identify potential users of online meeting planners except for the brands offering the service. It was mainly a corporate/chain initiative rather than individual property action. This outcome is reflected by only two brands that managed to introduce/suggest or survey the possibility of offering the meeting space online booking channel for their corporate accounts.
Whereas for the challenges facing the introduction/use of meeting space online booking service for the participating hotel brands, a variety of reflections were given. The most important challenges included, inter alia, technical aspects with respect to system interface and the absence of personal communication with customers which might affect customers' relationship and closing the sale professionally. Additionally, there was also a psychological resistance on the part of the customer and the preference of using the traditional tool.
However, all the participating brands were optimistic about the potential for meeting space online booking service to flourish in the Egyptian event management market with a potential saving between 20-40% for the interest of the customers in comparison with the traditional booking tools as the services are reasonably priced and competitive. Yet, there was no real market research effort to classify and/or identify potential users of online meeting planners.
As for the advantages for using this tool, brand participants asserted that online platform booking provides a more efficient communication especially for international requests, time saving for both the customer and the seller as it is easier for the customer to check the availability, capacity and services, better use of meeting capacity and revenue management is better controlled and handled.
With regard to the disadvantages voiced by the participating brands, the possible loss of business due to inability to negotiate in person and the insensitivity to the customer needs and finally the poor communication with potential customers were amongst the list.
- DISCUSSION AND CONCLUSION
The findings of this research has not been previously articulated in the literature, and as such, constitute a potential contribution to knowledge. The outcome of this research has shown some overarching themes. A number of these themes found resonance with the theoretical concepts of marketing mix and decision-making process and cultural issues. Also time efficiency was a major concern for both parties – the customer and the meeting/event planner (Spencer, 2002; Zhu and Zhang, 2010).
The study provides useful insights for practitioners and academics concerning the use of online booking platform for meeting spaces in Egypt. The results of the survey of 15 top brands have confirmed the significance of using such a tool for promoting the use of booking platform for meeting spaces in Egypt. However, some important themes were also eminent which include the possibility to track the conversation for compliance and transparency reasons (Egger and Walters, 2008). Additionally, the online booking adds more flexibility to the revenue management technique, stating the availability and adapting competitive pricing on the spot (Noone, McGuire and Rohlfs, 2011).
It is also evident from the data that there is to some extent a cultural barrier from the customers' perspective as regards direct communication associated with the construct of decision making process, better offer and negotiations (Bieger, Beritelli, Weinert and Wittmer, 2005; Steinbauer and Werthner, 2007; Wang, Law, Guillet and Hung, 2015).
The empirical findings pointed to the underdeveloped online meeting platform due to a variety of reasons. The themes that emerged from the data displayed identified the role of technology as a significant constituent of this sales tool. In fact, technology is assisting the evolution of meetings and events renewed in many ways. For instance, the shift toward virtual and hybrid meetings and how can meeting planners work to create an engaging digital experience. The instruments may include developing shorter and smarter programming via livestream or webinar and also looking at the challenges imposed by the shift toward virtual and hybrid meetings.
The research also enabled the researcher to look into the marketing mix of the meeting/event market (Jung and Butler, 2000; Kotler, Bowen and Makens, 2014; Wood, 2009). There is no doubt that the use of this tool has affected the traditional approach of the marketing mix in all aspects. The implications included all the 7Ps of the meeting space/event services. This required innovations by marketing and sales personnel on how to adapt effective marketing strategies and tactics to suit the technological characteristics of this new sales channel.
Finally, as online Travel Agents have dominated internet bookings for independent travelers, there is no doubt that hotel conference/event market will be next to face volatility.
- RESEARCH IMPLICATIONS AND RECOMMENDATIONS
One of the objectives of this particular piece of research is to assist hospitality industry practitioners, namely, event management/meeting sales executives to consider the use of the onsite meeting platform for their operation. While this particular service is used in some countries to a greater extent like, USA, UK and Germany by some hotel chains and hospitality operations, this service has not yet used/introduced in Egypt on a large scale.
More importantly, hotel management practitioners have to review the pattern of decision-making process of their customers of both individuals and organizations. More market research will be required to investigate the influences and characteristics of potential customers and how they respond and interact with the platform services.
Further, technological infrastructure is also recommended to enhance the potential of using this service. The infrastructure issue is more likely related to the internet capacity which is beyond the property capacity and associated with the country investments in this domain. New technology innovations will include new ways of imparting knowledge, virtual meeting units and networking of virtual spaces, increased participation of people or man/machine interfaces. However, hotel brands can do their homework and being ready for that particular service potential. Training for human resources of customer service to deal with spontaneous proposals should also be anticipated.
Furthermore, this particular tool will boost distribution channels, provide a better competitive environment and pricing strategies, and introduce a provision of more innovative products and services and better customisation. The ability to compete will require dealing effectively with the 7Ps of marketing mix.
Finally, addressing this particular approach would to a greater extent requires educating clients to enable them to know what to look for, regulating body and an industry watchdog to monitor this potential business development.
- FURTHER RESEARCH
Future research ideas would consider investigating how customers may react to offering such a service specifically their purchasing pattern behavior. Another area of research would signify the level of technology available and related services that features may include high speed internet service, online chat in order to guarantee spontaneous response to the customers' queries. A more robust research would consider investigating the characteristics of the meeting space market/segments that would decide on using such a purchasing practice.
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