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Business Observer Friday, May 2, 2014 7 years ago

Fishing for Tourists

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The Wells family's experience offers insights into how small lodges off the beaten path can compete with much larger hotel chains and resorts.
by: Jean Gruss Contributing Writer

One of the keys to the success of Tarpon Lodge is its name.

Evoking Florida's past as an untamed destination for big-game fishermen, Tarpon Lodge on secluded Pine Island has filled its rooms every weekend from President's Day to Easter. The average waterfront room rate is $185, equivalent to what some hotels on the better-known island of Sanibel charge.

“We're making a calculated bet that people are looking for throwbacks,” says Robert Wells, III, whose family converted the lodge from a substance-abuse rehab center in 1999.

Tarpon Lodge's experience shows how small, independently owned hotels can compete with chain hotels that have big marketing budgets, loyalty programs and the ability to adjust room rates with sophisticated software at the push of a button.

Tarpon Lodge has the added challenge that it's off the beaten path. Everyone knows about Sanibel and Captiva, but Pine Island is more obscure because of its mangrove shorelines and plant nurseries.
Tarpon Lodge has just 20 rooms and two cottages for rent, there's no beach on the property and it's an hour drive from the Fort Myers airport. When it was built as vacation home for a couple from Philadelphia in 1926, it was only accessible by water or shell road.

“It's been a very difficult task,” Wells acknowledges. Tarpon Lodge spends about $30,000 on advertising, a surprising amount given the inn's small number of rooms. “We could fill all the rooms and never pay for the cost of advertising,” Wells concedes.

Turns out, the hotel's restaurant is the moneymaker (Wells declines to disclose sales figures). The upscale four-star Tarpon Lodge restaurant seats 150 people and repeat business accounts for more than half the meals sold there. “Our model is restaurant-driven,” says Wells, who draws diners from Cape Coral, Fort Myers and the region.

Still, Wells works hard to fill rooms with guests by hosting weddings and corporate gatherings, especially during the less busy weekdays and off-season. He's looking into the possibility of partnering with sites such as Expedia, though he acknowledges he'd have to pay commissions and upgrade his reservation system.

The Internet has leveled the playing field to some extent and Wells has hosted bloggers with complimentary rooms. Wells, 40, who left home for a stint as a bond trader on Wall Street, also makes appearances on radio and television and has gotten favorable press from travel magazines.

Keep it the same
The Wells family is well versed in drawing people to hard-to-reach “throwback” places. Wells patriarch Robert Wells Jr., 68, acquired the Cabbage Key Inn and Restaurant in 1976 on a nearby island that's only accessible by boat.

But Cabbage Key sits at mile marker 60 on the Intracoastal Waterway, a heavily traveled path for boaters heading north or south along the Gulf Coast. “The Intracoastal Waterway is like I-75 on the water,” says Wells. “Cabbage Key never had to advertise.”

In fact, Cabbage Key has been a way station for people decades before the Wells family bought it. To keep people coming back year after year, the Wells family has taken great care not to change things. When storms blow through, everything is restored to the way it was before.

Wells III's brother, Ken Wells, 34, who manages Cabbage Key, likes to tell the story of a repeat guest who has a favorite chair: He was so attached to it that he put a plaque on it.

The elder Wells knows this. “We'll put up signs and my dad will try to take them down,” the younger Wells says. “He thinks they look commercial.”

If there are changes, they're usually not visible to guests. “He's stayed true to keeping it the way it was when he got it,” Ken Wells says of his father's strict adherence to history. “That was a real good move. A lot of places sold out.”

Still, technology has a way of sneaking into even the most remote places because customers request it. For example, there's Wi-Fi at Cabbage Key now, even though the elder Wells doesn't even have an email account.

One of Cabbage Key's customers created a Facebook page for the inn, which has a 150-seat restaurant, six rooms and eight cottages. After managing it for a while, he arranged for Cabbage Key to take it over. “He noticed we didn't have much [on the Internet],” the younger Wells chuckles.

The Wells family is careful not to create expectations other than what the property can offer. For example, all the photography on the Cabbage Key and Tarpon Lodge websites is original.

Attracting new customers
Robert Wells says small corporate meetings and intimate weddings have brought in new business, particularly during the slower weekdays. In particular, executives entertain clients at the lodge between meetings. “Instead of playing golf, we send them out with fishing guides,” Wells says.

Wells says he's taken business from much better-known and larger resorts such as Sea Island in South Georgia because of Tarpon Lodge's seclusion and uniqueness. “We had the good fortune of having a place with history,” he says.

Although fishing is a big draw at Tarpon Lodge, anyone who wants to go to the beach can take a boat ride to secluded Cayo Costa, a nearby barrier island that's a state park with pristine beaches.

On the weekends and in the summer, Florida residents including families from Tampa and Orlando come to stay at Tarpon Lodge. Wells calls them “sporting people” who don't care that the hotel doesn't have pool slides or game rooms for the kids. Plus, it's closer than the Keys, another popular destination.

Wells promotes the lodge with the press, scheduling interviews for stories in travel and fishing magazines. He says visitors still call for reservations today from a story Coastal Living published about the inn in 2002.

Social media is effective, Wells says, “but there's nothing free about it anymore.” He recently paid $100 for Facebook to promote Tarpon Lodge's boat picture of the week. He says 37,000 saw it, 1,000 people “liked” it and 54 people commented on the photo.

Wells says the Internet has leveled the playing field with much larger resorts, but he says online searches are more likely to seek Sanibel and Captiva than Pine Island. Wells is considering tying into online travel agents such as Expedia and Travelocity, but he acknowledges he'd have to pay commissions and upgrade his reservation system. “Our reservation system is somewhat antiquated,” Wells says.

Wells doesn't tinker with the room rates as many hoteliers do, though he did lower weekday rates during the recession while keeping the peak-season rates the same. “Our rate is what our rate is,” he says.

EXECUTIVE SUMMARY
Entrepreneurs. Wells Family Industry. Hospitality Key. Find a niche and make changes carefully.

LEE COUNTY LODGING REVENUES JUMP

Revenues per available room at Lee County lodgings rose nearly 21% in February over the same month in 2013, indicating hoteliers are confident about raising room rates without sacrificing occupancy.

According to the most recent Smith Travel data posted by the Lee County Visitor and Convention Bureau, revenue per available room rose 20.6% to $152.08 in February compared with the same month one year ago. Revenue per available room, a function of occupancy and average daily rate, is an important financial gauge in the hotel business.

The occupancy rate at Lee County lodgings rose nearly five percentage points to 88.3% in February from 83.6% in February 2013. That's despite the fact that hoteliers pushed the average daily rate up 14% to $172.22 in February compared with the same month a year ago.

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