Wisconsin Public Television University Place Entrepreneurship in Society  Kim Schaefer, "The Story of Great Wolf Resorts"  March 2, 2011 UP559    cc >> Jeanan Yasiri: Welcome back. This is Entrepreneurship in Society. It's a course that's offered from the University of Wisconsin School of Human Ecology. I'm Jeanan Yasiri. As we begin today I'd like to extend thanks to our partners in supporting this course: the UW Office of Corporate Relations, the UW College of Engineering for their technical support, and financial support that is offered through the Ewing Marion Kauffman Foundation, which is committed to advancing academic education and entrepreneurship. Additionally we'd like to thank our media partners, Wisconsin Public Television and their University Place crew for taping today's lecture. I'm very pleased to introduce our special guest today, Kim Schaefer, CEO of Great Wolf Resorts. Great Wolf Resorts is North America's largest family of indoor waterpark resorts. And Kim joined a predecessor to Great Wolf Resorts, headquartered here in Madison, back in 1995 as senior vice president of operations. Later Kim became president and chief operating officer where she focused her attention on delivering a great guest experience and established policies and procedures for indoor waterpark resorts. 

Her work with the organization has included deep involvement as chief brand officer where she ensured that Great Wolf Lodge found organic growth by adding proprietary amenities like Scooops and MagiQuest and adding known family brands like Pizza Hut and Starbucks and Dunkin' Donuts to the complement of their other services. This has been a significant part of what Great Wolf's brand evolution has been into full family entertainment. Kim earned her bachelor's degree in accounting from Edgewood College in Madison. She told me that she spent the first three years of her undergraduate career here at the University of Wisconsin though. She has over 20 years of accounting and hotel operating experience and sits on the advisory boards of Edgewood College Business School and Thrive. She is also active in Tech, a Madison CEO group. I asked Kim to come and talk with us to discuss what entrepreneurial thinking is like in a mature organization but also in one that is as unique a developer like Great Wolf Resorts. So please join me in welcoming Kim Schaefer. [APPLAUSE] >> Kim Schaefer: Thank you. >> Did I turn your mic on? >> I think so. 

Can you guys hear me? All right. Good afternoon, how's everybody doing today? Great. Exciting. Well I'm thrilled to be here today. Thanks for inviting me. How many times in your life do you get to be part of a company where you're building a brand? That's something for me that is really the most significant thing that I look at in my career. I stumbled upon the hospitality industry. I went into accounting, as you were told, and spent four years as a CPA and then stumbled on the hospitality industry. And it was something that I was very passionate about. I really enjoyed the variety. 

I enjoyed all the different things that there was to do. Eventually we stumbled upon, I say that a lot, don't I? We stumble upon a lot of stuff. And that is sometimes how life takes you in different roads that you're not necessarily prepared for. But if you've never been to a Great Wolf Lodge, have any of you seen a Great Wolf Lodge? There's one up in Wisconsin Dells. There's 12 around the country. That'd probably be one that you'd be most familiar with. Let me show you a quick video that shows you just a little bit about what Great Wolf is, and that will kind of lead to some of the discussion that we'll have this afternoon.  >> This is an exciting time for Great Wolf Resorts. With properties from coast to coast, we're North America's largest family of indoor waterpark resorts and the industry leader in drive-to family destination resorts. Over the last decade, Great Wolf Resorts has created a new brand based on the family experience along with a wide range of amenities that can include spacious suites, interactive entertainment and activity areas, and of course our enormous indoor/outdoor waterparks. 

We are a true brand leader in the marketplace, and we continue to extend or leadership to new development and a future pipeline with domestic and international potential. So come be a part of something special. Become a part of one of the world's leading brands of year-round family entertainment. Great Wolf Resorts, there's no time like a Great Wolf time.  [WOLF HOWLING]  >> Got to have the signature howl in there. We have been known in our company to do random acts of howling as good things happen in the company. I love this slide, because as we said, we're really all across the country now over the last 14 years. We started in the Midwest. You can kind of see that we've got a real close proximity. Wisconsin Dells was the very first one, but what I love about this slide is that our original business model was to build in close to home, drive-to destinations. 

