What I Learned Traveling Europe - Richard Fertig, Stomp Capital

Speaker 1: 0:00

Today we're speaking with one of the most interesting people I know, Richard Fertig, the founder of Stomp Capital, which owns and operates boutique lodging from the Hamptons to Palm Springs to Costa Rica. In this episode, you'll hear what he observed and learned from his most recent travels. There's a lot in here that you can use in your business, regardless of where you work in the hospitality ecosystem.

You've talked before about some of the most compelling aspects of hospitality being or happening when we move from consistency to excitement, and that's the opportunity.

Speaker 2: 0:55

Totally. And what I'm kind of iterating through right now with my team. It's always evolving, right? Is that? the way traditional hospitality solves a problem is by throwing labor at it, right? So there's an issue. Here's how we fix it hire somebody or make this part of somebody's job description, and so there's usually people involved, and that's the very traditional hospitality approach. But where I'm spending a lot of my time and thinking about my travels in Europe and we stayed, we had the great fortune of staying at some incredible luxury hotels that have been around for decades, if not generations, and just studying what it is that they do. And when I say studying, like every single person that we came into contact with, i was sitting in my own mind wondering is this valuable? Is this adding to my experience or actually detracting? And that's a new question. So frequently we assume that people in a role are adding value to the end user, but the reality of it is maybe it's post COVID, maybe the world is changing, but the average person in a hospitality role right now is actually not hospitable and isn't actually adding a lot of value. So what they might be doing could be adding value like, hey, the valet wasn't very friendly, but they got my car and I need my car, so like that's adding value. But what if the valet is not friendly and doesn't manage to get your car or scratches your car right? So now, all of a sudden, we've introduced a solution. That's caused a problem And the best example I can give I was staying in a five star hotel, world class. All of your listeners would know and think very highly of the organization. I'm not going to out them because it's not about. I'm not trying to make a point at somebody else's expense, but we paid a significant amount to stay at a five star hotel that all of your listeners would say, wow, that's preeminent hospitality. The suite that we stayed in came with our own butler not that we needed one, but they came with a butler And so they said just call us about everything. Well, the first night we got there we were tired And so I picked up the phone and I called the butler and I said hey, what time does the full service restaurant downstairs, what time do they close? And the butler said you know, i don't know. Let me transfer you to the restaurant. So she transferred me to the restaurant. The person answering the phone at the restaurant, which is now a second body. Second, you know, butler expense, and in Europe it's expensive and there's benefits and so on. So now the first person transfers me to the second person at the restaurant which, by the way, i'm capable of calling the restaurant directly. Right, like, i've got that ability, but I went with the route that they told me butler. First, butler transfers me to the restaurant. The person answering the phone at the restaurant also doesn't know what time the restaurant closes and says please hold for me, i'm going to now transfer you to the food and beverage manager. So here I am and my guest experience with these layers of hospitality, which are supposed to be adding value and are certainly adding expense, are actually detracting from my experience, Far from driving experience. They're literally wasting my time, frustrating me And I don't mean to be, you know, nitpicky and I'm, you know, like there's a fine problem to have, right, there's a lot bigger issues in the world to solve. But when I'm discussing, studying and studying the approach that traditional hospitality takes is, there's an issue hire somebody, train that person, have them be hospitable. It's harder today than it's ever been And the question that I have is is it even relevant, going forward, right, like in the next generation of hospitality. Do I need to have a butler, who then transfers me to somebody who answers the phone at the restaurant who then transfers me, or is there an app or instructions or a introduction to the property where I get onboarded and I have these answers at my fingertip? And, by the way, not only does that save labor expense, but is that actually delivering greater guest satisfaction? And the answer, if done properly, is yes.

Speaker 1: 4:45

So the takeaway is question everything right. Don't just inherit these assumed notions of these are the staffing we need.

Speaker 2: 4:52

That's exactly right, and what we're doing at Stomp Capital right now is we're literally putting together a whole set of orthodoxies that we're questioning, like it. Okay Well, do you really need somebody to check in? Do you really need a valet? Do you really need this, do you really need that? And what ends up happening is, if you get very, very granular and very specific about it, you can start to say no, no, no, no, no. You dwindle down the labor expense and then the things that you say yes to are very intentional and you can focus your Training and hospitality program around a few touch points as opposed to diffusing it broadly everywhere.

Speaker 1: 5:27

So I want to hear a little bit more about About your most recent trip, because I do appreciate you sharing that example. Sometimes we learn best from situations that didn't go so well right, and so that's helpful. I'm curious if you ran into an experience or an environment that you really enjoyed and appreciated. What stood out to you about that experience?

