As downtown’s bar scene becomes more saturated, old standbys are discovering Millennials seek experience over savings.
Steady progress in and around downtown Colorado Springs can easily be seen in the light of day. Vacancy rates are low, new shops and restaurants are common and established businesses that weathered the recession are being rewarded with a booming economy.
By day, consumer confidence is up, but when the moon rises, so does the competition.
Within the city’s core, the number of nighttime entertainment venues and watering holes is climbing, leading many to embrace new trends in order to attract more discretionary spending. But some long-established businesses say the saturation harms their bottom line.
‘It used to be busier’
Luke Travens is co-owner of Concept Restaurants with downtown properties like MacKenzie’s Chop House, Ritz Grill and José Muldoon’s. Citing several factors, Travens said he has seen nightlife numbers dip at his establishments within the past couple years. Travens said there’s been a rapid increase in the number of barstools in town — and not just in the bars. The dozens of tasting rooms located within craft breweries and distilleries in the city, combined with the availability of marijuana, have all affected his business, he said.
“We’re really competing for that disposable income,” Travens said. “From what I know about clubs downtown, it seems a lot aren’t as busy as they used to be.”
Travens said, within the past year, sales after midnight have fallen at the Ritz Grill and José Muldoon’s by about 15 percent.
“People tell me they just came from the Ritz and it was busy,” Travens said. “Yeah, but it used to be busier.”
Travens said Millennial spending and social habits are factors contributing to the downturn. According to the National Restaurant Association, Millennials have the lowest level of employment and are the lowest-earning generation, but have the highest spending power of any generation because they are 70 million strong. They are also younger (under 35) and more likely to frequent clubs and bars. Technology and social apps, however, have reduced the need to go to a bar to meet new people, he said.
Groups with the most spending power drive trends and, according to the association, those trends include craft and artisan spirits, craft beer and hyper-local production.
Travens said Concept Restaurants has been on the craft beer bandwagon for more than a decade, and while it’s often one of the first things tourists ask for, increased competition may mean it is no longer enough.
Quality, not quantity
Ian Lee and his cousin Nick Lee opened their gin distillery Lee Spirits Company in 2013. Just months ago, they opened Brooklyn’s on Boulder, a tasting room meant to highlight their craft spirits. While not technically a bar, businesses like Brooklyn’s pull after-hours spending from traditional bars.
“We’re consistently packed every night,” Ian Lee said. Brooklyn’s is open Thursday, Friday and Saturday evenings and only until midnight, while they could legally serve alcohol until 2 a.m.
“We won’t ever stay open until last call. The goal is not to be a bar, but a tasting room highlighting ways to drink the product we create,” Lee said. “The consumption that occurs downtown after midnight is not usually in pursuit of perfection or an experience. It’s not based around quality, just quantity.”
Lee said consumers, especially Millennials, are as interested in the experience as the product itself.
“The entire focus is on customer experience,” he said. “Our crowd is not as focused on going out to drink to get intoxicated with friends. We treat cocktails the way a restaurant would treat fine food.
“The reason we felt comfortable opening where we are is because there wasn’t a high-end cocktail bar on the north end of [down]town that offered this experience,” Lee added. “When it comes to drinking alcohol, there are a number places downtown to get a drink at a cheap price if you’re budget conscious. That’s not the consumer we’re going after.”
Lee said terms like “craft,” “artisan” and “locally sourced” are trendy, but they are also often synonymous with quality.
“Those catchphrases exemplify a standard, that at some point people gave a shit about their product before they gave it to the consumer,” he said, but added that there will always be a demographic for traditional bars.
“Which bar will depend on which ones are talking to the consumer’s heart,” he said. “Take Tony’s [on North Tejon Street]. It doesn’t get more old school than Tony’s, but it’s packed consistently. That’s because even if you’re ordering a PBR, they seem to care.”
Something for everyone
Sam and Kathy Guadagnoli have a substantial stake in downtown Colorado Springs’ nightlife. Their properties include nightclubs such as The Mezzanine, Cowboys, Blondie’s and The Mansion as well as Gasoline Alley, “an ultra dive bar and grill,” according to its website.
As for slipping business?
“Not on my block, and we own some of the biggest clubs in town,” Kathy Guadagnoli said.
She said business on Tejon Street has been better than ever, and agreed with Lee that creating an experience is critical.
That includes Cirque du Soleil-type performances at The Mansion, dance lessons at Cowboys, a piano bar atmosphere at the Mezzanine and pay-per-view mixed martial arts fights at Gasoline Alley — something for everyone, she said. Guadagnoli added collaborations with local hotelier and restaurateur Perry Sanders are in the works in order to step up offerings for those staying downtown, including waiving cover charges at clubs.
“We’re doing fantastic,” she said, adding their establishments will be hosting a high-end car show this year and celebrating the upcoming Summer Olympic Games in Brazil with street performances on Tejon Street. “Entertaining people is our forte.”
‘Customers expect it’
Marketing to the 70 million people between the ages of 21 and 34 can be complicated. Not only do they earn less than their adult counterparts, but according to the restaurant association, “Millennials are knowledgeable about food and drink; they’re demanding patrons, seeking a unique experience, customization and authenticity. They like to explore and discover new flavors and products.”
According to Sarah Harris, director of development and economic vitality for the Downtown Partnership, while many bars and restaurants are seeking Millennials to drive business, they are not the only demographic with disposable income.
“Lots of [Baby] Boomers and Generation Xers don’t necessarily want the same things,” she said. “That’s why we’ll continue to see diversity in the types of openings downtown.
“The one thing that is common is [new restaurants] trend local,” Harris added. “We are also seeing trends with an emphasis on our local craft and cocktail scene, as well as fresh-made products. Some of the [existing] bars are keeping up with that, but these are common themes in developing ones.”
She added that many downtown eateries, to include quick service restaurant models such as Chipotle and Bingo Burger, have liquor licenses — further adding to the competition.
“Customers expect it,” she said of adult beverage options.
Travens said determining what customers expect lately has been a challenge, and Concept Restaurants is working on ways to turn around slumping after-dark sales.
“We’re just working on reinventing ourselves as late-night destinations,” he said. “Perhaps we don’t need to stay open as late. Or, we may look at music because there are certain bands that really bring in the crowds and others not worth getting.”
The silver lining for Travens: Downtown is coming up on its busiest months.
“Summertime is a little different in that more tourists and people are looking to get out,” he said. “Summer is still pretty strong.”