A new wave of tourists from China is changing the outlook for the spa market in Thailand – for the better. But the spas need to adapt. Asian Spa veteran Samantha Foster explains
China has indeed become the most important inbound market for Thai spas. Language is the key requirement, and many spas are employing Chinese-speaking staff or developing multi-liingual menus and tools to help with communication.
The independent traveler tends to visit high-end spas and so, to attract and meet the needs of these clients, Thai spas should up their game in terms of digital marketing and e-commerce. I am stunned at how quickly China is becoming a cashless economy, with everything being searched for, ordered and paid for online. Thailand is way behind in this respect, and so spas need to ensure they have a strong and attractive presence on WeChat, strong organic search on Chinese search engines and be set up to accept electronic payment – ideally via WeChat or Alipay, although I’m not even sure if that is possible in Thailand yet!
While the number of independent travelers is growing, a lot of Chinese business is still done as groups, organized by the many specialist agents who arrange spa visits ranging from basic massage through to cosmetic procedures and rejuvenating cell therapy.
Group bookings sound attractive, but they do create challenges for operators. Hefty commissions (up to 50%) are payable to the agents, making profits quite tight. Also, groups are often noisy, and so spas have to create systems to manage these guests in a way that fosters the social connection of the group while at the same time ensuring peace and privacy for other guests, such as by limiting group size, blocking off the spa at certain hours, or creating dedicated group facilities.
I have lived in Asia since 1993, including three years in Shanghai before coming to Thailand in 2011. There are big cultural differences in the way of doing things. Everything in China is faster, and people are more demanding. It is well known that the Chinese people work hard and long hours, which has been great for prosperity in the country generally, but it also creates a lot of stress, with related problems in sleep, mental health and especially cardiovascular disease. Add to that the burden of environmental pollution, and it is no surprise that Wellness has become a priority for many Chinese people and for the government alike.
This is a generalization, of course, but the Thais do tend to be softer and more relaxed in their approach, which translates to a slower pace of life and less stress. The biggest health challenge in Thailand is diet, as most food is laden with sugar. It used to be rare to see an overweight Thai person, but today around 32% of the population is considered overweight, including 9.6% obese and 10% having the diet-related illness of diabetes. (WHO 2016 statistics). Sadly, there seems to be little public health education in this area.
In terms of business, there are pros and cons to each of these cultural approaches.
The Wants and Needs
The wants and needs of clients from China and from Thailand are quite similar, varying more by client type, gender and age rather than by nationality.
If a spa is targeting tourists, as many spas in Thailand are, its clients are usually looking for something connected to the location that they are visiting. Thai massage and body treatments using Thai spa products such as scrubs and wraps continue to be popular, as are treatments such as foot massage, which are very cheap and serve the needs of weary travelers. Likewise, visitors to China share a desire to experience treatments drawn from Chinese culture; with treatments often based on element theory with TCM techniques and ingredients.
Local clientele from both countries enjoy massage as part of affordable health maintenance, although the Chinese clients generally prefer a more vigorous treatment.
For Thai ladies, manicure and pedicures are routine, and treatments that relate to appearance are also popular – be it slimming, whitening, anti-aging or cosmetic enhancements. Thailand is a regional hub for cosmetic procedures. Younger ladies embrace quick-fix procedures, ranging from botox to get a V-shape face through to eyelid, nose and breast surgery. Older clients are increasingly turning to rejuvenation treatments, including cell therapy. Stem cell therapy is theoretically illegal in Thailand, however it is being offered for anti-aging under the guise of ‘fat transfer’.
Many Chinese clients are coming to Thailand for these treatments, as there is greater trust in the aesthetic service quality, and cell therapy is still very limited in China.
One key difference in China, especially amongst the older clients, is a preference for traditional medical systems. While Thailand does have its own system of traditional medicine, it is not well known by spa professionals (except Thai massage), and it is not integrated into everyday life the way TCM is. We find that senior Chinese clients are most comfortable to engage in spa services if they include TCM, and so I am sure we will see more authentic TCM emerging as it is also in alignment with the government’s five-year plan.
There is a perception that Thailand has a natural sense of service culture and that China does not, but this is a generalization. I have had exceptionally gracious service in China, and quite rude service in Thailand. So it is not impossible for Chinese spas to deliver world-class service, but it takes intention, commitment and time to build the right business culture – and it needs to be done from the top down.
If the spa owner wants their staff to treat their guest a certain way, they have to set the standard and treat the staff with respect and fairness. It needs to be clear, in communication, working conditions and practices, that it’s not all about the money.
Service starts with hiring the right personality – someone with warmth and emotional intelligence – not just the right skill set. It is then developed through continual training. Sadly, many Chinese spas don’t like to invest in training because they are worried about staff turnover, but in my experience, if you demonstrate to the staff that you have their interest at heart, and that you are willing to continually help them grow and develop, they can remain loyal over many years.
In cultivating a service culture, if Training is the ‘carrot’, then Performance Appraisal is the ‘stick’. Every staff member should have both KPI’s (Key Performance Indicators) that evaluate what they do, and Professional Behaviours, which evaluate how they do it. In an HR approach known as balanced scorecard, employees receive incentives based not just on achieving financial targets, but also on meeting expectations for things like: service, timeliness, teamwork, positive guest comments, etc.