Speaker 2: 5:48

So there's a hotel in the Amalfi Coast in Positano. It's called Il San Pietro. It's world-class, very well known, absolutely gorgeous place, costs a small fortune but it's worth it in my opinion, and I've been now twice, i went last year and I went this year and we're going next year And, in an ideal world, will continue to go every single year because we enjoy it that much and like. That's the kind of like Following that we hope people will have for our locations in our form of hospitality, where, instead of trying to find new people constantly and there's churn and short stays, our goal is to have people that are intentional, that love it, that have been more than once. It's easier to satisfy them and you get to know them and build a relationship, but also what length of stay increases and so on. So what did I learn from them? Well, first off, they are like a family. They've been around for let's call it 50 or 60 years and In many instances, the people that opened the hotel are actually still working there, and so that's not a job for them. It's part of their identity, that their Hospitality is who they are. They've got their one in the same, and so the guy that was driving us to town. I said, how long have you been here? and he was short 17 years. And then the next guy I speak to, how long have you been here? 35 years. And then the next guy or ladies, like yeah, i've been here cleaning rooms since they opened, and so That sort of legacy is very, very difficult to recreate, to recreate in today's world. People don't view like a job, as a career and a part of their identity, but, more importantly, they love what they do. They love the guests. They've figured out, you know, life satisfaction. They walk to the hotel. So it's really really powerful To have people on the team that really believe in what it is that you're doing and do it for more than the job, like they really derive satisfaction from delivering hospitality and service. So Impossible to recreate. Right, it's gonna take 35 years or so, but like that's the goal, that's what we learn from having consistency, because the same people are always there and they're training other people and so on. But that that's a remarkable experience and one that you know we should endeavor to replicate. So huge shout out to il san pietro.

Speaker 1: 8:06

I love that. I actually i recall seeing a tweet from a couple days ago. I can't remember where it was from, but you said you never wear swag, but i'm an exception. Was that this place, or is that another one?

Speaker 2: 8:15

so from that place, from ill san pietro, we take a boat to capri and then there's this little beach club. They're called la fontolina. I've been going there now for probably i don't know 10 years or so, but when i'm there it's the same sort of thing Meet somebody and they've been going for 20 years, and they've been going for 30 years and this, and that i was in the hamptons last summer and i was wearing a baseball, actually a hoodie that said La fontolina and i rarely wear swag of anybody, including us, but i would. I love this place so much that i was wearing a hoodie that said la fontolina, and this guy walking by me and i'm sitting having dinner at an outdoor cafe. So, oh my gosh, i love that place. In fact i named my dog la fontolina and so, like this guy's dog is named after this beach club. And then this last time i was there i was sitting at another hotel In the port of hercules called ill pelican also you know, incredible hotel, been around for decades and the guy sitting next to me Is where the left on the hat. So we start chatting and he said i name my boat fontolina, so people are literally naming. You know, no one's getting a tattoo that i'm aware of, but they're naming dogs and boats and so on over this location and you know. You might ask what's so special about this location, and there's a lot of lessons in this too. First of it's an incredible location. It's on the water. Great views like that's hard to replicate, but on capri there's a lot of places that have that too. So it's really the culture And who they invite and you have this sort of not everybody can walk in, so like that adds to the intrigue and the mystique and so on. But really it's not that much. There's cement over the Mediterranean rocks going right to the water. You can pay for like a phone, mattress or a chair and an umbrella. The prices are relatively exorbitant for what it is that you're actually getting. But what's kind of interesting is and this is a discussion i've been having with my team as well The expectations for hospitality in america is very different from europe. So what do i mean by that? Growing up, i used to hear that the service in europe is very poor, and the reason that the service in europe is poor was because they weren't motivated by tips, there weren't really gratuities, and so the the logical conclusion was If you work for tips, you're gonna deliver better hospitality because that's your income source and so like that was true for me, for you know my youth. What i'm kind of realizing now is that by introducing tips and gratuities as a means of remuneration, you're turning this thing into a transaction as opposed to a relationship, and so like i'm buying You being nice to me and i'm buying you waiting on us and bringing us water and so on and so forth, but i'm taking away your goodwill, i'm taking away your ability to delight and surprise, because it's literally a transaction like i'm kind of getting what i'm paying for. And in the post covid world now we get Point of sale terminals for like i don't know the airport checking out by the magazine. It's like would you like to tip well for what you know? like all you did with scan my magazine and a pack of gum, what am i tipping for? so it's gone too far. And now, in my opinion, european service seems to be better, because they were never really working for tips in the first place and if you do, in fact, it really quite surprising grateful they're not there where it's expected. And what it also means is that in europe the expectations around hospitality is very different. This club that i just discussed with you, yes, you can get a beverage. If you want a bottle of white wine or champagne, you can get delivered to your phone mattress. What i like. Hospitality in america, where they have six men and women running around and like t-shirts and skirts and so on, asking you if you want to drink, can i get your beverage? like, imagine i don't know Four seasons in hawaii or something right, fully staff, people constantly circling, constantly taking drink orders, and you get annoyed like, oh my gosh, it's been seven minutes and i haven't been offered like a drink. I'm gonna, you know, perspire to death here in europe, like you have to. Actually, at this club in particular, or many of the clubs that i've gone to, you actually have to get up Imagine that and go to the bar and get your own drink and then take it back or they'll deliver it to you, but so i'll. So much of this is about your expectations. And yet in europe, all these americans that are into this place, la fontelina, are delighted to sit on a cement floor with a little mat and go get their own drinks and pay a fortune for it, whereas in the us they'd be like The service is terrible. Here i'm not coming back one star, so i think that they're. The reality of it is just based on managing people's expectations and then over delivering, and i think it's a vicious circle when you're at that, say, like four seasons level, where you have to keep going around for drinks every seven minutes and then it's every six minutes and it's kind of like uber like when it launched, the car came in twenty minutes and we thought it was fantastic. Now, if there's a two minute wait for an uber, we're disappointed. This is terrible. I can't wait any longer. So i think that Stop. What we're doing is really taking a look at what are the expectations that were setting, what is the reality, how do we exceed those expectations and how do we retrain and refocus people to focus on what's important and i want to lean is case. It's the view, it's the water, it's the rest of the people, it's the vibe, it's the scene, it's not the fact that i can get a water without moving every minute. Right, like that's not it.

