Prices for Luxury Hotel Spa Treatments Down

USA Today: Like to indulge yourself at a luxury hotel spa every now and then? Well, here's some good - and bad - news for your wallet.

First, the good: The average price of a treatment in a luxury hotel spa in the USA this year is $134, or 7% less than the peak ($144) in 2008, according to a new spa report by Smith Travel Research.

"The average dollar per treatment has deteriorated with the recession and has not quite come back up yet," Smith Travel's Jan Freitag tells me.

The bad: Prices - for now - have stopped sliding as much as they did during the recession.

Those are among the main findings from Smith Travel Research's spa report.

The industry tracker's been expanding its research on the subject as luxury hotels try harder to squeeze profits from their spa operations. STR's latest report are based on findings from 55 luxury hotels in the USA, or about 20% of all the total. The figures reflect January through July business.

Treatment rooms mostly empty; sales ahead?
Even though luxury hotel spa prices appeared to have stopped sliding, the report shows that the rate at which spa treatment rooms are used has dipped. This year so far, spa treatment rooms have been used as little as 23% of the hours that they're open every month.

The only other time the rate fell below 25% in recent years was in September and October 2008, when two things happened: Lehman Brothers crashed, prompting a meltdown of financial markets and a reduction in travel, and the disclosure that AIG executives wined, dined and pampered their well-paid employees shortly after the insurance giant accepted a multi-billion-dollar federal bailout.

This year's decreased use of spa treatment rooms could mean two things, Freitag notes:

- Fewer treatments: In some cases, it means spas are selling fewer massages, body scrubs, facials and other treatments.

- Longer hours: It other cases, spas may be doing the same amount of treatments but they're staying open longer than in the past.

"In this environment, they may have more open hours because they have to accommodate guests' needs even more," Freitag tells me. "So instead of noon to 8, they may stay open 10 to 8."

Some spas selling specials on TravelZoo
It's a figure that might make more spa managers seek new ways to fill their rooms - a trend that's already underway.

TravelZoo, for example, has a growing number of luxury hotel spa deals, says Mike Stitt, who created TravelZoo's Local Deals discount program.

A current example: For $99, the InterContinental Los Angeles Century City hotel will let you book a 60-minute massage and 30-minute body scrub normally valued at $245. As of this morning, 473 of the packages were purchased. The deal includes pool access, fitness center access and even a glass of sparkling wine.

Spa industry expert's take on the situation
Spa industry expert David Stoup tells me he's not surprised by the report's main findings.

"The spa industry is overdeveloped, saturated and lacks differentiation," says Stoup, chairman of Trilogy Spa Ventures, which works on hotel spas. "The consumer demand for differentiated service at spas has yet to be answered and when it is, rates will rise."

In the future, he expects hotels will bring in spas that feature brands that consumers "know and trust" - and, thus, are more willing to try and pay premium prices. It's the strategy that Trilogy is, in fact, selling to hotels such as the Waldorf Astoria in New York, where Trilogy created the Guerlain spa.

(Stoup, by the way, is the reason why you've heard of Elizabeth Arden's Red Door day spas. In early 1990s, he bought the rights to the brand from Unilever and grew the two locations into a chain of 146 in 26 markets, and then he sold off the company.)

In this post-recession era, Stoup says the days of building the biggest and most opulent spas are over.

Hotels across the price spectrum also need to do a better job of figuring out a realistic number of treatment rooms that they'll need so they avoid wasting valuable real estate. Trilogy's now working with the Marriott San Diego to design "a very efficient 5,500-square-foot spa" with room to grow as business grows, he says.

"This is a departure from the old method of building the biggest and most opulent spas," he says. "I see this careful planning process as a trend going forward."


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