The Rise of the Second Option Hold
Fact or Fiction?
Happy days, a client has emailed over an amazing event enquiry, it doesn’t matter whether its large or small, the hunt for the right venue options to present to the client is on!
Inevitably, if you know your onions, the first handful of best-fits and good-fits will come straight to mind, probably followed by some back-up options and a couple of wild cards, just in case your client is feeling like going a bit right of field or feels like a change.
I think it’s always good to present a wild card or two, it opens conversations, presents potentially new venue options to the client, and shows that you aren’t just a production line when it comes to working on their events
Shift or Realisation?
It’s from this point on that there’s been a shift, not for all venues, but it’s increasingly obvious that a lot of venues are holding out for the highest revenue events they can achieve to fill their event spaces.
I’m not saying this is a brand-new, shocking practise that’s newly discovered and revealed here for the first time by my amazing detective skills; venues have always needed to protect their space, holding out for the highest revenue yielding enquiry and then doing their utmost to win the client over, but in reality, is it also putting clients off?
There are some clients who refuse to short list or site visit venues that will only offer second option holds and are cautious about joint and shared options too for the same reasons.
When time and travel are involved, there is a risk of site visiting a venue who may even receive an update from their first option client while you’re in transit, there’s the risk of putting that venue forward to your boss and then having to tell them that the option is no longer available for them.
Viva La Vegas!
Vegas is a good example, a bit extreme, but an example of my point. Most hotels in Vegas will simply not place any type of hold on any of their function space, full stop, nada, nein, no.
Many a discussion has been had from this UK office to another across the pond, explaining that if our client is willing to invest their time, money, and jet lag to fly to the States for a site visit, then surely, they could hold the space for a week or a short amount of time at least whilst the client explores the option, arranges flights, etc.
Most venues will concede in that scenario, but it’s not rocket science and shouldn’t cost time on our knees to achieve that elusive provisional booking.
That’s an extreme example, but a true to life experience.
Back to Home Territory
Closer to home is the rise of the joint option, the shared option, the second option.
First and second hold options are positions that no one is a stranger to. We all know that venues have used these strategically in the past but is the joint, shared and second option on the rise as a means of the venues vetting their enquiries?
I would say, categorically, yes. As I said before, I think it always has been the case, but perhaps it’s just more obvious now, perhaps we’re all just talking about it a bit more openly.
Take two recent enquiries as examples:
Event example (1)
London, x 160 cabaret style, two-day, possibly one-day, non-residential meeting. Clients preferred venue would be a 5star hotel (yes, even though the event is non-residential).
Lead time – 2months.
Venue (1) : First option hold available for two-day booking OR second option hold available for a one-day booking. (Accommodation on contract and room hire supplement loading on ddr.)
Venue (2) : Second option hold available, with immediate update that first option is extremely unlikely to confirm (Accommodation on contract and room hire supplement loading on ddr.)
Venue (3) : First option hold.
All three venues are comparable in terms of matching the clients brief, standard, location, size of venue, budget, etc., etc. All 5star properties in the same location and quite handily, for the purposes of providing an example, there is different hold option provided by each venue and, to be honest, probably what prompted me to write this article.
The client has dismissed the first two venues and has asked to site visit the third one, she doesn’t have the time to mess around, doesn’t want to present uncertain options to the internal decision maker. Any one of those options would have worked for the client, so the question in this case is, have the first two venues been savvy or have they lost out?
Does the Magic Still Exist?
To me, hotels and conference venues always had the Harrods touch, whatever the client wanted, the client got. The client is always right, unless they’re very wrong, of course. In some respect, has the rise of this joint, shared, second option (where no first option exists) scenario dissipated that, removed a bit of that magic?
A client looking to place an event 18months out used to be hailed a trailblazer, a client who understood that to have time means to have choice but try this now with an average sized event and the response is mixed.
Event example (2)
Home Counties, two-day, one-night residential meeting x 50 cabaret style with private evening dining.
Lead time – 18 months.
Venue (1) : Second option hold, no other event on first option, but the hotel has stated that they cannot offer a first option hold for the foreseeable future, at least until the event is a year out and they can gauge repeat business from existing clients.
Venue (2) : First option hold. Punchier costs than expected, but a good strong hold on a very strong venue option.
Venue (3) : First option hold. Another good contender at a better price point that Venue (2).
On one hand, when presented with Venue (1)’s scenario, I can see the fairness of this, it’s solid business sense but on the other the client is frustrated as they’re ready to go to contract on this event and it’s that fact that has exposed the venues position to the client.
It’s a People Thing
There must be something about the events world, it’s that thing about the hospitality industry, we’re hospitable, it’s about people and so when situations like this come up it feels personal and it falls down to the need for strong, clear communication, negotiation and managing expectations.
Across these two event enquiries we have also had a handful of venues who just won’t take the enquiry, a venue who proposed their function space without daylight when natural daylight is one of the client’s priorities and that space was also available, and others who also only offered second option when no first option hold existed.
Time for a Lightbulb Moment?
The Value of Agent
Does all of this make venue agencies/agents more valuable?
YES, it very much it does!
It’s the experience that means we can secure options the client can work with, when faced with an availability problem we can source alternative options to meet the brief that gives the client a solid base of options to consider, we have the experience to negotiation with the venues, discuss options both with the client and the venue for the best outcome, and, acting as a sound board for both too.
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