Taco Bell prompted some laughs — and endless nacho puns — when the fast-food chain announced in mid-May that it would dabble in the hotel business this summer.
Next month, the first Equinox hotel is set to open in New York City, with more on the horizon in Seattle, Houston, Chicago, Los Angeles and Santa Clara, Calif. The furnishings brand RH, formerly known as Restoration Hardware, plans to open RH Guesthouse in New York in the fall. West Elm, another furniture store, says it will open its first hotel next year — later than originally planned — but has locations coming in Detroit; Minneapolis; Indianapolis; Oakland, Calif.; and Portland, Maine.
They will join a smattering of hotels already operating around the world under names more associated with fashion, jewelry, crystal or home goods, including Armani, Versace, Bulgari, Baccarat, Ikea, Muji and Shinola.
“Hotels are the new showrooms for retail,” said Chekitan Dev, a professor of marketing and branding at Cornell University’s School of Hotel Administration. “It’s a dynamic, interactive, profitable showroom.”
In an age of quirky Airbnbs and Instagram-tailored design choices, “uniformity has almost become a negative now,” adds Bjorn Hanson, a hospitality industry consultant. He says brands might be attracted to hospitality to create more exposure for themselves, give their products an elevated platform and expand their corporate footprint.
But experts warn that travelers should do some homework before making a reservation based on retail experience or fun features alone. Dev, who has consulted for Equinox and in a lawsuit involving Bulgari, says that while funky is nice, “functional’s got to be first.”
“It’s easier said than done. I think most companies don’t appreciate all the moving parts that go into the complexity of managing a hotel.”
He suggests travelers check to see whether a hotel is affiliated with a known hospitality company. Some are professionally managed by hotel operators, and others have management with a strong hotel background. But guests shouldn’t take that for granted.
Hanson says travelers should search the hotel’s website for whatever photos or videos are available, then go to a consumer ratings site such as TripAdvisor to read the comments. Finally, they should explore a site that scours multiple sources, such as Trivago, to show what a reasonable price is.
“It’s the best time ever for people planning hotel stays because of the availability of information,” Hanson says.
For retail brands with strong reputations, branching out into hospitality poses a risk.
“The hotel still has to be great,” Hanson says. “In some ways, some of these brands have higher challenges because they can be so good at what they do as their core activity that the expectation is that their lodging will rise to the same excellence as their competitors.”
Chris Norton, CEO of Equinox Hotels, says that the company is already in the service business, just in fitness and retail. It is not bringing in an outside operating company for its hotels.
“One of the most difficult things in the hotel business is consistent delivery of service levels — the everyday, the consistency of delivery and the ability to execute,” he says. With nearly three decades at Four Seasons in his background and staffers who have worked in hospitality around the world, he says he’s up to the challenge.
For Equinox, the motivation for moving into the hotel business was the growing interest in not just fitness and wellness, but also a more athleisure-oriented way of living.
“You always ask yourself as a brand: How do I differentiate, what can I do that’s different and what can I do that’s disruptive?” Norton says. “You want to do something disruptive that resonates with the interests of your consumers and your guests so it’s relevant.”
While he says hotels have looked for ways to integrate wellness more thoroughly into their offerings, Equinox can give guests a gym experience that includes the local community.
At the Shinola Hotel in Detroit, which opened in January after more than three years of planning, the goal was to take the standards of the namesake watch and leather goods maker and apply it to hospitality.
“From our office to our stores, we’ve always tried to create a very welcoming, casual, comfortable environment, but use great materials,” says Shinola Creative Director Daniel Caudill. “So those are sort of the building blocks for the hotel. It was very much around creating this very warm welcome.”
Everything in the hotel, from blankets to power cords to wallpaper and a signature scent, was created for the property, with some of those items available for sale in the on-site shop.
“We definitely didn’t want people to feel like they were being sold every time they turned around in a hotel room,” Caudill says. “We wanted to make sure the hotel experience was truly one where they felt like they’re in a friend’s apartment or their own apartment rather than in a hotel room.”
Hanson said past clients of his who ended up not moving into hospitality liked the potential for showcasing their products in a hotel setting, but the realities of getting into the business kept them away.
“When we look at what’s been launched over the years — some of these new ones like West Elm and Restoration Hardware — will someone say the hardware was so great on the door to my room, I’m going to take off the hardware on my house and put it on? Maybe,” he says. “They’re doing something different; it’s more about brand awareness and quality.”
As unorthodox as the Taco Bell hotel sounds, McDonald’s had a head start by nearly two decades. In 2001, the company opened two “Golden Arch” hotels in Switzerland as part of an initiative dreamed up by a franchisee there.
At the time, a Merrill Lynch analyst told the Wall Street Journal: “Going forward, I don’t think hotels are going to be in McDonald’s’ vocabulary.” He was right. The Golden Arches turned the lights out in 2003, according to the Harvard Business Review, after failing to resonate with guests.
As for Taco Bell, the chain released new details about the project Thursday. The Bell will take over the V Palm Springs Hotel — reportedly, once a Travelodge — with more than 70 rooms available to book between the nights of Aug. 8 and 12. Reservations open June 27, with prices starting at $169 a night; press materials describe it as “truly Taco Bell luxury at a value.”
“The hotel will offer guests an elevated hotel stay with a Taco Bell twist at every turn,” Marisa Thalberg, chief global brand officer, said in an email. “The design, service, food, activities and amenities all reflect the passion of the brand and have been carefully curated for the ultimate fan experience.”
Thursday’s announcement hinted that guests could shape eventual menus, promising that “fans who make the ‘tacoasis’ journey might just have a voice in what may come to life in the future.”
“Some of these brand affiliations are harder to understand than others,” Hanson says.