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Rising spas: US wellness sector looks to healthy growth

With pampering at a premium during the long financial downturn, this year's US International Spa Association Conference showed definite signs of recovery with new, natural treatments proving the star attractions.

Photo: Chardonnay scrubs: alcoholic and alternative, ideal novelty spa treatments.
Chardonnay scrubs: alcoholic and alternative, ideal novelty spa treatments.

From chardonnay scrubs to vortex facials, provocative ideas that will undoubtedly drive the future of the wellness and beauty sector were on display at this year's International Spa Association's (ISPA) Conference and Trade Show in Las Vegas.

The theme of this year's event was "Grow" – sign that hoteliers and independent spa operators are – as of last year – beginning to see attendance, spend and investment returning to pre-recession levels. Tellingly, the ISPA's own figures showed a 4.7% increase in revenue (taking the total to US$14 billion) across the sector in 2012.

While the financial landscape is clearly changing, there are signs too of a shift in emphasis among spa visitors. "Princess pampering", long a mainstay of the industry, is now being complemented by a desire to dive deeper in to ancient practices. This is seeing greater store being set by the use of natural ingredients, while wellness is being actually embraced as an overall mindset.

There are also a growing number of male customers adopting the spa lifestyle, many of them seeking customised treatments and products. Despite the growing interest in on mind-body therapies, one legacy of the recession seems to be a penchant for fast and effective treatments – those deemed "worth the money".

Susie Ellis is the President of Spafinder Wellness, a New York-based marketing company specialising in the wellness sector, as well as being the CEO of the Global Spa and Wellness Summit. Assessing the current state of the industry, she said: "When we unveiled our first trend forecast a decade ago, the industry was in a different era. There was a focus on beauty and pampering, medical spas were a new concept and the concept of spas as centres of wellness was just emerging.

"This year we're excited to forecast a dramatically changed world, one where the industry fully embraces its role in helping people find wellness modalities that can transform their lives."

Ellis' words came as part of her introduction to the Global Wellness Tourism Economy Report, an in-depth look at the impact of the sector across the world.

Wellness goes mainstream

According to the report, consumers are now placing greater emphasis on healthier lifestyles and their overall quality of life. This has seen wellness come to play an increasingly large role in determining spa choices and fueling health tourism. The global wellness market is currently estimated at being worth $438 billion and is expected to grow to $678 billion by 2017. This prediction sees the sector growing almost 50% faster than overall global tourism.

The typical wellness tourist is also considered to be "high-yield", spending 130% more than the average tourist. Characterising these consumers, Ellis said: "They are looking for authentic experiences, healthy living, meaning and connection. In order to appeal to them, you need to focus on indigenous practices, eco messaging and adventure."

While not entirely new, the emphasis on these authentic and indigenous experiences, together with a distinct preference for natural products, was very much apparent at this year's event. According to some participants, consumers are now hugely accustomed to reading labels and expect ingredients that sound like they're almost good enough to eat.

Shannon McLinden, Founder of FarmHouse Fresh, a Dallas-based natural bath and body products specialist, was one exhibitor looking to capitalise on this trend. She said: "People are looking for more of a farm-to-table approach. We strive for 70-94% organic ingredients and the rest are certified pesticide- and Genetically Modified Organism- (GMO) free.

"Most of our customers that buy natural are not dead-set on organic. At the same time, they love locally-sourced ingredients, such as pumpkins from Oregon, grapes from the Texas wineries and whiskey from Kentucky."

Looking further afield, Sara Jones, Editor of Spa Professional Mexico magazine, said the shift towards wellness has been hugely important to the Mexican spa industry, where US travellers remain the key clientele. She said: "US health tourists are looking for indigenous treatments and local, traditional approaches, such as the use of chocolate and obsidian stones. It is important that the individuality of each destination is properly showcased in the spa offering, giving people a particular reason to visit."

Men refuse to age

Providing a particular reason to visit seems less of an issue in the male spa sector, however, with the number of adherents continuing to grow. Ten years ago, male spa visitors had hardly merited a mention, but now many wellness operators view it as a break-through area. The sector still has a lot of untapped potential, however, according to Colin Mcllheney, Director of the International Survey Unit for PwC, the global management consultant group.

