CEO Kim Schaefer on how Great Wolf Resorts’ sale paves the way for growth
by Jeremy Schoolfield

Kim Schaefer has the trip from her Wisconsin home to Madison’s Dane County Regional Airport down to a science. She can go from sitting in her driveway to sitting in her airplane seat in less than 60 minutes.

Yes, she flies a lot. But these days the Great Wolf Resorts CEO is more excited than ever about the places she’s going—both literally and figuratively. She used to spend much of her time bouncing between Great Wolf’s corporate headquarters in Madison and investor relations meetings in New York City, managing Wall Street’s quarterly expectations for the publicly traded indoor water park resort company. But all that’s changed since Great Wolf was purchased May 12 by private equity firm Apollo Global Management. After a year’s work massaging the particulars of that deal, Schaefer’s now reaping the rewards—her investor relationships went from hundreds to one. 

Schaefer’s still spending a lot of time on planes, but her destinations are a lot closer to her heart: Grand Mound, Washington; Traverse City, Michigan; Grapevine, Texas; and the other eight cities where Great Wolf operates its Lodges with the iconic wolf statues out front. Sure, these locales may not be as glamorous as the bright lights of the Big Apple, but Schaefer couldn’t be happier to be back among her employees—known internally as “Pack Members”—and the families they serve 365 days a year.

“I love, love, love getting back out into the properties. It is energizing,” says the executive with more than 20 years’ experience in the hotel industry, the past 13 at Great Wolf. “My team cringes a little when I go out because I’m going to come back with 15 ideas. I talk to the guests, even on the elevators, just asking them about their stay and their favorite things. That candid reaction is priceless.”

A married mother of two teenagers, Schaefer knows the importance of family time; it’s one of the lessons reinforced to her two years ago while filming an episode of the hit television show “Undercover Boss” (for more on that life-changing experience, turn to p. 49). When she’s out in the Lodges, she’s checking to make sure Great Wolf is allowing its guests to maximize their togetherness, all the while looking for ways to improve and expand the amenities of each resort.

Funworld spent a day with Schaefer at the Great Wolf Lodge in Grand Mound, about a 90-minute drive south of Seattle. We traversed the entire property—from the wave pool in the water park to the MagiQuest gift shop to the Scooops Kid Spa—and saw her in action as she interacted with employees and guests alike; she exudes a friendliness and approachability to both groups and isn’t afraid to get her feet wet (literally). Read on to learn her thoughts on the Great Wolf Lodge brand and how it informs the company’s delicate balance as both a hotel and an attraction. Also discover her insights on the Apollo sale and what it means for the future of the resort company.

The Apollo Sale

How and why did the sale of Great Wolf Resorts to Apollo Global Management come together?
We have a great company, a great brand, and great performance—even during the recession. But we’ve grown so quickly and, like a lot of people, we weren’t able to grow anymore because capital markets were closed down. So there were a lot of people who started showing interest in us, recognizing that even with debt, we had a lot of upside to offer. Apollo showed interest right away.

What did Apollo find appealing about Great Wolf?
They like the space and think regional entertainment has a lot of opportunity for growth. Wall Street has a risk profile for companies, so for Great Wolf our amount of debt gave us a higher level of risk; we were highly leveraged because we’d opened six new resorts in five years. We had lots of free cash flow, and our business was doing tremendously well, but our amount of debt posed a problem to a lot of investors. We knew there was no imminent issue, but it would’ve come with no growth opportunities for us because we couldn’t take on any more debt. Apollo, as a private equity firm, was not afraid of our balance sheet.

How does going private affect the way you can run your business?
We’re no longer judged by one quarter. Though that keeps you disciplined, there are many times—especially in this industry—when things take a long time before you get the payback on them. With Apollo we’re going to have an opportunity to look beyond one quarter and look at how we’re going to run this business over the next three to five years.

Looking back over the past five years, what were the keys to your success during the economic downturn?
We’ve established ourselves as a quality getaway. People could give up the $5,000 vacation because they felt like they could get everything they wanted out of a $1,000 Great Wolf vacation. It is a great value for families.

You never want to go through a recession to prove you  have a great business model [laughs] but I remember in 2008 thinking, “Discretionary spending is 90 percent of our business, so what’s going to happen?” The fact that people supported us by spending their hard-earned dollars with us during these tough times was something I’ll never forget.

