What is a boutique hotel?
A boutique hotel is a small (usually 10-100 rooms), stylish property that focuses on delivering a unique guest experience and personalized service.
Boutique properties favor distinctive decor and interior design that often reflects the local culture by working with local designers and decorating with local art. Their standout feature is offering highly personalized experiences that go beyond the everyday hotel experience offered by larger hotels.
They offer a different kind of atmosphere that is more intimate and exclusive, often located in unique destinations. The target market is usually travelers looking for distinctive experiences.
What's the difference between a boutique hotel and a chain hotel?
The functionalities of boutique and chain hotels are similar - daily operations are the same and the general hotel business runs on the same model - but there are some fundamental differences.
The functionalities of a boutique hotel and a chain hotel are similar in that the daily operations are the same and the fact that the general hotel business runs on the same model, but there are some fundamental differences.
Boutique hotels focus on individuality and character whereas chains focus on standardization and scalability. Boutique hotels are generally small and intimate operations, maybe even run by the same hotel owner. Chain hotels are usually owned by a group of hoteliers whose business plan is to own different real estate and to develop hotels in different areas.
Boutique hotels are usually independent or part of a small collection, whereas chain hotels have global brand recognition. The target audience differs as well: travelers staying at boutique hotels are looking for unique experiences that drive hotel guest satisfaction, whereas those who choose chain hotels prioritize reliability and amenities.
Must-have features for your boutique hotel
A hotel's features are ultimately what pushes a guest over the edge to make a purchasing decision.
Standard features every hotel should have
A boutique hotel needs the same standard features as a regular chain hotel, like a website optimized for online bookings, a well-crafted loyalty program, free Wi-Fi, clean rooms, comfortable beds and food and beverage options like room service and a hotel bar.
But you should also have features that make the difference.
Personalized amenities that make a difference
Instead of offering commercial bath products, work with local producers to create soaps, shampoos and conditioners that guests will love. You could also offer a pillow menu or duvet menu, where guests can choose their desired firmness and blanket thickness. Going the extra mile with your amenities will make the difference.
Theme-based experiences
Your added features should align with your hotel's brand identity, so before designing the features, make sure you have a clear idea of your hotel's value proposition.
Examples of boutique hotel experiences:
Art and local culture hotel
If you position your hotel as an arts and culture property, consider rotating art exhibitions from local artists or having each room decorated by a different local artist. You could gift a postcard with a painting at the end of the stay or provide art books within the rooms for guests to peruse at their leisure.
A foodie hotel
If you take the foodie route, leave artisan chocolate on the pillow during turndown service or offer artisan beverages in the mini bar. Invite visiting chefs to the hotel's restaurant or offer breakfast using local products and sustainable, organic produce. These perks provide an added bonus and personal touch to your hotel.
A wellness and spa hotel
A wellness and spa hotel is a great way to attract an audience that is generally not price-sensitive. Offer different kinds of massages, a nail or beauty salon, workout classes, yoga or Pilates classes and a juice bar. Tailor your services to focus on wellness, whether through a vegetarian restaurant, a meditation room, yoga mats inside the room or even a boutique that sells branded loungewear and sportswear to attract your desired guests.
Technology and virtual concierge
Online guest services like a virtual concierge are a great way to differentiate your hotel, offering top-notch service without investing in a dedicated staff member. Technology can boost satisfaction levels by handling simple guest requests like extra pillows or room service quickly while streamlining operations. This is one of those must-have features in a modern boutique hotel.
Sustainability and local partnerships
Eco-friendly practices, local sourcing and community engagement are all important in creating your boutique hotel. The more you invest in relationship building within the local community, the easier it will be to promote your hotel through word of mouth from local businesses, creating a network that can sustain your hotel long-term. In the niche travel market, sustainability is also a key added value.
10 tips for running a boutique hotel successfully
Now that we've looked at some must-have features, here are tips that will help you successfully manage your boutique hotel.
1. Use your unique value proposition
Your unique value proposition should be the common thread that ties your hotel together. Everything you do - the services you offer and how you offer them - should be directly related to your hotel's positioning. Make sure you complement these features and services so you can use them to position your hotel within your competitive set.
Learn more about defining your hotel's competitive set.
2. Rely on technology to streamline operations
In a boutique hotel setting, you're usually working with limited resources and employees who are multi-functional. The same person who serves breakfast might later clean the rooms. This is why you must rely on technology like small hotel management software that will fill gaps in personnel, taking away manual tasks from day-to-day operations so your staff can focus on offering the best service possible.
By leveraging this kind of software, you can automate operations to help drive activities like upselling that bring in more cash flow, better manage reservations, rates and housekeeping, and propel forward the guest experience in a way that is mutually beneficial for both your hotel and guests.
