Boosting Revenue and Caring for Guests with In-Room Wellness Solutions - Haley Payne & Zach Webster, Pure Wellness [Sponsor Bonus]

Josiah: Wellness is a huge trend and decision criterion for travelers today. And in today's episode with Haley Payne and Zach Webster from Pure Wellness, we're going to dive into some of the data on this, hear what they're hearing in the market, as well as some of the ways that they're helping hoteliers both provide a better stay and drive more revenue in doing that.

Josiah: Tell us about the company and then I want to get into some of the stuff that you're doing and seeing in the market today.

Haley: Thanks! Pure has been around for 16 years. In fact, I was the first employee that was not the founder of the company. But we are the leading in-room wellness provider for hotels as a premium room solution and then also as an experience for the guest. Our goal is to convert hotel spaces, hotel rooms or meeting spaces or spas or anything, and we do that through improved air quality. Our goal is to remove things that trigger respiratory challenges like mold spores and bacteria and viruses and yeast and fungus and things like that. Then, in a guest room, the bedding is hypoallergenic, and we filter the shower water. So we make it a total wellness experience for the guest and the hotel creates a room type, charges a premium for the room, so it becomes a revenue generator and also an alternative for a hotel if they're doing other things that are wellness or this is the door opening to what they're going to do for wellness in the future.

Josiah:
Any stats or trends that you've seen with regard to wellness that our listeners might appreciate knowing?

Haley:
Yeah. Through the Global Wellness Institute, we follow them very closely and they are great about showing all of the different trends for wellness. And it's not just tourism, but tourism is the number one grower, I guess, of all the wellness markets that are out there. And they're saying from 2022 to 2027, revenue for wellness tourism is going from 600 billion to 1.4 trillion. That's a lot of wellness travel and a lot of it may be people going to see spas or retreats or something like that, a primary wellness facility, but a lot of it is secondary travel, especially here in the United States where the guests may not be going to that location because of wellness, but they're going to partake in something that's wellness-related while they're there. So that kind of falls right into a Pure Wellness room for hotels.

Josiah:
Haley, I'm kind of curious, as you're talking to a lot of hospitality providers out there, what are you hearing, seeing in the sense of guest demand for these type of offerings?

Haley:
That's a really good question because sometimes hospitality has to catch up with what's going on. And everybody knows that the traveler is a different traveler today than it was, right? So this is an experience-based traveler, they're going to work a little bit and they're going to play a little bit. And we know that based on the feedback that hotels are getting is they don't want anything different than what they can have at home. Take the bedding industry, for instance, I have the bed that folds you up like a burrito and makes you cooler or warmer or whatever you need. And when I travel, I don't want to have anything that's less than that.
I think that travelers want to have the same experience and if they are the wellness-minded traveler, they're looking for things that help them remain healthy on the road. It could be healthy menu options, it could be a way better gym than what hotels have had historically. Meditation rooms popping up everywhere, wellness spaces. So I think that our program is an answer to that in that we're offering something to the guests that maybe they didn't even know they needed. Improved air quality, you don't always think of that on the wellness realm, but it's certainly very important.

Josiah:
It's fascinating. And this question could be for either of you, but I'm curious, some of the challenges, everything that you described, that's what I want as a guest - and as a hospitality provider, these seem like incredible things to offer the guests. You mentioned there's an opportunity for some upselling here. So, what are some of the challenges? What's holding people back from offering this kind of thing?

Haley:
There's a cost associated with converting the rooms, and so that is sometimes a challenge. And I think for some, again, people don't always think of air quality as what's on the wellness spectrum. It's so easy when you have something tangible you can show the guests that you're doing. We just renovated our rooms, the TV's brand new and it's gigantic. And so that's a much easier sell in the mind of a hotel and you can raise your rate because you've got something tangible you can show the guest. So when we start trying to talk to owners and management companies and say, "Hey, this is a room that the guest gets a better night's sleep because the air quality is so much better that they sleep better," it's just hard for people to wrap their arms around that.

Josiah:
I wonder if some of it comes down to messaging. I mean, Haley, you're running commercial. I've spent my career in marketing and some of the elements you mentioned, you talk about wellness, you talk about sleep quality, really interesting to think as hospitality providers, how do we get really good at providing good sleep?

