How lobby design can help boost ROI

Margaritaville Resort Orlando lobby, courtesy of The McBride Company

Catering to new demands, hoteliers are opting for smaller guestrooms and larger public spaces in hotels. The combination can help drive revenue in several ways, with both higher occupancy rates and purchases of amenities within the lobby.

Traditionally, Raj Chandnani, VP of strategy at WATG & Wimberly Interiors, said, hotel lobbies have served as an entry and waiting space. “It was a substantial portion of space that was non-revenue-generating,” he said. The addition of food-and-beverage options like a cocktail space or tea service helps “animate and activate” the space. And F&B options don’t need to include a full restaurant that is open for three meals each day, he added. “There are multiple options. It could be like a food hall or pop-up restaurants that keep people coming back.”  

“The inclusion of a food-and-beverage component is becoming crucial to enhancing the guest experience,” said Barbara Best-Santos, associate principal of ForrestPerkins. “Today’s lobbies are true ‘great-room’ environments that are activated through varied seating options and live/eat/work-inspired spaces.” 

By providing opportunities and reasons for guests to linger in a lobby, Best-Santos said, hotels can add to their return on investment through beverage sales, which typically have a high return. “There is also a trend toward renting areas in, or adjacent to, the lobby for small meetings and/or events,” she said. “Once the place is activated to a level that makes it a desired destination, the hotel can actually sell private areas and create revenue.”

The communal space concept, Chandnani said, has opened designers’ eyes to the WeWorks concept of “coworking” spaces, and of potentially positioning lobbies to accommodate mobile workers. “There’s a debate within the industry if it should be a formal WeWork concept with a membership fee or if it’s just a way to differentiate the lobby,” he said.

Jessica Lotner, senior interior designer at the McBride Company, is designing a Margaritaville resort in Orlando, Fla., where the goal of the design is to create a social environment with lots of seating and opportunities to congregate. To help facilitate social interactions, the lobby has lots of restaurants, coffeeshops and retail venues surrounding the seating spaces. “You are part of larger environment,” she said of the lobby experience. “It’s easy to wander in and meet people. It’s really like the heart of the hotel.” 

Even small hotels can find sources of revenue in lobbies. Lotner is designing a boutique property in Vermont, and has partnered with local craftspeople to provide supplies and amenities that both enhance the overall experience and that are available to purchase as souvenirs. When guests can take home local maple syrup to handcrafted coffee mugs, Lotner said, it promotes local trade and helps everyone. 

Lobbies and Brands

A hotel’s segment and the “brand promise” are certainly determining factors in the initial programming of what needs to go into a lobby, Best-Santos said. “However, there is such diversity even among hotels in the same sector and brand that the final program and design are largely defined by the location, desired personality and operational goals of each property. The same hotel in different cities may have entirely different amenities. This speaks to a new personalization of hotels that is even creeping its way into formerly structured and traditional brands. The future operation of a project is carrying more weight in the early decision-making of the program and aesthetic.”

For the Orlando project, Lotner said that the hotel’s partners help emphasize the Margaritaville brand. “It reinforces the sense of play and the relaxed atmosphere,” she said. Stores in the lobby will sell branded mementos like pillows that guests can first experience in the hotel and then take home. It not only reminds them of the trip, she said, but reminds them to come back again.

New Design, New Lobby

In late May, the first Tru by Hilton hotel is slated to open in Oklahoma City. The brand, geared toward millennials, has small rooms with a large open-plan public space called the Hive, inspired by other Hilton brands like Hampton and Home2 Suites. By creating open-plan “zones” to suit different needs (eating, socializing, working and playing), the team maximized the usage of the space’s 2,770 square feet. Beyond a breakfast space, the Hive includes a 24/7 market where guests can grab snacks, drinks and supplies.

“Designers look to other industries and segments to keep abreast of trends in space utilization,” said Tripp McLaughlin, senior director of Tru brand management at Hilton. “As a result, they help brands design today for the needs of tomorrow’s lobbies.” The Tru design, for example, was inspired by the “tiny house” movement and Ikea furniture, he said. “This is a perfect example of trends guiding layout design, which is applicable to lobbies as well.”

The prototype, McLaughlin said, was created to meet a range of needs at all hours of the day: “Guests no longer have to leave the property to eat or socialize because of the elements and experiences the lobby provides, making the space a natural revenue-generator for properties.”

While much of the “eat. & sip.” market is devoted to food and beverage, McLaughlin said, the “Command Center” (the brand’s version of a front desk) also sells other sundries and supplies. 

To develop the lobby, the Tru team and Cincinnati-based FRCH Design Worldwide leveraged a mix of consumer and current Hilton owner insights. “We conducted eight rounds of consumer testing with about 4,000 of our target consumers physically coming into the Tru by Hilton model to test and improve the space,” McLaughlin said. “Additionally, we worked extremely closely with a team of 10 of our most dedicated and innovative Hampton owners, who we dubbed the ‘Midscale Advisory Group.’” The team incorporated the advisory group’s suggestions throughout different aspects of the brand elements and prototype. “For example, they were a great resource as we finalized the amount of seating in the lobby, as well as colors throughout the space.”