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That’s right: spas. Hotels -- from branded, global chains catering to business class or high end, jet-setting travelers -- have (or are building) spas. Ditto for boutique establishments and casino hotels that cater to guests seeking luxurious amenities. In fact, hotels of every stripe are hopping on this new trend. Note, we said trend. Not fad.
Spas in hotels are coming in at a fast and furious pace, and they’re here to stay. New hotels are building eye-popping, state of the art spas right into their plans, while existing properties are replacing health clubs and gyms as fast as they can with spas. And for the hotel chains whose guests are one-night, time-pressed young business travelers, who won’t necessarily take the time to visit an in-house spa, what better way to indulge them with a pampering experience than to build private, spa-like bathrooms into their suites?
To get more insights on the latest marketing strategy in the hospitality industry, Daily Fix readers may wish to read recent Business Week article “Hotel Chains Recharge with Spas.”
Let’s face it: in this frenetically-paced, cold world, nothing appeals to us more than being pampered and nurtured a bit. Even though luxury hotels can charge substantial rates for spa treatments, industry reports show response has been excellent.
In the Business Week article cited above, “According to the trade organization International Spa Association, North American spas, including those located within hotels and resorts, have seen an average annual growth rate of 16% between April, 2004 and August, 2006. U.S. spas drew $9.7 billion in revenue in 2005 (the latest statistics available). The growing wellness industry and the 'masstige' or mass-market luxury, phenomenon have helped increase he popularity of spa treatments”.
Interestingly, the shift here has been away from using hotel-branded personal care products, in favor of famous spa brands. In fact, great care is being taken by many chains, it seems, to align the hotel brand with the correct spa brand. Co-branding can be a very effective marketing tool. Again: it’s all a matter of the right alignment and hotel and spa brand having equally strong assets that complement each other.
Starwood Hotels are planning on featuring Bliss products in its new aloft hotels, beginning in 2008. Starwood now owns the Bliss brand, which originated in the Bliss Spa in New York City. L.A.’s Sofitel’s LeSpa uses only Decleor and Carita products while the Beijing and Paris Sofitels will feature Lancome products.
Harrah’s Atlantic City casino and hotel features Red Door Spa, a famous luxury brand owned by cosmetics giant Elizabeth Arden. Harrah’s Atlantic City senior VP and general manager, R. Scott Barber, was quoted as saying: “Today’s travelers have come to expect that there will be a spa at every top property. With the opening of the Red Door Spa at Harrah’s Atlantic City, we are expanding our lifestyle options for guests and becoming a comprehensive destination resort. This allows us to expand our reach, our customer base, and our revenue.”
Mr. Barber’s citing of offering another lifestyle option that generates additional revenues is right on the money (pun intended).
Some hotels have gone so far as to rebrand and reposition themselves due to their spas. For example, the Newport Beach Marriott in southern California has been renamed: Newport Beach Marriott & Spa after a huge renovation. That goes to show us how much draw, and how many dollars, the Marriott chain thinks this move will generate.
Questions: what do you think of hotels co-branding with spa lines? What other examples of co-branding have you seen work well together? We’d like to hear from you. . .
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Comments
Ted, are hotels, "replacing health clubs and gyms as fast as they can with spas", or complementing with? I hope they don't replace health clubs with spas--I need my workouts on the road!
Spas look like another good profit oppty and help keep guests "onsite" and spending money.
Posted by: Paul Barsch | 07.18.07
Paul,
While the BW article cites that a number of hotels are ousting the gyms for spas, I'll bet quite a number retain the gyms even as they add the spas.
You're right: keeping the guests onsite for upgraded services means they will spend more cash in the hotel purchasing spa services as well as spa products. And that can become a great profit center for the hospitality business. Thanks for your comments, Paul.
Posted by: Ted Mininni | 07.18.07
Ted - I'm just back from a stay at the Renaissance at Koh Samui, Thailand. When I was planning the trip, what struck me was that every single hotel at Samui, boasted of a "spa" - however dinky and unbelievable. Most of the spa's offer garden-variety massages and treatments. But quite a few, especially those of the larger hotel chains, offer great treatments and overall amazing "experiences". Thats a real change from what was the USP of hotels during a trip just 4 years ago - proximity to nightlife. And the manager told me that this trend started "quite a while back". Guess Thailand is on the leading edge of hotel marketing trends!
Posted by: Atul Vaid | 07.19.07
Hi Atul,
Thanks for sharing your recent experience and this information with Daily Fix readers. Yes, a few hotels experimented with the addition of spas a while ago, but it seems this has really caught on and it's a bona fide trend now. Boutique hotels and major chains alike--all over the world--are using this as a means to pamper their guests. And as Paul pointed out, to generate more revenue and profits.
Posted by: Ted Mininni | 07.19.07
Hi, Ted. As this spa trend transcends to the masses through franchise operations like Massage Envy, people have the opportunity to pamper themselves in their own neighborhoods on a regular basis. I wonder if this will eventually affect the hotel spa business when these same consumers are traveling on business and pleasure.
Posted by: Elaine Fogel | 07.21.07
Elaine,
You raise an interesting point. As you know, the majority of people who stay in hotels are traveling for business reasons. These people are usually very busy and work many hours so I suspect they might avail themselves of hotel spas before indulging in their own neighborhoods. Regardless, we could all use a little bit of pampering from time to time, and I see no reason why hotel spas and neighborhood spas can't both be successful.
Thanks for your keen observation, Elaine.
Posted by: Ted Mininni | 07.23.07
Ted/Elaine - Thats a really interesting observation. The Unilever operation in India has just started a chain of spas, which are doing roaring business. Now if a FMCG company like Unilever has entered the spa market, you KNOW that its a mass market trend.
Posted by: Atul Vaid | 07.24.07
Atul,
This is a very interesting development. Thanks for sharing what is happening in India on the spa front.
There was a time when spas and spa products had an aura of exclusivity and high prices. More recently, both have been made accessible to the mass market, with more moderate pricing for these products and services. Here in the U.S., consumers can purchase spa products in their local department stores, drugstores, beauty salons and local spas, as well, for home use.
Companies that have gotten into the spa business saw an opportunity to take advantage of a growing trend. Very smart thinking, and very well received by grateful customers. . .all over the world. Thanks for your input, Atul.
Posted by: Ted Mininni | 07.24.07
Hotels should position their spas just as they should any amenity or co-branded feature: where they fit customer interest or need.
Regarding successful co-branding efforts, smart property sales teams consistently look outside their walls for local partners. Those partners need not be expensive, either. They might be historic venues, entertainment, dining/meeting space or sports/adventure options.
In the process, they create a unique, local experience for guests, while leveraging the brand essence of the flag they fly.
Posted by: Greg Krauska | 07.24.07
Greg,
Exactly. It's all about knowing one's brand, knowing one's customer and creating unique experiences for that customer. There are many amenities that hotels, gated communities, condominium associations and other property groups offer their patrons. I think we can all expect more of this kind of thinking in future. Thanks for weighing in, Greg.
Posted by: Ted Mininni | 07.24.07
Spas need to become more responsive to a technologically savvy consumer most of them use antiquated systems and frustrate consumers who are more fast paced.
Posted by: Katie Hurley | 08.19.07
Katie,
Interesting observation. I'm not sure what you mean by your statement. Can you give some specific examples of this to help us all better understand the point you've made? That would be very helpful. Thanks, Katie.
Posted by: Ted Mininni | 08.20.07