Some of you might know we have a sister publication, Hotel Business, covering the hospitality market.
The Hotel Business staff recently returned from the NYU hospitality investment conference, where no fewer than five new hotel brands were announced, each angled at appealing to younger travelers seeking trendy, localized, personalized and convenient lifestyle experiences without the corporate trimmings of traditional full-service hotel brands.
E-Commerce Disruption
Why does this matter to HomeWorld’s housewares retailing audience?
Because the traditional hotel and retail businesses share the challenge of e-commerce disruption (think Airbnb in the case of hotels) causing many to devise alternative ways to attract and sustain a new generation of consumers less inclined to patronize establishment channels.
Home products retailing and hotel management already enjoy a symbiotic merchandising relationship. The housewares industry for years has sold into food service, in-room amenities, housekeeping and other hotel departments, while several hotel brands have stepped up the marketing of their branded linens and other proprietary goods to retailers.
Something deeper is at work, though, with recent moves by two expanding specialty retailers to check their brands into the lifestyle hotel business. Williams-Sonoma’s West Elm announced development partnerships to open West Elm hotels in Charlotte, Detroit, Indianapolis, Minneapolis, Savannah and Oakland; and the first Restoration Hardware hotel is slated for New York City’s Meatpacking District.
Growth Pathways
Meanwhile, J.C. Penney announced a developing wholesale hotel supply business after discovering how many independent hotel owners already buy furnishings from the retailer.
These initiatives diversify revenue growth pathways around a bumpy retail marketplace. They also widen the retailers’ overall marketing presence to the potential benefit of their core retail operations.
Faithful West Elm and Restoration Hardware customers, for example, are likely to be drawn to their hotels. Better yet is the opportunity to harvest new retail customers by giving guests unfamiliar with the retail brands engaging hotel experiences that inspire store business.
No doubt guests at West Elm and Restoration Hardware hotels would be able to buy furnishings featured in the hotels. And their names and profiles would go into databases to be used for retail promotions.
Inescapable Forces
Inescapable market forces are compelling traditional retailers of all sizes and scope to create lifestyle-topical experiences vital to re-energizing store traffic and loyalty.
Hotels might not be relevant real estate for most retail nameplates. Retailers that occupy a more institutional, mainstream position might be better suited, like J.C. Penney, to capitalize on the hospitality opportunity though a wholesale supply service.
But for retail brands aligned tightly to experiences and aesthetics that connect on a personal level with today’s consumers, especially younger consumers, investing in the surging lifestyle hotel business might be an investment worth exploring.
