After a successful week at GWA 2016 in Las Vegas, it’s time to reflect. Not about the amount of money lost at the tables but about what it takes to be a successful workspace operator. This year there was a lot of discussion around how to monetize services and provide upsell and cross-sell opportunities in both coworking spaces, business centers, and executive suites.
With the event held at the Mandalay Bay Hotel and Resort in Vegas, it occurred to me that there is a huge amount that flexible workspace operators could learn from Sin City.
So, here are my thoughts on the top five things that workspace operators can learn from Las Vegas:
1. Hotel rooms are a minority revenue line
Now this statement may be obvious once I say it – but it’s important. Las Vegas has more hotel rooms than any other city in the world (154,500 by a count that was taken in 2013). But the hotel rooms are non-core revenues to the hotel operators. But – profitability of hotel rooms is limited – Vegas hoteliers are hoping you spend your hard earned cash in their casino, restaurants, bars, shows, clubs, shopping malls, water parks, rides and any other activity you may be inclined towards. The room is there just to get you to the entertainment. In fact – when you see this pitch from Vegas resorts the hotel room is rarely mentioned – they lead with the all of the other fun stuff. Flexible workspace operators can and should learn from this – the services you can offer above and beyond your offices, desks and space are the last reasons why your members choose to make your space their home.
2. Getting people out of their rooms give opportunity for upselling
Before arriving at GWA, I met with a coworking operator in London – their space is high end and offers fantastic services to entice members away from their desks and offices and into common and collaborative spaces. When I spoke with the Operations Director, it was a very clear strategy. “I’ve been in the boutique hotel industry for 15 years and getting people out of their rooms is key. The longer they spend out of their rooms, the more they spend on incremental products and services and the more, the better their experience.” Communal spaces, networking events, speakers and community building get people communicating and collaborating and start to help you build and leverage an active community of members. Vegas is amazing at doing this. How long do you spend in your hotel room when there’re so many reasons to go and do more?It’s about the service and experience
3. It’s about the service and experience
One thing that can be said is Vegas does bigger and better than anywhere else. But, it’s the little things that count when it comes to service. Whether it be the fact that once you’ve given your name, every staff member in the hotel seems to remember it (hopefully that wasn’t just me otherwise I may have some explaining to do) they say ‘Hi’ and greet you by name. When you’re in the casino sat at the roulette or blackjack table the complementary drinks keep coming – keeping you happy and content to swap your hard earned cash for more chips.
4. When businesses are in town, their people spend much more
Maybe less so in the coworking space, but Executive Suites and Business Centres sometimes forget that there is a market beyond the business that you are renting space to. The employees of that company are also your members. And when a business comes into your space it’s not just a billing relationship with that company that can be a revenue opportunity. A recent survey in the Las Vegas Sun newspaper calculated that the average visitor to Vegas spends $991.00 (not including hotel – $578 Gambling, $129 Shopping, $274 Food and Drink), more interestingly the average business visitor spends 23.4% more than the average visitor. So – think about services that will allow you to establish billing relationships by offering products and services to your tenant’s employees.
5. Technology is at the heart of operational efficiency
Technology underpins everything in Vegas whether it’s the smart solar panels powering the low energy lighting across hotels and casinos or it’s the facial recognition software helping casinos identify cheaters. All of this technology is being put to good operational use – reducing operational costs, helping them to serve customers better and helping them monetize new revenue streams. It’s the same with your workspace – one thing that became apparent at GWA is that many operators still haven’t cracked the technology that underpins their business and that leads to missed opportunities, increasing cost bases and an inability to scale and grow in the future. At essensys we want to help you build your workspace and offer the best experience you can – occupie from essensys has been developed specifically with you in mind to help you manage your business from lead to cash.
So, in summary, I’m not suggesting that you change your strategy. I don’t think pumping oxygen into your space to keep your tenants and members awake or adopting a ‘house wins’ mentality towards service is a good idea. But what I am suggesting is that service matters, and there is a lot to be learned from adjacent industries that operate similar models to our own.
It was a great pleasure to be at GWA 2016 and be involved in some great discussion about the future of our industry, and I’m looking forward to bigger and better next year.