Haley:
It's such a good question because look, how many times do you hear, forget hospitality, just in life, on the news, what you read, on the radio, commercials where, hey, people are not sleeping the way they should. This is going to solve your problem or that's going to solve your problem or whatever. And I feel like that's where hospitality is going to go is improved sleep.

Josiah:
This has resonated for me because I got about four hours of sleep last night and I am wishing I could stay in a hotel room that has some pure technology installed in it. Zach, I would love to get your take on something because, again, it sounds great. I'm curious on the logistics side, the operations, you're running operations for the company, helping hotels across the country with this kind of stuff. How would you advise our listeners think about what the install looks like or some of the operational considerations of bringing this online?

Zach:
Sure. What makes Pure unique to some of the competition is we are a very low intrusive turnkey option. So we have technicians that will come in and install this product and it's going to be available for sale the following day after it's been installed. And sometimes when you hear hypoallergenic solutions, there are players in this market who actually will require removing carpeting from the rooms or doing linoleum to reduce allergen triggers from things like pet dander or dust mites.
What's unique about Pure, we utilize a solution called Shield, and that's a bacteriostatic barrier, scientific phrase there, but an analogy would be it's a microscopic layer of spikes that get sprayed down and once it dries, it's incredibly safe and you could lay your sandwich on the credenza and then pick it up and eat it. You're not exposing yourself to any crazy toxins or anything like that. But what makes that awesome for hoteliers is we can come in with this turnkey solution, the room looks almost identical to how it did prior, and there's no major construction involved in turning that into a premium room type for a guest. And if I was a hotelier, that would be critical for me. Hospitality is a fast-moving market. You got to be able to have rooms online quickly, and that's where Pure is a competitive differentiator for sure.

Josiah:
It's great to know. I'm in California and unfortunately somewhat frequently wildfires will come through and unfortunately a lot of locations where people could be listening in from deal with this on a too frequent basis. So your offering's kind of one of the ways that hospitality providers can think about ensuring that they can protect their guests in these kind of situations?

Zach:
Absolutely. Actually, we historically have seen an uptick in traffic to our website anytime things like wildfires or air quality is top of mind for the guest. And thinking back to historical examples, we've had guests that have reached out to us and asked where our partner locations are in California if they're visiting family during one of those times. But our air filtration systems remove 99.99% of microbes at a very small micron level, so it's definitely a safe space during times of poor air quality, whether that be viral or pollution.

Josiah:
Well, it's interesting you mentioned that because you mentioned air pollution from a wildfire or something like that. Obviously through the pandemic, I feel like there's a lot of talk about this, but what I'm hearing you, Haley, talk about is on an ongoing basis, even if those two things are not there, there's a certain amount of this is going to enhance sleep. Are there other benefits that you encourage some of the people that you're working with to communicate in terms of how this becomes part of the guest experience?

Haley:
When we first rolled out Pure, we rolled it out really to focus on the allergy and asthma sufferer because clearly that's the guest that can benefit greatly from this room. But as we learned about the traveler, we realized there's a lot more benefits. I'm not an allergy or asthma sufferer. For me as a road warrior, it was around making sure I get a good night's sleep. But anytime you improve the air quality, your body can get to a resting state much easier because it's not trying to fight off a particulate that it's not used to breathing. And so you can get in that level of REM sleep and sleep longer and better and wake up and feel more refreshed.
So we certainly focus on that. But, say, a guest that has pet allergies, like Zach alluded to, this is a room where we discourage pets. Even though I love pets, we really don't want pets in this room if it can be avoided because the dander is too heavy for the air purifier to filter that out. So the hotel would have to deep clean the rooms. But since most brands are now pet friendly, this is a room where a guest that wants to stay at that brand, they're loyal to that brand, but they don't want to deal with pet dander, then they have an alternative.

Josiah:
I always love to bring a new idea or an innovation to life through a story. And I wonder if there is a case study of a hotel or group of hotels that you've worked with. Name the name if you want, or you could just leave it anonymous. But I'm just curious how this has played out on a project, both in terms of logistics of the installation and then if you can speak to some of the business impact, whether that's revenue or otherwise for them.

