Not long ago, an associate at a foodservice consulting firm told me that fancy, upbeat, expensive fine-dining restaurants in luxury hotels (or even those, he cautioned, in lower-tiered establishments) can be the “fuel dumps of ego trips fired by food & beverage directors who ought to know better,” adding “they can be a waste of space and money, an excess existing to satisfy guests who demand amenities that match the exorbitant rack rates those kinds of hotels charge.” At some hotels, that may ring true.

However... in the ever-changing landscapes of the only two multithemed mega-resort cities worth talking about, Las Vegas and Orlando, hotel food & beverage managers constantly struggle to unearth ways of attracting tourists—be it their casino fanatics or pals of Mickey Mouse—to their restaurants, regardless of whether they are fancy, upbeat, expensive, or ego driven.

We have lectured often enough about your restaurant and how, in many cases, it functions as the face of your hotel. Provided its field is strong enough, it’s the magnet that draws guests and locals to everything else you have to offer in food & beverage.

Here we have an intriguing, yet unusual, spin on that lecture. And our prototype is the Walt Disney World Swan and Dolphin Resort. At 756 rooms, the Swan—Westin-managed under the Starwood umbrella—is the smaller of the two; the Dolphin—Sheratonmanaged, also Starwood—at 1,509 rooms, twice the size. They are connected by a canopied walkway. The buildings are the handiwork of Michael Graves, whose architectural flights of fancy mirror the enchantment of everything Disney. As one aficionado of Graves’s work wrote, “[the Swan and Dolphin] is designed to amuse, delight, and stimulate the imagination.”

The entire complex, which opened January 1990, was built by Tishman Construction Co. Although managed by separate divisions of Starwood Hotels, New York-based Tishman Hotels Corp. retains partial ownership. Given its skills and successes in those diverse—but symbiotic, industries— most industry savants, when asked, will tell you Tishman Corp. knows implicitly what goes into hotels and what makes them operate productively and efficiently.

TISHMAN Manifesto

Keeping in mind what that associate with the consulting firm said about hotel restaurants, note one of the points Tishman Hotel Corp. stresses about managing its hotels: “Tishman Hotel Corp. matches the level of service and amenities provided, with those the guest is willing to pay for. We do not believe in providing services and amenities simply to meet a generalized nationwide expectation.”

There is also this Tishman manifesto, which brings us to the nitty-gritty of the strategy implemented by the Swan & Dolphin F&B team led by Director of Food & Beverage Tony Porcellini. “Any action taken or recommendation made is done so with the express purpose of improving the hotel’s operating performance and increasing its value.” This is emphasized by Menze Heroian, VP, food & beverage, Tishman Hotel Corp., who works with the food & beverage team at these properties with particular goals in mind for each property.

Veiled threat or caution? Doesn’t matter. Heroian is doing what must be done, given the set of competitive conditions the Swan and Dolphin faces daily. To say he lifted a page from the F&B manual at Caesar’s Palace may be a bit of a stretch, but the reality is that when Heroian was working there under the mentorship of VP of Food & Beverage Gamal Aziz (now president and COO, MGM Grand), he picked up a few pointers about promoting restaurants in a hotel.

The 2,265-room Swan & Dolphin, although a spectacular setting inside Walt Disney World, is still close enough to Orlando to let us draw comparisons between it and Las Vegas. Orlando is as much a playground, albeit a family-friendly one, as Las Vegas. One could easily make the case that Orlando—with the second-largest convention center in the country (Chicago’s McCormick Place is largest) and with its vast array of entertainment attractions—easily rivals Las Vegas as the country’s premier tourist and business destination.

The analogy to Vegas is relevant, if only because the same strategies deployed to promote the restaurants and lounges at Swan and Dolphin (17 of them) to conventioneers and other mixed bags of business people and families are similar to those deployed successfully in Vegas. Simply put, if you’ve got great restaurants, find a way to fill them for breakfast, lunch, and dinner.

PARADIGM SHIFT

The Swan and Dolphin has found a way. It is, excuse the expression, a key paradigm shift. It focuses on the hotels’ F&B business model and how management has shaped it to appeal to families and friends frolicking in fantasyland and to business meeting groups compelled to balance the allure of Disney with the justification for the meeting. After all, there is that IRS restriction stipulating certain measures be met before expenses can be deducted.

Rare is the guest at Swan & Dolphin who leaves in the morning without stopping by one of the restaurants or lobby lounges for breakfast, even if just for a pastry and a cup of coffee. And though F&B business drops off after that, the property captures enough lunch business to keep the restaurants busy. Exception? The four specialty restaurants. They are open only for dinner.

What Heroian has observed (which brings us to the heart of his point) is that conference planners—although continuing to schedule traditional F&B functions during meetings (breakfasts, lunches, and breakouts)—are skipping, for the most part, the prearranged evening banquet (the one featuring a big-deal after-dinner speaker or the one where standout performers are recognized for doing something outstanding or big hearted), preferring to allow attendees, after the last meeting of the day, to come and go as they please before returning to the conference the next day.

That’s where Heroian says hotels face their biggest challenge: filling those dinner-only restaurants with conference attendees, convincing them that it’s OK to go outside the resort, grab a cab, and head into Orlando proper for dinner somewhere else—but why bother? With four great restaurants (referred to as “signature dining”) and three high-energy lounges all of them remodeled—that temptation to go somewhere else, thinks Heroian, doesn’t make any sense.

We talked to him about this subject.

