At the just-opened retro-chic James Royal Palm hotel, visitors won’t find an ordinary sundry shop.
The oceanfront hotel created a retail outlet with a charitable theme called Give. It’s stocked with items that you might find in Whole Foods or in globally minded catalogs.
“It’s a collection of unique items that all have a story,” says Lisa Zandee, brand chief for Denihan Hospitality. “Most of it’s about giving back.”
Guests might pick a pair of sunglasses ($125 and up) from Toms, the charitable brand best known for giving a pair of shoes to a person in need for each pair sold. Or, they can buy a recycled key necklace that’s produced by a group in California with proceeds going towards housing homeless people.
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The Give shop’s the latest example of how hotel retail is evolving, as properties take into account travelers’ age, income levels and interests to create new types of stores to generate ancillary revenue and customer loyalty.
Hotel retail helps create an experience
“Hotel retail isn’t just convenience oriented anymore,” says Ann Natunewicz, who runs U.S. retail research for Colliers International and travels frequently for her work. “It’s an amenity because hotels have to differentiate themselves from competitors. At first they were doing it by improving the quality of the rooms and improving the quality of the loyalty program. But you want to give people multiple reasons to come. Shopping is the next extension of that.”
Some hotels are revamping their stores – whether leased or run in-house – to emphasize items made by local artists. Some are creating pop-up shops to sell season-specific products. Others are teaming up with publishers to sell high-end books.
Retail shops typically don’t account for a large share of hotel revenue. According to hotel industry tracker PKF Consulting, in 2011, hotel retail revenue averaged $497 per available room – or 1.1% of total revenue. The amount tends to be less in less-expensive hotels that don’t have restaurants, and more in convention center hotels. Resorts tend to sell the most – $2,014, or 2.1% per available room.
Unique retail increasingly plays into the formula to build a successful, upscale hotel, Ken Cruse, CEO of Sunstone Hotel Investors, tells USA TODAY’s Hotel Check-In.
“Over the last few years, we’ve concentrated on redefining the lobbies, restaurants and public spaces within our hotels to create more inviting, highly-functional, multi-purpose spaces,” Cruse says. “These spaces typically include integrated gastro-bars, public work areas and unique retail spaces. When done correctly, these new spaces entice guests to stay on property longer to work, socialize, relax and even shop.
In Rochester, Minn., for instance, the company built an entire shopping mall beneath its various hotels surrounding the Mayo Clinic.
“As guests travel from the Mayo Clinic to their hotels, they filter through a variety of interesting retail venues,” he says. “As a result, our guests have a more satisfying experience and our revenues increase.”
No more Pepto-Bismol
Last year, Hotel Terra Jackson Hole, an environmentally certified hotel in Teton Village, Wyo., carved out space in its lobby by the front desk and restaurant to use as a first-ever, hip gift shop called Made Jackson Hotel.
“They don’t sell Pepto-Bismol or Bayer Aspirin,” says David Kingston, the hotel’s general manager. “We do that through the hotel. The gift shop specializes in selling items that are completely hand-made, re-purposed or found items for sale; it uses local artists and vendors whenever possible.”
Among the more popular items are belt buckles made of pieces of recycled glass that artists colored and designed, he says. They range in price from about $12 to $24. Also popular are antler necklaces ($36) and a recycled bike chain clock ($22). Some guests even go for the bigger ticket items that require the added expense of shipping, such as antique tables and chairs, Kingston says.
“It’s different than a traditional hotel gift shop, where you tend to find overpriced sweatshirts with hotel logos on them,” he says.
The theme also “speaks directly to who we are and what we’re all about,” he says of the 132-room hotel with a high level of environmental certification.
Trendy clothing
Designer fashions are a major focus in the retail shops going into luxury boutique hotel, The Joule, in downtown Dallas, says architect Jerry Flemons, ForrestPerkins, the architecture firm in charge of the hotel’s expansion.
The expanded hotel will have several shops that have to both please customers and attract locals, since one of the city’s requirements is that the hotel help bring back street life to the area.
The hotel, for instance, is adding mens’ and women’s boutiques by Traffic Los Angeles, a high-end Los Angeles retailer that carries a variety of upscale clothing, but wouldn’t overlap with the original Nieman Marcus department store location next to the hotel, he says.
The trendy W chain pioneered the hip hotel boutique years ago, and in 2010, introduced its own clothing line – the Global Glam collection – during Mercedes Benz Fashion Week.
The items included gold shorts, tiny bikinis and $45 black Bowler hats. The chain sold the items online and in W hotels’ trendy shops, mixed in with other fashionable accessories ranging from bangles to high heels.
High-end books
The Joule is also adding a bookstore that will look like it’s part of the hotel lobby, Flemons says, underscoring the push to make the look of hotel retail as interesting as the products.
The St. Regis hotels in Washington D.C. and New York, for instance, have dedicated some library-like space to selling luxury stationary including wedding invitations, monogrammed calling cards and leather-bound books by Thornwillow.
“It will look like a hotel lobby lounge library, but it’s actually a retail outlet,” Flemons says of the Joule’s bookshop strategy.
So where might guests find a toothbrush, deodorant or condoms? The Joule will still make these necessities available to guests, perhaps at the front desk or the concierge, he says.
Pop-up shops
In September, the luxury resort Bacara launched a pop-up shop called Bacara Adventures. The pop-up promoted action-sports rentals such as stand-up paddling and surfing, which drove people into the store and ultimately boosted sales of retail items. The pop-up sold high-end surfer apparel, reusable water bottles, bathing suits and children’s items. It was so successful, that the resort’s already in negotiations for a pop-up store for the spring.
“For the guest, it offers a nice surprise and delight moment – particularly for our repeat travelers,” says Bacara general manager Kathleen Cochran.
Big chains tinker with retail, too
The big hotel chains such as Westin and Marriott have long been pushing their retail offerings online.
But in a sign that change could come to the chain hotels, too, San Diego’s Westin Gaslamp hotel recently unveiled a new retail shop when it redesigned its lobby – and it’s serving as a pilot for the upscale chain.
“It’s proving to be very successful and is being used as a best practice for other hotels interested in introducing dedicated, branded retail space,” says Westin spokeswoman Nadeen Ayala.
What can you buy at this Westin shop? Many items from the chain’s famed Heavenly bed, home and spa collections including a Heavenly shower head, along with other gift-type merchandise such as candles (tin travel candle, $8). A Westin Heavenly robe costs between $60 and $80, while a scented Heavenly shampoo costs about $15.