By Jeff Loether, president and founder of ELECTRO-MEDIA DESIGN - 6.12.2019
Outsourcing audiovisual services to a third-party provider has its advantages but is not always the right choice for every facility. Hotels and conference centers that provide standard presentation and voice reinforcement services often choose to use their own equipment and staff since they have only occasional needs for advanced equipment, support or labor. To help determine if a venue should self-operate its day-to-day AV services, operators first need to evaluate their venues, the types of support required for the events they book, the capabilities of their operating staff, and the needs/expectations of meeting planners and attendees.
Here are 10 top advantages of self-operating audiovisual services in a hotel of conference center environment:
Control Over the Guest Experience
Hotels differentiate themselves by the guest experience they deliver; many take great pride in branding that experience for even greater autonomy. They want all guest touch points and interactions to be handled with a consistent level of service. Should something fail during a meeting, it impacts the guest experience and reflects upon the hotel. The meeting planner and guests remember the incident and that it happened at your hotel — what they don’t remember is that the service was rendered by a third-party vendor. Providing services with internal staff ensures that service levels are consistent, especially in the delivery of technology services.
Higher Profit Margins
Audiovisual services can be a profitable business. It’s an industry unto itself, created specifically to provide services to event planners. Rather than loosing 60% to 70% of the top line revenue to a third-party provider, self-operated venues start at 100% of all revenues. Smaller venues often find that they can accommodate nearly all the basic presentation needs with their own staff and a combination of standard built-in and portable equipment, with profit margins reaching into the high 70 percent range.
Equipment is Reliable and Easy to Use
Where AV equipment was once difficult to setup and operate, many of today’s AV systems are easy to use, intuitive, and very similar to what most people have in their own homes and offices. Providing basic display support is no more difficult than connecting a video game to television or a monitor to a computer, something most people do on a regular basis. With design documents requiring more built-in technology in hotels, staff will be able to more consistently deliver services with the push of a few buttons.
Non-technical staff can support basic requirements
Staffing to support AV services is a major concern. Many properties cling to the service model of using all portable equipment. When a self-operating department utilizes the built-in AV systems to its fullest capacity, operators can spend far less time setting up, removing and storing equipment and more time focused on service. Many new and recently renovated hotels and conference centers have the latest AV systems installed, particularly in standard meeting rooms. These systems are high quality, easy to use and do not require a large staff of skilled AV technicians to set them up and break them down to provide basic AV services to guests.
Flexibility to meet Customer Needs
Sales staff want to have flexibility in how they package and price the services for meeting planners’ events. Venues that out-source AV services often have restrictions on how much flexibility they have when negotiating with a client. By owning and being responsible for providing basic AV services using their own staff and equipment, the hotel has complete control and discretion to price and package their event services while still maintaining profitability as they do not have to share the revenue with an out-sourced provider. This provides a greater return on investment.
Majority of business is basic presentation support
AV Services do not have to be “all or nothing.” Even the largest production companies don’t own everything. Often, when hoteliers consider self-operating, they are warned against it due to high-cost equipment and manpower to support advanced AV needs. These needs are within the services realm of the outside AV vendors. However, if most of the business at the property is basic presentation support, it doesn’t make sense to outsource everything. Why spend the money to be covered 24/7 if you only need advanced support services a few times each year?
Equipment quality is increasing while prices are falling
While in the past technology has progressed rapidly, causing fears about purchasing equipment that will be outdated in six months, presentation technology (particularly display technology) has reached a plateau. The right display technology purchased today will remain current for a minimum of the next five years and probably longer. Further, due to high demand in the consumer market, it has become less expensive for manufacturers to produce large displays at affordable prices, creating an attractive ROI with purchases that will pay for themselves within 18 months or better.
Growth opportunities are available for staff
Hotels and conference centers of all sizes already have staff who are performing many roles. Management may want to provide opportunities for individuals to learn and grow in skills and responsibilities. Having an AV services department to provide support to guests using the hotel’s AV systems is an excellent opportunity to blend a love of guest service with interest in technology.
Smaller available revenue stream – capture more revenue rather than sharing
Smaller venues with limited revenue streams, or venues that are not located near metropolitan areas, may have challenges finding a vendor that is able to provide dedicated services while sharing 40% to 50% of the revenue. These venues often receive a smaller commission on sales because the provider must first make enough to cover their expenses (and make some type of profit) before they can provide revenues to the host property.
Protecting ownership investment in built-in systems
Where a hotel or facility is built to “brand standards” it will have typically made a significant investment in AV systems and equipment such as sound systems, digital signage, projection screens and flat panel displays. A self-operating AV service is far more likely to utilize these systems, and by extension keep them serviced and in good working condition and will not abandon them to use primarily portable equipment like outsourced vendors. Generating revenue from built-in AV technologies enables the owner and management team to optimize ROI.
Self-operating audiovisual services can be a viable and profitable option in many hotels, especially hotels that serve small to medium sized meetings and events that do not require a great deal of specialized equipment or highly skilled technical specialists. Even in these smaller hotels, however, there must be a program to guide the planning and delivery of services and to know when outside support may be required.
Jeff Loether is president and founder of ELECTRO-MEDIA DESIGN, Ltd., an AudioVisual systems design and Acoustical consultation group with expertise in audio, video, control, and related presentation, entertainment, and communications technologies. Loether is the 2018 recipient of the Mel Hosansky Award for Distinguished Service presented by IACC, formerly known as the International Association of Conference Centers.
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