Haley:
I'd say we're pretty evenly distributed between Marriott and Hilton. And we've got IHG and we've got Hyatt, and then we have some independents, but Hilton is our best-performing brand from a revenue perspective and I think a lot of that is because you can give a really good room description for a Hilton room, and so the guests can understand. When you look online and you see a Pure Wellness room, I don't know what that means to somebody. So when you can read about it and understand it's around air quality and hypoallergenic bedding and filtered shower water and things like that, then you have a better understanding and can make that buying decision.
Marriott, there's not as good of a descriptor, and again, it's hard to put an image. I can put an image of an air purifier on there, but you may not know it's an air purifier. The issue is trying to get the guest to book the room before they get there so that they can pay the premium prior to checking in. So Hilton certainly is the top revenue generator, but I can tell you it is a very rebooked room type. So once the guest stays in the room, tries the room for the first time, they like the room, they'll rebook it on their own. So the challenge is getting them in there that very first time.

Josiah:
It's always a little bit hard to look at ROI of things, but I always love to try to attempt to do that in a sense that I know that not every benefit can be quantified or tied back to an innovation, but do you have some sense of the payback period on this?

Haley:
Yeah, so we have a couple of different payment models. One where the hotels can buy the program upfront and usually that's through CapEx dollars and it's a two-year agreement. And then every two years there's a renewal for the rooms because we do a maintenance on the rooms every six months. So there is an ongoing partnership with the hotels. Typically, when a hotel buys the program upfront, they'll start to see the return on investment anywhere three to four months after install. There's a little bit of a ramp up in the beginning, but it's around 40, 50% paid occupancy, meaning the guest will pay the premium 40 to 50% of the time, and it's usually a 20 to $25 premium. So depending on if they do 10 rooms at the hotel or they do a floor or something like that, it would depend on how soon they start seeing the return on investment. For a revenue share hotel, meaning there is no upfront cost, but we will share in the premium that they capture, then the return is fairly quick because they're not having to upfront the money, but they're always sharing that revenue with us.

Josiah:
That's amazing. Very few innovations that I've seen do a revenue share. Is there some criteria to participate in that program?

Haley:
The criteria is that they sell the rooms. No, I mean, if it's July, for instance, and you, Mr. General manager or Mr. Asset Manager wants to put Pure in some of these hotels, but you don't have any more capital dollars, what are you going to do? And we don't want you not to do this until the next year, so we work with you on that.

Josiah:
I understand you just signed a new deal with Atrium. Could tell me a little bit about that.

Haley:
Yeah, so we are in the middle of installing all of Atrium Hospitality's portfolio, about 71 hotels across the US and what's great about it is they are in major markets, but they're also in secondary markets in states where we weren't before. And so now you can find a Pure room in states where we haven't been in the past and it's great.

Josiah:
I love it. I do want to invite people to visit your website to learn more about this. This sounds really exciting, especially the ways that you can work with hotels. But before we go, any final thoughts?

Haley:
For me, when you look at hospitality and all these lifestyle brands that are popping up, there's so many now, I don't even know them all anymore, right? But it is hospitality's way of reaching that guest that is traveling that has that special need. And so I think that where hospitality is really going towards that personal experience for the guest and that's great for Pure, that's great for the traveler because certainly it allows them to be on the road more frequently. They don't have to be at home or in an office working and they can spend their time at hotels and experience life a little more. So I think it's great for hospitality and we are so happy to be a part of that.

Josiah:
That's great. In terms of where can people go to learn more about you and what you're doing?

Haley:
So they can go to pureroom.com, www.pureroom.com, or they can really stay at any one of our 300 hotels and experience a Pure night's sleep, which we would love them to do.

Josiah:
Amazing.

Haley:
If you go online, you can learn more, contact us. And then also there is a Find a Pure Room location where you can find a Pure room to stay in when you travel. So, Josiah, you can do that.

Josiah:
Well, I definitely will. I'm going to pull this up right now. Haley and Zach, thanks so much for taking some time to chat today and sharing a little bit about this.

Haley:
Thanks for having us.