Windtower Lodge: A case study in adaptation

Alain LaTulippe
Alain LaTulippe

Windtower Lodge & Suites is an interesting case study on how a hotel can adapt to uncertain market conditions. The 102-room property was built nearly 20 years ago in the town of Canmore, Alberta, Canada, not far from the world-renowned ski area and national parklands of Banff and just over an hour’s drive west of Calgary. Although I’ve known the general story for a long time, I recently sat down with my old friend Alain LaTulippe, the GM, to discuss Windtower’s scenario in full.

Alain has been in Canmore for 17 years, and he has witnessed it completely reinvent itself. In case you are unaware, Alberta has experienced a massive oil boom, bringing the Canadian province a surge of wealth and labor. When Alain first arrived, the town was 3,000 people strong. Now, it has a base population of 10,000, not counting all the weekenders driving up from Calgary who live in chic new condominium developments. The main street has retained the feel of a traditional Western town, but it’s dotted with a plethora of high-end restaurants and bars.

Knowing only the basics of the scenario, you’d think the Windtower would be exceptionally prosperous — winters filled with skiers and summers brimming with eco-travelers. But the Banff tourism industry isn’t keeping pace with the province’s growth. The core issue: Japanese and American tourists who supported the area in the past have flat-lined — not only for the ski season, but for golf in the summer as well.

No longer are hotels within Banff-proper selling out all the time. And as a “feeder town” to the nearby national park, many of the newer hotels in Canmore were built on the speculation that the industry would continue to grow. This was especially true for properties like the Windtower, which grazes the Trans-Canada Highway (the highway that winds from Calgary, through Canmore, and onto Banff). So now Canmore is experiencing increased competition with demand that is basically stagnant.

What is a hotel that caters to skiers to do when all the skiers are gone? You can’t rely on local business — there are plenty of new housing and apartment units for rent. You can’t rely on F&B — the town is streaked with an abundance of culinary favorites. And you can’t rely on Calgarians, as they are much more likely to travel to Canmore on a day trip and drive home at night.

The Windtower’s solution: selling long-term stays, month-to-month rooms. Beginning over five years ago, Alain strategically implemented a conversion from short-term FIT and group business, focusing on delivering a quality residence for long-term transient stays. Probably the first thought that comes to mind when you think “long-term stays” is retirement homes. But this isn’t the case. Retirement home living requires too many government mandates for it to be feasible as part of a mixed operation. True, the Windtower does get the odd retired couple here and there, but these are typically those who are in-between selling their house and finding a proper assisted-living facility.

The Windotwer targets seasonal workers in summer and sports groups in winter. During the warmer months, Alberta is a hotbed of primary industry. Although oil and gas have been the stereotypical big draws for the province, that’s mostly happening further north around Fort McMurray (roughly a nine-hour drive north). The Banff region continually hires crewmen for mining, building construction, highway maintenance and environmental cleaning agents in the national park. They all need temporary homes in the area, and the Windtower has been fitted as an ideal residence for extended stays.

Of the 102 guest rooms, just over half of them have been redesigned for long-term stays — the most significant feature being the kitchen added to every room. Alain has personally negotiated deals with crew company chaperones who place workers who need residences while working on an industry job for the summer months at the Windtower. All said, Windtower’s occupancy on month-to-month units now represents 50% of the total summer business.

The sports groups typically come in the winter months. As you’d imagine, they’re there to train on the Olympic-level ski facilities and perfect their skills for months at a time — downhill, cross-country, slalom and heli-skiing are all within an hour’s reach of Canmore. In order to accommodate this worldwide demand, the Windtower consulted several leading sports organizations to build a second, athlete-caliber gymnasium. The teams that stay there even have their logos festooned throughout to increase the homey appearance.

The Windtower includes a daily breakfast as a part of the rate, but for lunch and dinner, a team’s personal chef is allowed to use the hotel’s kitchen to prepare special dietary meals at the hotel’s restaurant so the group can dine together as a team. This risky venture started off slowly, but now Alain has more sports associations wanting to stay at the Windtower than he has rooms. And a program like this is heavily dependent on word of mouth, which is something Alain believes in strongly.

His F&B strategy reflects this as well. Instead of maintaining an evening restaurant with a non-ideal dining location to compete in a crowded market, the Windtower only offers a complimentary breakfast. Lunch and supper are out, except for special occasions — specifically UFC Fight Nights. For the past six years, Alain has gotten every pay-per-view UFC offering and opened up the restaurant for locals with chicken wings and beer. Not only do they sell out, but this has become a great engine for raising local awareness and generating additional referrals. It’s a small touch with big results, and the local bars are only now catching on.

In the end, converting to a month-to-month system has differentiated the Windtower in the face of stiff competition. But it has also had the additional benefit of greatly reducing costs. With the rooms only requiring cleaning once a week, a hotel geared for extended stays only requires about one-third the number of maintenance staff. This is especially important considering the rapidly inflating labor costs in this booming province.

Furthermore, with this new business model, the Windtower’s sales do not experience the typical peaks and valleys of conventional FIT-oriented properties. As such, Alain hasn’t needed a full sales force to push his product. Instead, Alain relies on tried-and-true word of mouth, limited (highly targeted) Google Adwords in conjunction with a solid website for a foundation, as well as targeting sports associations and crew companies. The model works.

But this isn’t to say that the Windtower has completely abandoned short-term clientele. It still attracts huge numbers of walk-ins looking to experience the pristine winter slopes or take advantage of the hiking trails, golf or mountain-biking opportunities in the summer. Canmore is nonetheless a tourism town, and the Windtower will forever be entwined with this business.

With its capacity for long-term residences, the Windtower has the flexibility to retrofit its rooms purely for the short-term market if the economic climate improves. However, there’s too much competition in the immediate vicinity, and Alain has smartly positioned his hotel away from his neighbors and any caustic price wars that might happen in the near future. All said, it’s a great example of a hotel successfully adapting to unsympathetic marketplace conditions.