So families who went historically to Cedar Point amusement park down in Ohio, if any of you have been there, this is a place that families from Cleveland, all around the Midwest every single summer were getting in their cars and making the drive down there to spend some family time together. And we thought, well why not build a location like we had up in Wisconsin Dells to build them in other family destinations. If you look on the map you'll see Grand Mound, Washington, and Grapevine, Texas, there's nothing there for families to do. As our brand has grown, we've been able to set our own destination. The reason people go to Grand Mound, Washington, is to go to our property. And that's really the evolution of our brand. We couldn't have done that at the very beginning of our life cycle, but where we are in our company with our brand awareness, with our loyal fans, we've been able to take our model of where we can build a Great Wolf and move it to other locations in the country. We did not start this concept. We bought the very first lodge up in Wisconsin Dells. What I like about that is that to be entrepreneurial, to be innovative, you don't have to necessarily create the concept. 

What you have to do is you have to make it better. And so we found the first concept up in Wisconsin Dells. We were a hospitality development company, we were building Crowne Plazas, Holiday Inns, Hamptons, things like that around the country, found this concept and approached the owners about taking this concept national. And so for us, we bought the first property which was an indoor waterpark resort. What we've done, over the last 14 years, is we've made it a family entertainment resort. So we've taken, and every single time we've opened a new lodge we got smarter, we got better and we continued to innovate and grow based on having 80,000 families come, we now have almost a million families across our lodges who visit us every single year. That's a lot of customer research. We're a lot smarter today than we were 14 years ago, and we use every single piece of data that we think is relevant to figure out how to continue to grow and how to be better than we were the day before. Another thing that kind of happened to our company that does change some way the way you think, the end of 2004 we went public through NASDAQ. While we are a very innovative spirited company, being public comes with its own set of rules and regulations and SEC codes that we need to follow. 

And sometimes that dictates how you think. And we've tried to separate as much as we can the people who are really focused on the public company side of the business, which is not what I do. When I became the CEO of the company two years ago, I went from being the innovator, to being the brand strategist, to being the CEO and spending most of my time out in New York talking to Wall Street and making sure that as a public company we're representing the interest of the shareholders. Where three years ago, my interests were really aligned with our employees and the guests that came to a Great Wolf Lodge. So being able to balance that and realizing that it's not just about what I want to do or what we think the ultimate result is, being a public company really has added a whole other layer of sophistication, and in some cases difficulties, to how we do business and continue to grow. As we've been more mature, in 2009-2010 with the recession things changed dramatically in the financial market. As you saw, you probably got a flavor. These are very large properties. 100-plus million dollars to build a Great Wolf Lodge. So the financial markets were not really cooperative for us to build during 2009-2010. 

And so we looked at how do we continue to grow as a public company, and one of the things we said and we'll talk about a little bit later is we've done some really great things in our lodges. We've created a lot of activities and amenities and things for families to do. In 2010, we took those things and we focused on them outside of the lodge. So we opened up a Scooops, it's a kids spa, at the Mall of America. We took a majority interest in a small technology gaming company that we use in our resorts called Creative Kingdoms. So it was fun for us to be able to say let's look at some brand extensions and how we take the some of the success that we've had throughout the years and capitalize that outside of our core competency.  So the first thing for us, and I think the first thing for anybody, is to always stay focused on who your audience is. Who are you talking to as far as trying to reach your business? Who is your audience? And for us it's always been consistent over the last 14 years. That's not necessarily the same for all companies. Sometimes they evolve and have a new audience. 

But for us it's always the same core. We talk to our employees because they are our audience, and we also focus on families. The good news for us is that there's new customers born every single year that mature into an age that come to a Great Wolf Lodge. So we're never going to run out of customers at our business model. And if you follow a lot of demographics, you're about to come into another opportunity for a big boom with families. And so family entertainment, especially on a regional basis is slated to be a real hot topic over the next 10 years. So we keep in mind who we're talking to at all times, how we're going to market to them, what we're looking for, who are we innovating for, and who are we trying to become a better company for? It's for those families that come to our lodges and for the employees who take care of them. I did add in vendors and other partnerships because I think that's important to make sure that you're aligning with people who represent you. I'm going to talk a little bit about building the brand. Talk about creating a strong foundation. 

We've got over 5,000 people who work for us in 10 different states. It's really important that we have a very strong foundation of who we are so that 5,000 people can all act on our behalf the way that they would if I were there doing it myself. We also need to talk about how we deliver the brand message. That's certainly a very important key component to being successful. What is the message that you're trying to deliver, and can you get that out to the audience of which you're representing? And then "Wolf Moments." We talk about creating Wolf Moments. To us, this is innovation. For the last 14 years we have been a company that innovates. Every single year we're trying to do something a little bit different to take a look at how families are spending their time together, what's important for them. Because, again, it's not necessarily about me, it's about those families who are coming. So we create what we call "Wolf Moments." And we'll talk a little bit more about that, and even though we're the largest family of indoor waterpark resorts, we're really the only company in the world that is focusing on managing assets that are indoor waterpark resorts. 