Hospitality and Entertainment

Great Wolf occupies a unique space in the market beyond just the indoor water park segment. Can you discuss how you mesh aspects of both a hotel and an attraction, all the while adding new entertainment experiences beyond the water park?
For us, it’s a balance between both, where we want our guests to feel like they’re at home, in a comfortable surrounding. The intimacy of that experience—and what they expect from it—is much higher than if they were coming for just pure entertainment. Seeing a mom come walking down on a Saturday morning in her pajamas to get coffee … there’s nothing better than that because you know you’ve done the right thing.

It’s also about making sure there’s always something they can do, but we don’t want to be in their face about it. We give them lots of options, but if they just want to sit down by the fireplace, we give them a comfortable place to do that. It’s been an evolution for us over 15 years to get that right blend.

A hotel is used to people being essentially absent during the day, whereas a water park is used to saying good-bye to guests in the evening. You have to do both—how do you manage it?
That’s why the exceptional guest service has to be there. Not only do our Pack Members have to be friendly, but also accommodating and willing to stop what they’re doing and make sure the guests get whatever they need—because they’re not going away! Anybody can build the asset; it’s what you do with that asset that makes the difference and keeps people coming back.

So how do you find the right employees and instill this mixture of hospitality and entertainment in them?
When we first started out, most of us came from the hospitality side. So we hired people from the entertainment side who understood things like the arcade and retail and the overall show. Once we merged those two cultures together, we started writing our own playbook for indoor water park resorts.

Now we hire for aptitude. You have to like children, you have to like the hustle and bustle, and you have to have a great personality. We can train them for the rest of it. It’s been years of best practices and making sure we’re building leadership into every level of our Pack Members.

It’s not just about doing your job well, but making sure you are a leader to all the guests here. There are times when you can have 600-700 children in the resort, so you need to be friendly and helpful without intimidating the kids. As a parent, when your kids are happy, you’re happy. So it’s about providing the level of service where the parents are going to feel like they got their money’s worth, but also making the kids smile.

The Great Wolf Brand

You often talk about the moment when Great Wolf “decided we have a brand.” Could you explain this further?
We bought the first Lodge in Wisconsin Dells in 1997 and then built the second. By the time we started building the third and fourth Lodges in 2003, we realized there were some patterns developing in ways we engage guests; Story Time at the fireplace was first. We began to look at ways we could ensure we could replicate those experiences at each resort. Things came together and our brand identity evolved across all the properties.

What defines the Great Wolf brand?
The marketing of our Lodges is always going to be focused on the water park because that’s the caché and what people understand. But when they get here and they experience our many “Wolf Moments,” have fun spending time together, and make memories … that is what we’re about.

Great Wolf and the Future of the Indoor Water Park Industry

What is your assessment of the indoor water park industry right now?
We are a regional destination and I think families are going to look to regional destinations for vacations  more and more. We’ve found you can’t do anything that isn’t high quality and with a high level of service. Indoor water parks aren’t unique anymore; people understand them, and the bar’s been set pretty high for what they expect. That is going to allow the cream of the crop to do well. And while it is about building the best water park you can, it is also about the vacation experience and offering all these other things to do.

Where do you want to see Great Wolf go in the future?
We want more growth. We think there are a lot of places we don’t have Lodges where we could do a great job entertaining families. The other part is continuing to grow the experiences in the Lodge (Editor’s note: see “Kids Experience” sidebar). Now that we have a clearer runway with the new owner, what’s the next idea? What will capture the hearts of the guests who come here?

What is it like to be back in the Lodges more and see guests having fun?
It brings the experience to a personal level. It is sometimes the simplest satisfaction of seeing the little girl with her wolf ears on—that personal connection—where I know we got it right. That’s what it’s all about. Every once in a while you have to be reminded who and what you’re doing it for. It’s motivational. We’re in a lot of people’s photo albums, and that’s pretty cool.

Contact Senior Editor Jeremy Schoolfield at jschoolfield@IAAPA.org.

‘Undercover Boss’: The Gift that Keeps on Giving

It’s been two years since Kim Schaefer’s episode of the hit U.S. television series “Undercover Boss” debuted. In it, Schaefer cut her hair, donned glasses and a uniform, and went to work as a frontline “Pack Member” at multiple Great Wolf Lodges—unbeknownst to the employees she worked alongside. A camera crew followed Schaefer for a week as she worked as a waitress, checked guests in at the front desk, and—in the most memorable moment—cleaned feces out of a pool. The series’ goal was to help CEOs like Schaefer get in touch with their companies’ hourly employees and gain a better sense of how their businesses operate day to day.

