Claire Way Managing Director, Spa Strategy
It's an exciting time to be in the wellness industry, and if you're fortunate to be able to travel, to be a wellness traveler. In this article we will look at some best practices, and the order they should be actioned, when considering building or expanding your spa and wellness facilities in new build hotels or renovations.
Whilst the pandemic slowed many projects, momentum is changing. New hotels, wellness resorts and renovations are due for completion, with several projects opening this year. Expect more options and variety that appeals to a broad market.
The global wellness economy was first measured by the Global Wellness Institute (GWI) in 2014 and has demonstrated a 5.8% annual growth across all sectors. As of 2019, GWI calculated its value at US$4.5 trillion dollars. Consumer demand for wellness services and products has not shown any sign of slowing down, in fact, it is believed that Covid-19 has accelerated consumer interest in creating well-being in their life.
Recent research by McKinsey on consumer interest in wellness indicates that they care deeply, and that their interest is growing - 42% of respondents consider it a top priority. They view wellness through a broad lens, encompassing not just fitness and nutrition but also overall physical and mental health and appearance. They also have more choice in the types of products and services they buy and the way they buy them. With this in mind, it is now more important than ever to understand what the guest wants from their wellness experience at your hotel, to have a clear promise and method for how that is delivered, and to understand your position in the wellness market.
There is a lot of early strategic planning that is often missed, or not given sufficient attention, before moving into the design phase. This is best done with the help of a spa and wellness consultant. Ultimately, this planning helps the project run on time and on cost, it is an important part of the development process. It ensures that under or overbuilding is avoided. That the, often high, fixed overheads of a spa and wellness operation are carefully thought through, and that an efficient layout minimizes staff costs.
That a concept is identified that allows for flexibility to be built into the spaces so that they can "flex" with trends and consumer demands. It ensures that different guest types are identified early on, so that the flow and movement of guests, staff and support staff are carefully thought through and do not detract from the guest experience. It is the culmination of this strategic planning that ensures your facility(s) can deliver a superb guest experience. Essentially spas include many of the same components: treatment rooms, relaxation rooms, hydrothermal spaces etc; it is the guest journey, how the staff create unique experiences within these spaces that make an exceptional guest experience. Without forward planning this is much harder for the team to deliver.
Vision and Initial Thoughts
Understanding, questioning and challenging the initial vision is an important first stage, especially considering the resources needed for an expanded wellness program or a wellness resort. It is important to understand what are you seeking to achieve by including spa and wellness facilities in your new build or renovation, and more importantly ascertaining if you can deliver the guest promise?
Often the desire for spa and wellness facilities falls into one or more of these categories.
Is it an expected component of the guest stay and needed to tick the Expedia box to put your hotel top of the guest search list? A revenue stream that needs to carry its costs to fulfill this objective.
Is it a value-added proposition to the guest experience that positively contributes to turnover and profit, whilst also influencing ADR, occupancy and increasing capture of guests per room?
Does it define the hotel position, for example a wellness resort. Is it the extensive wellness facilities, programming and specialist staff skills that drive occupancy and ADR?
There are key questions to ask, such as. Who is the envisioned guest, what is their health profile, and what your wellness promise to the guest is? What is the geographic reach of the hotel? Will the facilities be standalone or is this a model that you want to replicate in other locations or to leverage the brand value when established? Is the location suitable for the resources needed to achieve the vision?
This last question is often the least understood, and yet depending on what you seek to achieve it is the most critical. It is vital to understand very early on the resources needed for the type of wellness experience and brand promise you wish to deliver. These questions are important to ask and to gain a clear understanding of the answers and the implications. This understanding significantly influences the breadth and depth of the concept, size of space required and the financial performance.
Identify Your Consumers and Competitors
Start with defining your guest mix. Analyze your international and domestic markets separately, what is unique to international travelers maybe common place to domestic travelers. Think about your different guest types: local, in-house (domestic), in-house (international) member, and the duration of time each guest will spend in the spa: single service, day package, program etc. Define what each guest mix is seeking from a wellness experience at your hotel and create guest segments within your guest mix.
