Hospitality

You’ve optimized room rates. You’ve improved your F&B program. What else can you do to increase your hotel’s revenue?

Get social. We’re not talking about social media, but rather using social events to encourage guests to spend more and attract more revenue-generating customers from the community. Here are just a few types of events that hotels around the world have embraced.

Creating a successful hotel F&B (food and beverage) program is hard.

It’s labor-intensive. It requires skill, vision, and market savvy. Volatile food pricing eats into profits. F&B brings in less revenue than rooms do.

And yet, it’s essential. A hotel’s culinary reputation is the magic ingredient that attracts guests and keeps them coming back. How can you elevate your dining and make that magic happen?

Hotel dining is having a moment.

Hotel restaurants used to have a stodgy, old-school reputation as “a three-meal-a-day café where you just get a club sandwich and a burger,” Ewart Wardhaugh, executive chef at the Epicurean Hotel Atlanta, tells FSR magazine. “But now, the food and beverage within a lot of hotels is just as good as a freestanding restaurant, if not better because they have better support.”

While many hotels’ F&B profits have struggled to rebound post-pandemic, the industry is seeing increases in F&B revenue per occupied room. The drivers: more in-room dining, menu price increases, and event revenue.

Working to boost your F&B in 2023? Look to these trends.

Of all the aspects of hospitality lost to COVID, the hotel bar was missed more keenly than most (second only, maybe, to the breakfast buffet). The bar is a uniquely convivial experience: a place to sit shoulder to shoulder with fellow guests and savor the experience of being somewhere unfamiliar but welcoming.

People want that opportunity to socialize again. That’s why it’s time to reinvest in the hotel bar and end any limitations on food and beverage services, hospitality experts say.

“International travelers want a great bar experience in particular,” Sloan Dean, CEO and president of third-party management company Remington Hotels, said at the NYU International Hospitality Industry Investment Conference. “Often they stay and dine in the hotel, whereas domestic travelers often don’t. So we need our food-and-beverage really dialed in.”

Here's a look at some hotel bar trends and opportunities to maximize revenue and guest satisfaction.

Michael G. Medzigian, Chairman and CEO of Watermark Lodging Trust Inc., remembers the absolute devastation wreaked on the hotel business in 2020. His April occupancy rate plunged from 76% to 4%. His company furloughed 10,000 people and lost around $50 million in cash in the first month.  

It “took unimaginable effort to get to where we are now,” he said in The View for 2022: Insights and Expectations for the U.S. Hotel Industry, a recent webinar hosted by the Cornell Nolan School of Hotel Administration. And the journey’s not over: While Medzigian is generally optimistic, he sees more challenges piling on now than he’s ever seen before.

We distill four of the key insights he and other hospitality professionals shared in the webinar, to guide hotels through an encouraging but tumultuous year.

“Expectations are resentments under construction,” said writer Anne Lamott. That’s especially true in the hotel industry right now, as staffing shortages force cuts in services.  

• Guests expect a full free breakfast… and they get yogurt and a granola bar.
• Guests expect sparkling clean rooms… and they see hasty housekeeping.
• Guests expect to enjoy hotel amenities… and they discover the gym is closed and cocktail hour is canceled.

Guests were willing to lower their expectations for a while, Carolyne Doyon, Club Med’s president and CEO for North America and the Caribbean, said at the recent Caribbean Hotel & Resort Investment Summit. "You know, little things that would have bothered them pre-pandemic, they were accepting. But as we are moving forward, we're back to pre-pandemic expectations” — which can be hard to meet.

In the face of widespread labor shortages, how can you improve satisfaction and prevent disappointment (and, yes, resentment) in hotel guests?

Hotel guest satisfaction is holding steady overall, the 2021 J.D. Power North America Hotel Guest Satisfaction Index Study found. But guests have one big criticism: They miss breakfast. 

More than a third of hotels eliminated buffet breakfasts from May 2020 to June 2021, the study found. Satisfaction with breakfast offerings dropped across the board (except in the economy segment, which rarely offered hot breakfast pre-pandemic.)

"It is clear that guests expect breakfast service to resume, especially in limited-service hotels that usually provide complimentary hot breakfast," said J.D. Power hospitality practice lead Andrea Stokes. Labor shortages, food costs and COVID concerns can make this a challenge, however.

What’s the best hotel breakfast to keep costs down and satisfaction levels up? Here are some innovative approaches.

A drink at the hotel bar. A lavish breakfast buffet. A perfectly planned wedding reception. A romantic dinner at the lobby restaurant.

Hotel guests worldwide had to give up these pleasures in 2020… and hotels felt the pain. Now, hotel operators are getting creative about F&B to win back their guests.

“The perceived value goes beyond portion size,” writes Matt Rinehart, Vice President of Food & Beverage, HRI Lodging in Lodging magazine. “Guests will measure value through the delivery of a thoughtful dining experience or to-go order that is consistent, guest-focused, and detail-driven.”

Here are four ways hotels are delivering just that.