This is a topic that can become very heated, very quickly. To avoid this, I'll start by saying that excellent Destination Management Companies (DMCs) are worth their weight in gold. Without DMCs, event planners would have a much more difficult job. Still, there are legitimate concerns and grievances on all sides.
DMC Concerns About Event Planners
DMCs get frustrated when event and meeting planners ask for urgent quotes that go nowhere. Unfortunately, there are no easy solutions as clients often send the same urgent request to a number of event planning firms and then fall off the face of the earth. If, across the board, DMCs and event and conference planners start charging a deductible for the initial consultation, this would reduce the number of frivolous inquiries.
Another frequent concern raised by DMCs is that they would like to handle the whole event, including arrangements for hotels, meeting venues, transfers, tours and special events. The challenge is that the industry has drifted away from wholesale pricing. Whether the client, the event planner or the DMC calls the hotel or other travel supplier, the rate quoted is the same. Even DMCs that do a high volume of business with specific resorts and hotels end up quoting a rate that is about 5% higher than what the client or event planner can get by dealing with the hotel directly. While it is frustrating for DMCs to lose out on hotel commissions, it is often just not viable to source hotels through DMCs. Three-tier pricing would help.
Event Planners' Concerns About DMCs
Scenario: A DMC provided a quote for an incentive trip at one of the luxury, 5 Star hotels. Their rate was still not below the leisure rack rate. The event planner marked it up by 10%. The client determined that the quote was DOUBLE what they could get by going to the hotel directly.
This is inexcusable since DMCs already receive commissions from hotels.
In Ontario, the problem is compounded since TICO is insisting that event planners book hotels through registered travel agents. It will be even more challenging to provide competitive quotes.
Scenario: An event planning firm contacted a DMC for an urgent quote for one of the special events that the DMC had promoted. The client was arranging hotels, facilities for business meetings and transfers through its local travel agency. The situation was complicated by the fact that the requests was last minute. Airfares and visas had to be arranged for a site inspection in less than 2 weeks. The DMC responded that unless it arranged everything, it was not prepared to provide an event preview during the site inspection. Even though the client was willing to pay for the preview, the DMC dug in its heels and took the position that it would provide hotel, transfers and meeting facilities....everything BUT the event it had promoted. Fortunately, event planning firm was able to find another supplier after a lot of scrambling.
Let's face it. Everyone in the industry would prefer to have more time to respond to RFPs and to offer the more lucrative full packages. Requests often come in at the last minute. When the client is ready to book and fly to the destination, it is not the time to refuse to cooperate.
With the opportunity for clients to book hotels through the Internet, fewer clients are going to require full service. Rigidly clinging to a model that is disappearing will make it challenging to take advantage of the business opportunities that remain.
As event planning associations design conferences for 2012, it would be wise to build in some Event Planner/DMC/Hotel panels and round-tables. There are legitimate concerns that can only be resolved through open dialog.