A New Future for Hotel Restaurants

By Peter Karpinski Partner, Sage Hospitality | August 12, 2012

Is it possible to change the way travelers currently think about hotel restaurants? Can hotel restaurants provide a customer experience so good that they capture significant local market share in an ultra-competitive sector, and also deliver a solid return to shareholders?

At Sage Restaurant Group, those are exactly the challenges we work every day to solve and the same questions I wrestled with during my early experience in hotels and restaurants. In the end, we create unexpected, playful and locally focused food and beverage experiences that resonate with guests and the people who live and work in the communities we serve. Integrating great restaurant fundamentals in the unique context of F&B can be delivered through true partnerships at the property level. But this isn't the way I was taught.

Like many in this industry, I received my hospitality degree and went to work learning the business, inside and out. I was fortunate enough to work with some of the best companies in the world – Four Seasons Hotels & Resorts, Starwood Hotels & Resorts, Caesars Entertainment, and Starr Restaurant Organization. Along the way I internalized the concept of continual learning.

In each of my professional relationships, I gained new insights about hotel and restaurant customers and stakeholders. I asked questions and I watched and learned from extremely talented managers and executives. I sought mentors all along the way. I built as much perspective as possible.

In a quest to learn about the strengths and pitfalls of independent restaurants, I professionally progressed away from the traditional hotel F&B environment, and closer to the world of independent restaurants, until I finally found myself out of the hotel sector altogether. As I learned about the business models of free standing restaurants, I realized the gap between profit and loss and knowing your markets. I realized there was no reason hotel restaurants should be loss leaders to the lodging business or unreliable sources of hotel profit. With that conviction, I needed a partner who understood the opportunity and was willing to join my commitment to shift the paradigm.

In 2005, I met Walter Isenberg and Zack Neumeyer at Sage Hospitality and they were open to this new opportunity. As Sage was becoming a more active owner, developer, and operator of premier full-service branded hotels, they were committed to developing a more sustainable in-house F&B platform and, from that, Sage Restaurant Group was born. Our new platform has changed the way our guests and our hotel ownership groups think of hotel restaurants. It has created a new model for investors and executives, and has provided our organization with a unique proprietary differentiator.

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Social Media: Getting Personal

There Social media platforms have revolutionized the hotel industry. Popular sites such as Facebook, Twitter, Pinterest, Instagram, Snapchat, YouTube and Tumblr now account for 2.3 billion active users, and this phenomenon has forever transformed how businesses interact with consumers. Given that social media allows for two-way communication between businesses and consumers, the emphasis of any marketing strategy must be to positively and personally engage the customer, and there are innumerable ways to accomplish that goal. One popular strategy is to encourage hotel guests to create their own personal content - typically videos and photos -which can be shared via their personal social media networks, reaching a sizeable audience. In addition, geo-locational tags and brand hashtags can be embedded in such posts which allow them to be found via metadata searches, substantially enlarging their scope. Influencer marketing is another prevalent social media strategy. Some hotels are paying popular social media stars and bloggers to endorse their brand on social media platforms. These kinds of endorsements generally elicit a strong response because the influencers are perceived as being trustworthy by their followers, and because an influencer's followers are likely to share similar psychographic and demographic traits. Travel review sites have also become vitally important in reputation management. Travelers consistently use social media to express pleasure or frustration about their guest experiences, so it is essential that every review be attended to personally. Assuming the responsibility to address and correct customer service concerns quickly is a way to mitigate complaints and to build brand loyalty. Plus, whether reviews are favorable or unfavorable, they are a vital source of information to managers about a hotel's operational performance.  The February Hotel Business Review will document what some hotels are doing to effectively incorporate social media strategies into their businesses.