Even though we're the only, the largest, the best, we still have to continue to raise the bar higher. So every single year, what can we do to make ourselves more relevant, to make ourselves better than we were the day before?  So this is what I was talking about before by really having a strong foundation. We bought the first lodge in 1997, and that was a family-owned business and the family was there working every single day. And as an employee you knew exactly who you were working for. And now a company from Madison comes in, we're not there every single day, and you have a different way of doing business than it is as a family run business. We opened up our second lodge in Ohio almost immediately following the purchase of this first one. We spent a lot of time hands-on, learning the business, working side by side with the employees and everything was great. We opened our third lodge, and we had our fourth lodge under construction in 2003. So we've been doing this now for three or four years, and in 2003 we opened up our third one. We now have over a thousand employees, and we realized that we just can't do business the way that we'd always done business. 

We had too many employees trying to get them to represent what we thought was important to our guests. You get some great employees, you get some employees who aren't so great, but trying to manage that process can prove to be very difficult. So the first thing that we did, I'm taking a lesson out of the play book, some of you may be studying this if you're studying marketing at all, if you're studying any of the branding classes, is to have that foundation. Who is it that you are as a company that every single one of our 5,000 employees understand what's important. So we have our mission, it's the way that we do business. What's our ultimate goal? It's to take care of the families that come to Great Wolf Lodge. Our great expectations are our values. What's important to us? The core competencies that are important to us as people, as human beings, how we treat people, we want to make sure that everybody understands what is the most important thing for us. A brand promise and then service standards. We have four service standards in our company, and we're a family resort so it's probably not surprising that fun is one our safety standards. 

We have huge indoor waterparks. So no surprise that safety is one of them. And then consistency and quality. People are paying a lot of money to come and have an experience, a vacation experience, at a Great Wolf Lodge. So those four service standards have to be rooted in every single decision that we make, it has to be in every single decision that the 5,000 people who interact with our guests every day, it has to be the fundamental for what they do to make their decision. It took us four years to get to this point. It took a long time to realize that the way we were doing business, it needed to involve, it needed to grow. We were becoming a bigger company, but we didn't want to lose what was special to our company. So the culture of our company become very clear to us, and it's something that we've spent a lot of time making sure that every single person in our company understands this. If you guys have questions, just start jotting them down. 

I'll leave plenty of time for questions. You guys are far smarter than I am so I'm sure you're going have some great questions to ask, and I'll do my best to answer them as we get through all of this. Once we know who we're talking to, we need to go out and market to them. And so we call, for us it's strategic brand marketing because we're not just marketing a widget. For us, it's our brand that we're marketing. It is the quality of experience that we want families to come and have at a Great Wolf Lodge. So we have to make sure brand equals consistency. We need to make sure that everything that we do in our company can be rooted through all of our marketing. And so everything is overlaid, as you see with all those circles. When we started out 14 years ago there was literally three forms of marketing that we did. 

There was TV, yes there was TV when I started doing this. There was TV, there was radio, and there was direct mail. That was it. Those were the only three modes that we used in advertising to try to get our brand message out to our guests, for them to come and have a Great Wolf stay. Now we have all of these different metrics. Social media has become huge for us. It is a fully integrated part of our marketing, how we talk to our guests. Facebook and Twitter, they just weren't around 14 years ago when we started doing this. But our target audience is moms. That's who we talk to, to make this purchase decision to come to a Great Wolf. 

And moms of today, in that 24 to 39 range, they're using social media. And so our entire platform has changed and evolved in how we used to market. It's a lot of fun because that peer-to-peer connection and how people use the Internet versus how they did 15 years ago, it's changed dramatically. It used to be information, they'd look it up to kind of get an idea of what the product was. Now they're using it as a booking engine. They're making all their decisions. They're talking to other moms to say, how was your experience, should I be going, I have a four-year-old, is it relevant? So we're trying to make sure that we give all of those guests a platform to have a conversation about Great Wolf Lodge. One of the important things on here as well is partner alliances.  If you're going to be bring a third party into your business, it is no different than having an employee. They are going to represent your business by the actions and who they are as a company. 

