Hotels and retail companies are finally realizing that they have a lot in common. It’s time for hotels to harness that  potential.

June 10, 2020 •

3 min reading

Retail and Hospitality convergence

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What Is Hospitality Retail Management?

The field of hospitality retail management offers managers an opportunity to enhance a customer’s hospitality experience with creativity, while maintaining established standards. The role may include managing aspects of any hospitality establishment such as restaurants, hotels, casinos, museums and gift shops.

Hospitality retail management reflects the feeling of familiarity and security that customers experience when they enter a hotel, pub, restaurant or other establishment and know what level of service and quality to expect, according to the Conrad Lashley book, “Hospitality Retail Management.” In essence, hospitality retail encompasses any sales establishment that offers customers hospitality.

Managing hospitality retail differs somewhat from other forms of management. Lashley explains that hospitality retail management focuses on managing the customer experience to provide consistent service, presentation and quality. Depending on the establishment, this role may require varying degrees of merchandising, quality assurance and coaching employees.

The field of hospitality retail management includes a number of behind-the-scenes workers and functions. Workers may include back office workers such as chefs, planners, sourcers, purchasers and security specialists. In addition, managers must carefully control the customer’s environment.

Retail and Hospitality convergence

Hospitality retail was once little more than a lobby corner shop and some display windows. But in recent years, hotels have started to see the marketing and revenue potential retail presents. When it launched in 2006, the Hoxton Hotel London’s front desk, which doubles as a retail counter, was a pioneer. Since then, brands like 25hours and W Hotels have gone to great lengths to integrate retail into their value proposition.

MUJI hotel room

The rooms at MUJI Hotel Ginza are designed in the brand’s minimalist style, and furnished almost exclusively with Muji products.

An increasing number of new real estate developments are bringing retail and hospitality closer together. It makes sense. Both activities aim to optimize revenue per square meter and offer an immersive customer experience. The lavish reopening of La Samaritaine in Paris by the LVMH group in 2020 features a department store operated by duty-free specialist DFS alongside a Cheval Blanc hotel, thus making full use of the available space. And existing hotels are not waiting on the sidelines: Italy’s iconic Pellicano hotel group partnered with luxury e-tailer MATCHESFASHION in the summer of 2019 to provide a pop-up store aboard a 1930s yacht, servicing the group’s three Italian properties and offering an exciting experience to their guests.

“Hotels have started to see the marketing and revenue potential retail presents.”

Hotel maison du monde Nantes

The Maisons du Monde hotel lounge has a distinctively homely vibe, and can serve as a showroom for the brand’s products.

Many retail companies have actually ventured into the hotel business in an effort to contextualize their products and engage their customers in a less transactional, more meaningful way. Within the past two decades, fashion and jewelry brands Armani, Fendi and Bulgari have all opened hotels, as have home decor companies Muji and Maisons du Monde. Hoteliers, however, have been slow to do the opposite. Compared to these concepts with strong individual identities, chains like Westin and Hilton are missing an opportunity to assert who they are, and create a full brand universe.

“ Retail companies use hotels to contextualize their offering and engage their customers in a less transactional way.”

As customer expectations towards hotels evolve, the traditional model in which rooms create revenue and facilities serve as support is fading. And whilst hotels will continue to rely on their rooms as their main revenue source, a thoughtful retail strategy can help drive the overall perceived value of a hotel — and offer a welcomed additional revenue stream.

This article is extracted from the Hotel Concept Handbook, developed by Creative Supply in partnership with EHL and has been used to create winning hotel concepts. For hoteliers, it helps to create integrated, compelling concepts that attract the interest of guests and industry professionals alike by linking storytelling to operations or design. The Hotel Concept Framework is taught every year to students at EHL.

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