Hoteliers note 'unfortunate' growth of e-bidding

Growth of companies using online bidding for meetings and events plants focus on the price

Hoteliers in the UAE have been coming to terms with the growth of companies using online bidding sites to book meetings and events.

Although advantages have been highlighted, some hoteliers are concerned that the trend has its downfalls for the hotel industry.

Rotana Dubai and Northern Emirates assistant director of sales – MICE, Archana Kawatra, said she believed e-bidding certainly gave the client the advantage when making event bookings.

“It is definitely the corporations who benefit from the e-bidding process. They take advantage of the fact that the hotels are forced to drop their rates to win the business,” Kawatra said.

“Sometimes, they also extend the bidding time, thereby pushing the hotels to re-consider and drop the rates further. Unfortunately, e-bidding is evolving further, since some pharmaceutical companies are following the same concept to get subsidised rates from hotel suppliers.”

JW Marriott Hotel, Dubai sales manager Myra Verana-Flores, based in the event booking centre sales department, said the “main hindrance” in the e-bidding model was the hotelier not knowing the bidding company’s main contact.

“There are fewer opportunities to discuss and justify your rate. If you know them first hand you have the chance to provide inputs and suggestions on events they are planning,” Verana-Flores asserted.

“Maybe they could [introduce] a new slot which will give you information on which property got the business, preferably rates and maybe also the reasons why they were chosen.”

Despite the negative aspects of the process, both Verana-Flores and Kawatra acknowledged there were advantages for hoteliers to be found in e-bidding.

“We had to be a part of this trend and use this transparent tool, which we believe can provide the best for both parties and which saves time negotiating,” Kawatra said.

“Quite a few MICE groups have been confirmed from leading corporations through electronic bidding.

Our chances are always better as we operate many hotels and we normally participate with three or four properties and try to lower our bid to the minimum possible, as compared to our competition.”

Furthermore, there have been positive signs of a recovery in the corporate sector with a noticeable increase in companies putting out tenders for events in 2010.

However, with companies focusing on their bottom line, it is expected that e-bidding will continue to expand and hoteliers will have to overcome issues regarding having no direct contact with decision makers and an inability to know which properties they are bidding against.