Mittwoch, 15. Juli 2009

Al Lewis: A Minibar That Doesn't Bite

I opened the minibar at the Wequassett Inn Resort and Golf Club in Chatham, Cape Cod, Mass., with a sense of wonder.

A Heineken for $1.50? A Captain Morgan's rum or a Johnnie Walker Red whiskey for $2? A Tanqueray Ten gin for $3?

I have seen Budweiser in other hotel minibars for as much as $8 a can. I have seen sodas and candy bars selling for $5 or more.

Yet here, a Coke, a bottle of water, a tube of Pringles potato chips, and a Snickers bar listed for 75 cents apiece. Even the chocolate chip cookies -- an indispensable part of any late-night binge -- went for only $2.50.

Wequassett is a luxurious retreat on a tranquil bay where finely appointed rooms average $650 a night during peak season. Why was it not bending its guests over the minibar like so many other fine establishments?

"It's extortion," Mark Novota, 47, managing partner of the 120-room resort, replied. "It's gouging."

But hotel guests expect to be extorted at the minibar. Isn't that the industry standard?

"We see it as an amenity," Novota said. "We don't see it as a profit center."

Anybody who can afford $650 a night can afford to take a soaking over a bag of pretzels. And if they need more alcohol after the bars have closed, they probably have it coming.

This is why there hasn't been a Congressional investigation on minibar price-fixing, even though it's been a blatant abuse for decades, sometimes adding hundreds of dollars to credit card bills and employee expense reports.
Novota, however, is taking a stand: "People are willing to pay money, but they're not willing to be taken advantage of."

As an extensive traveler, he has been on both ends of the minibar, once paying $12 for a jar of jelly beans.
"You make a deal with a devil. You come home at eleven at night. And you say, 'Geez I have a craving for this and it's twelve bucks. It should be $1, but what the heck.'

"It's not even a splurge because it doesn't feel like you're getting anything," he said. "You feel taken advantage of ..."
Novota doesn't want this feeling to be part of the overall guest experience.

The resort owner grew up in Chicago, the son of a printer. Years ago, when he first took his humble parents to a fancy hotel, they marveled at the minibar.

"I remember them saying how nice of the hotel to give away all those products," he laughed. "I was footing the bill, but I didn't have the heart to tell my mom, 'They didn't give them to you.'"

Novota also recalls reveling all night at a California hotel, fueled by a pillowcase full of minibar marvels that one of his impulsive friends dragged out to a patio.

"You don't want to be that guy," Novota advises. "When everyone wants to party after the bars close, make sure they are not near your room."

Minibars are so expensive, most sober guests don't use them. Often they remove the pricey items and replace them with goods from a nearby grocery. That's why some hotels have gotten rid of minbars altogether.

In Arizona, for instance, as part of a $50 million renovation, the 492-room Hyatt Regency Scottsdale Resort and Spa at Gainey Ranch, replaced minibars with refrigerators.

Even convention-goers with corporate expense accounts are cutting back on minibars in the middle of a recession, Novota said.

"Luxury is a bad word right now. It's not in good taste to be excessive."

Novota has been at Wequassett for 22 years, yet it wasn't until three years ago that he came upon his pricing epiphany.

He frequently hears from guests. One family told of their struggles, always having to disappoint their children with warnings to stay away from the minibar.

"It's like a toy with goodies in," Novota said. "And it's a dangerous situation, especially when it's five bucks for M&Ms. ...

But not anymore: "What was once this evil domino in the room has become a useful thing."

(Al's Emporium, written by Dow Jones Newswires columnist Al Lewis, offers commentary and analysis on a wide range of business subjects through an unconventional perspective. The column is published each Tuesday and Thursday at 9 a.m. ET. Contact Al at al.lewis@dowjones.com or tellittoal.com)