Find out how hotel front desk software can streamline operations.
3. Create and leverage guest profiles
Guest profiles are key for keeping track of guests who stay with you, so you can offer targeted services and keep a record of their preferences - for example, if they like to find their bed turned down or have certain temperature preferences. Having this information on hand helps you better understand who is staying with you so you can better cater to their preferences. Personalization is one of the keys to guest satisfaction.
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4. Collect feedback with surveys
Satisfaction surveys are a great way to pinpoint problems, gaps in your service or room for improvement so you can anticipate possible issues before they become a problem. They also give you a chance to understand what you're doing well so you can give your staff positive reinforcement, which does wonders for staff morale.
5. Review, refine and repeat
There is no secret formula to a perfectly-running boutique hotel, so the important thing is to review how things are going regularly, learn from your mistakes and keep refining processes. Involve your staff to make it a collaborative process where they feel like they're an important part of your hotel functioning to its full potential - which they are.
6. Engage directly with guests
One of the benefits of a small hotel is that you have a chance to talk to and get to know the people who are staying with you. An important part of being a manager is being able to identify pitfalls before they become a problem and understand what you're doing well. Get an idea of who your guests are, their motivations and what kind of services they might like to see in the future.
Getting to know your guests is as easy as striking up a conversation when they check in or when they're relaxing at the bar. There is no better way of doing market research than actually getting a feel for who your guests are, what they're looking for, how they found your hotel and why they chose to stay with you.
7. Focus on staff training and culture
Just like luxury hotels, boutique hotels have an added value that comes from the staff - people are at the heart of the hospitality industry. Investing in training hotel staff is an essential part of delivering exceptional experiences because they are the face of your hotel and the ones in charge of hotel operations. The more trained your staff is, the more empowered they are to make decisions and help make the guest experience unforgettable. Invest in your staff and they will invest in your hotel.
8. Collaborate with local businesses
Local businesses and artisans, restaurants and tour operators can help develop a sense of place around your hotel's offerings. Whether it's a curated city tour, exclusive dining or locally sourced amenities like handmade soap or shampoos, the more you can connect guests to the destination, the more cohesive the entire experience is, setting your hotel apart from other hotels that could be found anywhere in the world.
9. Use data to optimize pricing and marketing
Use data to optimize pricing, monitoring occupancy trends, seasonality and guest behavior. This will help unlock ways to maximize revenue and keep occupancy rates high. You can also tailor marketing campaigns to meet the revenue needs of your hotel and drive direct bookings. Your marketing campaigns can be used to drive demand generation.
10. Curate exclusive experiences
Personalized experiences like private wine tastings, themed in-room surprises, tasting menus at your hotel restaurant, guided food tours of the city, rooftop parties with local musicians or art expositions within your hotel are a huge part of personalization, which is what guests staying at boutique hotels are looking for. This will also help differentiate your hotel from the competition and lead to repeat guests.
Measuring success in boutique hotel management
Measuring success is about having a series of essential hotel KPIs that help create a picture of how well your brand is performing. You'll also want to look at guest satisfaction, online reviews and gather social proof to determine the success of your boutique hotel.
Knowing where you're performing well and where you need improvement will not only help guide your marketing efforts but will also help you make better strategic decisions in the short and long term. You can only be successful over time by knowing what works and what doesn't work so you can tailor your strategies to meet the end goal of profitability and a great reputation.
Key performance indicators
Some key performance indicators that can tell you how well your hotel is doing are: occupancy rate, ADR, RevPAR and GOPPAR. By establishing a baseline you want to reach, you can also develop marketing strategies and campaigns that will help you drive the results you want to achieve.
Guest satisfaction metrics
Guest satisfaction is at the heart of what you do, which is why it's important to measure guest satisfaction through surveys and calculating a Net Promoter Score (NPS), which is a measure of customer loyalty and satisfaction, showing how likely a customer is to recommend your hotel to other people on a scale of 0 to 10.
Online reviews and social proof
Monitor ratings on platforms like TripAdvisor and Google and social media, which will help determine your online reputation. This way you can engage guests and respond to both negative and positive reviews alike, which is a way of demonstrating that you care. It's important to know what guests are saying about you online because it's like your online business card.
Conclusion
Managing a boutique hotel isn't rocket science, but it does require persistence, flexibility and the ability to learn and adapt your offering to what the market wants. The key to running a successful boutique hotel is having a clear idea of what your unique value proposition is so you can mold all of your activities - from marketing to decoration, services, amenities and more - around what makes you unique. After all, a guest chooses a boutique hotel for its ability to offer a one-of-a-kind experience.
Want to better understand changing guest expectations?
Download our guide "Understanding the Modern Guest"
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