We need to learn to make good use of each others strengths. By Kenneth Zhang, President of PARAMOUNT BEAUTY
The biggest difference between a day spa and a hotel spa is their business model. Day spa owners are more flexible in operation. They have stronger capacity to reach more customers and offer a wider variety of treatments and programs. They can even tailor services for individuals. Hotel spas, however, are run by spa managers who strictly conform to the management style of the hotel. There is a unified standard of services and a strong focus on details. With regard to treatments, safety is the first thing. What they care most is that there is no complaint from the guests. Effects and customer satisfaction come second. So comparatively, there is less flexibility with hotel spas.
Another difference between a hotel spa and a day spa is their customer type. Different types of customers have their own requirements and interests to spas. While seeking customer satisfaction and treatment effects, day spas also care a lot about customer volume, membership numbers and visit frequency of the members, in order to reach the profitability index on which they have settled. Hotel spas have done a good job in providing personalized service experiences and meeting guests’ relaxation and de-stress needs. Though they also have certain profitability index to reach, they have less pressure than day spas. They also shoulder the responsibility of providing value-added services to the hotel guests and meet this group’s unique requirements.
Obviously, day spas do better in the usage of high-tech equipment. They understand the preferences of today’s guests. So they flexibly combine high-tech equipment with traditional spa products in order to enhance the effect of the treatments. Moreover, equipment treatments are always composed of several sessions over a certain period and thus require guests to revisit again and again. This is a good way to increase the profit. The reason why high-tech equipment is not so much seen in hotel spas is that hotel spas always try to avoid operational accidents during the services as much as possible.
But hotel spas do have some high-tech equipment. I once saw a very comfortable water bed which features multiple functions such as light therapy, sound therapy and relaxation. It can lead guests into meditation and the release of alpha brain waves. However, in China, such equipment seems to be still unable to attract many guests or make them stay. The revenue they generate can hardly compensate for the expensive cost of the machine.
There are some reasons for the phenomenon above. Firstly, hotel spas mostly use high-tech equipment as a supportive unit for the spa experience and most guests, especially in less-developed cities, fail to understand the true value of such equipment. Most spa-goers in China are still merely interested in the improvement to their skin and body condition. Hotel spas have always paid much more attention to training therapists for manual treatments which bring pampering and relaxation to the body, mind and soul. Secondly, hotel spa managers just don’t bother themselves to consider how they can better design a treatment package which may involve equipment. It’s not difficult to combine the effects of high-tech equipment with the pampering experience of manual treatment. In fact, they can even support each other. For example, after a deep relaxation from a manual massage, the skin and body will be more ready to receive the nutrition or manipulation delivered by high-tech equipment. So before and during the treatment, therapists can make proper introduction of the high-tech equipment and programs to the guests so that they can better understand the effects. Afterwards, it is more possible for them to have a try.
No matter what operation mode a hotel chooses, to operate the spa itself or grant a second party to manage it, as long as the spa can continue to attract hotel guests and city guests, then both the hotel and the spa operator will benefit. Afterwards, as customer satisfaction increases, the hotel’s occupancy rate will also rise, which in turn will support the spa revenue.
At present, there are three major business modes of spa outsourcing.
Renting. The hotel rents the space to a spa owner and gets steady rental from the spa owner. The hotel doesn’t care whether the spa is profitable or not. So in this way, the hotel usually won’t give any operating or marketing support to the spa.
Management and Technique Support. The spa operator gives spa management and technique support to the hotel and charges the hotel certain service fees. The hotel pays all the expenses and costs of the spa operation. The hotel gets the profit the spa generates and shoulders the risk of loss as well.
Profit Sharing. Two parties cooperate by an agreed cost/profit ratio. The spa operator pays the hotel a discount amount of rental and they share the profit by ratio. Such cooperation is more transparent. But the problem is that the actual profit the spa generates is not so much higher than the rental fee.
We should always learn to make good use of each other’s strengths. Today, the biggest problem of the industry is the lack of talent and techniques. Many hotels are unable to operate and manage a spa themselves. It’s good for them to grant the spa to a second party for management and operation. This trend has become especially popular during the past two years. It is also a kind of recognition of the day spa operators who now come to support the hotels. It means their management and operations have reached the hotel’s high standards and can meet the needs of picky hotel customers. In every aspect from service quality to operation mechanism, they are surely commendable.
Through spa outsourcing, hotels can get a rental fee or share profit with the spa operators. Moreover, they don’t need to put energy into the spa management or pay for the labor force any more. So more and more hotels have adopted such a business mode. However, for any spa, staff is the foundation of success. Therefore, firstly, spas need to have a detailed training plan and strict assessment system to ensure that their techniques and services have reached the required standards. In addition, they need to set up and put into practice a proper supervision system, rewards & punishments system and responsibilities mechanism. Also, spas should try to attract more excellent staff and convince them to stay through a good enterprise culture, employment mechanism and career development plan.