Responding to the flourishing consumer demand for wellbeing facilities, the spa has established itself in the hospitality industry to today become an indispensable part of upscale and luxury establishments, particularly in the leisure segment. If professionals realize such an investment’s impact on the establishment’s activity, profitability and revenue optimization remain the principle concern of hoteliers, who should learn to manage this new activity with adapted personnel.
The new hotel classification's entry into force last July was a driving force for the French spa industry in hotels and other tourist lodgings. Favoring the upmarket movement of establishments, the new hotel classifications have led to the multiplication of the industry's wellbeing supply, now considered a key differentiating element by professionals. France has a current network of almost 9 000 spas, some 400 of which are located within hotel infrastructure. In the five-star segment alone, almost 46% of establishments are equipped (*). The trend to increase spa supply in the hotel sector should be continued over the coming years and follow the changes in wellbeing tourism, that should continue to develop until 2020, globally and in France, according to experts. "The use of spas in hotels has been growing over the past few years and the latest are no longer used as only a place to stay, but rather as a place to feel good. Spas are only in their infancy in terms of supply development and are now part of the means at hoteliers' disposal to attract new clients, as an integral part of the hotel experience", explains Anna Bjurstam, Vice President of Six Senses Spas which has an international network of 27 establishments.
While the trend mainly concerns the upscale and luxury segments, Aldina Duarte Ramos, president of the SPA-A association, notes that the hotel spa supply tends to be democratized in France as well as abroad : "Today, hotels increasingly equip themselves with spa services. As these services are almost automatically offered in the four- and five-star hotel segments, we also find a similar offer in three-star establishments, tourist residences, as well as campgrounds". The democratization of wellbeing in the three-star hotel segment particularly corresponds to the development of boutique hotels.
Several reasons explain the current craze among professionals for the hotel spa offer, and its variations across the different markets and segments of tourist lodgings. Such an installation represents at the same time a powerful differentiation tool for establishments that want to set themselves apart from the competition, and allows them to offer a more complete service to their clients. It is this that Anna Bjurstam explains : "the advantages to hoteliers of offering spas are infinite. With such equipment, they are able to reach their customers in a new way, like no other department in the establishment can ". But above all else, spas respond to a growing consumer demand in the 21st century, more attentive to their personal wellbeing and increasingly to the search for fulfillment and serenity. Many studies conducted over the past years have thus shown that a great majority of clients are selecting a hotel on the basis of whether it has a spa or not and the type of establishment. Opening a space entirely dedicated to wellbeing thus allows hoteliers to reinforce their clientele and to attract new ones, not only from the hotel but externally as well. Today, spas are now real leverage points for attendance and hotel activity, improving occupancy rates as well as client satisfaction, thus their loyalty."The presence of spas in hotels is clearly a leverage point for reservations, without expecting them to play a large role in hotel image in the eyes of consumers. Therefore, this naturally has direct consequences on occupancy rates and average daily prices. We also observe that spa clientele is more numerous in the leisure segment than the business market, thus concerning a clientele that is ready to reserve more spacious rooms rather than the standard", speculates Aldina Duarte Ramos.
Searching for better profitability
While the advantages of installing a spa in a hotel establishment seem evident, development in infrastructure is not a less important investment for hoteliers. This then raises the question of profitability and the capacity of hoteliers to quickly generate returns on their investments, which is very different from that concerned in other types of infrastructure pertaining to the hotel business like restaurants. "The spa is an activity that is not generally easy to monetize. As for all businesses, one needs to pay close attention, be able to analyze and master the costs, identify the business' leverage points, and define an action plan with a competent and motivated team", explains the president of the SPA-A association. The problem of the profitability of spas has been a recurrent question in the hospitality sector over several years, and has brought about several economic models to find the best possible balance between limiting the hotelier's risks and optimizing the additional direct revenue that such an activity brings. "Today the economic models that have been developed to optimize spa management are many, but the ones that are most frequently used on the market are direct infrastructure management by the establishment, management by a third party, white label or space rental", lists Aldina Duarte Ramos. Many recognized cosmetics brands have thus made their appearance in the hotel industry by supporting establishments in developing their wellbeing offer, via their knowledge in terms of care and their reputation in the beauty market. This is in particular the case of Cinq Monde, Décléor, Carita, Occitane, Guerlain, and Clarins which just launched a new spa at the recently opened InterContinental Marseille hotel.
