Maximizing Your Hotel's Potential With the Perfect Amenity Mix
By Jason Sorci Partner & Chief Financial Officer, Architectural Design Consultants, Inc. | June 01, 2014
The first three words in real estate are location, location, location. A hotel property inevitably prospers based on its location to nearby elements and attractions. A major city center, national park, shopping outlet, theme park, or convention center can be counted upon to fill a lot of room nights and buoy occupancy. In a vacuum, you need nothing more than a great location. Of course, the real world is different. There is competition galore, especially in the best locations. How do you ensure that you have captured your fair share of the market? It's all about your amenity mix.
Optimizing your amenity mix can increase your average length of stay, boost your ADR & revPAR, create a substantial market differentiation, and turn average customers into coveted repeat guests. If done properly, your amenity mix will ensure that you have left no revenue on the table. If done poorly, you could be faced with a disjointed and unharmonious guest experience, debt service that can smother your business, and operational expense that far outweigh the benefits they were meant to provide.
There are many variables at play when choosing an amenity package. Your approach to planning will be dictated by whether the subject property exists or is still on the drawing boards. Existing properties have far more potential restrictions on them than new properties. Chief among these are continuation of existing operations during construction and an existing infrastructure that will dictate the feasibility of your ideas. Regardless, there are some universal concepts that will apply to either new or existing hotels.
Know Your Clientele
Business or pleasure, limited service hotel to full-service destination resort, independent versus flagged property; your amenity mix needs to extend from and enhance the offerings to your base clientele. Food and beverage outlets are a great example of an amenity that are both universal and can be tuned to meet the needs of a wide range of travelers. An upscale bar and restaurant is a great fit for the conference crowd to carry their business from the tradeshow floor to close deals over dinner or network with their colleagues over cocktails. Similarly a buffet restaurant within a vacation resort can retain your guests on site and capture additional revenue that might otherwise have walked out the door with your patrons. These are straight forward examples, but they underscore the need to maintain a basic consistency in your amenity mix.
Balancing divergent uses and guest experiences can be very profitable and very tricky. Consider a destination resort with a convention center component. On paper it looks like a winning combination. The business traveler drives occupancy during the week and the leisure traveler picking up the weekend. With a major convention center and indoor and outdoor waterparks, Kalahari Resorts is one example of a hotel property that balances these two different groups with great success. However, serving the business and leisure travelers simultaneously requires a separation of the business suits from the swim suits.