In Thailand, a 60-minute aromatherapy massage at a reasonable quality day spa like Let’s Relax costs around THB 1,200 (RMB 240), although it is certainly possible to find it for THB 800 or less. The same service at China’s Green Massage, which is comparable quality, is RMB 398, or about 65% higher. I suspect that the lower pricing in Thailand is because the market is far more competitive. In Bangkok, there is at least one spa in every block… if not more!
Pricing at international hotel spas tends to be similarly priced across countries, as hotel brands want to create consistency in perceived brand quality and positioning.
Medi-spas are much harder to comment on, as they vary so much within the home market. For example, an ‘official’ Botox treatment (using Allergan) product in China will cost you around RMB 4,000+, but if the Chinese generic product is used, it can be half that.
Thailand has become a lot more regulated in recent years, with regulations introduced in 2016 covering five areas: premises and operator now must each be licensed; therapists must be government certified and registered; services, products and safety measures. The Thai Spa Association works closely with various government departments, and so there is a good deal of mutual support.
It is more difficult for holistic wellness centres, as this is an emerging category and the government doesn’t quite know how to deal with it. Often classified as clinics, hospital-style rules are imposed for facilities and staffing, with which wellness centres struggle to comply.
I am less familiar with licensing requirements in China, but I do know that the Chinese FDA regulations that require animal testing on all imported cosmetics are still making it very difficult to get high quality natural products into the country, despite the great demand from Chinese clients. Ethical brands are not willing to compromise their values, but I understand that the FDA is now looking at alternative testing methods. China is the last major country to require animal testing, so when it does finally abolish this requirement, it will be a huge boost to quality and the industry.
Doing Business in China and Thailand
I love working in China because things get done. People are keen to learn, and willing to stretch their knowledge and skills to reach new heights. Generally, Chinese people and companies are good at embracing change; they have an appetite for the ‘new’ and adopt new ideas faster than any country I’ve ever worked in, which is exciting.
However, there is a downside to this need for speed. Quite often unrealistic deadlines are imposed, and insufficient time is allowed for research and planning, so projects race ahead with implementation leading to compromises in quality and functionality. Often things get put on hold and openings pushed back because of the need to go back and re-do elements. It would have been more efficient, both in terms of time and money, to have allowed a little longer in planning and implementation to begin with.
Similarly, the race to embrace the ‘new’ also allows products and services to take off in China without proper evaluation of their safety and efficacy. As a result, there are a lot of gimmicky healthy and beauty products on the market, which is not great for the integrity of the wellness industry, but unfortunately it can also be dangerous. Thai medi-spas receive a lot of clients from China who are seeking ‘repair’ after having had their skin damaged by sub-standard equipment or poorly-trained therapists, although this trend seems to have improved in recent years.
The pros of working in Thailand is that we usually have more control over the spa development program, and that it is easier to find qualified staff. Language used to be a challenge, but given the importance of tourism to the Thai economy, it is now increasingly easy to find experienced Thai spa staff who speak English. It is a different story if you need to hire expats, however; the Thai government is making it more and more difficult to get work permits. It is also very difficult to import products or equipment, taking a long time and demanding enough paperwork to destroy a small forest.
As a result, Thailand continues to be a regional centre for Spa, with an emphasis on manual therapies and locally made products. It is also highly regarded for medical aesthetics and anti-aging, typically offered in hospitals and clinics. However, it is not so advanced in the more high-tech holistic Wellness services. I expect China will easily overtake it in this sector.
I am currently working on an integrated wellness centre in Bangkok, pretending to be a slimming centre. We have found that the phrase ‘wellness centre’ tends to attract two types of people: those who are already wellness-savvy, and those who have had some kind of health scare and need to take desperate action. We wanted to target those in-between, to improve their health before a crisis occurs. Called BodyConscious, the program differs from the typical slimming centre in that we don’t offer diet pills or miracle creams; we look for the root cause of the person’s weight challenges and create a personalized program to fit. Guided by a comprehensive medical assessment, solutions include nutrition, movement, counselling, TCM, hydrothermal, body treatments, and – for some – may also include intravenous nutrition and natural hormone supplementation.
Our projects in China include a new wellness resort near Shanghai, due to open early 2019. Currently the site has an existing 98-room resort, a successful medical body-check clinic and a conference facility. Our job is to convert them into a seamlessly integrated whole, offering a variety of wellness packages for both individuals and corporates wanting healthy meetings. The site has extensive gardens and a fabulous organic farm. Combined with the owner’s vision to modernize TCM in an authentic, accessible way, we look forward to this property becoming a jewel in Chinese wellness hospitality.
DSM has also recently been appointed to convert a 250-room hot spring hotel in Beijing to a wellness property. Part of a mega-masterplan which also includes a medical centre and seniors’ living community, this client has ambitious plans to be the gold standard of wellness resorts in China. It will be a challenge to apply our personalized approach to wellbeing at such scale, but we’re looking forward to it!