Hotels Turn Guest Experiences Into Retail Goods

■ The Evolution of Private-Label Product Lines Lotte Hotel & Resorts' amenity brand sees sales growth quadruple within six months of launch. Josun Hotel kimchi grows to 50 billion won in annual revenue. Overseas expansion accelerates with direct exports to Singapore and beyond. Hotel Shilla debuts limited-edition keyrings, eco-bags and more. --- A long-awaited trip lingers in the memory. The scenery and restaurants leave their mark, but so does the hotel experience. The rustle of crisp sheets on the bed, the subtle fragrance in the room and the breakfast spread — all of these can stir longing once travelers return to daily life. Hotels are now tapping into that nostalgia. They have begun packaging the experiences guests enjoyed during their stays into products available for purchase, so the sense of something special can continue long after checkout. The scent of a hotel room, the bedding, the breakfast dishes and the character dolls picked up in the lobby have all become merchandise. In particular, whereas hotel private-brand (PB) products once centered on a narrow range of food items such as holiday gift sets and kimchi, the lineup has now expanded to include amenities, character goods and region-exclusive gifts. Room amenities rank among the most popular items with consumers. Lotte Hotel & Resorts partnered with a Swiss fragrance house with 250 years of history in a joint development process spanning nearly two years. In July last year the company launched "Emissary.73," an amenity brand comprising shampoo, body lotion, diffusers and more. Positive reviews of the scent and quality spread among guests who tried the products during their stays, and external sales growth quadrupled within six months of the launch. This month the brand also introduced a travel kit containing 50-ml versions of shampoo, treatment, body wash and body lotion. Lotte Hotel & Resorts is broadening its product range on its own online mall "eShop," where it sells the amenities alongside bedding, diffusers, food items such as kimchi and bakery goods, and character merchandise. On the food side, hotel kimchi stands out. Josun Hotel kimchi, in particular, started as an external retail product in response to purchase requests from hotel guests and has grown into an independent business generating 540 billion won in annual revenue last year. Kimchi has also become the top-selling product on Josun Hotel & Resorts' official mall, "Josun Taste & Style." Its average annual revenue growth rate reached 23.8% from 2021 through last year. Overseas expansion began two years ago, turning the product into an export item shipped to Singapore, the United States and Osaka, Japan. Targeting 100 billion won in revenue by 2030, the company opened the new "Josun Hotel Premium Kimchi Center" in Seongnam, Gyeonggi Province, a facility 2.5 times larger than its predecessor. Walkerhill Hotel & Resorts' kimchi is also drawing attention abroad. In September last year, after roughly two years of preparation, the company made its first shipment of approximately seven tons of cabbage kimchi and ponytail radish kimchi to the western United States. The initial batch sold out quickly at Korean markets in Los Angeles and elsewhere. A second shipment expanded beyond California to New Jersey, Georgia, Seattle and Texas, with more than half of the 10-ton consignment selling immediately upon arrival. Walkerhill, which established the hotel industry's first kimchi research center in 1989 and has supplied premium kimchi to international events including the Inter-Korean Summit and the G20 Summit, is leveraging that expertise as a competitive edge in exports. Fairmont Ambassador Seoul, located in Yeouido, Seoul, is also using the K-food served at its breakfast buffet as a strategy to extend the guest experience. "Fairmont Gim," a PB seaweed product launched last month, has become a signature souvenir that guests tuck into their bags at checkout. Hotel Shilla is expanding sales through character goods and limited-edition products. The company continues to roll out keyrings, eco-bags and other items centered on its Shilla Bear plush toy. Some limited editions have generated enough demand to command premiums on secondhand trading platforms. In January this year, to mark the Year of the Horse, the company released a Shilla Bear Cowboy Edition. Jeju Shilla Hotel offers region-specific variations such as the Haenyeo Bear and Blue Herringbone Bear. The hotel industry sees satisfying stays as a driver of purchasing demand for hotel products. The thinking is that the gratification guests felt at the time translates into purchases of souvenirs, food and limited-edition items, and that product experiences in turn encourage return visits — creating a virtuous cycle. "The relationship with a guest that used to end with a single stay now extends through product purchases, greatly expanding brand touchpoints," an industry official said. "Building a structure that keeps us connected to guests even after checkout will be a core challenge for hotel brands going forward."

Hotels Turn Guest Experiences Into Retail Goods

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