Hotel Spas: If you build it, will they come? (Part II)

Hotel Spas: If you build it, will they come? (Part II)

Published September 1, 2008

by Gary Henkin
President
WTS International

The previous installment in this series highlighted a number of areas to consider before launching into the development of a spa. This article will discuss the preparation phase (how best to plan and prepare for a successful spa opening) and issues that can make or break your spa’s operative and financial success.

Once a decision has been made to develop a new spa or to expand an existing facility, the developer should have a road map and guideline for the entire pre-opening process. In other words, there should be a well thought out plan with each step outlined to appropriately initiate a successful launch of the spa all the way through the Grand Opening. The creation of a pre-opening timeline is an essential tool in keeping both the owner/developer and the hotel operator on track. This document should contain the various items that are required to effectively open the spa, and steps should be detailed from start to finish with a date for each task is to be completed. Areas should include, but are not limited to, the following:

Selection and training of the Spa Director/Facility Manager and the entire staff including service providers.
Development and/or finalizing of the spa menu.
Retail product selection and inventory system.
IT/data management system selected and in place with training provided for staff.
Marketing and promotion plan developed and finalized.
Standard operating procedures.
Operations manuals.
Front desk/reception system.
Select uniforms, towels, linen, etc.
Maintenance plan.
Supplies and equipment ordered.
Operating budget finalized.
Create a customer service ethic which can be measured and monitored.

Once you have a viable timeline, it’s important to focus on the key issues that will ultimately determine whether your spa will be successful. Several of the most important include the selection of key personnel; creating a P.R., sales and promotion scheme; staff training regimen; retail sales plan and front desk administration to name just a few. In addition, a meticulous cleaning and maintenance schedule should be detailed along with how the staff will be remunerated for services rendered and products sold.

Staff Selection Training:
This is perhaps the single most important decision you will make for the spa. Just one “bad hire” in a key position can easily prevent or stunt financial growth and may negatively impact customer service and daily operations. Take your time in coming to a decision regarding the selection of your Director and other key staff including therapists and estheticians. Although consumers will certainly remember aspects of the design and signature elements of your spa, they will likely focus (and comment upon) the “experience” of the treatment itself and whether there was a caring and personal approach to their visit. Thus, what becomes memorable to the spa patron is a combination of design features, special/unique services and the quality of the treatment received.

Finding and retaining qualified staff is a significant and ongoing challenge. This includes not only the Spa Director but service providers (therapists, estheticians, nail technicians, etc.). Offering consistent educational programs, training and support combined with benefits such as a staff break-room and on-site meals is vital to attracting and retaining a quality staff. Once the spa staff has been selected, pay as much attention to their training procedures as you do the selection process itself. This area is often given short shrift, and a consistent training process for all service providers and support staff is crucial. Break down the spa operation into the various departments and train each of these groups individually (e.g. receptionists, locker room attendants, service providers, maintenance, sales staff, management staff, etc.). It is also critical, once you have provided the initial training regimen, to offer continuous input, staff support, educational resources and additional training. A mistake made by many Spa Directors is to “assume” that their staff are doing the job and effectively carrying out their roles and responsibilities.

A training program which is consistently implemented will always pay off in producing a more qualified staff and one which is able to produce a better customer and guest experience.

All too often, hotels overlook the importance of a continuing education program and spaces within the spa to allow for staff (and not just guest) relaxation. Thus, one of the biggest problems in hotel spas today is constant turnover of personnel. Another typical mistake is to hire the Spa Director based primarily on the person’s experience or resume without due consideration given to the individual’s “core qualities” (leadership and communication skills, business, acumen, enthusiasm, work ethic, etc.). A thorough training process including business skills should be in place as many Spa Directors are focused more on delivering the experience and less in the delivery of revenue generation, promotion, expense management and the operation of the spa as a business unit. When you hire new staff, consider carefully these core qualities and not just the candidate’s resume and past experience. This is the most important decision you will make. The right staff selection and training will give your spa the best chance for operational success.

