Health, Wellness and Tourism: healthy tourists, healthy business ...

Table 11 Treatment and revenue rate of change for February 2009 and February 2010
February 2009/2010
WEEK
1
WEEK
2
WEEK
3
WEEK 4
2009/2010 Treatments 200% 500% 400% >300%
2009/2010 Revenue 128% 356% 280% >204%
As can be seen, there is a dramatic increase in revenues (up 356% in week two) and the
number of treatments demanded (up 500% in week two) during the case study (as shown in
3.1). The owner/manager was positive about the possibility of improving revenues and
customer demand using discounted pricing policies, and was very satisfied with the results.
She does believe, however, that the results could be improved still further with increased
marketing and promotion of the discounted service.
Concluding Remarks
Personal interest in health and wellbeing has grown in recent years and is expected to further
increase in the coming decades. People’s lifestyles are constrained by a fast pace of life and
this is in contrast to a natural inclination towards slower living, which represents a challenge
for the wellness industry. The demand for wellness, including from spa services, health
services, and sports and fitness services, needs to be met with appropriate marketing and
management strategies in order to maximise the potential of this sector. This study has
considered yield management as a possible approach to managing this sector more efficiently
and profitably, in this case testing the theory on day spas. Day spa Valentino, located in a
popular tourist destination, allowed the testing of a discounted pricing policy as a part of yield
management techniques. A case study approach was used, with semi-structured interviews
and a questionnaire addressed to the day spa management. Characteristics and baseline
performance for 2009 were acquired, together with demand data and the services cost
structure. A fair margin discounted product was tested in February 2010 and considerable
results were attained. The clientele of the day spa demonstrated an appreciation of the benefits
of the discounted service and their price sensitivity led to a significant increase in sales in
February 2010, with a number of first-time purchasers of the product, despite all the
customers being frequent visitors to the spa. The owner/manager was very satisfied with the
results and has since introduced a number of discounted packages on other products offered
by the spa, encouraging customers to purchase products in bulk, purchase more products and
try services they have not previously bought. The new pricing policy has shown immediate
results with an exceptionally high amount of total revenue in February compared to the other
months studied.
The effects of this simplified application of yield management are worth considering with
regards to the wellness industry as a whole. The strength of yield management in improving
customer demand is evident from the study and this has the potential to be carried over into
other areas of the industry. The dimensions of some spas around the world can create
difficulties in implementing the complexities of an information system as yield management
requires, as the necessary competencies and investment may not be present. However, the
sophistication of yield management can be high requiring the application of information
systems or “in a more limited way with an intelligently developed and applied set of pricing
and organisational practices” (Anderson et al. 2007).
The spa wellness industry has so far been constrained within a fixed price strategy model,
whilst managing a fixed capacity with perishable products, losing the manoeuvrability