Most high-end hotels have a spa, they have become as common as gyms and restaurants. The hotel spa management strategy and the feeling behind their popularity could be attributed to a hotel wanting to give a customer a nice place to relax; whether travelling for a vacation or business, everyone needs to unwind. But, do we use them? When we walk past the green and white floral decorations, when we hear the gentle tinkle of miniature indoor waterfalls, do they entice us inside?
According to a study by Hotelscombined, 50% of us aren’t.
50% is a large percentage and the study shows spas to be a lot less popular than services like in-room dining or a concierge service. But, this still means 50% of guests do use spas and 50% of customers cannot be ignored. 50% makes including a spa almost mandatory. So what is the right hotel spa management strategy? How does a hotel choose to fit-out with a spa in mind?
The first consideration when it comes to hotel spa management, is the space to be dedicated. Spas are often used by hotels as elements of reward programs or as extras for room booking customers. Spas are less known as a revenue generator with walk-in trade, unlike restaurants or to a lesser degree gyms. It might be less profitable than keeping the room inventory with good views. It may be the case that offsetting the cost of fit-out and hotel spa management by increasing room prices may be the difference between taking bookings and not. Some hotels offset costs by increasing restaurant prices, but for a new hotel, employing this spa management strategy early on may be a mistake.
Another consideration is the type of spa to be managed. If a hotel has decided to furnish a smaller spa it may still suffer expense though facilities management and staffing of a spa that is less used. A hotel may want to manage a spa booking system for its venue rather than choosing an open door policy. This would free the time of a spa receptionist for another duty within the hotel. Better still bookings could be made via the main reception or operator thus cutting staffing costs down to those of the therapy team only.
Should a spa be leased?
A third consideration is the type of spa. A hotel may choose a hot stone spa, decorated with the aforementioned lily foliage and waterfalls, very attractive. But if the spa suffers due to poor marketing or lack of awareness, the quality of the fit-out may be immaterial. A spa does not have to be thought of as a stand-alone venue but can be part of a themed entertainment floor of the hotel. Or, a spa could be leased to a third-party spa management entity thus offsetting any revenue issues the hotel may face. This would also enable a professional spa operator to provide best in class service to hotel and external guests. Such an approach can also positively impact on the overall review score for the hotel.
Deciding which additional services a hotel will offer is not an easy one to make. It is important a hotel does not copy another hotel close by because it sees it performing well. When it comes to a hotel spa management strategy, there is rarely room for duplication in close proximity, and an empty spa could be an expensive outlay if the business plan is not correct.
JLL Hotels & Hospitality Services: Through every phase of the hotel investment and operating cycle, we offer leading hotel advice and apply a broad spectrum of hotel valuation, brokerage, asset management and consulting services for specific areas like hotel spa management strategy and fit-outs. We have helped more hotel investors, owners and operators achieve high returns on their assets than any other real estate advisor in the world. To know more, contact our Hotels & Hospitality Consultants in MENA.
Author: Marko Vucinic
Marko has more than 11 years of consulting industry experience focused around Hotels and Commercial Real Estate. Marko is responsible for managing JLL’s Hotels & Hospitality business and the delivery of services to clients, such as investment & development advisory, search & selection, valuations, strategic advisory and asset management.