Call it wishful thinking, but we’re anticipating the steadfast return of the hotel lobby bar now that COVID-19 restrictions are lifting. In fact, we predict such outlets stand a good chance at becoming big attractions in the year ahead, with hoteliers able to use them to differentiate their marketing approach and garner more bookings.
The lobby bar (or rooftop bar) is a point of pride for many.With first impressions so important, it’s one thing to approach the front desk to check-in with music billowing the halls from a nearby lounge with most tables occupied by chattering patrons; it’s an entirely different matter to be greeted by an empty hall.
Both of us have long been big fans of the upscale and hobnobbing lounges that hotels have painstakingly created because of the attention to detail in the decor, F&B, theme and overall vibe at these establishments. They are often attractions in their own right. Importantly, and in contrast to an empty lobby when checking in, this ‘scene’ acts to boost overall guest satisfaction and word of mouth to draw in more paying guests.
The pandemic sadly shuttered many of these outlets, and the lack of foot traffic can make a place feel less welcoming. Without the hubbub, something feels off; it’s a void that bleeds into the hotel experience, subtly diminishing one’s appreciation for the guestroom product or other amenities.
What we’re seeing on the ground right now, though, tells a different story — one of revival. With many lobby bars setting up gated entrances to check vaccination status, this conspicuous security chokepoint now elicits an air of safety, so much so that patrons are increasingly confident about returning to the pre-pandemic lifestyle of gathering at kinetic, close-quarters locations. Barring a major surge in virus caseloads that hammers this renewed spirit for socialization back down to its 2020 levels, our forecast is that the lobby bar only gets busier as global travel resumes.
How do you take advantage of this emerging renaissance? How do you re-start a beverage-driven establishment to be both quantifiably profitable and work intrinsically to boost room reservations? In balancing these two realities, the latter is one that may not be readily measurable but is perhaps the more critical of the two as it drives total revenues for the property and gives your property a zero-base marketing tool.
It’s no longer just about thinking of your bar or restaurant as a siloed revenue generator, but in its contribution to TRevPAR (Total Revenue Per Available Room). Does the lobby bar encourage more room reservations? Can the lobby bar positively influence TripAdvisor scores? Are there certain guest profiles that would be more inclined to spend at the lobby bar, thereby giving you a more detailed lookalike audience to hone your marketing efforts? These are a few cross-departments questions to ask.
Design is critical here as your restaurant or bar has to be ready. If you have a renovation planned, the winter is the time to do it before what may be a great summer of travel come May 2022. Then, in addition to having such an operation already in place (big CAPEX is not exactly on the table at the moment) or making the binary decision about whether to re-open, most crucial is having the right staffing. Labour shortages severely limit your topline sales from this outlet, as well as perhaps forcing you to reduce your bar’s operating hours.
Our top recommendation on the labour front is less is more. Food menus should be uncomplicated, featuring only your bestsellers to limit requirements on the kitchen and speed up table turns. Similarly, where it concerns beverages, it’s easier to crack a beer bottle or pour a glass of wine than to prepare an elaborate cocktail, even though the latter may have a price point set at several dollars above such simpler options. While cocktails help to differentiate your product in a unique way, it’s a balancing act because of the time drain involved.
Next, from a design perspective, less is also more as you may need to contend with backlogged workorders and supply-chain issues that might make complex decor purchases harder to implement. Most guests would simply be happy just to have a home-base option at their disposal.
Some hotel brands have great bar components and are poised to make it big as travellers return. Remember, a great bar not only provides marginal ancillary sales, but it also can produce a halo effect to subsequently drive more loyalty and bookings. And that’s ultimately what hotels need right now, so consider how your bar, or any restaurant outlet for that matter, can work holistically towards re-building your guestroom bookings where most hotels make the majority of their profits.
Larry and Adam Mogelonsky are partners of Hotel Mogel Consulting Limited, a Toronto-based consulting practice. Larry focuses on asset management, sales and operations while Adam specializes in hotel technology and marketing. You can reach Larry at [email protected] or Adam at [email protected]