So we've tried to be very strategic in who we've aligned with. As we become more of a national brand, we've had the opportunity to join with some of these partnerships. Coca-Cola is brand new, we just signed that one in December. So they're a brand new partner for us, but we're really excited about having this opportunity to do co-marketing with them, to have them represented in our company, but also they're a huge international company and to be part of their sweepstakes and their giveaways and some of the different things that they do to their customers is huge. But that brand alliance has to be there because if something happens, let me pick a smaller one, if something happens with Nestle or Edy's. A few years ago Nestle had a huge recall on their cookie dough, those things affect the companies that they've aligned in their business, and it now becomes our problem as much as it becomes Nestle's problem. So we've been very thoughtful about not overfilling any one page to have too many partnerships that we can't truly understand that we don't think aligns with our business. The very first one that we aligned with was Starbucks. Starbucks and Pizza Hut were our first two alliances. And the reason that we did that is because our families who were coming to the lodge were looking for that quality experience, that quality getaway, they expect to have these types of brands. 

We sell more cheese pizza, you figure we had over 600,000 kids in our resorts last year, that's a lot of cheese pizza. So Pizza Hut likes having us around. They're a Dallas company and we happen to have a Dallas resort, and so we do a lot of trial and error. We were the first hotel to open up a WingStreet to sell wings, their new concept that they have. So it's a lot of fun when you align with the right brands to be able to enhance what you're doing as well. The life cycle of a company makes a big difference as well. And we talked a lot of about how we've evolved as a company, and we've got some examples of some of the innovation that we've done, but it also matters the life cycle of where your guest is in the business. So for us, we have a really nice base of repeat customers. Once you come to a Great Wolf, you tend to come to a Great Wolf quite a few times. We have them for about four or five years, and then usually their kids get to an age where okay we've done this for the last four years, time to do something else or they're too old, and they don't want to go. 

I used to be the perfect demographic. My kids are 13 and 16 now, they don't want to do anything with me anymore. So those types of family weekends, they're replaced with them doing things with their friends. But the great thing is there's a whole lot of guests who now have those kids who are in the 2 to 12 range where they do want to do things with mom and dad, they appreciate having those getaway weekends, and so we can keep filling the pipeline. How we talk to them and all of these different things, it doesn't change the mode of communication. We're still talking to them via TV and via radio and via direct mail, but their decision point is a lot different. If you guys have bought a product, you've all been out there, you buy a product, once you know the product, your purchase decision is a lot easier the second time around. And so we need to be very thoughtful on where we are in the life cycle. People are making a $400 a night decision to come to one of our properties so we need to make sure that they really understand the value proposition. We brought a new director of marketing in about six months ago, and she's brand new to the company, she knew it, she'd been to a Great Wolf Lodge and she looked at our website and she said, nowhere on here do you say that waterpark passes are included in the room. 

We all sat around and thought, of course it's on there somewhere, everybody knows it, that's just what it is. We've been talking to our repeat guests for so long and during this recession they've really taken care of us because they come in full force, they recognize the value, we never really thought about the fact that our prospect guests, since times have kind of changed dramatically since 2007 that that became an important point of decision making for them, that this value proposition was so much more important than it was in 2007. In 2007 it was all about convenience. Families were so busy, they had money but they had no time. So if you could offer them something that was a two-hour drive and they could still have a lot of fun and it only took two days out of their schedule, they were all for it. In 2010, it's a much more thoughtful decision on where they are in this life cycle. They don't know the value of our resorts. And so just having that fresh perspective to realize where our customers are in the life cycle and what's important in today, today it's all about value, it's all about making sure that they're getting a good deal. Never even dawned, certainly on me, I'm not doing the marketing but it certainly didn't dawn on me that that's something we should put on our website. So our whole platform this year changed so that we're talking to those new prospects. 

So in the first three months of the year we're up 37% in new customers who are booking to come to a Great Wolf. By just changing our thought process on who we're talking to within the life cycle made a dramatic difference in our business. And heck, we've been doing this for 14 years. So that fresh perspective always challenging yourself to think about things a little bit differently pays off in dividends. The brand message, we talked about the culture, it's important that any company that you go work for, any company that you start over the years, you want to make sure that you understand what's important for that company. We try to celebrate it. We have a lot of fun with our employees so we do things like living the brand road shows. We get out and we talk to the employees about hey this is what's important from a promise standpoint. You kind of want to understand what it is that you're really focused on. So we have things, we did Great Wolf Idol last year and we allowed the employees to do whatever they wanted, they just had to record it, it couldn't be more than three minutes long, and they could put it up on our YouTube channel that we have for Great Wolf Lodge. 

