Hotel spas, from urban hotel spas to resort spas, enjoy various perks that other spas do not. They have a client base of hotel guests right at their doorstep, the opportunity to tap into their hotel’s resources (Finance, Marketing, Housekeeping, Engineering, to mention just a few), and the ability to reach out for support from the hotel general manager when needed.
However, with these perks come a different set of challenges such as:
1. Increasing hotel guest capture rates.
2. Encouraging repeat visits.
3. Stimulating retail sales.
4. Attracting local (non-hotel guest) clientele.
Apart from these typical challenges, each type of hotel spa has its own unique difficulties. In this article, we’ll take a closer look at urban hotel spas.
Guest capture rates for urban hotel spas vary significantly across the globe. For example, in China, these figures can go as low as 1%, and in the Philippines and certain locations in Europe, figures can go as high as 8 to 10%. With this relatively low capture rate, spa managers are under enormous pressure to meet their revenue goals.
Due to the low average length of stay and predominantly MICE or business clientele in urban hotels, it’s difficult for urban hotel spas to capture this type of guest. The focus of urban spas should therefore be to tap into other streams of revenue and target additional audiences to drive their businesses forward.
Here are 5 ways that urban spas can tap drive more business:
1. Get Competitive
Urban hotel spas normally face a lot of competition from other day spas in their area that provide budget to high-end services. If you manage an urban hotel spa, the first thing you should do to drive more business is analyse your competitive set. Identify who your direct and indirect competitors are, and clearly define your spa’s strengths and weaknesses in comparison. Then divide your target audience into two different customer segments: hotel guests and local clients. Once you’ve identified your target audiences and your competitors’, you’ll be able to come up with a customised menu of services and marketing plan that will draw new clients to your spa.
2. Offer Perceived Preferential Pricing
The general perception among local clientele is that hotel spas tend to be extremely expensive. It’s important that you bring down this price barrier. Identify the price point of each of your customer segments and together with your Director of Revenue and Distribution, create rate fences that are favorable to local clientele. Examples of preferential pricing would be: memberships, off-peak pricing, local client specials, and loyalty programmes, to name a few. Your external client base will grow once local residents perceive that they are getting preferential treatment and pricing.
3. Leverage Unique Selling Propositions (USPs)
Leverage facilities and other benefits that competing day spas in the area might not have. For example, you could include the use of your hotel’s gym, sauna, and swimming pool in your spa memberships. Other benefits such as discounts in your hotel’s restaurants and bars or special room rates also tend to be attractive to local residents. For the business hotel guest, organise brief spa treatments during meeting breaks to entice these guests to squeeze in a few moments of relaxation in their busy schedule.
4. Create visibility in your hotel and community
Make sure your spa’s message is clearly visible and tailored to each of your audiences. For local clients, consider running advertising or social media campaigns that focus on more affordable treatments. Within the hotel, your spa should be mentioned on all hotel collateral and signage. Get your spa team to distribute vouchers to interested guests at the hotel lobby and concierge to encourage these guests to visit the spa. You might also run targeted specials for club and executive floors to attract VIP clients.
5. Build a Strong Brand Identity
Your spa should have a brand identity that’s separate from the hotel’s. Create a solid online and offline presence of your spa. Build a database of local clients and send out targeted mailings. Use the hotel’s database to reach out to potential hotel guests or groups that would be interested in your spa services. Having a unique identity will allow you to tap into your hotel guest and local client markets more successfully.
In summary: Urban hotel spas should focus on tapping into their local market as well as catering to their hotel guests. Understanding that there are limitations on hotel guest capture rates and exploring alternative streams of revenue will help urban spas drive their business forward.
Want to find out more about how to take your hotel spa’s sales and marketing efforts to the next level? Stay tuned for the second installment of this Spa-Balance.com two-part blog series on hotel spas, with tips that can help boost your top and bottom lines right away.