Spa & Wellness MexiCaribe 49, Primavera 2023

Thrive!
In the Next Recession
The spa industry has seen unprecedented growth in demand
post COVID. Yay us! But are we prepared if that demand slows
dramatically or turns negative? The service sector tends to be
more vulnerable to economic swings and given that the outlook
of top analytical firms like STR (CoStar Group) and LARC (Lodging
Analytics Research & Consulting) are expecting very modest gains
in hotel occupancy in 2023, and the latter is projecting negative
growth in 2024, now is a good time to create a strategic plan to
remain strong no matter what the economy brings.
First and foremost, spa owners and managers must review their
expenses and prioritize spending - a thorough analysis of costs,
from supplies to salaries, determining which expenses are
essential and which can be trimmed or postponed. The trick is
to cut expenses, but not opportunities. By cutting non-essential
costs, spa businesses can free up resources to invest in marketing
and promotions.
Marketing expenditures will need to increase in order to attract
guests and differentiate your spa from its competitors. Decide
in advance which digital platforms can help reach your potential
guests and be the first to execute. Algorithms take time, so be
prepared.
Next, plan to diversify the spa's offerings to attract a wider range of
guests with varying budgets. Provide ‘either, or’ rather than ‘take it
or leave it’ options. Think strategically about how to appeal to those
guests who may be more cautious with their spending. One way to
both cut costs and diversify offerings is to create touchless or nontreatment
offers if you have the facilities to support it. Enhanced day
passes or week passes can fill the gap.
Guest loyalty is key to weathering an economic recession. Plan how
you can incentivize your newly acquired, and long-time guests. This
can be achieved through a simple loyalty program. Do not wait,
implement this now, since retaining existing guests can ensure a
stable stream of revenue through.
Lastly, maintain your high level of guest service, even if it means
sacrificing a bit of margin. The economy swings both ways and
guests have a long memory. While it appears that consumers have
prioritized wellness in their post COVID lives, stay alert. Guest
confidence and spending are closely tied to the economy, especially
the luxury sector, according to the US based, National Bureau of
Economic Research. And while a global recession is not guaranteed,
be proactive; monitor economic indicators for trouble, examine your
internal metrics to identify patterns, act swiftly and thrive in good
economies and bad.
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