One of the things we like to do with this blog is open the curtain and tell you about what goes into creating Southwest Fox and especially the financial considerations. We think it’s helpful to us and to you if you understand why we make some of the choices we make.
In this post, we want to talk about the economics of conference centers. In planning a conference, there’s a choice between holding the sessions at the same hotel where attendees are staying and holding the sessions at a separate facility.
We’ve found that it works better for us and our attendees to use a single facility. Why? First, of course, because it makes it easy for attendees and speakers to go back to their rooms during the day to drop things off, pick things up or even take a nap. When the hotel and conference center aren’t together, that can be harder.
But the primary reason for using a single facility is that filling hotel rooms with our attendees gives us leverage.
We use that leverage to negotiate a room rate for the conference. We push to make that rate better than what you get booking directly or through a third-party. We also push to have that rate available not just for the conference dates, but for a few days before and after the conference, so that you get it if you want to come out early or stay late to visit friends or relatives, to do some sight-seeing, or just to sleep in or sit by the pool.
We also use that leverage (along with the leverage of buying a lot of food) to get the use of the meeting rooms for free. Normally, there’s a fee for using conference meeting rooms; it’s typical to have a basic fee to use the room for a three or four-hour block and then an additional hourly fee. For a conference like ours, which needs rooms to be set aside for us for three and a half days or more, those fees could be enormous. But the other income we bring to the hotel means they’re willing to waive those fees.
In exchange for this, our contract with the hotel commits us to filling a certain number of hotel rooms. The hotel blocks those rooms for our attendees and, if we fail to fill them, we must pay the hotel for them (unless the hotel is sold out). We work to find the optimal number of so-called room nights that ensures our attendees get rooms at the conference hotel, but doesn’t obligate us to pay for rooms that won’t be used.
Why are we telling you about this? Because we know that sometimes, despite our best efforts, you can find a little better room rate online, or you can find a cheaper hotel nearby. In 2018, a new Hilton-branded hotel is supposed to be built next door to the DoubleTree where we hold Southwest Fox. Based on what we’ve learned about the particular brand, rooms there will likely cost less than rooms at the DoubleTree. But those rooms will not count toward our guarantee.
So we’re asking you not to stay there. If enough people stay elsewhere or book at the DoubleTree without using our special conference code, it will cost us more to run the conference, and we’ll have to charge you more. So you might save on your room, but have to spend the same amount in added conference fees in future.