Presenting the Consumer Snapshot: Male Consumer Insights panel during the event, Mcllheney said: "We found that only about a third (28%) of US men have visited spas within the past 12 months, which leaves two-thirds that haven't. That's a massive untapped potential."

The report revealed that men are particularly interested in those treatments that relieve sore muscles and reduce stress, with the data characterising the spa-going man as one likely to "work hard and play hard". Baby Boomers (those aged 48 to 66) show a particular reluctance to age and are willing to spend serious money on skin restorative therapies, such as Restylane and Juvederm.

In terms of the younger male demographic, many spa users are far more comfortable with the concept of personal beauty than the previous generation. Of the preferred services in this sector, men are most likely to opt for a massage (30%), a barbershop service (24%) or a facial (21%). As to the consensus as to the best incentive for participating in a loyalty programme, most consider it be the offer of a free treatment.

Photo: Always in demand: anti-aging treatments and skin products.
Always in demand: anti-aging treatments and skin products.
Photo: Cleansing confectionery for bath bliss from Feeling Smitten.
Cleansing confectionery for bath bliss from Feeling Smitten.

It seems important for men to know that a spa service or product was made specifically for them. The promotional language for any such item needs to be clear and concise and explains just how a product or service serves their needs. Unlike women, they tend to plan their spa visits quite spontaneously, meaning it's wise for hotels to entice them during their stay.

Explaining how best to lure these individuals, Mcllheney said: "We're seeing many golf courses now offering spa experiences for men after they are finished on the golf course and before they head for a drink. We're even seeing alcohol-based treatments, like whisky facials."

Mcllheney is also optimistic about the overall prospect for the sector, now the US economy seems more confident. He said: "The results we're seeing this year will be even better next year. I expect turnover to reach $15 billion in 2014."

Immediate results are a must

With the general expectation of a bumper year to come, the enthusiasm for sampling potentially lucrative treatments was understandably high. Appointments for many new technology-based treatments were booked in advance for all three days of ISPA, with spa operators particularly interested in those offering immediate and lasting results.

Explaining this appeal, Beny Koe, Spa Director at Miami's Ritz-Carlton Coconut Grove, said: "People love gadgets and they love products and treatments with maximum results and, preferably, little or no downtime."

At present Koe's spa offers a considerable range of traditional treatments, but he is keen to address client demands for new therapies. At the show, he was tempted by a HydraFacial MD machine, said to deliver a medical-grade procedure that detoxifies, exfoliates and hydrates skin. Another item on his shopping list was a range of crow's feet and laughter line treatments from WrinkleMD.

Explaining his approach to choosing new products, Koe said: "People are spending more on their spa treatments. They are also more educated about the benefits and, as long as they are getting good service, it also gives them something to tell their friends about."

While high-tech dazzles the high-end of market, cute and affordable still retains a particular niche, especially during the holiday season. Proof of this came from a range of tempting cupcakes that turned out to be bath bombs. These drew a crowd at the Feeling Smitten "bath bakery" stand, where attendees were only too enamoured by the prospect of being smothered in gelato sugar scrubs and shower truffles.

Explaining the allure of her products, Cady Mckee, manning the stand for Feeling Smitten, said: "The holidays are coming up, and people are looking for special and unique pick-me-up items."

Feeling Smitten was launched in 2008 with an initial client list of just a dozen retailers. Claiming to have found a niche for affordable gifts in the spa sector, it has doubled its distribution every year since.

Explaining its success, McKee said: "We have flexible price points and flexible opening orders – both of which were particularly important during the recession. We're doing well now. People are looking for brands that are hand-made and eco-friendly. They see our products as a fun little gift."

Photo: Sole traders: weary wellness attendees take a break.
Sole traders: weary wellness attendees take a break.

The 2013 ISPA Conference and Expo took place at the Mandalay Bay Convention Center in Las Vegas between 21-23 October and attracted 220 exhibitors and 2,500 attendees from 37 countries.

Anna Huddleston, Special Correspondent, Las Vegas

Content provided by Picture: HKTDC Research
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