Speaker 1: 13:49

I think this is what makes hospitality exciting rate, because it great services, not a fixed concept is, as you mentioned. It's in the context of my expectations, is within the context of the vision for the brand, for the property, and it fits into that. And i think, going back to what you mentioned earlier is rethink everything right. Okay, do we have to have All the things, all of these things, to have that great experience? but i think you just your comment about buying swag there is interesting because that is a hallmark of sort of the brands. When you made it right, somebody who never wears this stuff says i feel such a connection to this place. I'm not only gonna want to return every year, tell my friends about it, i want to buy something to commemorate that.

Speaker 2: 14:30

So The reason is, by the way, because of how the emotions that it solicits. When i'm there, right, i feel like I'm king and i'm looking at the beautiful ocean and i have access to the food and drinks and everyone else who's there is maybe of similar sort of like Calibre made it in, just enjoying the natural beauty, because it's not about the service of the hospitality. They have a really good restaurant which is worth going to me always eat there, but, just like when i'm there, i'm looking out of my gosh i have. This is fantastic. I love it. I'd like to be here more, and so the swag Isn't to promote their brand, but it's to remind me of those feelings, those emotions, like the way that i feel, and that's what we want to do at stomp capital and all of our different locations.

Speaker 1: 15:23

That's great. Ever, should, you said. Coming back from this trip, you've been meeting with your team and you know kind of thinking about whether it's the way we invest it, whether it's the way that we operate our properties. Let's rethink things. Is there a ways to take a fresh approach to hospitality? is there anything else that you're bringing back from your most recent trip or that's top of mind for you now?

Speaker 2: 15:45

So, again, a lot of this won't be brand new, but it is perhaps new to us. This particular trip to Italy we noticed how much the Italian places that we're staying Infused sense into all of the locations and they all have these diffusers and it's in the bathroom, it's in the lobby, is in the common areas and it's signature to them. We want to buy the scent from ill send Pietro before we actually loved it. Turns out that you can't ship it and we didn't want to carry it, so we didn't end up getting it. But then we started paying attention To the different locations and what their sense were and I think it's an opportunity. I know, and once again, like, i think this is an American thing, but In America there's a lot of people who say it's the sentence too strong and I'm very sensitive and I can't do this and I can't like it's, i can't write. But In Italy then you just don't go to that hotel because that hotel smells like that, like in every single room. But it's such a strong emotion and a way for us to connect an experience, a memory. The olfactory system is incredibly underutilized in my personal opinion and so in my personal residents. We've now bought a bunch of one cent and we're gonna infuse this entire place with it. We're gonna see what it's like to live on with it on a day-to-day basis. But I think there's these little things where, you know, i used to Airbnb my own apartment or house years ago and I remember I got a really bad review. Somebody was like I'm very sensitive to my scent and I can't do this and I couldn't sleep and be forewarned if the scent is strong and I Was just like alright, well, we're gonna take that out. You know, like that doesn't work for everybody and what I'm recognizing I've said this before, maybe even on your podcast like we're not for everybody. So if you don't like the scent or you don't like the low-touch hospitality Or you think that you need to have, you know, the water every seven minutes and we're probably not a good fit. But for the people who we're offering something that they can't get anywhere else to, that's what creates the loyalty and the passion and the memories and the referrals and all of that. So we're experimenting with all sorts of things. We have yet to pick a signature scent. We'll probably make one, but I think there's opportunities to delight people on many different levels. That might be non-obvious.

Speaker 1: 18:10

That's great. I mean great. Brands are built on a strong point of view right and taking a A stance on the details. The details matter in hospitality, so I love that, richard.