In order to accelerate the return on hotel investments, professionals are searching tirelessly for new techniques to adapt to spas. One of the current trends concerns the use of Revenue Management in the wellbeing market, or the real-time adaptation of pricing to available capacities. Well-developed across the Atlantic, the technique known by hotel professionals is making its first appearance on the French market and is seeing establishments increasingly equipping themselves with spas. According to the vice president of Six Senses Spas, "Revenue Management is a good tool to use in spas when it is possible. It not only consists of proposing different prices during different periods, but of finding the right price for the right clients that find themselves in the establishment at the right moment. It also concerns knowing the profile of the clientele that we receive by the sum that they are ready to spend and the nature of the experience that they expect. But one must also have a flexible Revenue Management approach". For Aldina Duarte Ramos, Revenue Management allows hoteliers to "intelligently manage their appointments according to high or low hours, manage promotion campaigns and conduct push operations".
The search for increased optimization of the revenue generated by hotel spas comes through development as well as through cross-selling in the sector. This sales technique allows the increase of the average package and to make products more visible which might have not been before. In the case of the hotel spa market, it consists of offering for example cosmetic products for sale when clients reserve or arrange their chosen treatments. Therefore, cross-selling also plays a role in consumer satisfaction in loyalty ratings for the spa as well as the hotel.
Some establishments have successfully launched into the spa experience and are now feeling the positive effects in their activities, such as the Best Western hotel of Carnac in Britain. After opening its spa, the establishment saw its turnover surpass 1.6 million Euros, for 72 rooms, at 2.4 million Euros, for 55 rooms. The new infrastructure notably allowed it to maintain its occupancy rates above 50% over the six months of winter, not be so dependent on the seasonal system, overcome the economic crisis by reviving an aging product, amortize its complete renovation, and gain notoriety.
Hotel spas require adapted training
The employee mass is another of the challenges faced by professionals in the process of improving hotel spa profits. Representing between 40% and 50% of an establishment's entire wellbeing operating cost, it should be considered with care and involve an adapted and efficient staff, sometimes difficult to find in the world of hospitality. "Outside of the lack of quality and cohesion in some hotels, one of the hotel spa sector's current weaknesses on the international stage is the general lack of competence of general directors and hotel personnel to effectively manage a spa, being an entirely different type of activity from any of the other departments characteristic of the hotel industry", explains the vice president of Six Senses Spas. It is up to each institution to invest as required in the training of its staff and to turn to the dedicated training centers that have appeared on the market a few years ago, like the Elegance Spa Academy. Established in 2004 by Jean-Eric Knecht, the concept was conceived of in Bordeaux with the opening of the first Spa Academy in Europe and today delivers diplomas licensed by the state of Spa Practitioners. Recently the network, today present in Madrid, Vichy, Montpellier and Nice, launched a Spa Manager course to better respond to the needs of the wellbeing sector, especially in the hospitality industry.
New trends in hotel spas
To the further development of spas in hotels, there is the risk of uniformity in the product and service offer as well as consumer fatigues in the sector today. But wellbeing professionals have not yet given their last word and expect to greatly distance themselves from the threat by redoubling efforts to extinguish monotony in the wellbeing sector. "The current trend is for fulfillment, meditation, and healthy hotels, or establishments that specialize in the well-being of their clients during the entire experience and not only in the gym and spa", analyzes Anna Bjurstam. The InterContinental hotel group has thus decided to launch a new brand entirely dedicated to wellbeing to respond to the growing demand of clients who aspire to travel healthily. Even caters to consumers that focus their travel on wellbeing, concerning nutrition as well as work, exercise, and relaxation. IHG has made a goal of opening 100 Even establishments in the United States over the next five years, and the first should open in New York City between now and 2014.
On a smaller scale, in the spas themselves, other initiatives have been taken to diversify the wellbeing supply offered to clients. Among the current trends, aboriginal care packages are returning to establishments, with sessions in salt caves, salt treatments and the use of mud for skincare. The InterContinental Presidente Cozumel Resort Spa, in Mexico, offers for example treatments according to their ancestral Mayan techniques, with elaborate treatments based on local natural elements like (plants, herbs, fruits). "Natural products also work very well and have become an important factor in the experience", Anna Bjurstam adds. The Intercontinental Aphrodite Hills hotel, located on the island of Cyprus, has for example an elaborate treatment menu based on Greco-roman ritual with plants and minerals from the island. Another trend that is appearing on the market is that of natural treatments, like those offered by the InterContinental Sanya Haitang Bay Resort hotel spa, in China, based on plants, coconut, lotus tea and rose salt to enjoy the benefits of the ying and the yang.
