What’s Next for Tommy Bahama? A Study in Growth Through Diversification

The lines between retail and dining have been steadily blurring over the years as more brands build memorable experiences, enabling consumers to eat where they shop and play where they eat. A natural growth progression for many multi-location brands is to play in the hospitality space, and that’s exactly what Tommy Bahama is doing this year. Now in its 30th year in business (a lifetime for many retailers), the company is launching its first hotel, Tommy Bahama Miramonte Resort & Spa, in Indian Wells, California, later this year.

Doug Wood has been the CEO of Tommy Bahama since 2015 and with the company for 22 years and believes that the key to longevity and growth lies in:

• Building a memorable, consistent, and meaningful brand experience
• Understanding your customers intimately
• Continuously evolving your product/service offering
• Waiting until the time is right to make moves

Building on the last one, Wood shared that the concept behind the Tommy Bahama Miramonte has been in the works for 15 years, but the company was waiting until it found the right location and could focus on the new initiative.

Starting as a wholesale men’s apparel brand, the company added women’s clothes, retail, restaurants (21 locations and two unique dining concepts) home goods, accessories, and licensed products like beach chairs. About 2 million beach chairs are sold each year. Apparel is designed and produced in-house because Wood believes it’s the company’s core competency, but other areas involve seasoned partners or licensing deals.

The creative development of the new hotel is managed by the same executive who runs food and beverage and features 220 guest rooms, a spa, and olive and citrus trees, consistently delivering a relaxing island lifestyle. The EVP overseeing the project came to Tommy Bahama with a background in hospitality. When a retailer enters a new industry, this type experience can be vital to success.

“This is not a marketing stunt or ego play,” Wood says about the hotel venture. “This is a business. A Tommy Bahama visitor will spend seven minutes on the website, 15 minutes in the store, and 90 minutes in the restaurant. But now consumers can spend several days in the hotel.”

The brand uses qualitative and quantitative data in all its decision-making. Tommy Bahama has a clear profile of its target market.

“Human service is ultimately still a part of the brand experience,” says Wood. That holds true throughout all aspects of the company’s offerings.

Despite brand fickleness and changing consumer tastes, island living appears timeless, and the willingness to diversify may be a great way to grow loyalty and revenue.

Three decades of success may prove that out.