Efficient Scheduling of Staff is Crucial:
The inefficient scheduling of staff can quickly lead to the demise of any spa from a financial perspective. The Spa Director needs to be cognizant of the importance of this issue so that the spa can work with groups on a short timeframe and can quickly respond to consumer demand. Too many times, hotel spas will leave money on the table by not having enough therapists available when needed while, at other times, there is an overflow of staff which can create significant expense and financial harm.

Better and More Efficient Use of Treatment Rooms:
Hiring therapists who are multi-skilled and treatment rooms that can serve in a multi-use fashion are significant pluses. Too many times, owners/developers design treatment rooms for one use only and hire staff who do not have multidimensional skill sets. This is an operational mistake which can have negative financial implications. Thus, massage treatment rooms can serve to provide skin care services while a couples room can also become applicable for singles. Having flexibility to convert other spaces in the hotel for use as treatment areas is highly advantageous as is the potential to add spa services to guest rooms.

Develop a Marketing & Sales Plan:
All too often, spas are launched without a viable and promotion marketing plan in place. In addition, very little effort is expended in the area of public relations which can be a far more effective way to get the word out to the local population of spa goers. Take the time to develop a thoughtful marketing approach and consider engaging a qualified public relations firm to place articles about the spa in area publications, develop press releases, etc. A focused approach in the implementation of an ad campaign, media placement and direct mail can pay significant dividends in driving non-guest business. This is particularly important for spas located in venues other than in destination locales or resorts. In an urban setting, if the spa is to be profitable, it is almost always necessary to drive non-guest use and not just rely on revenue from the hotel population. Make sure that your marketing plan contains not only an approach to drive treatment/services income but also includes a targeted approach to the sale of spa product. Receptionists and service providers alike need to be trained to “upsell” products in every instance in which there is an opportunity to do so. Training needs to be continuous throughout the year and those spas which don’t provide this will ultimately suffer including loss of profit potential and diminution of the overall guest experience.

Emphasize Retail Product Sales and Cross Marketing:
Another profit avenue that may be overlooked is that of retail merchandising, display and marketing. Retail sales represent a healthy percentage of overall spa revenue; yet, this area is often a stepchild when designing or operating a spa. One should consider offering spa products as part of the hotel’s retail outlet as well as part of the property’s web site. Products should also, when possible, be displayed throughout the spa and within hotel rooms as well. Thus, consumers should want to extend their spa purchase from home. A system for purchase opportunity needs to be established, and each spa guest should be viewed as a continuum for product purchases. Additionally, if you expect to have retail product sales impact your spa’s bottom line, your Spa Director must offer continuous training and support to the staff in this area along with training from the retail product companies. The word “sales” may not be viewed favorable by therapists and estheticians unless the spa offers education, and motivation/incentives for them. Finally, make sure that there is a separate link to the spa’s web site so that hotel guests and day spa users can easily book a treatment or make a product purchase.

Getting the Word Out is Critical:
Perhaps the single greatest error from an operational/financial perspective is to avoid the expectation of a proactive marketing, public relations and promotion plan. Many spa owners and hotel management firms make the mistake of not thinking through how best to entice hotel guests and day spa patrons to the spa. They assume instead that “the horse will always drink the water.” Nothing is further from the truth, and a consistent effort must be made to integrate the spa into every facet of the hotel’s marketing and sales approach. In order to maximize the capture rate from a hotel guest, consider exposing the spa to conference and meeting groups well in advance of check-ins; signage is important (in elevator cabs, at reception, etc.); the in-room TV channel should advertise the spa continuously; food and beverage, concierge and other areas within the hotel should promote this area as well. In addition, each spa should evaluate the potential to add income from the surrounding locale. In order to do this effectively there should be a sales/marketing budget in place which includes direct mail, a public relations campaign and advertising in local papers. In addition, an effort needs to be made to create positive community relations which can be accomplished through charitable events or affiliations from time to time. In order to maximize the chance for a positive bottom line, spas must consistently mine for customers, both internal to the hotel and externally.

