Super Bowl, Super Event

By , Area Manager, Enterprise Accounts


Are you ready for some profit?

  • Hotels typically commit anywhere from 50-90% of their inventory at agreed upon rates
  • Consider the total value and profitability of any group opportunities and weigh that against transient demand
  • Capture the best length of stay reservations quickly, sometimes sacrificing rate

In 2014, Minneapolis was announced as the host of Super Bowl LII (can we stop with the Roman numerals already?). Now, four years later, the big game between the New England Patriots and the Philadelphia Eagles is happening at US Bank Stadium, just down the road from IDeaS HQ.

To get some thoughtful perspectives on how hotels should handle Super Events (mega events that do not regularly occur in the same location), I sat down with industry leader Steve Green, corporate director, revenue generation with Carlson Rezidor Hotel Group. Steve is well-versed in the art and science of optimizing revenues around Super Events, with his nearly two decades of experience working with large and small hotels around the globe.

Steve and I discussed how properties should approach their next Super Event to ensure they capitalize and come out triumphant on the scoreboard.

NM: When you learned the Super Bowl was to be held in Minneapolis, what did you do to start preparing to maximize your hotels’ revenue productivity?

SG: For an event like the Super Bowl, the process starts up to four years in advance. As part of the city selection process, the National Football League (NFL) works with the city to secure maximum hotel participation. At that point, hotels typically commit anywhere from 50-90% of their inventory at agreed upon rates. The NFL confirms blocks about 6 months out and, at that point if you get some rooms back, you are at liberty to contract with whomever you choose, and at whatever rate they are willing to pay.

The week leading into the Super Bowl typically sees a reduction in normal corporate demand (transient and groups), so even getting a four-night stay for the Super Bowl is huge. It is imperative that any public rates or additional group blocks have strict payment policies that usually include some sort of deposit and, if possible, full pre-payment (non-refundable) well in advance of the event. This allows the hotel to sell off any available rooms to other group/transient guests.

NM: What about additional revenue streams beyond guest rooms?

SG: For hotels with function space, it is wise to set premium F&B minimums for any groups wishing to block space. For events like the Super Bowl, it’s an opportunity for companies to impress clients so it is not uncommon for hotels and restaurants to get completely bought out by a company and these groups are usually willing to pay top dollar for the right facility to entertain their guests. When setting these minimums, keep in mind the location (to the stadium, satellite events, the media center and the airport), the flexibility/usability of the space, F&B pricing and a variety of other inputs to ensure you are not leaving any money on the table.

NM: As group inquiries start coming in for the Super Bowl, how do you decide what is the best business for your hotel?

SG: Setting controls on length of stay and mitigating risks are your key strategies. You need to consider the total value and profitability of any group opportunities and weigh that against transient demand. Keep in mind that it doesn’t take much F&B to exceed the revenue/profit generated from an individual traveler.

The data shows that the greatest lengths of stays are booked 30+ days out. However, what makes sporting events unique is a hotel may not know the primary feeder markets until just before the actual event. Most people aren’t going to pre-pay for rooms and buy airline tickets until they are sure that their team is going to be in the Super Bowl. For this reason, a hotel should be prepared for a demand spike the day of the conference championships (semi-finals) when the two final teams are determined.

Understandably, the longer length of stay demand for these transient travelers (super fans) is booked during this demand spike. The closer you get to arrival, the length of stay decreases but these shorter stay guests are willing to pay a premium. The trick is to capture the best length of stay reservations quickly and that sometimes means sacrificing a little rate.

NM: How do you measure hotel performance relative to the competition, and what steps can you take to ensure you can repeat success?

SG: It is highly recommended to have discussions with your owners, management companies and other stakeholders well in advance of the event to agree on the metrics to evaluate business and performance post-mortem. For example, you may have to offer some lower rates in order to get a golden F&B function but the F&B won’t show up in your STAR report; however, the overall profitability may be greatly improved. Understanding what is important to whom up front will help minimize confusion and unnecessary evaluations since everybody wants to get that next STAR report to see how “well” the hotel did.

Guest service level may be another metric to consider. And while it is difficult to maintain your typical scores that focus on value, since there isn’t going to be any fundamental changes in your actual facility, your rate may be 2-3 times more than normal. If a hotel can increase this score, they are obviously doing something special and each hotel should consider what is necessary to provide those unique experiences.

To deliver the desired guest service levels it is imperative the entire property is fully prepared. If the hotel is group heavy and there are some major check-in times, sales should let operations know this by a group resume or some other form of information dissemination. Making sure the hotel team is as ready as possible will enable them to provide quality service and also solve any issues that may (and they most certainly will) arise. The preparation is critical to successful service delivery and, in turn, a beyond-satisfied guests.

For more great insights from Steve, check out a recent Unconstrained Conversation (video) he had with IDeaS’ chief evangelist, Klaus Kohlmayr:

Nick Molitor
Latest posts by Nick Molitor (see all)
Area Manager, Enterprise Accounts

In his role as revenue solutions advisor for IDeaS, Nick Molitor helps hoteliers understand their revenue optimization needs before connecting them with solutions that maximize revenue opportunities. His love of travel and exceptional experiences led him to a career in providing hoteliers with tools and services that help them maximize revenue and profitability.

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