SILVER LINING
Among these gathering clouds, the tour- ism sector has remained a bright spot on the horizon. Figures from the Vietnam National Administration of Tourism showed that international arrivals reached over 6.8 million in 2012 – a 13.8 per cent increase over 2011. China, South Korea and Japan were the top source markets, confirming the trend for travel originating from other Asian countries. Factor in the additional 32.5 million trips made domestically and overall tourism turnover reached VND162 trillion (US$7.7bn, €5.8bn, £5bn) last year. With a strategy that seeks to secure pri-
vate and public investment of VND1.9 quadrillion (US$94.2bn, €71.6bn, £70bn) for tourism infrastructure between 2011 and 2030, it’s expected that this sector will be a key national industry within the dec- ade. Accordingly, targets have been set for 10.5 million international arrivals and 48 million domestic trips by 2020, with fore- casted revenues rising to VND392 trillion (US$18.5bn, €14.1, £12.2bn), for the year. Set against this landscape, the VND3.1 tril- lion (US$144m, €109.5m, £94.7m) generated by spa tourism in 2012 can be considered a
Spa Business 3 2013 ©Cybertrek 2013
Resort and hotel spas, such as Fusion Maia Da Nang, bring in 86 per cent of sector revenue
relative drop in the ocean. But Euromonitor International’s 2012 Health and Wellness Tourism in Vietnam report predicts this sec- tor will achieve a compounded annual growth rate of 16 per cent over the next five years.
HOSPITALITY INFLUENCE From the Euromonitor report, which com- pares revenues of hotel and resort spas (86 per cent) versus other spas (14 per cent), it’s clear that wellness tourism is driven by hos- pitality operations: “The healthy growth of hotel and resort spas shows that more con- sumers prefer to go to premium facilities in spite of higher prices as they provide profes- sional services and trusted products.” Key purchasers, it says, are middle- and
upper-income consumers and foreign tourists who enjoy Vietnam’s low-priced spa services. Other spas are typically operated by small independent players, with varying service quality due to loose government management.
Not surprisingly, it’s resort and hotel
development that will underpin expansion, rather than local businesses. While aware- ness is still limited among the country’s upper and middle-classes, Euromonitor predicts that more Vietnamese will become interested in spa “thanks to the greater exposure of western culture in the country.” Although estimates for the country’s middle-class vary – KPMG suggests 14.6 million of the 88-million total while McK- insey reports over 7 million – it’s universally acknowledged that these consumers are a growing force, interested in spending their money on products and leisure. This pre- sents an interesting opportunity for hotel brands incorporating major spas in cities such as Hanoi and Ho Chi Minh. Outside Vietnam’s two main urban hubs, coastal regions make natural homes for spa resorts, and new locations include Asian Coast Development’s integrated Ho Tram Strip project in southern Vietnam, which will accommodate five different resorts with spa offerings after its completion in 2020. In the following pages, we delve into three different Vietnamese spa businesses to see how they’re faring in the market.
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