With the 2017 ED’s Overall Club of the Year already in their portfolio, find out why The Penthouse Club brand is the “key” to becoming the No. 1 club in your market.
A group of guys find themselves in a city they’ve never been. They’re in town for a convention or a sporting event, and they’re looking for the sort of good time that guys look for when they’re together and sans wives and/or girlfriends. They check their phones for the city’s strip clubs; they see a few listed, but one jumps out — it’s the one with the name they know.
In that same city, a group of girls is looking to head out for a naughty bachelorette party. They want to have some “adult” fun, but they want to do it in an environment that appears safe, upscale and welcoming to women, one that understands the meaning of “hospitality” and knows how to accommodate bachelor and bachelorette events.
There’s certainly something to be said for brand recognition, especially when that brand is known around the world as one that symbolizes upscale adult entertainment and beautiful women. With a parent brand like Penthouse, it’s no wonder The Penthouse Club brand has enjoyed a great deal of success in the adult nightclub industry. Following The Penthouse Club’s win for ED’s Club Chain of the Year in 2014, the brand’s Baton Rouge, Louisiana, location took home top honors at the 25th Anniversary EXPO by winning the ED’s 2017 Overall Gentlemen’s Club of the Year Award.
“Between winning Overall Gentlemen’s Club of the Year and one of the club’s entertainers, Aja Marie, winning the EXPO’s $10,000 Bikini Contest, The Penthouse Club in Baton Rouge certainly had a fantastic showing at this year’s EXPO,” says John Kirkendoll, Founder & CEO of Kirkendoll Managment, which owns and operates two Penthouse Clubs (New Orleans and Baton Rouge). “Having previously been named Club of the Year/Central in 2012, we’re honored to have The Penthouse Club, Baton Rouge recognized as the best of the best in our industry once again.”
“It was really our experience as a licensee, which started 11 years ago when we rebranded our club in New Orleans, that sold us on the deal. We’ve witnessed firsthand the power of the brand. The acquisition of The Penthouse Club master license is the embodiment of our desire to revolutionize the gentlemen’s club industry, and we’re extremely excited to scale our best practices and take this brand to a whole new level.” – John Kirkendoll
But Kirkendoll Management doesn’t just own and operate those two Penthouse Clubs. In April 2017, it was announced that Kirkendoll Management had acquired the master license for The Penthouse Club, which means that Kirkendoll now manages the Penthouse Club license for the adult nightclub industry on a worldwide scale.
We had the chance to speak with John Kirkendoll on this game-changing acquisition, especially as it relates to the future of The Penthouse Club brand in the adult nightclub industry. What is the new criteria for Penthouse Club locations, and what will Kirkendoll Management be bringing to their licensees that the previous Penthouse licensing regime did not? Kirkendoll answers these questions and many more in our exclusive interview. – Dave Manack
ED: The Penthouse Club, Baton Rouge just won the most prestigious club award in the industry, the Overall Gentlemen’s Club of the Year. Please tell us about that club, what makes it special, and why it was deserving of this award.
JOHN KIRKENDOLL: We were asked several times how we thought the club could compete with others in larger markets across the country, and when it came down to it the answer was easy: We have a globally-recognized name, a beautiful club with a professional management team, an accommodating staff, and the hottest entertainers in the South. What else could we need?
We’re incredibly proud to be the Overall Gentlemen’s Club of the Year and we’d like to give our sincerest thanks to everyone who voted for us.
ED: Back in our May issue, we announced that Kirkendoll Management had acquired the master license for The Penthouse Club. Now is our opportunity to go into much further detail about this acquisition. The first question is, what made the “Penthouse” brand so attractive for Kirkendoll Management? It took quite a while and months of negotiation to acquire the brand, from what we understand.
JK: Yes, this wasn’t an impulse decision by any means. Expanding Kirkendoll Management’s Nightclub Division has long been a goal of our company, and this partnership with Penthouse was the perfect opportunity. It was really our experience as a licensee, which started 11 years ago when we rebranded our club in New Orleans, that sold us on the deal. We’ve witnessed firsthand the power of the brand, which helped elevate us from the number-three club in the highly competitive New Orleans market to number one.
As we grew into the brand and licensed another club in Baton Rouge, we began creating proprietary technologies and applications and fine-tuned everything from our management processes to our marketing strategy. It didn’t take long for us to realize that we could make an impact far beyond our local markets. The acquisition of The Penthouse Club master license is the embodiment of our desire to revolutionize the gentlemen’s club industry, and we’re extremely excited to scale our best practices and take this brand to a whole new level.