If you are lucky to have an existing operation, how well do you know your guests, do you have a clear picture of the segments within your guest mix? Does your existing guest mix want the future vision you see for wellness at your hotel? Hopefully you have good data to build qualified consumer insights using demographics and psychographics to build consumer personas.
It can be helpful to also identify the guest segments that you don't want to attract, this helps with keeping a clear vision especially if business gets tough. A lot of insight can be gained from conducting interviews with your existing guests. To prevent forming opinions on a bias, ensure that your interviews are across all segments and that you speak with a cross section of users within each segment.
If you are a new hotel without qualified data to draw upon the process of identifying guest segments is harder. An impression of each guest segment can be drawn, but it is just an impression, which should be qualified and adjusted once the facility starts to operate. There is a lot of data available to create these impressions such as: consumer research reports, industry reports and social media trends, or conducting focus group interviews with your target markets. With all of these insights it is important to review the information with an objective mind. Understand the data set of research reports and extrapolate information that helps you build impressions of your guest personality types, interests, lifestyle, opinions, values and beliefs. Don't take the data as unequivocal truth, especially with small datasets as bias may have crept in.
The wellness industry and mainstream media has in recent years written a lot about a movement known as "self-care". This is a significant macro-trigger to book time in a spa. It has a strong focus on personal betterment. However, we feel that there will also be a move towards "we care" where the focus is on getting people out of their heads and ego (not more into them). Moving away from the idea of self-care as being selfish and into occupying a space (physically or emotionally) that is about the shared benefit and how that extends into support units-friends & family and an individual's relationship with sustainability.
Life span has been an underpinned motivation behind the "self-care" movement with the belief that changing your lifestyle will, hopefully, extend how long you live. With Covid-19 there has been growth in recognizing that health span-how healthy, both physically and cognitively, will you or someone you love be throughout their life is equally important. I've only touched on a couple of significant motivators, in fact, the triggers and motivators to booking a wellness service are multi-fold, it is important to delve into and analyze these when identifying your guest segments.
With a good understanding of who your guests will be and their wellness needs, move on to researching the competitors. Wellness in hospitality, like hotels, is scalable. Sue Harmsworth in a recent GWI interview gave a great description of the scale. "From light wellness (massages to meditation) to serious wellness which is more complex and based around preventative, functional medicine and diagnostics". It is important to understand where your property, your vision and the guest segments you wish to attract fit along this scale.
Wellness has diversified with many new and interesting ways wellness services are being offered. Review your market closely and don't limit your competitor set to other hotel spas. It is helpful to define benchmarks for comparison between competitors to help with finding the white space. Consider comparing price, menu, facility and service delivery. Understand where you want to compete and where you don't.
Create a Clear Value Proposition
As the wellness sector becomes more appealing to investors it is becoming tougher to find your USP. Consider putting all ideas on a board, even the ones that at first glance seem too far out of the box. Get input from colleagues and don't discount any idea. Use the insights gained from your research to filter the ideas to a single clear value proposition that can be concisely articulated and is easy to understand.
High-Level Concept, Financial Projections & Architectural Program
Before your design team starts on functional layouts a clear understanding of the concept is invaluable. This will drive the design process and reduce the number of revisions, which can be a costly exercise.
A high-level concept identifies how you are going to deliver the guest promise. What facilities are needed to execute the concept, are there any signature spaces, does the menu impact the design? Financial projections covering a 5-to-10-year period and the high-level concept drive the architectural program. This detailed program lists the dimensions of each space and is an important requirement for design planning.
Finalize Your Project Team
With an understanding of the functional needs of the building, the project team can be finalized. If you have not already retained a spa consultant to help through the earlier planning phases, then now is the time to include one in your project team. Hydrothermal spaces are notoriously tricky, and if incorrectly installed can break down and disrupt the guest experience. Retaining the services of a hydrothermal consultant for pools, saunas, steam room etc can save money in the long run.
It is important to understand the scope of each consultant in the project team to ensure no deliverable is missed. For instance, BOH spaces are sometimes not part of the interior designer's remit, so you may want a spa consultant who can provide this service.
As hospitality continues to come back, we look forward to reading about, seeing and trying all the new spa and wellness facilities.