They put it up on YouTube, and they could express their feelings about Great Wolf Lodge. A little scary, but it was just so much fun to see the passion that employees have for the company. And if any of you get the opportunity to own your own company, to start your own company or to be in a position of leadership within a company, it's a very proud moment when you see that you've got thousands of employees who really feel good about the job that they're doing representing your company. So we try to have a lot of fun with different things with contests and stuff, but it's all around living the brand. So we talk about our values: respect, integrity, accountability, competency and teamwork. Those are our five values. We'll have contests around there, represent, you can send in an essay about somebody who's living our culture through one of these values. And it's a lot of fun to see people talk about other employees and tell the things that they do on behalf of the company. Have you guys seen "Undercover Boss" before on CBS Sunday nights? Yeah? Okay. Did you guys know Great Wolf was on there? Actually we've been on there twice. 

88 minutes of me is more than enough that national TV needs. But we had on opportunity, they approached us last April about being on the show, and it was a great experience, a little unnerving at times, but it was a lot of fun, and for us it was actually, we tried to use this as an opportunity to go back and talk to our employees about the company. The company showed very well on the show. I think it was a great episode, but more importantly it really was a chance to showcase some amazing employees that we have in the company and then go out and talk to them about what it means. So no matter what we do we try to relate it back to the 5,000 people that work for us. This is one of my favorite slides. We talked about innovation. For us, as I said before, we bought an indoor waterpark resort back in 1997. Where we are today, is we are regional family entertainment. When people come to us, part of what they do is the waterpark, I always say that's kind of the marketing sizzle, the reason they come to us is because we have a great waterpark. 

It's a lot of fun. It caters to every single age, every single adult, but the reason that they come back is all of these things. And these are the things that we've innovated over the years. None of these things really existed before. Gr8-Space is a teen tech center. I said kids get to be teenagers they don't necessarily want to hang out with mom and dad, but if they have younger siblings a lot of times they can bring a friend, they'll come along, let's give them a space that after they've spent time with the family they can go and hang out with their friends. These are the things that we see that families are not asking for a teen tech center but we realize that these families are coming and there is an audience that isn't necessarily served after 9:00 at night. So we wanted to have something for them. We have Scooops kids' spa. This is the spa I was telling you about that we actually now took outside of Great Wolf Lodge, and we're looking to franchise this around the country. 

The first one has opened up at Mall of America currently as a stand alone. This is great. This is again something that we realized was kids like spas. And especially during the really good times they were used to being pampered at a very young age. And this inspiration was actually from my daughter. She loved going to spas, but I didn't like that when we came into a spa, you've got to be quiet. That's not what kids should do. Kids should have fun. So we decided to take the innovation and say let's build a kids spa, and we did it all around an ice cream theme. You can get chocolate covered cherry pedicures and Neapolitan manicures. 

It's a lot of fun. And we didn't root this, any of these things here, I think that's important to mention, are not done on customer research. And you have to balance customer research. We do a ton of customer research. Where are you spending your time? How do you make important decisions on a family vacation? We're asking families a lot of those types of things, but I guarantee that if I'd gone and asked moms, hey, are you willing to spend $35 for your daughter to have a chocolate covered cherry manicure, I think I know what the answer would have been. It would have been no. But we know that families are willing to spend money on experience, they're willing to spend money on things that are unique. So what we do is we then take that type of research and come up with innovation that makes sense for us. MagiQuest is another example. It's a live action video game. 

We actually took a majority interest in the parent company because they were looking for a financial investment. And we love this product. People love this as much as they love the waterpark. Live action video game, you buy a wand and you go throughout the hotel on this north woods adventure, and you gain power so that you can battle the dragon, save the pixie and it's a lot of fun. And parents enjoy it because, you know what, we don't understand why our kids sit there for three, four hours playing video games. Well you get into this and you see the competitive nature, you see the fun of solving something and you want to go on that adventure with them. So those are the types of things that, again, we brought in knowing that the core understanding is that families want a great experience, and they're willing to pay for something unique. So they're not asking for these things, but what they are asking for we were able to serve by being innovative, by being creative, and by always keeping our eye on who our audience was and who we were building these resorts for. I'm going to show you one more slide, or clip. It's actually from "Undercover Boss," and it will kind of speak to the last point that I have which is on leadership, and then I'll take questions after that. 

 >> It takes a certain personality. Marie has that passion, that magic. She was great with the kids. >> What's your favorite thing? >> Swimming. >> Swimming. >> Did you guys like the cooking class? >> I ate all of mine. >> You did? Was it good?  Oh, thank you. >> The kids loved the cooking program. They had a great time doing it. >> Was that fun or did you like playing with Thor better? >> Thor and the pizza. 