Spa Memberships are often Overlooked:
This is a potential source of income for many spas which goes unnoticed. A spa membership (often in combination with fitness center use) can be created for the non-guest populace. These memberships are very popular with local clientele and an excellent source of potential revenue from treatments, programs (e.g. personal training) and product sales. This needs to be carefully planned with various options and price points in place well before the spa opens for business.

Keep a Tight Rein on Cost Controls:
Runaway staff costs are the bane of many spas. This can quickly lead to the financial demise of the facility. Ensure that the Spa Director continuously evaluates this area and that the staffing schedules are constantly monitored. Keep tight controls as to how the service providers are paid as many spas don’t set themselves on a successful course. Consider the possible setup of a flat rate (plus gratuities) for the spa staff as opposed to a percentage. Also, keep a close eye on other cost centers including inventory control for retail goods, COG and operating supplies as these items can spin out of control readily. The Spa Director should meet weekly with his/her staff to monitor payroll and other expense issues.

Communicate With Your Patrons:
So often, hotel and resort spas miss a golden opportunity to create more sales and perceived value for their customers. This can be achieved with little effort through the development of a communication channel with each spa consumer who has visited your site. Offer an inducement to retrieve vital information from the guest such as name and email address (if possible); let them know that the purpose will be to communicate unique packages, product purchasing opportunities, getaway specials, etc. Create a “spa bulletin” which you can then send to your patrons quarterly or semi-annually as you wish. Target holidays and other times of the year such as Mother’s Day, Valentines Day, Christmas and others and allow your customers to purchase items such as gift certificates, retail product, robes, etc. over the internet. Additionally, this is a great way to magnetize patrons to return to the spa for a getaway weekend and to bring their friends. The mistake made by too many spas is to ignore their own customers without further communication once they leave the property

Promote & Maintain a Customer Service Ethic:
One way to delineate your spa is through the development and implementation of an exemplary customer service ethic. Customer service means different things to different people, but at the end of the day, you must instill a standard in this area for your staff and guests which is consistent with that of the overall property. In today’s highly competitive marketplace, the items that can truly delineate one spa from another aren’t necessarily tied to how the spa is designed, what the treatment menu is or how the facility is promoted. All of these areas are certainly important, but perhaps the most critical single factor is in the quality, standards and consistency of customer service. This can be something as small as how staff answers the phone and whether they stand to greet a guest as he/she enters the spa. Small touches applied in the locker room accoutrements, presentation of robes/slippers, towels and treatment rooms and retail display all have an impact on guest perception. But of all the variables in the customer service category, the single most important consideration is the consideration demonstrated by the staff. A friendly, courteous and attentive staff can do more to create a memorable spa experience then almost anything else. Thus, one should continuously stress this area and train your staff to listen to and react immediately to customer concerns. Some of the world’s best spas deliver a wonderful experience to guests not because they are larger in size or have a more diverse menu of services; rather, they focus on the execution of a customer service ethic across all boundaries of the operation which creates a guest’s desire return to the spa again and again.

Inspect What You Expect:
If you do decide to add or expand a spa (or fitness facility) at your site, it is important to make the commitment to “inspect what you expect” if you want it to be successful. Those hotel General Managers who do this on a consistent basis by walking through the spa regularly and meeting with the Spa Director formally (at least monthly) are sending a strong signal to the staff that the spa and its success matters. If hotel owners or the General Manager never come into the spa to inspect it, how will they know whether it is effectively meeting their expectations?

These are but a few of the important considerations if you are considering the opening of a spa or once you have officially opened the doors. If attention is paid to the aforementioned areas, the chance that your spa will achieve operational success will be significantly heightened.