Other establishments go beyond the simple proposal of specific packages and represent the concept throughout, like the Best Western Celtic hotel of Carnac which chose to position itself on a low-cost model, three stars, due to competition from a nearby four-star thalasso. The establishment thus offers quality packages at an attractive price, in a family-friendly format. " It must not be thought that the spa is a product reserved for the upscale hotel segment, but to democratize it. We reclaim the concept of low-cost spas and we have willingly remained in the three-star market ", explains Daniel Richard, hotel director, showing that the spa industry still has a multitude of development opportunities in hotels.
(*) source: Nathalie Peyrodes, www.nouvelles-esthetiques.com
While the trend mainly concerns the upscale and luxury segments, Aldina Duarte Ramos, president of the SPA-A association, notes that the hotel spa supply tends to be democratized in France as well as abroad : "Today, hotels increasingly equip themselves with spa services. As these services are almost automatically offered in the four- and five-star hotel segments, we also find a similar offer in three-star establishments, tourist residences, as well as campgrounds". The democratization of wellbeing in the three-star hotel segment particularly corresponds to the development of boutique hotels.
Several reasons explain the current craze among professionals for the hotel spa offer, and its variations across the different markets and segments of tourist lodgings. Such an installation represents at the same time a powerful differentiation tool for establishments that want to set themselves apart from the competition, and allows them to offer a more complete service to their clients. It is this that Anna Bjurstam explains : "the advantages to hoteliers of offering spas are infinite. With such equipment, they are able to reach their customers in a new way, like no other department in the establishment can ". But above all else, spas respond to a growing consumer demand in the 21st century, more attentive to their personal wellbeing and increasingly to the search for fulfillment and serenity. Many studies conducted over the past years have thus shown that a great majority of clients are selecting a hotel on the basis of whether it has a spa or not and the type of establishment. Opening a space entirely dedicated to wellbeing thus allows hoteliers to reinforce their clientele and to attract new ones, not only from the hotel but externally as well. Today, spas are now real leverage points for attendance and hotel activity, improving occupancy rates as well as client satisfaction, thus their loyalty."The presence of spas in hotels is clearly a leverage point for reservations, without expecting them to play a large role in hotel image in the eyes of consumers. Therefore, this naturally has direct consequences on occupancy rates and average daily prices. We also observe that spa clientele is more numerous in the leisure segment than the business market, thus concerning a clientele that is ready to reserve more spacious rooms rather than the standard", speculates Aldina Duarte Ramos.
Searching for better profitability
While the advantages of installing a spa in a hotel establishment seem evident, development in infrastructure is not a less important investment for hoteliers. This then raises the question of profitability and the capacity of hoteliers to quickly generate returns on their investments, which is very different from that concerned in other types of infrastructure pertaining to the hotel business like restaurants. "The spa is an activity that is not generally easy to monetize. As for all businesses, one needs to pay close attention, be able to analyze and master the costs, identify the business' leverage points, and define an action plan with a competent and motivated team", explains the president of the SPA-A association. The problem of the profitability of spas has been a recurrent question in the hospitality sector over several years, and has brought about several economic models to find the best possible balance between limiting the hotelier's risks and optimizing the additional direct revenue that such an activity brings. "Today the economic models that have been developed to optimize spa management are many, but the ones that are most frequently used on the market are direct infrastructure management by the establishment, management by a third party, white label or space rental", lists Aldina Duarte Ramos. Many recognized cosmetics brands have thus made their appearance in the hotel industry by supporting establishments in developing their wellbeing offer, via their knowledge in terms of care and their reputation in the beauty market. This is in particular the case of Cinq Monde, Décléor, Carita, Occitane, Guerlain, and Clarins which just launched a new spa at the recently opened InterContinental Marseille hotel.
In order to accelerate the return on hotel investments, professionals are searching tirelessly for new techniques to adapt to spas. One of the current trends concerns the use of Revenue Management in the wellbeing market, or the real-time adaptation of pricing to available capacities. Well-developed across the Atlantic, the technique known by hotel professionals is making its first appearance on the French market and is seeing establishments increasingly equipping themselves with spas. According to the vice president of Six Senses Spas, "Revenue Management is a good tool to use in spas when it is possible. It not only consists of proposing different prices during different periods, but of finding the right price for the right clients that find themselves in the establishment at the right moment. It also concerns knowing the profile of the clientele that we receive by the sum that they are ready to spend and the nature of the experience that they expect. But one must also have a flexible Revenue Management approach". For Aldina Duarte Ramos, Revenue Management allows hoteliers to "intelligently manage their appointments according to high or low hours, manage promotion campaigns and conduct push operations".