“Undercover Boss” was a smash hit in the United States and eventually around the world; millions of viewers watched as Schaefer struggled to remember dining orders and was criticized by children in Great Wolf’s Cub Club arts and crafts center. But they also saw how much she appreciated her Pack Members and how going “undercover” affected her in a very personal, emotional way. The experience was so powerful, it’s stuck with the CEO long after the cameras stopped rolling.

Did you pick up anything from the “Undercover Boss” experience you’ve taken with you as you go through the resorts now?
Over the last 15 years of doing this, I was always focusing on the guests. “Undercover Boss” opened my eyes to the Pack Members. We do a great job of taking care of them and involving them in new procedures, but “Undercover Boss” was a good reminder of how critical they are. We were in the middle of the recession when we filmed, and the Pack Members were going through a lot; yet they came in every single day and did their jobs.

Now that you’ve had a couple years for the show to soak in, what has its impact been on you and Great Wolf as a whole?
It’s a gift that keeps on giving—the show has aired over and over again in many countries. As a marketing vehicle, I don’t think you could ask for anything better; we’ve almost been able to incorporate it into our marketing plans.

But something I didn’t expect was the personal connection.

For better or worse, I became the face of Great Wolf, even though I’m a little more comfortable behind the scenes. I became somebody people identified with, and people stop me and want to tell me their stories. When the show first came out, there were kids coming up and wanting pictures with me and autographs. I was not prepared for that—nobody told me that was coming! Over the past two years, I’ve gotten at least 2,000 letters or e-mails … people send me books as a thank-you for inspiring them.

Since the show’s been picked up in syndication, are you still hearing from people who have only now seen it for the first time?
Every country where it airs is always something new, so all of a sudden I’m getting invitations from Denmark to come stay at people’s homes if I’m ever in the area [laughs]. Every time it airs I get a handful of e-mails from people who have questions or comments for me.

Has it opened other doors for you that perhaps you didn’t anticipate?
The number of requests for speaking engagements is triple what I’ve had in the past.

Knowing what you know now, would you still have done “Undercover Boss”?
Without question. During the filming, I was reminded how amazing our Pack Members are. Seeing them in action encouraged me. I know they can—and will—help us continue to raise the level of service we provide our guests. 

What are some lasting lessons you’ve taken from the experience that still carry over to Great Wolf now?
We hold an annual golf outing where we raise money so we can give scholarships to our Pack Members. That’s been one of the most meaningful things we’ve been able to give back to our employees. The one thing that’s tough about the show is you’re rewarding six people, and there are 5,000 Pack Members who do those same things every single day. So we looked at things we could do to give back on a broader basis.

Editor's note: As a result of the golf tournament, this year Great Wolf awarded a total of $48,000 in college scholarships to 11 employees from across the company.

‘Kids Experience’: Entertaining Children Outside the Water Park

Great Wolf CEO Kim Schaefer likes to say guests come to the Lodges for the water park, but they come back again and again for everything else.

Over the past decade, Great Wolf has added multiple children’s programs to its resorts, everything from Story Time around the fireplace to the interactive MagiQuest game to the Cub Club arts and crafts program to the Scooops Kid Spa.

All of these activities and entertainment outlets fall under Great Wolf’s “Kids Experience” umbrella, and now this program is taking even bigger steps as the resort company extends its brand. Some of the new initiatives include:

• Expanding Scooops in markets separate from the Lodges.
• Publishing its own brand of children’s books that tell the Great Wolf story; guests can buy the books (or download them online) and have a reminder of their visit to take home with them.
• Unveiled new mascot Oliver Raccoon, a signal that Great Wolf is placing more emphasis on its own their personalities, and their favorite spaces within the resorts. For example, Violet the Wolf now makes daily appearances inside Scooops. 
• Launched www.greatwolfkids.com, a website dedicated to and customized exclusively for children, where they can learn more about Great Wolf, print out activities to do in the car on their way to the Lodge, download apps, play games, and more.

“We’ve always marketed to moms, the decision-makers. But there is a generation of kids now that is completely technology focused and more interactive with their parents in making vacation decisions,” Schaefer says. “There’s a maturity level to kids these days that has changed. So, for us, ‘Kids Experience’ is about having more of a direct conversation with them.”