>> Okay, well that's good to know... (laughs) >> I spent some time working in our little kids room. Who you have in a position is very important because I wouldn't have lasted an entire shift doing that job that she was doing. But I was trying to ask the kids what they liked, what they thought was great. I was dealing with six-year-old kids there. And the bottom line is I thought that cooking program that we had was the dumbest thing I'd ever heard of. I couldn't believe that we had done that cooking program because it didn't make any sense to me. But you know what, every single one of the kids had a ball and they ran out of the room afterwards and they told their parents how much fun they had. So I think remembering who your audience is and who you're doing that for is more important than what I necessarily think that it is. But the reason I showed you that clip is you can see the passion from the lady that I worked with there, her name was Bree. 

She was so passionate about what she did. She happens to be a teacher who works for us part-time and you could see it. She was great with the kids. She just engaged them at every level, and they walked out of there so happy which is going make their parents happy. So one of the things that we did probably about four or five years ago is we realized that not everybody in our company made it from a leadership position. We hired good people, their resumes were great and we liked them, but for some reason they just didn't have what we thought we needed at Great Wolf Lodge. So I stumbled on this concept, I found a book on leadership branding. Realizing that every brand is unique, it has to be consistent, it's no different for the leadership. The people who represent you have to have, not only the core values and that culture of what you think are important, but they have to have the same leadership skills. They don't have deliver on it the same way, but they have to have the same leadership skills. 

What makes Wal-Mart different than a Lexus? The type of leader that is there has to really understand how that all funnels down. And so we went around and we looked and said, listen, you have to be passionate about the company. We're dealing with families, we're dealing with children, you have to like that type of business. Had a really good guy come in, he had worked at one of our hotels and we brought him down to Wisconsin Dells to work in the restaurant. Great guy, I'd known him for five years. He worked for us, done everything that we needed him to do. I came up one Saturday night and after the shift I talked to him and I said, wow, you're just not the same high energy, you're just not engaged the way that you used to be. And he looked at me, he was 20-some years old, and he said, "I hate kids." [LAUGHTER] And I thought, you know what, it never even dawned on us to ask that question, because, you know what, when you've got a full restaurant, any of you worked in food service? You get it. It's busy, especially on Saturday nights, it's busy, it's high stress, it's high energy and it never dawned on me when I brought him there because he was a great leader, he was really good at what he did, that putting him in this environment where not only do you have all the pressure and the stress, you now have families with tired children who want to eat and they're crying and they're whiney. When you've got kids,  you get that. 

Doesn't mean you have to have kids, but you have to be in that frame of mind to understand that you're playing on a different platform. And so we talked about it and said, you know what, we need to change the way we think about leaders. You have to like families. You have to like kids if you're going to be in our business. You have to be passionate about that. And really if you get the opportunity to be passionate in your job, whatever your career is, I'm telling you that is probably the most important thing to be happy is being able to find something that you feel you can make a difference, whatever level that is, if you can make a difference in a company, good for you. I think that is so exciting.  The other thing that's important that I'll mention in this one is servant leadership. I'm not there, none of the people who sit here in Madison, Wisconsin, at our corporate office, none of us are dealing with the guests every single day. And that is the connection point for us of where our brand is defined. 

And since we're not there, our job is be to servant leaders to the people who are in the field making all of that happen. And so it's our job to make sure that the housekeepers have what they need, to make sure that the front desk clerks have what they need, and it is up to us to provide that service. It is not up to us to boss them around and tell them what needs to be done. It's up to us to ask them what they need done and be able to provide the tools, to provide the resources, to provide the leadership and guidance to get them to where they need to be. And I'll tell you not everybody buys into that philosophy. And that's okay. For us it's important, for other companies it may not be. So I think defining the leadership brand of a company is really important to the success of it. And then finally before I take questions, we talked a little bit about this, for us we're in the service business so every single time a guest interacts with one of our employees, that is the definition of our brand. If they get it wrong, they get it wrong and now that guest walks away unhappy. 

So we need to make sure that we do everything that we can along the way. It's not always the fun and glamorous stuff, but we need to make sure that all along the way we're doing everything we can, because we realize that that is the connection point for us that defines our brand. So with that, why don't I take some questions. >> Students know that, look at all these hands going up, all right away. That's marvelous. I was going say, I told Kim that I'll hand off the mic, and the students will introduce themselves as they ask their questions. >> Hi, my name is Alyssa. >> Hi, Alyssa. >> As soon as you mentioned the social media aspect of your company, I went on Facebook and I looked at the Great Wolf Lodge page, and there was a pretty negative comment here and it's actually erased now. So I was wondering how you deal with negative comments and how this social media, negatively wise, affects you. 

