Guest post by Andrea Foster, VP and National Director of Spa & Wellness Consulting at PKF Consulting USA

Beginning in 2008 and 2009, U.S. spas – and hotel spas, in particular – experienced negative impacts in demand, revenues, and profitability.  During this same period we experienced the Great Recession, the worst economic downturn since the Great Depression.

Intuitively, we understand these are not independent phenomena, but how exactly are they linked?  Despite unemployment still being at all-time highs, spa performance – measured by both demand and profitability – is improving.  So, what economic and lodging market indicators are directly correlated to spa performance?  By connecting the dots backward, we can better project future performance based on economic and lodging forecasts.

In my session, “Spa Performance in Light of Economic and Lodging Industry Impacts”, we will explore how economic indicators such as employment, personal income, the makeup of gross domestic product, and lodging occupancy and average daily rates impact – and assist in projecting – the performance of spas.

We will also explore the more qualitative issues, including data on the deteriorating health and wellbeing of North Americans, our aging population, the impact of lifestyle on our overall health, and the increasing awareness of health and wellness.  And even these qualitative factors can be reduced to quantitative measurements, namely the exorbitant and ever-increasing cost of health care – or more appropriately, sick care – for governments, companies and individuals.

So, how are spas impacted by this confluence of factors?  And more importantly, how can spas more broadly impart positive influences on our populations’ wellbeing, healthcare costs, and economy?  And in a slowly improving – yet still cautious – economy, how do we best operate spas as a business to reinforce their value to owners, investors and operators?

Spas are not operated in a vacuum, but are dynamic within both our economy and our evolving lifestyle.  People “vote” on what is important to them with how they spend both their time and their money, and the options they choose must be simple, convenient, and demonstrate a positive cost-benefit value.  Within this challenge is an opportunity to “do well, by doing good”.  One cannot exist without the other.  As spas’ core mission is to care for the wellbeing of their guests, they are innately “doing good”.  And because spas are a business, they are not sustainable without “doing well”.

There are catalysts in existence and sweeping changes coming down the pike that will begin to radically change how we think about – and make choices related to – our health and wellbeing.  Spas of all types are ideally positioned to be at the forefront of this change.  To be effective, leaders in the spa industry need to be adept at monitoring and evaluating the changing economy, demographics and psychographics of our population, and proactively applying such knowledge to their programming, marketing and guest interaction.

I look forward to sharing our research, both impacting the U.S. and the Canadian markets, and exploring the resulting challenges and opportunities with you all at the ESI Conferences in 2013.

Here’s to our health!
Andrea Foster, Vice President and National Director of Spa & Wellness Consulting, PKF Consulting USA