Where Hospitality Meets Retail: Engaging Through Experience
By Scott Acton CEO & Founder, Forte Specialty Contractors | March 04, 2018
For many years, retailers and hospitality brands have had an intrinsic relationship, in particular, finding ways to wow each guest who walks through the door; and keep them coming back time and time again.
Dating back to the emergence of all-inclusive resorts in the 1950s spurred by the creation of Club Mediterannee (Club Med) to now with fashion retailer Forever 21 who has developed a playground-like experience with a lifestyle mix of beauty essentials, interiors products and accessories to further engage consumers, retail and hospitality brands are continually looking for ways to distinguish themselves and build up their brands with the demands of the consumer in mind.
We're now seeing one of the biggest trends emerge: hospitality and retail fully integrating in order to provide the ultimate customer experience and create an extension of the brand. Leading retailers like Armani, Muji, West Elm, Nobu Matsuhisa and Parachute have begun opening their own hotels to allow a new level of engagement with the brand that consumers have never experienced before. This intersection between hospitality and retail is being largely driven by Millennials and Gen-Zers who rely heavily on technology and seek out experiential environments.
This comes as no surprise as even several years ago, according to a 2014 study conducted by PKF Hospitality Research, the hotel market dynamics began shifting and lifestyle and boutique hotels were outperforming traditional hotels in terms of revenue, due to the rise of traveling Millennials and their innovative ability to localize and personalize services that put a greater emphasis on technology and created an immersive, lifestyle experience.
As a result, larger hotel brands like Starwood, Hilton and Marriott have all taken notice and gotten in on the action. Hilton@Play has partnered with Live Nation to create a series of live music events and to appeal to the younger generation. To encourage loyalty, concert-goers must also be HHonors members with between 30,000 and 80,000 points in order to attend the live concerts. Starwood's Aloft brands itself as "stylish, boutique hotels that break the traditional hotel mold for a truly unforgettable stay." The Aloft brands were specifically designed to appeal to Millennials and Gen-Z consumers through social interaction from the communal pool tables to "Sips & Spins" DJ sets at the WYXZ bar or encouraging guests to tag their photos on social of the property before they even leave the grounds. Marriott's Moxy Hotels has now brought in top social influencers to entertain guests.
Hotel operators and retailers must now look at the entirety of their mix of products -- from shelving to the guest lobby, social landscapes to event spaces, artwork, health and fitness options, and family entertainment -- in order to create a true sense of destination. Additionally, this has also prompted hoteliers and retailers to look at how they can provide unexpected moments of intrigue that captivate the senses and leave lasting impressions at every touch point.