>> Great question. Like I said, every time somebody interacts with our guests they define our brand, and we don't always get it right. We've got 5,000 people and they don't always get it right. What we try to do, we try to make it a very personal guest recovery. And that is to take it off of social media and get the guest one on one. Typically we either invite the guest back to the lodge or we try to rectify whatever the situation was that happened. Especially this time of year, it's cabin fever, there's not a lot of do outside so when we get 400 rooms at a lodge, we get 1600-1700 people and they stay there. And it does tend to be our most difficult time to run our business. But that's usually how we try to handle it. Most of them are positive, and we're grateful for that but we try to, as much as possible, the only ones we ever really go, we've got somebody, we have a social media director that's all they do is look at TripAdvisor and Great Wolf and all the different outlets that are out there to talk to people, and if we see a negative we try to reach out to the guest to see what we can do to help them. 

>> So since you made the transition from accounting to kind of tourism, how did you make that transition? Were you an accountant for the company to begin with and then you worked your way through the ranks? >> For me, I started, I worked  at a CPA firm, so I was a CPA for four years after college, and I made the decision to get out of public accounting and ended up at a hotel over on the east side of town, and it just happened to be, I will say that it wasn't a real conscious decision. Lucky for me that I did what I did, because I did find that I really enjoyed it. But really it was really at that point still following accounting, and I just took a controller job at a hotel and from there we went on to start what's now Great Wolf Lodge. >> I'm going to just dovetail on that question because I think you made a comment that was kind of interesting, it's not like you really thought it through strategically. Can you expand on that a little bit because I think that happens to many of us through our careers. Would there be anything you would have done differently or is there anything else coming to mind about the fact that you fell into it, as you say? >> It is interesting. I think there's so many, and you take these little detours or you make these decisions that affect your whole life. Where I am today was all based on a decision to take this job at a hotel. I think that what you have to do is some of it is living in the moment. I was ready to get out of public accounting. 

I had just gotten married, my husband was in public accounting, we were looking to start a family, and at that point and time in my life the most important thing was finding a job that I could be happy at, use my accounting skills but also balance my family life a little bit better. So I made the decision at the time that was right for me. It's really not that different. After that when Great Lakes started I went with my boss who owned the hotel on the east side of Madison here, I went with him and we were with a startup company, which was the Great Lakes companies that became Great Wolf Resorts. And we had no money; we had no infrastructure. That was actually a scary decision because it was way outside my comfort zone. I'm accountant by nature, I'm a little conservative by nature, and going into something that was so unknown was much farther outside my comfort zone but I believed in my boss. I knew he was taking the same risk, and so I think the only advice that I could really give you is it's got to feel right, because life isn't perfect, there's always going to be ups and downs, and all you can do is assess the risk that you know when you're making that decision. >> Hi, Kim. >> Hi. 

>> Kevin Green. When you were talking about the alliances that you have, how do you choose what companies to team up with and how do they, do they pay to rent space from you? Or how you are teamed up with them? >> Good question. It does vary a little bit. We do not rent space to anybody. Because we're in the service business, for us we want to make sure that like Pizza Hut, we license the name and we actually perform all the services of a Pizza Hut because we'd rather control that part of it, than not having access to it. But I think what it is, is we look at what's popular, what's relevant for families. Like I said, Pizza Hut was kind of one of those first ones that we did that was such a no-brainer. No matter what we did in our restaurants, our kids wanted Kraft Macaroni and Cheese and they wanted cheese pizza. So we just decided rather than trying to keep being fancy on what we're serving them, let's go out and do a deal with Kraft and let's go out and do a deal with Pizza Hut and bring in what they want. So some companies do pay us. 

We have a sponsorship with Coca-Cola that does have some paid dollars, but there's also some mutual exchanges that we have. Little Tikes is a good example of an opportunity for them to reach a million families, that isn't always easy to reach, they get to reach a million families by being part of our kids club program. So it just depends on that. But yeah we love companies who are willing to give us money to represent it. But it still has to be thoughtful because, like I said, no money is worth it if they end up doing something to damage our brand. >> Hi, my name is Ben. >> Hi, Ben. >> I have a question. In the Wisconsin Dells I know there's a lot of resorts and I was wondering how do you guys just stay a little bit ahead of everybody else because I know how competitive it is there. >> It's a great question. 

