TWO : Dynamic Yield Management
The variability inherent in the spa industry makes revenue management a necessity , yet many spas are still offering the same services , for the same amount of time , at the same prices — even during high-demand periods . Luckily , technology enables spas to practice yield management through dynamic pricing , the process of making adjusting the pricing of a product or service in response to demand . The goal is increased revenue during periods of high demand and increased bookings during times of low demand . Dynamic availability is another strategy that increases profits by managing the mix of services on offer . Examples of this practice include a spa offering only higher margin services or shorter service options during peak times . By cutting off longer services or lower-margin services during your peak times , you will service more guests and increase yield simultaneously .
Next-generation dynamic pricing will utilize sophisticated algorithms to
match not only demand and supply , but detailed guest preferences , therapist skills and preferred location .
THREE : Smart Staffing Solutions
It ’ s no secret that labor costs are the biggest financial burden facing spas . Add to that mounting costs in other areas and severe staffing shortages , and in many cases , it becomes a deal breaker . In a recent ISPA Town Hall , every participating spa leader admitted that their spas were operating at limited capacity due to staffing challenges . Nearly every spa director is struggling to manage staffing needs alongside fluctuating demand .
Studies have shown that once the hospitality workers were laid off due to the outbreak of COVID-19 , many of them were not willing to go back to their original job again . For example : women , who , according to the American Massage Therapy Association , account for 85 percent of massage therapists and who also often bear more of the workload at home — especially when it comes to childcare — may often be better suited to the “ work where you want , when you want ” gig economy where they have full control over their schedule *.
To fill service provider and other vacancies , look for more smart technologies that can use algorithms and artificial intelligence to match qualified staff with facilities facing excess demand for spa services .
FOUR : CRM for Personalization
The days of the “ one size fits all ” spa model are gone . As guest needs become more individualized , effective use of technology has become critical to “ hyper-personalize ” the spa experience . Post-pandemic , spa guests expect treatments to do more than feel good — they want them to improve their well-being . Our services must be not only authentic and personalized but produce desired results that are individual to each guest .
CRM ( Customer Relationship Management ) programs offer spa leaders the opportunity to take a highly targeted approach to marketing as opposed to a broader , scattershot approach , allowing for market segmentation divided into smaller , more defined categories based on similar characteristics . The more discretely you segment guests and prospects based on demographics and psychographics , the more effective the messaging . The right message to the right guest or prospect increases capture rates , repeat business and guest loyalty and engagement .
Resort hotel spas can leverage their CRM ’ s marketing functionality to have an opportunity to capture business by directly targeting and engaging with guests prior to their arrival . Hotel spas can target locals for membership , “ stay-
* A 2021 report from McKinsey & Co . noted that women ( 23 percent ) were more likely to leave the workforce during the pandemic than men ( 13 percent ). Women with children ( 18 percent ) were also more likely to leave the workforce than their childless counterparts ( 10 percent ).
FEBRUARY / MARCH 2022 ■ PULSE 49