Numerous investors pursue boutique hotels – especially in major centers like New York City. Investors understand that the concept of buying into a NYC hotel is on the mind of shrewd entrepreneurs everywhere. Actually, hotel owners under major brands are also examining the 'concept of buying' as it applies to their guests.
The 'hotel shop' is becoming a place where establishments can express their uniqueness. Bjorn Hanson, divisional dean of the Preston Robert Tisch Center for Hospitality, Tourism, and Sports Management at New York University, says that hotels can express individuality through their shops. Hotel owners prefer unique merchandise.
During the previous decade, the hospitality industry had tried the same plan to promote their restaurants. Originally, the shops in hotel lobbies were designed to address practical needs. The outlets offered sundries, candy bars, and souvenirs. The hotel shop was an uninspiring fixture in lodging properties.
Concept of Buying
Yet today's hotel owners are rethinking the shopping services provided for their guests. Every hotel wants to distinguish themselves from the rest of the hospitality sector down the street or across town. Hotel owners are upgrading their shops and expanding their merchandise to include items found in gift shops, fashion outlets, emporiums, and even art galleries.
Hotel brands (including several properties operated by the Morgan Hotel Group) are rethinking the concept of the shop itself. Hotels hope to attract leisure and corporate guests as well as local residents to their stores. Indeed, large chains (such as Marriott and Westin in which the average stay is five days) have successful shops focusing on quality clothing and local products.
Individual hotels in a variety of markets are adopting their own initiatives. In fact, small boutique chains and high-end independent properties have already been embracing innovation. Although hotels still stock standard items (such as bathrobes and sheets), many brands have developed additional customized goods.
W Hotels in certain cities around the world offer cocktail dresses, earrings, and bracelets in their own hotel brand. W clothing collections were first introduced a couple of years ago at New York Fashion Week. W Hotels has stores in 18 of its 41 properties on the global scene. This chain is credited with originating the idea of the high-concept hotel shop.
In 2002, the W New York shop started the trend by offering high quality clothing, amazing accessories, and superb candles in the store instead of standard choices. Eva Ziegler, W Hotel’s global brand leader, says that the main goal of the collections is to provide the ultimate experience for guests. Profit is not the prime concern but Ziegler adds that the stores enjoy financial success.
Hospitality and Retail
Hotels are beginning to realize that the retail and hospitality industries can work together - although each sector has its own requirements. Properties can form partnerships with retailers or lease space to outlets. Local retailers welcome the chance to open a version of their main stores within a hotel shop. Since occupancy rates are expected to increase, hospitality insiders predict a bright future for upscale hotel shops.
High-end outlets add to a hotel's appeal. Chekitan Dev, an associate professor of strategic marketing and brand management at the School of Hotel Administration at Cornell University, has nothing but positive things to say about attractive and efficient hotel shops that meet guests' needs. Successful hotel shops mean that satisfied customers will spend more time and money within the property.
If hotel owners find a perfect balance and popular vendor, they will improve the general experience for guests and add to their own profits. Owners must choose which type of venture (shop, restaurant, or bar) makes more financial sense. Depending on the specific hotel and its location, owners can charge vendors anywhere between $50 and $1000 per square foot. Properties might also be able to share in the sales revenue.
Generally, sales in hotel stores are spontaneous purchases. The best selling items fall in the price range of $10-$50. Guests buy everything from toothbrushes and candy to customized clothing. Although major items are available in hotel stores (such as the $1,000,000 apartment at the Mondrian South Beach vending machine), guest prefer smaller products that fit into carry-on bags.
Morgans Hotel Group
A spokesperson for the Morgans Hotel Group says that their chain likes to vary the products at their stores in different cities. As well, like most hotels, the Morgans Group gears its inventory to reflect the location and its clientele.
New York's Standard Hotel
New York's Standard Hotel invites artists to create installations for sale in the establishment's shop. In addition, the hotel offered limited-edition prints and posters for purchase as well as playing cards based on the artists' work. Of course, the Standard Hotel does not forget the staples of hotel shops such as magazines, jewelery, and fragrances.
The Mondrian Soho in New York has introduced an exciting project to create shopping outlets in minimal space. Hotel guests can use an in-room iPad and buy items (Rogan sweaters and shirts,…) from the mini-bar. Purchases are ready within ten minutes.
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