It's really difficult, especially when families, if at  they don't know the area, all waterparks are a commodity to them. And we get that. So as much direct mail that we can do or direct advertising to reach them is important. We try to be real thoughtful on our rates because that ultimately, especially the last couple of years, has been a big decision point. We don't have as many rooms as a lot of people in the dells do. We're kind of that, we're one of the four big resorts, the upscale resorts, but we have the smallest number of rooms. So that allows us to really sell ourselves on the exclusivity. We're probably the only waterpark that does not sell outside waterpark passes. You have to stay at our resort. So we sell our exclusivity, and we sell all of the amenities that we were talking about like MagiQuest and Scooops. 

Nobody else has that. So we try to differentiate ourselves as much as possible, but it's not always easy. >> Hi. >> Hi. >> My name is Tyler Lark. Your company seems very focused and successful on managing the economic and social aspects of the business, and I'm wondering what kind of consideration you guys are thinking about in terms of environmental responsibility, and if you incorporate any sustainability concepts into your resorts? >> That's a great question. Project Green Wolf is probably what I would point to first and foremost. When we went in to build a resort in North Carolina, the state said absolutely not. We are not giving up our precious commodity of water in order to have you come in and build something even though it would be great for families. And what we did is we said, listen, our waterparks, separate the hotel, our waterparks are state of the art. 

They are so energy efficient. Other than what walks off in your swimsuit or evaporates in the air is getting recycle, reclaimed and reprocessed underneath in this huge filtration system. So the amount of water we use is, on an average, about 40,000 gallons a day, which may seem like a lot but really it's not when you compare it to the hotel that takes a lot more with showers and things like that. So what we did is we set up what's called Project Green Wolf for us, and we were the first brand in the country to be Green Seal certified. And we went through the process which was a operating hotel standard, so kind of like LEED certification for those that follow the construction industry, it's like that for operations. And we did that and then we helped them write the waterpark standard so that we could really then, holistically, show that we really are paying attention to the environment and really focused on giving back, and not being something that a city or a municipality should not be proud of. Good question. Thanks. >> Hi, my name is Jackie. I'm wondering if when you became a public corporation if you noticed any kind of a culture shift within the organization? >> You know, Jackie, it's a great question, and going public was certainly an exciting opportunity for our company, but as I talked about before when we first started the company there was actually six partners. 

I happened to be one of them and five guys who started the company. They were very entrepreneurial. They loved going out and finding people to invest in the company and raising money. And it just, it was that thrill of every single victory of what we did. When we went public, going public for us gave us a little more certainty. We were going to hedge our future on building Great Wolf Lodges. And so for them it became more tactical. I was the only one who stayed. And so all five of the partners left during that time because they really wanted to do things that were more suited to what they wanted to do, not in this public setting that, you know, I don't want to say it's stifling, but there's certainly another layer that is added on and it's not just all entrepreneur and innovation from there. So yeah, big culture shock. 

>> I'll ask the last question. Kim, in regard to the fact, and I know I shared with you, we have 130 undergrads in this class and they will be pursuing a lot of different dreams, many of them entrepreneurial, over their lives. What recommendations would you have for them as they're going out into this work world, into this economy, as they think strategically or not about their next steps? >> I don't know if any of you guys follow Warren Buffett from investing but I think he always has one philosophy for investing and it's not really that different when you're going out to look for your career or what you want to do in your life and it is know what you're getting yourself in to. Never buy a stock if you don't understand the company. And I think that that is really an opportunity for all of you to be able to, as I said, be passionate about something. To know that you want to make a difference, to know that you can grow something, you really have to have an understanding of what the company is all about. What are their values? What are their aspirations? What do they want to do? Because if they don't align with yours, it may still be a great first step, but I think ultimately if you get the chance to choose the field, the area and even the company that you want to be in, be thoughtful about it. Take your time, do your research, ask the right questions because you're going to spend a lot of time working and defining yourself through this company. So as much as you can align that, as much as you can appreciate what this company is all about and know that you get to contribute to it, I just think that that is just such a better place for be. Like I said, I've been very fortunate for the last 14 years to be part of Great Wolf because I truly believe in what we're doing, how we're doing it and having a chance to just be a part of it, is just kind of icing on the cake. 

>> Well I know that in introducing you, Kim, I mentioned that you graduated from another great campus in town, Edgewood, but as I mentioned, Kim was a Badger three years before she moved on. And you're a Badger again today. >> Oh, thank you! >> So thank very much. Thank you, Kim Schaefer, for joining us today. >> Thank you. [APPLAUSE]