Revenue management in spas: Lessons from the hotel industry

 

In terms of yield management and optimizing revenue, there is a lot the spa industry can learn from the hotel industry. Thanks to the similar complexity that goes along with the management of pricing and rate levels for hotels and spas, the new customer-oriented approach taken by the hotel industry looks like the ideal path to follow for the spa industry.

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RevPATH and the art of understanding time to improve yield management in the spa industry

 

Last week, we introduced some of today’s most challenging issues surrounding yield management in the spa industry. Furthermore, we stressed the importance of bringing an integrated approach into revenue management capable of providing spas with the opportunity to measure time as a crucial variable to understand revenue-production performance.

In our previous post, we briefly introduced RevPATH as the key performance indicator (KPI) that will allow us to measure time effectively. In the following lines, we would like to further explain the benefits that this KPI provides to spas and wellness centres in terms of revenue management. We would like to continue to use the reference document Spa Revenue Management from Sheryl Kimes and Sonnee Singh. Let’s take a look.

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Re-Defining Yield Management in the Spa Industry

 

In previous posts, we have discussed the importance of adopting effective yield management within the spa and wellness industries. There is little doubt that this is a crucial issue especially with the worldwide revenue our industry generates each year (over US$70 billion) and the ongoing challenges and opportunities we face.

Our previous discussions covered different matters including revenue management for hotel spas, pricing strategies and new models of yield management based on lessons from the hotel sector. In the following post, we would like to focus on what spas are doing to ‘yield manage’ and the key performance indicators (KPIs) they are using. Moreover, we would like to highlight the importance of embracing a more integrated approach for dealing with revenue management.

In order to do this, we will bring into this discussion some of the insights provided by the Spa Revenue Management report elaborated by Kimes, Sheryl E. Singh and Sonee. Let’s have a look.

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