HF&BE: Let’s talk about your perception that meeting planners aren’t bothering to schedule evening functions for conference attendees.
Heroian: In large properties, like the Swan and Dolphin, with multiple restaurants—and we’ve got four here, Todd English’s bluezoo; Shula’s Steak House; Palio, an Italian restaurant; and Kimonos, Japanese—we’re finding that planners are deciding not to spend money on catering or a banquet but are telling members, “we’ll take care of breakfast and lunch, but everything else—dinner included— you take care of."

HF&BE: But we were always under the impression that banquet & catering was the cash cow of a hotel’s F&B.
Heroian: You’re right. Catering is more profitable. There’s a fixed environment, we know who’s coming, profit margins are better. But, think about it. We have created these fine restaurants. We have spent a lot of money renovating them. We have entertainment. Part of the restaurant environment is the adjacent lounge and bar.
These places aren’t just for show. We have spent a lot of time and effort creating restaurants to produce a new image for the property: to position the hotel as a food & beverage destination. It opens up a whole new door of opportunities for the meeting planner to say, “they’ve got great restaurants here with enough capacity to handle our whole group in all of them.”
Our sales people walk clients around showing them what we’ve done with “this restaurant here, this renovation here, this bar and lounge over there” and—guess what?—the client gets excited about it. And the excitement they would typically have in spending a lot of money putting together an exciting banquet or catering program now shifts to the excitement of one of our “new” restaurants. The restaurant now becomes the alternative venue to hosting a banquet in a banquet room. And, it costs the client a lot less money.

HF&BE: So, banquets & catering in the hotel are on the wane, except for affairs that traditionally call for one such as a wedding or a bar mitzvah? Banquets & catering are boring?
Heroian: There is so much more focus these days not just on food & beverage, which is what you’ve got—face it—when you’re in a banquet. On the other hand, in a restaurant (one of our restaurants), it’s food & beverage and service and the whole design, ambiance, and experience of dining. You just don’t go to a restaurant anymore, meet someone, eat, and leave. We do whatever it takes to make our restaurants not look like a hotel restaurant, but something as distinctive as any other freestanding independent out there. We have given our restaurants an identity that is solely theirs.

HF&BE: So guests—tourists, conference attendees—choose one of the restaurants at the Swan & Dolphin because there’s really nothing better out there?
Heroian: That’s exactly what I’m talking about. There is nothing better out there. We have created restaurant environments that stand alone within the hotel environment. Once you are in any of our restaurants, you have the feeling you are out of the hotel. You are walking through the window that is the hotel and into a restaurant that is, for all intents and purposes, an independent restaurant.

HF&BE: Yet, the impact of the independent restaurant is precisely that it’s independent. It’s different, unique, unlike anything else out there. What’s so special about what you are doing?
Heroian: You’re right. You just can’t change the menu and the uniform and say, “wow, we’ve renovated.” You have to change the whole look. That being said, you can spend the entire evening in one of our restaurants: go to the bar, enjoy the music, have a drink, then go to dinner, and when dinner is over, you retire to the lounge and bar. The restaurant dining experience today is not just what you have off the menu, but what happens before and after. It’s the experience of the restaurant. Knowing that, we’ve made dramatic changes in the designs of our restaurants. We’ve taken old, stale cooking restaurants and changed them. We’ve changed the music systems to make them trendy. We’ve made them places where it’s cool to be seen and where we also offer great food & beverage. You cannot do as much with banquet & catering spaces. They are still part of the hotel image. As for the restaurants, you can change to make them more distinctive—to stand alone apart from the influence and design of the hotel.

HF&BE: Major shift in F&B strategy?
Heroian: It’s not, if you look at what the main goal of the resort is and that is to book the business: convince the group to come to your hotel. We can do that because we have something our competition doesn’t.
We know of groups that specifically have booked here because of the renovations in the restaurants. The meeting planners know their attendees will have a good time, won’t be bored, and will be well taken care of.

HF&BE: What happens to banquet & catering sales and profits?
Heroian: Overall, revenues are the same. Percentages are the same, just a matter of how much drops to the bottom line. The industry shift we are seeing is one from banquets to restaurants, especially during dinner period. We’re still doing very well, but here’s the way we look at it: it doesn’t matter because in the long run if we book several groups in the hotel because of how effective our restaurant sales efforts are, we’re bringing in a lot more money from those groups on the room side. I don’t have to tell you we’re not only about food & beverage. It’s all about positioning our product—the total package. We’re fine with the shift from banquets to restaurants if we are booking more groups here and getting a higher rate because of that.

HF&BE: You say you’re not just food & beverage, and I have to agree with that, but in the long run you have to stay ahead of the game—the trends—in food & beverage if you’re going to sell, as you say, “the total package.”
Heroian: You’re right. We must keep up with what’s going on in the industry. I see that best exemplified by what Tony Porcellini is doing at the Swan and Dolphin. He is constantly reinventing food & beverage. He is well-informed of what is happening in industry food trends and the meetings market and strives to stay ahead of both the industry and the competition. We have to get a pulse-report of what the consumer is looking for in the ever-changing business climate of food & beverage. And, just as Tony is doing at the Swan & Dolphin, we see the same thing happening at the Sheraton Chicago Hotel & Towers.
You have to read about chefs who are trying new and different things like “molecular gastronomy.” You don’t know if it’s going to catch on, if it’s going to last, but you keep an eye on it. If it does catch on, you want to get on that track in the beginning, not at the end. Your F&B director has to be on top of those things, as does your chef. We need to give them the opportunity to experience what’s new. If we keep them in the dark, we might as well fold the operation.

Stephen Michaelides is president of Cleveland-based Words Ink.