ED: If a club is thinking about becoming part of the Penthouse brand, tell us about the brand recognition that the Penthouse name brings in a competitive club market (such as in New Orleans). What advantage does a club have if they carry the Penthouse Club name?
JK: The Penthouse Club brand is already a globally-recognized leader in the adult entertainment space, and we want to build on this recognition by positioning Penthouse as the premier club to visit for a luxury experience, complete with beautiful entertainers and a premium party atmosphere.
Last month, The Penthouse Club contracted an independent survey company to randomly collect anonymous responses from 500 American men with knowledge of the gentlemen’s club industry regarding their thoughts on various gentlemen’s club chains and brands. The results overwhelmingly favored Penthouse, which was found to be well-recognized and known to offer an upscale experience with very attractive entertainers. The survey results also demonstrated that Penthouse is highly regarded for bachelor parties and bottle service, and has a great nightclub/dance atmosphere.
As operators, we’ve always been critical of our competition and have strived to set a higher standard for the entire industry; this survey confirmed that the hard work of Penthouse Clubs around the world has solidified the brand as the ultimate gentlemen’s club experience.
ED: The story in our May issue notes that Kirkendoll Management will assist with management of operations, technologyand marketing for all licensees of the Penthouse Club brand. Can you explain in more detail what this will involve, and what value this will bring to a licensee?
JK: The new Penthouse Club licensing experience will be much more holistic. Traditional licensing opportunities gave licensees a name to hang above their door with little added value, but we’re committed to utilizing our 100-plus years of combined industry experience to make every Penthouse Club a leader in its market. The Penthouse Club will provide one-on-one operational and marketing support to all of our licensees, in addition to offering exclusive use of our proprietary enterprise software and applications developed specifically for gentlemen’s clubs.
Ultimately, we want our licensing experience to be more than just a transaction. We strive to serve as partners and play a role in the success of each and every Penthouse Club, and we’re confident that the help and support of our team can bring any gentlemen’s club to the top.
ED: What type of clubs and/or markets are you looking for when seeking to acquire Penthouse licensees?
JK: The Penthouse Club is an ultra-premium brand for leaders in major markets. In order to maintain this distinction, we’re extremely selective when it comes to identifying future Penthouse Club licensees and locations. To become a member of the Penthouse Club family, a licensee needs three things: 1) An outstanding operator capable of and committed to running a world-class establishment; 2) A premium club location in a major market; and 3) The ability to maintain or become the number-one club in its market.
We’re primarily targeting operators with a successful track record of owning/operating adult entertainment businesses who are committed to helping us elevate The Penthouse Club brand. Our ideal markets are trendy neighborhoods in larger cities (one million people plus) with vibrant nightlife scenes, professional sports teams, and without extreme seasonality. Given the depth of our industry experience, we’re also happy to take a more hands-on approach via a management agreement or buyout.
ED: Since you purchased the master license in March, several clubs have debranded. Why was that?
JK: When we purchased The Penthouse Club brand, we inherited licensees in markets that should never have been licensed as Penthouse Clubs to begin with. Two of the three clubs that debranded simply didn’t meet the criteria mentioned above and it was an easy decision to not renew their contracts. The third club was The Penthouse Club in Paris, which opted not to renew due to financial reasons stemming from the severe downturn in Parisian tourism that has affected the city since 2015.
ED: What will be the biggest differences between how the Penthouse Club brand is managed now under Kirkendoll Management, compared to how it was managed previously?
JK: At the end of the day, we’re club operators who understand the industry and what it means to run a successful gentlemen’s club. As we reposition the brand to become even more synonymous with “ultra-premium,” we understand we have to offer this level of services to our licensees. We’ve built out an outstanding back office of industry veterans who have the knowledge and the know-how to assist with every aspect of creating and sustaining a number-one club. We also have a portfolio of game-changing marketing techniques, technological innovations and management technologies that will be made available exclusively to Penthouse Club licensees.
ED: Are there any new Penthouse Club licensees that you can announce?
JK: At present, domestic Penthouse Club licensees are located in Baton Rouge, Detroit, New Orleans, Philadelphia, San Francisco and Tampa. International licensees are located in Auckland, Moscow and Perth. The 25th EXPO provided us with the perfect platform to secure several new leads, and we’re excited to announce that two new major-market domestic clubs will be joining the Penthouse Club family in the coming months. As we’re still in the final stages of negotiation we can’t specify their locations just yet, but we’re incredibly thankful to the entire ED Magazine team and EXPO staff who helped make our first convention as The Penthouse Club a huge success.