The search for increased optimization of the revenue generated by hotel spas comes through development as well as through cross-selling in the sector. This sales technique allows the increase of the average package and to make products more visible which might have not been before. In the case of the hotel spa market, it consists of offering for example cosmetic products for sale when clients reserve or arrange their chosen treatments. Therefore, cross-selling also plays a role in consumer satisfaction in loyalty ratings for the spa as well as the hotel.
Some establishments have successfully launched into the spa experience and are now feeling the positive effects in their activities, such as the Best Western hotel of Carnac in Britain. After opening its spa, the establishment saw its turnover surpass 1.6 million Euros, for 72 rooms, at 2.4 million Euros, for 55 rooms. The new infrastructure notably allowed it to maintain its occupancy rates above 50% over the six months of winter, not be so dependent on the seasonal system, overcome the economic crisis by reviving an aging product, amortize its complete renovation, and gain notoriety.
Hotel spas require adapted training
The employee mass is another of the challenges faced by professionals in the process of improving hotel spa profits. Representing between 40% and 50% of an establishment's entire wellbeing operating cost, it should be considered with care and involve an adapted and efficient staff, sometimes difficult to find in the world of hospitality. "Outside of the lack of quality and cohesion in some hotels, one of the hotel spa sector's current weaknesses on the international stage is the general lack of competence of general directors and hotel personnel to effectively manage a spa, being an entirely different type of activity from any of the other departments characteristic of the hotel industry", explains the vice president of Six Senses Spas. It is up to each institution to invest as required in the training of its staff and to turn to the dedicated training centers that have appeared on the market a few years ago, like the Elegance Spa Academy. Established in 2004 by Jean-Eric Knecht, the concept was conceived of in Bordeaux with the opening of the first Spa Academy in Europe and today delivers diplomas licensed by the state of Spa Practitioners. Recently the network, today present in Madrid, Vichy, Montpellier and Nice, launched a Spa Manager course to better respond to the needs of the wellbeing sector, especially in the hospitality industry.
New trends in hotel spas
To the further development of spas in hotels, there is the risk of uniformity in the product and service offer as well as consumer fatigues in the sector today. But wellbeing professionals have not yet given their last word and expect to greatly distance themselves from the threat by redoubling efforts to extinguish monotony in the wellbeing sector. "The current trend is for fulfillment, meditation, and healthy hotels, or establishments that specialize in the well-being of their clients during the entire experience and not only in the gym and spa", analyzes Anna Bjurstam. The InterContinental hotel group has thus decided to launch a new brand entirely dedicated to wellbeing to respond to the growing demand of clients who aspire to travel healthily. Even caters to consumers that focus their travel on wellbeing, concerning nutrition as well as work, exercise, and relaxation. IHG has made a goal of opening 100 Even establishments in the United States over the next five years, and the first should open in New York City between now and 2014.
On a smaller scale, in the spas themselves, other initiatives have been taken to diversify the wellbeing supply offered to clients. Among the current trends, aboriginal care packages are returning to establishments, with sessions in salt caves, salt treatments and the use of mud for skincare. The InterContinental Presidente Cozumel Resort Spa, in Mexico, offers for example treatments according to their ancestral Mayan techniques, with elaborate treatments based on local natural elements like (plants, herbs, fruits). "Natural products also work very well and have become an important factor in the experience", Anna Bjurstam adds. The Intercontinental Aphrodite Hills hotel, located on the island of Cyprus, has for example an elaborate treatment menu based on Greco-roman ritual with plants and minerals from the island. Another trend that is appearing on the market is that of natural treatments, like those offered by the InterContinental Sanya Haitang Bay Resort hotel spa, in China, based on plants, coconut, lotus tea and rose salt to enjoy the benefits of the ying and the yang.
Other establishments go beyond the simple proposal of specific packages and represent the concept throughout, like the Best Western Celtic hotel of Carnac which chose to position itself on a low-cost model, three stars, due to competition from a nearby four-star thalasso. The establishment thus offers quality packages at an attractive price, in a family-friendly format. " It must not be thought that the spa is a product reserved for the upscale hotel segment, but to democratize it. We reclaim the concept of low-cost spas and we have willingly remained in the three-star market ", explains Daniel Richard, hotel director, showing that the spa industry still has a multitude of development opportunities in hotels.
(*) source: Nathalie Peyrodes, www.nouvelles-esthetiques.com
