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RESEARCH


Fifty-fi ve per cent of spas in the US added new retail products


Guest numbers are up by 4.1 per cent which has boosted revenues


There’s been a marked shift towards full-time employees, up 9.3 per cent; a further sign that the industry is back on track and gearing up for rising visitor numbers


Almost six in 10 said visits were up and 55 per cent reported increased client spending per visit, across all types of spas. Sixty per cent of operators saw a growth in revenues. Staffi ng levels stayed evenly balanced. T ese are positive developments, showing


an improvement on the 2011 survey results when a minority of 45 per cent reported a growing spend per visit.


RISING PROFIT MARGINS Driven by increasing demand, profi tability is on the upswing. Fiſt y-fi ve per cent of spas reported a 2011 profi t percentage topping 10 per cent, up from 49 per cent in 2010. Most also said that profi tability had improved between September 2011 and March 2012 compared to 12 months previously. But almost one in fi ve spas, reported a net loss in 2011, virtually unchanged from 2010 (18 per cent). Together, these results show an indus- try that has stabilised in terms of staffi ng and location numbers and is experiencing a modest but broadly-based recovery.


STIMULATING DEMAND Spas have been adopting a range of strate- gies to stimulate demand and increase visits in an arena which is highly competitive, and where consumers are now more price con- scious than before the recession.


ABOUT ISPA RESEARCH


ISPA is recognised worldwide as one of the voices of the spa industry, represent- ing providers in more than 70 countries. It has been publishing in-depth studies of the spa industry in the US since 2000.


Operators are keeping prices steady to


maintain competitiveness against a backdrop of rising consumer prices. Average price per spa service – us$80 (€61, £50) – remained unchanged in 2011 compared with both 2010 and 2009. T is is likely to refl ect the mod- erate pace of consumer spending and the use of discounts and rewards to encourage visits and loyalty. However, holding prices steady also means that improving profi tabil- ity is likely to remain challenging for many spas for the time being. At the same time spas across the board are


expanding their portfolio of services, off ers and products, to provide more choice and fl exibility to busy customers. Over 83 per cent reported making one or more changes over the past 12 months in response to recent economic conditions. Nearly one in four added additional health and wellness programmes such as individual wellness consultations, nutritional programmes and group wellness packages. In addition, 28 per cent introduced shorter treatment offer- ings of 30 minutes or less to bring greater value and effi ciency to time-pressed clients. Almost one in three operators expanded their spa treatment menu and 55 per cent have added new retail products. On average spas have made 2.5 changes to their opera- tions in the past year.


Topics covered in detail in the full ISPA


2012 US Spa Industry Study, prepared by PricewaterhouseCoopers, include: indus- try size and continued modest growth; an industry profi le looking at size and geog- raphy by type of spa; facilities, including elements of indoor square footage; serv-


42 Read Spa Business online spabusiness.com / digital Ninety-six per cent of spas have their own


website and are stepping up the use of online social media, up from 82 per cent in 2011 to 88 per cent in 2012. T ree in four spas off ered one or more giſt card promotions.


CONFIDENT OVERALL As the industry makes further progress along the road to recovery, spa operators we ques- tioned noted there were a range of challenges


the industry still faces. T ese included: ■ T e economy and consumer spending; ■ Pricing, infl ation and profi tability. In a


competitive environment, with consumers shopping around for the best deals, spas are seeking to maintain quality but without rais- ing prices. Against a backdrop of rising costs,


margins are being squeezed; ■ Shortages of qualifi ed staff and rising pay-


roll costs; and, ■ Perceptions and the need for education. Spas continue to tackle a public perception of luxury and pampering. T ere remains a need to educate consumers about the health benefi ts of the spa experience and to position spas as places which promote wellbeing.


Overall, however, an overwhelming 78


per cent of all spa operators are confi dent or very confi dent that revenues will continue to increase in the next six months. ●


ices and products off ered; prices and the composition of revenue; and visitor and employee numbers. The full report is avai lable at


experienceispa.com. ISPA members can download a copy and non-members can purchase the report via this site.


SPA BUSINESS 4 2012 ©Cybertrek 2012


PHOTO: MASSAGE ENVY


PHOTO: RED DOOR SPAS


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